Company: FWDI
Filing Date: 2025-09-16
Form Type: 8-K
Source: 0001683168-25-007036
Chunk: 90

Company: Forward Industries, Inc.
Filing Date: 2025-09-16
Form: 8-K
Item: Item 1
Chunk 90
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 further significant continuing involvement with this segment. The
Retail Exit was considered a strategic shift that would have a significant impact on the Company’s operations and financial results.
The inventory of the retail segment met the criteria to be considered “held-for-sale” in accordance with ASC 205-20, “Discontinued
Operations.” Accordingly, the retail inventory was classified on our condensed consolidated balance sheets as “discontinued
assets held for sale” at September 30, 2023, and the results of operations for the retail segment have been classified as “Discontinued
Operations” on the condensed consolidated statements of operations for the three months ended December 31, 2023.

     F-37 

FORWARD INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

In March 2025, Forward China
determined it would not renew the Buying Agency and Supply Agreement (the “Sourcing Agreement”), which subsequently expired
on May 9, 2025 (see Note 8). Without this agreement, the Company determined it would not continue the OEM segment of the business and
committed to a plan to sell the segment. On May 16, 2025, the Company and Forward US entered into a transaction agreement with Forward
China, pursuant to which the Company sold all equity interest in Forward Switzerland and Forward UK and sold certain other net assets
related to Forward US’ OEM segment to Forward China to satisfy outstanding payables due to Forward China under the Sourcing Agreement.
Additionally, the Company and Forward China terminated the Supply Agreement and extended the term of the Note Payable (see Note 8) to
December 31, 2025. The Company paid $200,000 at closing and agreed to make additional cash payments of $150,000 on each of July 31, 2025,
August 31, 2025 and September 30, 2025.

 The sale of the OEM business is considered
a strategic shift that will have a significant impact on the Company’s operations and financial results. The assets and liabilities
of the OEM segment were classified as assets and liabilities held for sale on the condensed consolidated balance sheets at December 31,
2024 and September 30, 2024. The results of operations for the OEM segment have been classified as discontinued operations on the condensed
consolidated statements of operations for the three months ended December 31, 2024 and 2023. The