Company: FWDI
Filing Date: 2025-12-11
Form Type: 10-K
Source: 0001683168-25-009068
Chunk: 1074

Company: Forward Industries, Inc.
Filing Date: 2025-12-11
Form: 10-K
Item: Item 9
Chunk 1074
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Promissory Note

On January 18, 2018, the Company
issued a $1,600,000 unsecured promissory note payable to Forward China to fund the acquisition of IPS. The promissory note bears interest
at a rate of 8% per annum and had an original maturity date of January 18, 2019. Monthly interest payments commenced on February 18, 2018,
with the principal due at maturity. The Company incurred and paid interest associated with this note of $49,000 and $63,000 in Fiscal
2025 and Fiscal 2024, respectively. At September 30, 2024, the maturity date of this note was December 31, 2024. In October 2024, the
maturity date of this note was extended to June 30, 2025. In connection with the sale of the OEM segment, the maturity date of this note
was extended to December 31, 2025. The maturity date of the note has been extended on several occasions to assist the Company with liquidity.
The Company fully paid off this note in September 2025.

Other Related Party Activity

In October 2020, the Company
began selling smart-enabled furniture, which was 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 Terence Wise, former Chief Executive Officer and Chairman
of the Company. The Company recognized revenues from the sale of Koble products of $380,000 in Fiscal 2024. Due to the Retail Exit, these
revenues are included in the loss from discontinued operations.

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. This agreement was effective until August 31, 2023,
and was extended on a month-to-month basis until November 30, 2023. The Company incurred costs under this agreement of $20,000 for Fiscal
2024. Due to the Retail Exit, these costs are included