Ton Strategy Co

This proposal asks shareholders to cast a non-binding advisory vote approving the Company’s disclosed 2025 compensation for named executive officers. Management frames this as an opportunity for stockholders to express their view on the overall compensation philosophy, elements and amounts reflected in the Summary Compensation Table and related narrative disclosures, rather than on any single payment. The Board recommends an annual advisory vote and will consider the outcome when making future compensation decisions. Key contextual factors include significant equity awards and performance-based arrangements granted in 2025, retention and performance objectives embedded in employment agreements for recently hired senior officers, and the Company’s status as a smaller reporting company where the Compensation Committee has used outside consultants. Management argues the program ties pay to retention and performance, uses customary mix of cash and equity, and includes clawback and anti-repricing protections. Critics could point to the scale of some awards relative to recent shareholder returns and the company’s sizable net loss, creating potential optics and alignment concerns. Because the vote is advisory, passage would not change contractual obligations but would validate management’s compensation approach; a failure would prompt the Board to reevaluate pay structures and potentially modify practices. The Board’s recommendation to vote FOR is premised on needing to retain executive talent crucial for executing the Company’s strategy while aligning long-term incentives with stockholder value and including governance features (clawbacks, no repricing) intended to mitigate risk.

This management proposal requests shareholder approval to adopt a new 2026 Equity Incentive Plan reserving up to 10,000,000 shares to grant various equity awards (options, stock appreciation rights, restricted stock, RSUs, performance shares/units) to employees, non-employee directors and consultants. Management argues the plan is necessary to attract, retain and incentivize personnel critical to the company’s growth and that without shareholder approval the company would be unable to continue making equity grants, jeopardizing talent retention. The plan’s design incorporates several governance-oriented features: administration by the board or a committee (comprised of independent directors), prohibition on repricing or exchange programs without shareholder approval, minimum exercise price equal to fair market value, no evergreen automatic increases, clawback provisions, and limits on liberal share counting and dividends on unvested awards. The Compensation Committee reviewed benchmarking and usage expectations and concluded the 10,000,000-share reserve should support equity grants for approximately three years under current assumptions, while acknowledging actual usage could vary. The Board emphasizes that the plan aligns executive and employee interests with long-term stockholder value through performance-based awards and vesting schedules and retains discretion to structure awards to comply with Rule 16b-3 and Section 409A. Vote FOR rationale rests on the need to maintain competitive compensation tools coupled with plan-level safeguards to limit dilution and mitigate governance risks; opponents may still raise concerns about the absolute size of the share reserve and potential dilution, particularly given recent large grants and the company’s historical issuance practices. If approved, the plan becomes effective upon shareholder approval and the Company expects to use it as its primary equity compensation vehicle going forward.

This management proposal asks shareholders to approve an amendment to the existing 2019 Stock and Incentive Compensation Plan to increase the authorized share reserve to up to 3,000,000 shares. The company explains the request in the context of prior reverse stock splits and a determination that equity awards were inadvertently issued in excess of the amount then available under the shareholder-approved 2019 Plan; as of March 31, 2026, awards totaling 3,700,428 shares had been issued and the company estimates approximately 3,692,333 shares were issued in excess of the plan reserve after earlier stock splits. Management proposes the amendment to regularize the plan’s authorized share count, enable recipients of prior awards to realize the intended incentives, and to permit replacement grants under future plans where appropriate. The filing also notes expected reductions in the excess (approximately 1,664,833 shares) from forfeitures and cancellations (D&O Forfeited Shares) and states the company may issue substantively similar awards under the new 2026 Plan to participants who forfeited awards and continue service. The Board argues the amendment is necessary to effectuate the original objectives of the 2019 Plan—retention and incentive alignment—while noting the administrator retains discretion over future grants and that stockholder approval is required for the increase. Key controversies include that past practice resulted in over-issuance, which raises governance and dilution concerns, and that the amendment is a remedial step that could be seen as ratifying prior excess grants; proponents emphasize corrective intent and the plan’s role in retention, while critics may press for tighter limits or further disclosures on dilution and past issuance practices. The Board’s unanimous recommendation FOR reflects the view that correcting the plan authorization is needed to align incentives for service providers and preserve the ability to grant awards consistent with the plan’s objectives.