Company: FWDI
Filing Date: 2025-02-13
Form Type: 10-Q
Source: 0001683168-25-000993
Chunk: 20

Company: Forward Industries, Inc.
Filing Date: 2025-02-13
Form: 10-Q
Item: Item 1
Chunk 20
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 references
made to shares, per share, or common share amounts in the accompanying condensed consolidated financial statements and applicable disclosures
have been retroactively adjusted to reflect the reverse stock split. The reverse stock split did not change the par value of the common
stock nor the authorized number of shares of common stock, preferred stock or any series of preferred stock.

Nasdaq 

In July 2023, the
Company was notified by Nasdaq that it was not in compliance with Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Price
Rule”). Thereafter, in February 2024, the Company was notified that it was not in compliance with Nasdaq Listing Rule
5550(b)(1) (the “Stockholders’ Equity Rule”) (collectively, with the Minimum Bid Price Rule, the “Minimum
Requirements”). In April 2024, the Company presented a plan of action to the Nasdaq Hearings Panel to meet compliance
with the Minimum Requirements. As a result of the reverse stock split effected in June 2024
and the entrance into the Accounts Payable Conversion Agreement (described in Note 8), the Company regained compliance with the
Minimum Requirements in July 2024 and was formally notified by Nasdaq that the Minimum Requirements were met. Until July 24, 2025,
the Company is subject to a Nasdaq “Panel Monitor” which provides that in the event the Company fails to satisfy the
Stockholders’ Equity Rule (not the Minimum Bid Price Rule) during the monitoring period, the Company will be required to
request a hearing before the Panel in order to maintain its listing rather than taking the interim step of submitting a compliance
plan for the Listing Qualifications Staff’s review or receiving any otherwise applicable grace period. If the Company falls
below the Stockholders’ Equity Rule during this period, we can provide no assurance the Company will be able to maintain its
Nasdaq listing. The Company’s stockholders’ equity was below $2,500,000 at December 31, 2024. As a result, and in an
effort to maintain compliance with the Stockholders’ Equity Rule, in February 2025, the Company and Forward China agreed to
convert additional amounts due to Forward China into preferred stock. See Note 11.

Preferred Stock

In
connection with the Accounts Payable Conversion Agreements with Forward China (see Note 8), the Company filed two Certificates of Amendment
to the Certificate of Incorporation (the