Company: FWDI
Filing Date: 2025-12-11
Form Type: 10-K
Source: 0001683168-25-009068
Chunk: 106

Company: Forward Industries, Inc.
Filing Date: 2025-12-11
Form: 10-K
Item: Item 1
Chunk 106
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 The Series B shares contained certain beneficial ownership limitations and until August 8, 2025, were subject
to a maximum number of shares of common stock that could be issued without triggering shareholder approval requirements under the Nasdaq
Stock Market rules. On August 8, 2025, the Company received shareholder approval to issue shares of the Series B in excess of these limitations.
Dividends through September 30, 2025, were capitalized by increasing the stated value of each share of the Series B.

On May 23, 2025, the Company
entered into a Preferred Stock Purchase Agreement (the “PS Agreement”) and related Registration Rights Agreement (the “Series
B Registration Rights Agreement”) with two accredited investors (the “Series B Investors”) whereby the Company granted
the investors an aggregate of 1,000,000 shares of the Series B and warrants to purchase an additional 111,111 shares of common stock (the
“Series B Warrants”) in exchange for $1,000,000. The PS Agreement contained restrictions on the Company’s ability to
incur debt, issue additional preferred shares, enter into a change of control transaction or make restricted payments without prior written
consent of the investors. These restrictions were terminated pursuant to the Waiver and Leak-out Agreement described below. The Company
paid third-party fees of $66,500 associated with this agreement, of which $29,000 related to the preferred stock portion of the agreement
and has been deducted from the proceeds and recorded as a reduction of additional paid-in capital, and $37,500 related to the warrants
and has been recorded as a component of general and administrative expenses on the consolidated financial statements at September 30,
2025.

In September 2025, in connection
with the Securities Purchase Agreement, the Company entered into a waiver and leak-out agreement (the “Waiver and Leak-out Agreement”)
with the Series B Investors, pursuant to which the Series B Investors agreed to (i) the termination, waiver or amendment of all covenants
and provisions to forgo all of their rights under the Series B Warrants, the PS Agreement and the Series B Registration Rights Agreement,
including a general release from any liability for prior non-performance, and (ii) provide conversion notices and such other documentation
reasonably requested by the Company in order to complete the conversion of all of the Series B into shares of common stock. On September
10, 2025, all outstanding shares of the Series B were converted into