Company: FWDI
Filing Date: 2025-09-17
Form Type: S-3ASR
Source: 0001683168-25-007043
Chunk: 9

Company: Forward Industries, Inc.
Filing Date: 2025-09-17
Form: S-3ASR
Chunk 9
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approach to blockchain design, committed and growing developer community, and strong social layer.

There can be no assurance that the value of SOL
will increase, and investors should carefully consider the risks associated with digital assets. See “Risk Factors - Risks Related to the Company’s Business and Solana Strategy and Holdings” for additional information.

How We Earn Staking Rewards

To earn staking rewards, we intend to delegate
our SOL to our own validators, which are operated by third-party service providers through a white-label arrangement. We may also delegate
to other third-party SOL validators via Solana’s in-protocol delegation system. We will continue to keep the SOL held by third party
custodians. This means we deposit our SOL into a stake account, which is then delegated to a validator’s vote account. Both our
validators and the third-party validators we select are integrated into our qualified custodians’ platforms, allowing us to stake
SOL to them directly from our custody accounts. We will work closely with our white-label service provider for our validators to achieve
a track record of high performance, high yield generation, and attractive delegator economics. We will also delegate to other third-party
validators who, in our opinion, have demonstrated a similar track record. We use multiple validators, both our own and third-party, to
seek to maximize the return on our SOL treasury and to mitigate the risk of having only one or two validators for our treasury staking.
We may also negotiate bespoke arrangements with DeFi teams and validator operators to further enhance returns.

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How We Manage Liquidity

We acknowledge that during the deactivation period,
staked SOL is not earning rewards and is not yet liquid. We factor this into our liquidity and risk management framework.

Our staking program involves a temporary loss
of transferability of staked SOL during the “deactivation” or cooldown period. Under normal conditions, we expect to regain
complete control over un-staked SOL within approximately 48 hours; however, network conditions could extend this period. To mitigate liquidity
risk, we intend to maintain a portion of our treasury in un-staked SOL and cash to meet short-term obligations. We may also utilize capital
markets instruments, such as structured products and non-dilutive debt, to enhance liquidity and expand our SOL holdings. Our use of SOL
options may involve margin requirements or collateral posting, which could reduce available liquidity. Option premiums paid or received
may also create volatility in our near-term cash flows.

We