Company: FWDI
Filing Date: 2025-09-16
Form Type: 8-K
Source: 0001683168-25-007036
Chunk: 59

Company: Forward Industries, Inc.
Filing Date: 2025-09-16
Form: 8-K
Item: Item 8
Chunk 59
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 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
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 “COD”) designating 2,700 shares of Series A-1 Convertible Preferred Stock, with a
stated value of $1,000 per share (the “Stated Value”).

The
holders of the Series A-1 Convertible Preferred Stock have no voting rights and rank senior to all classes or series of the Company’s
common stock with respect to the distribution of assets upon liquidation, dissolution, or winding up. Subject to a 19.9% share cap (as
defined in the COD), the Series A-1 Convertible Preferred Stock shall be convertible into a number of shares of the Company’s common
stock as determined by (i) multiplying the number of shares to be converted by the Stated Value, (ii) adding the result of all accrued
and accumulated and unpaid dividends on such shares to be converted, and then (iii) dividing the result