FWDIForward Industries

Forward Industries Asia-Pacific Corporation

“The Company had a Buying Agency and Supply Agreement (the “Supply Agreement”) with Forward Industries Asia-Pacific Corporation (“Forward China”). Terence Wise, the Company’s former Chairman, Chief Executive Officer and greater than 10% beneficial owner, is the owner of Forward China. Mr. Wise resigned in May 2025. In addition, Jenny P. Yu, a Managing Director of Forward China, owned more than 5% of the Company’s common stock. The Supply Agreement provided that Forward China would act as the Company’s exclusive buying agent and supplier of products in the Asia Pacific region. The Company purchased products at Forward China’s cost and paid Forward China a monthly fee for services it provided under the Supply Agreement. Through March 2023, the monthly service fee was calculated at $100,000 plus 4% of “Adjusted Gross Profit,” which is defined as the selling price less the cost from Forward China. From April 2023 through October 2023, the fixed portion of the monthly fee was reduced to $83,333 per month. This supply agreement expired October 22, 2023.”

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Forward Industries Asia-Pacific Corporation

“On November 2, 2023, the Company and Forward China entered into a new Buying Agency and Supply Agreement (the “New Agreement”). The New Agreement provided that Forward China would act as the Company’s exclusive buying agent and supplier of products in the Asia Pacific region. The Company purchased products at Forward China’s cost and paid Forward China a monthly fee for services it provided under the New Agreement. The monthly service fee was $65,833 plus 4% of “Adjusted Gross Profit,” which is defined as the selling price less the cost from Forward China. The New Agreement expired October 31, 2024. The New Agreement was substantially similar to the Supply Agreement (disclosed above) except for the reduced monthly fee payable to Forward China. In November 2024, the Company and Forward China agreed to: (i) extend the New Agreement until April 30, 2025, but allow either party to cancel with 30 days’ notice, (ii) reduce the fixed portion of the sourcing fee to $35,000 per month, and (iii) change the payment terms to better align with payments from our customers. The New Agreement was extended to and subsequently expired in May 2025 in connection with the Transaction Agreement (described below). The Company recorded service fees to Forward China of approximately $331,000 and $891,000 during fiscal 2025 and 2024, respectively.”

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Forward Industries Asia-Pacific Corporation

“On November 2, 2023, the Company and Forward China entered into a Deferred Payment Agreement. As of October 30, 2023, the Company owed Forward China $7,365,238 for the purchase of products in its OEM and retail divisions and the cancelation of open purchase orders related to the Company’s exit from the retail division. To preserve the Company’s liquidity, Forward China agreed to limit the amount of the payables that it would seek to collect from the Company to $500,000 in any 12-month period. All amounts due to Forward China under the Supply Agreement, New Agreement and Deferred Payment Agreement have been settled in accordance with the Transaction Agreement and Separation Agreement (described below).”

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Forward Industries Asia-Pacific Corporation

“In order to maintain compliance with Nasdaq’s listing standards, the Company entered into four separate agreements with Forward China, 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 “Series A-1”). The holders of the Series A-1 had no voting rights and ranked 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 in connection with the transaction), the Series A-1 was 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 Certificate of Designation. The Series A-1 was not redeemable. All of the Series A-1 were converted in fiscal 2025.”

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Forward Industries Asia-Pacific Corporation

“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 $0 and $380,000 in fiscal 2025 and fiscal 2024, 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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Forward Industries Asia-Pacific Corporation

“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 3.0% fee on the total cost of the product. Revenue recognized from Happ was approximately $0 and $523,000 in fiscal 2025 and fiscal 2024, respectively.”

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Forward Industries Asia-Pacific Corporation

“To fund the acquisition of IPS, the Company issued a $1.6 million promissory note to Forward China in consideration for a one-year loan. The note was originally due January 18, 2019, but has been subsequently extended several times and was due on December 31, 2025. The note bore an interest rate of 8% and charged monthly interest. The Company made approximately $49,000 and $63,000 in interest payments associated with the note in fiscal 2025 and fiscal 2024, respectively. In fiscal 2024, the Company made $500,000 of principal payments on this note. In fiscal 2025, the Company repaid the remaining principal and interest on this note.”

