Company: FWDI
Filing Date: 2025-09-16
Form Type: 8-K
Source: 0001683168-25-007036
Chunk: 10

Company: Forward Industries, Inc.
Filing Date: 2025-09-16
Form: 8-K
Item: Item 8
Chunk 10
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 Company decided
to cease operations of its retail distribution segment (the “Retail Exit”) and is presenting the results of operations for
this segment within discontinued operations in the current and prior periods presented herein. Our retail distribution business sourced
and sold smart-enabled furniture, hot tubs and saunas and a variety of other products through various online retailer websites to customers
predominantly located in the U.S. and Canada. The inventory of the retail segment is presented as discontinued assets held for sale on
the balance sheet at September 30, 2023.

In March 2025, the Company
committed to a plan to sell the original equipment manufacturer (“OEM”) distribution segment of the business (“OEM Plan”).
In May 2025, the Company completed the sale of this line of business and is presenting its results of operations within discontinued operations
in the current and prior periods presented herein. The OEM distribution segment sourced and sold
carrying cases and other accessories for medical monitoring and diagnostic kits as well as a variety of other portable electronic and
non-electronic devices to OEMs or their contract manufacturers worldwide, that either packaged our products as accessories “in box”
together with their branded product offerings or sold them through their retail distribution channels. The Company did not manufacture
any of its OEM products and sourced substantially all of these products from independent suppliers in China, through Forward Industries
Asia-Pacific Corporation, a British Virgin Islands corporation (“Forward China”), a related party owned by the Company’s
former CEO (see Note 14).

Unless
otherwise noted, amounts related to these discontinued operations are excluded from the disclosures presented herein. See Note 3 for more
information on these discontinued operations.

Liquidity and Going Concern

The accompanying consolidated
financial statements have been prepared assuming the Company will continue as a going concern, which contemplates, among other things,
the realization of assets and satisfaction of liabilities in the ordinary course of business. The Company had an accumulated deficit of
$19,637,000 at September 30, 2024, a net loss of $1,951,000 in Fiscal 2024 and a cash balance (excluding cash associated with the discontinued
OEM segment) of approximately $2,000,000 at November 30, 2024.

In December 2024, our largest
design customer notified us of its plan to discontinue their insulin patch program, on which we were working.  We expect this to
cause a material decrease in our revenues beginning with the second quarter of