Company: FWDI
Filing Date: 2025-05-14
Form Type: 10-Q
Source: 0001683168-25-003548
Chunk: 26

Company: Forward Industries, Inc.
Filing Date: 2025-05-14
Form: 10-Q
Item: Item 1
Chunk 26
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 any 12-month period,
which the Company agreed to pay within 30 days of any such request. This agreement pertains only to payables that were outstanding at
October 30, 2023 of approximately $7,365,000. Purchases from Forward China made after October 30, 2023 are not covered by this agreement
and are expected to be paid according to normal payment terms. At March 31, 2025, the remaining balance covered by this agreement was
approximately $2,099,000 and is included in the balance of liabilities held for sale.

Accounts Payable Conversion Agreements

In order to maintain compliance
with Nasdaq’s listing standards, the Company entered into four separate agreements with Forward China (the “Conversion Agreements”),
to convert an aggregate $4,925,000 of amounts Due to Forward China into shares of Series A-1. Under the terms of the Conversion Agreements,
in the fourth quarter of fiscal 2024 and the second quarter of fiscal 2025, respectively, Forward China agreed to convert $2,200,000 and
$2,725,000, respectively, of the Due to Forward China payable into 2,200 shares and 2,725 shares, respectively, of the Company’s
Series A-1. See Note 6.

     16 

Promissory Note

On January 18, 2018, the
Company issued a $1,600,000 unsecured promissory note payable to Forward China to fund the acquisition of IPS. The promissory note bears
an interest rate of 8% per annum and had an original maturity date of January 18, 2019. Monthly interest payments commenced on February
18, 2018, with the principal due at maturity. The Company incurred and paid interest associated with this note of $12,000 and $17,000
in the three months ended March 31, 2025 and 2024, respectively and $24,000 and $36,000 in the six months ended March 31, 2025 and 2024,
respectively. The maturity date of this note was extended to June 30, 2025. The maturity date of this note has been extended on several
occasions to assist the Company with liquidity. This note has a remaining balance of $600,000 at March 31, 2025. 

Other Related Party Activity 

The Company’s retail
division sold smart-enabled furniture