Company: FWDI
Filing Date: 2025-09-17
Form Type: S-3ASR
Source: 0001683168-25-007043
Chunk: 29

Company: Forward Industries, Inc.
Filing Date: 2025-09-17
Form: S-3ASR
Chunk 29
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 are unable to rely on an exclusion, we would be required to register with the SEC, which could impose
additional financial and regulatory burdens.

Further, state regulators may conclude that the digital
assets we hold are securities under state laws, requiring us to comply with state-specific securities regulations. States like California
have stricter definitions of “investment contracts” than the SEC, increasing the risk of additional regulatory scrutiny.

The classification of digital assets that we hold as a commodity could subject us to additional CFTC regulation, resulting in significant compliance costs or the cessation of certain operations.

Under current interpretations, SOL are classified
as a commodity under the Commodity Exchange Act and are subject to regulation by the CFTC. If our activities require CFTC registration,
we may be required to comply with extensive regulatory obligations, which could result in significant costs and operational disruptions.
Additionally, current and future legislative or regulatory developments, including new CFTC interpretations, could further impact how
SOL and SOL derivatives are classified and traded.

If SOL are further regulated as a commodity, we may
be required to register as a commodity pool operator and register the Company as a commodity pool with the CFTC through the National Futures
Association. Compliance with these additional regulatory requirements could result in substantial, non-recurring expenses, adversely affecting
an investment in our securities. If we determine not to comply with such regulations, we may be forced to cease certain operations, which
could negatively impact our investors.

We are not subject to legal and regulatory obligations that apply to investment companies such as mutual funds and exchange-traded funds, or to obligations applicable to investment advisers.

Mutual funds, exchange-traded funds (ETFs) and their
management are subject to extensive regulation as “investment companies” and “investment advisers” under U.S.
federal and state law; this regulation is intended for the benefit and protection of investors. We are not subject to, and do not otherwise
voluntarily comply with, these laws and regulations. This means, among other things, that the execution of our changes to our digital
asset strategy, our use of leverage, our ability to engage in transactions with affiliated parties and our operating and investment activities
generally are not subject to the extensive legal and regulatory requirements and prohibitions that apply to investment companies and investment
advisers.

Due to the unregulated nature and lack of transparency surrounding the operations of many digital asset trading venues, digital asset trading venues experience greater risk of fraud, market manipulation and other deceptive marketing practices, as well