Company: FWDI
Filing Date: 2025-09-16
Form Type: 8-K
Source: 0001683168-25-007036
Chunk: 63

Company: Forward Industries, Inc.
Filing Date: 2025-09-16
Form: 8-K
Item: Item 8
Chunk 63
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 of sales upon sales of the related products. Due to the OEM Plan, these costs are now included in income from discontinued operations
for the three months ended December 31, 2024 and 2023. The Company had purchases from Forward China during the three months ended December
31, 2024 and 2023 of approximately $1,671,000 and $1,516,000, respectively.

In order to preserve the
Company’s current and future liquidity, in November 2023, the Company and Forward China entered into an agreement whereby Forward
China agreed to limit the amount of outstanding payables it would seek to collect from the Company to $500,000 in 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 December 31, 2024, the remaining balance covered by this agreement was
approximately $4,881,000.

Accounts Payable
Conversion Agreements

In order to maintain compliance
with Nasdaq’s listing standards, the Company entered into two separate agreements with Forward China (the “Conversion Agreements”),
which were effective in July and September of 2024, to convert portions of amounts Due to Forward China into shares of preferred stock.
Under the terms of the Conversion Agreements, Forward China agreed to convert $2,200,000 of the Due to Forward China payable into 2,200
shares of the Company’s newly designated Series A-1 convertible preferred stock (the “Preferred Stock”) with a stated
value of $1,000 per share. See Notes 6 and 11.

     F-42 

FORWARD INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

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,