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Forward Industries Asia-Pacific Corporation

“On May 16, 2025, the Company and Forward Industries (IN), Inc., a wholly-owned subsidiary of the Company entered into a Transaction Agreement with Forward China, a company owned by Terence Wise, who at the time served as the Company’s Chairman of the Board and Chief Executive Officer. Pursuant to the Transaction Agreement, the Company sold its wholly-owned subsidiary, Forward Industries (Switzerland) GmbH and certain other assets related to the Company’s discontinued Original Equipment Manufacturer business to Forward China to satisfy outstanding payables of approximately $4,100,000 due to Forward China under the New Agreement. Additionally, as part of the Agreement, (i) the Company and Forward China terminated the New Agreement and (ii) the Company and Forward China extended the maturity date of the promissory note dated January 18, 2018 (as amended) issued by the Company to Forward China to December 31, 2025. The Company repaid the promissory note prior to the end of fiscal 2025. In connection with the Transaction Agreement, the Company and Mr. Wise entered into a separation agreement and Mr. Wise resigned from all of his positions with the Company including as a director.”

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Galaxy Strategic Advisor Agreement

“In September 2025, the Company entered into a securities purchase agreement (the “Securities Purchase Agreement”) with certain accredited investors (the “Purchasers”) pursuant to which the Company sold and issued to the Purchasers in a private placement (the “Private Placement”) an aggregate of (i) 77,144,562 shares of common stock of the Company, at an offering price of $18.50 per share and (ii) pre-funded warrants to purchase 12,031,364 shares of common stock with $18.49999 of the exercise price per pre-funded warrant that was pre-funded at closing. In the Private Placement, the Purchasers tendered U.S. dollars, USD Coin (USDC) or Tether (USDT) to the Company as consideration for the securities. The Company received aggregate proceeds of approximately $1.65 billion, before deducting placement agent fees and other expenses.”

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Galaxy Strategic Advisor Agreement

“In September 2025, the Company entered into a Strategic Advisor and Lead Investor Agreement with Galaxy Digital LP (“Galaxy”) pursuant to which we engaged Galaxy to serve as our strategic advisor with respect to the Private Placement. In consideration of Galaxy’s services, the Company issued to Galaxy, in addition to the securities acquired by Galaxy pursuant to the Securities Purchase Agreement, 1,783,519 Pre-Funded Warrants and 4,458,796 warrants to purchase common stock at $0.01 per share, based on certain share price milestones.”

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Galaxy Service Agreement

“In September 2025, the Company entered into a services agreement (the “Services Agreement”) with Galaxy, pursuant to which the Company engaged Galaxy to provide certain operational, financial and human resources services to assist with the inception of its new digital asset treasury strategy. As compensation for its services, the Company pays Galaxy a monthly fee of approximately $583,000. The Services Agreement has an initial term of six months but may be extended for one additional six-month period if mutually agreed in writing by the parties. Through December 31, 2025, the Company incurred fees of approximately $2.14 million related to the Services Agreement.”

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Galaxy Asset Management Agreement

“In September 2025, the Company entered into an asset management agreement (the “Asset Management Agreement”) with Galaxy Digital Capital Management LP, an SEC-registered investment adviser and subsidiary of Galaxy (the “Asset Manager”), pursuant to which the Company appointed the Asset Manager to provide discretionary investment management services with respect to all of our cash, cash equivalents, stablecoins, cryptocurrency and other investible assets (excluding (i) publicly-traded equities acquired pursuant to mergers, acquisitions, combinations or other similar transactions pursuant to which we acquire or otherwise combine or merge with another publicly-traded digital asset treasury company, (ii) privately offered equity securities and (iii) non-publicly traded convertible debt instruments). The Asset Manager is not authorized to act as custodian of the Company’s assets, nor to take possession or title to any assets. As compensation for the Asset Manager’s services, the Company pays management fees of 0.6% per annum of the value of the asset being managed. The Asset Manager is otherwise responsible for all of its overhead costs, and the Company will pay or reimburse the Asset Manager for all reasonable and documented expenses related to the operation of the account. The Asset Management Agreement has an initial term of three years commencing in September 2025 and renews for successive one-year renewal periods unless either party provides written notice of non-renewal at least 90 days prior to the end of the then-current term. Through December 31, 2025, the Company incurred management fees of approximately $2.23 million under the Asset Management Agreement.”

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