Company: FWDI
Filing Date: 2025-06-20
Form Type: DEF 14A
Source: 0001683168-25-004653
Chunk: 20

Company: Forward Industries, Inc.
Filing Date: 2025-06-20
Form: DEF 14A
Chunk 20
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’s listing standards, the Company entered into four separate agreements with Forward China (the “Conversion Agreements”),
to convert an aggregate $4,925,000 of accounts payable due to Forward China into 4,925 shares of newly designated Series A-1 convertible
preferred stock with a stated value of $1,000 per share. The holders of the Series A-1 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 Certificate of Amendment of the Certificate of Incorporation filed related to the transaction),
the Series A-1 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 by the conversion price of $7.50, subject to adjustment as defined in the COD. The
Series A-1 is not redeemable.

In October 2020, the Company
began selling smart-enabled furniture, which is sourced by Forward China and sold in the U.S. under the Koble brand name. The Koble brand
is owned by The Justwise Group, Ltd. (“Justwise”), a company owned by Mr. Wise. The Company recognized revenues from the sale
of Koble products of $380,000 and $2,058,000 in fiscal 2024 and fiscal 2023, respectively. The Company had an agreement with Justwise
under which (i) Justwise performed design, marketing and inventory management services related to the Koble products sold by the Company
and (ii) the Company was granted a license to sell Koble products. In exchange for such services, The Company paid Justwise $10,000 per
month plus 1% of the cost of Koble products purchased from Forward China. The agreement expired in August 2023 and was extended on a month-to-month
basis until November 30, 2023.

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The Company had an arrangement
with Happ LLC (“Happ”), whose principal owner is the daughter of Ms. Yu, whereby the Company purchased products directly from
Forward China and shipped the product directly to Happ. In consideration for these services, the Company was paid a