Company: FORA
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001140361-25-042313
Chunk: 8

Company: Forian Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Item 8
Chunk 8
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 certain information assets from third parties as a key input to certain information and software products. Any disruptions associated with these suppliers could have a material short-term impact on the business while alternate sources are secured. The information licenses specify content deliverables and specified use rights for a fixed fee and time period. Payment terms for information licenses generally consist of upfront payments and annual licensing fees. The Company expenses the contract costs over the expected period of benefit and records any differences between amounts expensed and payments incurred as other assets or liabilities on a contract by contract basis. Payments for licensed information, including the changes in related assets and liabilities, are classified within “Net cash provided by operating activities” on the condensed consolidated statements of cash flows. In cases where the Company pays variable fees based on content usage, such costs are expensed as incurred.

   On July 31, 2024, the Company was informed by one of its information vendors that effective December 31, 2024, the vendor would no longer include certain data within the information products it licenses to the Company. The vendor stated this was due to clarifications and updates to the licensing relationship between the vendor and one of its data suppliers. In February 2025, the vendor announced that it intended to exit the data licensing business by the end of 2026. The Company plans to license data from additional vendors in consideration of the above changes; however, there can be no assurance that the alternate sources of comparable data can be obtained, and if so, on terms and conditions substantially equivalent to those under the Company’s previous agreement. As a result of this event, the Company is evaluating its rights under the contract and the impact of the vendor’s announced wind down on future obligations under the agreement. The Company reduced the expected period of benefit under the agreement effective with the vendors announcement. The resulting change in accounting estimate did not have a material impact on operating results for either the three or nine months ended September 30, 2025.

   On September 23, 2024, the Company was informed by one of its information vendors that it was exercising the right to terminate the agreement with the Company effective September 25, 2024, based on restrictions imposed by the information vendor’s upstream licensor. As a result, the Company recorded an adjustment of $542,389 recorded as a reduction of cost of revenues during the year ended December 31, 2024, representing previously recorded charges under the contract that will not be paid. On July 2, 2025, the Company entered into a