SkyAI Raises Tender Offer Ceiling to $214.3 Million After Settlement With Bastion

Key Facts

SkyAI announced a support and settlement agreement with Bastion Trading on October 27, alongside amendments to its tender offer for its securities, raising the approximate maximum payments to $214.3 million if all targeted securities are tendered. The company said payment would be made from available cash and that the offer was not contingent on securing financing. Under the agreement, Bastion agreed to tender all its shares and warrants in the amended offer and not withdraw them. In return, it accepted restrictions barring it from taking certain actions or influencing the company for 3 years after signing the agreement. The amendment addresses the scope of securities covered and the terms of certain warrants, while the maximum amount remains contingent on full participation.

SkyAI expanded the offer to include the purchase of up to 100% of prepaid warrants, whether cash or crypto-linked, up from a previous cap of 95% for each category. It set the purchase price for these warrants at $3.00, less an exercise price of $0.0001. It also added two categories of accompanying warrants, cash and crypto, at $0.17 per warrant. Both types of accompanying warrants carry an exercise price of $9.75 per share. SkyAI's chief executive said the expanded offer gives holders of eligible warrants "the same opportunity to receive cash for their securities on equal terms" and helps complete the transaction in a timely and orderly manner.

The purchase terms for common shares and strategic warrants remain unchanged: the company is targeting up to 95% of each category at $3.00, with an exercise price of $0.0001 deducted from the strategic warrant price. Acceptance of tenders in each category remains conditional on at least 50% of that category's securities being tendered, independently of the other categories. Reaching the minimum threshold in one category therefore does not ensure the condition is met in another. SkyAI said it had about $223 million in cash when it announced the agreement, and had sold about 2 million SOL in the preceding weeks at an average net price after fees of $107.20 per token. It also said it had completed the sale of its SOL holdings and would not repurchase the token after the offer closes; the company did not attribute its reported cash balance solely to the sale proceeds.

The figures show the potential obligations widened under the amendment: the original offer, which began on October 19, targeted about $201.3 million at full subscription, compared with an amended ceiling of about $214.3 million if all targeted securities are tendered. When it launched the offer, the company had announced cash holdings of about $223.8 million and reported completing the sale of all its SOL units. That compares with a reported cash balance of about $223 million when the Bastion agreement was announced. The amended offer value remains an estimate tied to participation by security holders, while SkyAI said it would cover the payments, fees and related expenses from available cash. SKYA shares closed at $2.91 on October 27, compared with $2.89 on October 23 and $2.88 on October 21.

Bastion's holdings underscore the importance of its commitment to tender its securities: the company said it owns 4,649,745 common shares, 4,234,615 cash prepaid warrants and 5,384,615 cash accompanying warrants. Its chief executive said the agreement gives Bastion "a clear and orderly exit," and that it supports SkyAI's decision to expand the offer to include prepaid warrants and accompanying warrants at a total value equivalent to 1x mNAV. SkyAI, for its part, said its board had approved the offer and its amendments but did not recommend that shareholders or warrant holders participate or refrain from doing so. It added that each holder should make their own decision. The agreement ties Bastion's tender of its securities to the amended offer, with a commitment not to withdraw them.

The company announced that the offer's new expiration date is November 12. It said the solicitation of tenders and the purchase of shares and warrants are being conducted exclusively under the offer documents, letters of transmittal and related materials filed or to be filed as part of a Schedule TO filing with the U.S. Securities and Exchange Commission, including the forthcoming amendment. Accordingly, the terms for each category and the minimum participation threshold set out in the offer documents remain the basis for accepting securities. The extension gives holders additional time to consider the amended terms before the specified deadline. Meanwhile, $214.3 million remains an approximate ceiling that assumes all securities targeted by the offer are tendered.