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Forward Industries , Inc. (NASDAQ:FORD), a manufacturer of plastic products with a market capitalization of $4.15 million, announced today that it has entered into an agreement to convert a portion of its debt to equity, in a move to bolster its financial position. The company, which has seen its revenue decline by 13% over the last twelve months, also disclosed that its CEO’s firm has expressed interest in acquiring Forward’s original equipment manufacturer (OEM) distribution business. According to InvestingPro analysis, the company currently operates with a moderate level of debt.
On March 20, 2025, Forward Industries entered into an Accounts Payables Conversion Agreement with Forward Industries (Asia-Pacific) Corporation, a firm controlled by the company’s CEO, Terence Wise (LON:WISEa). As per the agreement, $2.5 million of Forward’s outstanding accounts payable to the CEO’s firm was converted into 2,500 shares of Series A-1 Convertible Preferred Stock, each with a stated value of $1,000. The company’s financial health metrics from InvestingPro indicate negative EBITDA of $1.5 million for the last twelve months, highlighting the importance of this financial restructuring.
This strategic conversion is part of Forward Industries’ ongoing efforts to meet the continued listing requirements of the Nasdaq exchange. However, there is no assurance that this action alone will be sufficient to satisfy Nasdaq’s standards.
In a related development, Terence Wise notified Forward Industries that his firm would not renew the Buying Agency and Supply Agreement, which is set to expire. Consequently, Forward Industries is considering exiting its OEM distribution business if an extension of the agreement is not feasible. Preliminary terms for a potential sale of the OEM business assets or securities to the CEO’s firm have been agreed upon, subject to further negotiation, approval by independent directors, and compliance with governance requirements. There is no certainty that a definitive agreement will be reached or that a transaction will occur.
This news is based on a press release statement and the recent SEC filing by Forward Industries, Inc. The company has taken these steps to strengthen its shareholders’ equity and to potentially streamline its business operations by divesting its OEM business. The conversion of debt to equity and the potential sale of the OEM business are significant developments for Forward Industries as it seeks to navigate its financial and operational challenges.
In other recent news, Forward Industries, Inc. has made a significant financial move by converting a portion of its debt into equity. The company has agreed to convert $225,000 of accounts payable into 225 shares of Series A-1 Convertible Preferred Stock. This transaction, disclosed in a recent SEC filing, is part of Forward Industries’ ongoing strategy to manage its financial obligations through equity distribution. The issuance of the preferred stock is exempt from registration under the Securities Act of 1933, following specific regulatory provisions. This approach is increasingly common among businesses seeking to balance their financial sheets by improving liquidity and reducing debt obligations. The conversion agreement is detailed in Exhibit 10.1 of the Form 8-K filed with the SEC. These developments provide investors with insights into Forward Industries’ current financial strategies.
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