Company: FWDI
Filing Date: 2025-12-11
Form Type: 10-K
Source: 0001683168-25-009068
Chunk: 907

Company: Forward Industries, Inc.
Filing Date: 2025-12-11
Form: 10-K
Item: Item 7A
Chunk 907
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% per annum, payable quarterly in arrears in cash, provided that the Company may elect to
pay dividends in common stock or by increasing the stated value if specified equity conditions are met (as defined in the COD), (ii) were
convertible into common stock at $4.50 per share, subject to customary anti-dilution and other adjustments as set forth in the COD, (iii)
were mandatorily convertible if certain conditions are met, (iv) had liquidation rights equal to the greater of 125% of the conversion
amount and the amount the holder would have received if the holder converted the shares into common stock immediately prior to liquidation,
(v) were not redeemable, (vi) had such voting rights as required by New York law, including class voting rights on matters affecting the
Series B rights and preferences and (vii) had senior rights to all classes of common stock with respect to dividends, distributions, and
liquidation preferences. 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