Kidz Ai Inc

This management proposal asks shareholders to approve a charter amendment increasing authorized Class A Common Stock from 100,000 to 85,000,000 shares. Management is seeking this approval to give the Board discretion to issue a large number of Class A shares for corporate purposes—financing, strategic transactions, equity compensation (including grants under the proposed New Incentive Plan), working capital and other general corporate needs—without obtaining further shareholder approval except where required by law or exchange rules. The proposal is explicitly linked to other company plans: it would permit the previously approved potential sale of up to 500,000 Class A shares to the CEO and would enable issuance of up to 30,000,000 Class A shares under the New Incentive Plan if that plan is approved and authorized shares are available. The Board acknowledges and discloses the dilution and voting-power consequences, noting that Class A shares carry 25 votes each and thus issuances could materially shift voting control and affect the market price of Class B shares. The proxy highlights that while not intended as an anti-takeover measure, the newly authorized shares could be used to oppose a hostile takeover and thereby entrench management, and the Board states there is no current takeover attempt. The Board has evaluated these tradeoffs and recommends approval, concluding increased authorization provides operational and strategic flexibility that may facilitate growth and capital access. Required vote is a majority of voting power present at the meeting, and abstentions and broker non-votes will count against the proposal.

This proposal requests shareholder approval to allow issuances of Class B Common Stock under the May 21, 2026 Purchase Agreement with Chardan in excess of the 19.99% threshold set forth in the agreement’s Exchange Cap, and to comply with Nasdaq Listing Rules 5635(b) and 5635(d). Under the Purchase Agreement the Company may sell up to $100 million of newly issued Class B shares to Chardan at prices determined by a VWAP-based formula less a 4.0% discount, and the agreement contemplates that such issuances could be below Nasdaq's “Minimum Price,” triggering a shareholder approval requirement under Rule 5635(d). Additionally, Nasdaq guidance indicates that an investor acquiring 20% or more could constitute a “change of control” under Rule 5635(b), so this vote would also address that potential issue. Management frames the approval as necessary to preserve access to this financing facility and to avoid operational limitations that would result if issuances were constrained by the 19.99% cap. The Board discloses the dilutive effects and potential downward pressure on Class B share price and voting power, and warns that approval could permit a single investor to acquire substantial influence or control, with attendant governance implications. If not approved, the Company’s ability to draw under the Purchase Agreement would be limited and the Company might need alternative financing on potentially less favorable terms. The Board recommends a vote FOR, concluding that the capital access afforded by the Purchase Agreement is important to the Company’s financing strategy while disclosing the associated risks and Nasdaq compliance context.

This management proposal asks shareholders to approve the Company’s 2026 Equity Incentive Plan, which would reserve an initial 30,000,000 shares of Class A and Class B Common Stock for awards to employees, officers, directors and consultants, with an annual automatic increase equal to 5% of outstanding Common Stock on each January 1 for up to ten years unless adjusted by the Board. Management states the plan is intended to attract, retain and motivate key personnel and align their interests with stockholders via a broad range of equity awards—including incentive and non-qualified stock options, stock appreciation rights, restricted stock, and other stock-based awards—and to provide sufficient flexibility to respond to market and regulatory changes. The plan restricts Class A awards to executive and management employees (not non-employee directors) and permits non-employee directors to receive awards denominated in Class B shares; each Class A share carries 25 votes and Class B one vote, so granting Class A awards could materially dilute existing stockholders’ voting power and potentially entrench management. The New Incentive Plan contains standard tax, withholding and Section 409A provisions and includes acceleration provisions tied to change-of-control events, as well as committee discretion over terms, vesting and administration. Management emphasizes the competitive necessity of an equity program in the Company’s labor market and argues these incentives will help retain and recruit talent critical to execution. The Board acknowledges dilution risks and governance implications but concludes the plan’s retention and alignment benefits justify approval, while noting issuance under the plan remains subject to availability of authorized shares (linking to the Authorized Share Proposal). The Board recommends voting FOR the plan as consistent with long-term stockholder value creation while disclosing the mechanics, limits, and potential dilutive impacts.