What changed in Forward Industries, Inc.'s 10-K — 2024 vs 2025

(“Kablooe”), is a design company serving top tier medical and technology customers. The Company provides hardware and software product design and engineering services to customers predominantly located in the U.S. The Company also acquires and holds Solana (“SOL”) and other digital assets and has adopted SOL as its primary treasury reserve asset.

There are, however, numerous design and engineering companies that compete with us in specific industries and/or with specific targeted skills or have competitive advantages. 1 New Digital Asset Treasury Strategy In September 2025, we announced the launch of our digital asset treasury strategy, pursuant to which we plan to pursue a number of strategic initiatives to acquire Solana (“SOL”) and other digital assets.

We entered into asset management and services agreements to guide us through the implementation of our new digital assets treasury business. On September 15, 2025, we announced our initial liquid SOL purchases of 6,822,000 at an average price of $232 per SOL, or approximately $1.58 billion in the aggregate.

Under our new treasury policy and strategy (the “Treasury Policy”), the principal holding in our treasury reserve on the balance sheet will be allocated to digital assets, primarily SOL, by applying a public-market treasury model to an asset that we believe is earlier in its lifecycle, structurally reflexive, and underexposed as compared to Bitcoin.

Our planned approach involves acquiring SOL directly through market purchases and staking our holdings via our own or third-party operated validators and generating incremental revenue through strategic partnerships and deployments within the Solana ecosystem.

In addition to operating our hardware and software product design and engineering services business, our management will focus its resources on our new Treasury Policy and a significant portion of the balance sheet will initially be allocated to holding SOL in our digital asset treasury. Currently, our new Treasury Policy is primarily dedicated to SOL and other Solana ecosystem tokens.

As a result, our assets are highly concentrated in digital assets, particularly SOL. Adverse developments specific to SOL, its protocol, or its ecosystem could have a materially disproportionate impact on our financial condition and results of operations.

We may utilize a range of capital markets and onchain strategies, including staking, lending, and participation in decentralized finance (“ DeFi ”) protocols, as well as pursuing accretive partnerships and acquisitions within the Solana ecosystem. Competitive Conditions in the Digital Asset Treasury Business The digital asset treasury business is characterized by a dynamic and evolving competitive landscape.

Publicly listed digital asset treasury companies primarily pursue strategies centered on holding digital assets. As the digital asset treasury sector evolves, competition is intensifying among companies that diversify their holdings beyond Bitcoin to include other digital assets (such as Ethereum and SOL).

This shift toward a broader range of asset holdings is reshaping the competitive landscape, as treasury companies seek to distinguish themselves by capitalizing on the unique advantages offered by different digital assets. The increasing variety of assets under management and deployment strategies is driving new dynamics and heightened competitiveness within the sector.

Periods of market volatility and downturns may result in financial distress for smaller or less-established digital asset treasury companies, creating opportunities for larger, more stable participants to pursue accretive mergers and acquisitions and further consolidate the market.

We believe that our focus on SOL and the Solana ecosystem, combined with our capital markets and onchain strategies, positions us to compete effectively within this rapidly developing market. However, the competitive conditions described above may impact our ability to achieve our strategic objectives and could affect the value of our digital asset holdings.

Our Treasury Policy Our Treasury Policy is intended to bring value to our shareholders through the following planned initiatives: · utilizing intelligent capital markets issuances, including the issuance of equity, preferred stock and debt, to purchase and hold SOL subject to certain factors; · staking the majority of the SOL in our treasury to earn a staking yield and help turn our treasury into a productive asset; · purchasing SOL at a discount to the then-current spot price, including through over the counter transactions and strategic partnerships; · actively participating in DeFi protocols and other onchain strategies; · selling our SOL holdings, whether on the open market, through block trades, or other negotiated transactions, for various reasons and at various times, including, in order to repurchase shares of our Common Stock when our Board of Directors believes such repurchases will result in accretive value creation for our shareholders and at such times when it is legally permissible to do so. 2 We believe that SOL is currently the fastest and most used public blockchain in the world, processing more transactions and generating more on chain fee revenue than all other blockchains combined.

We believe Solana has established itself as a high-performance blockchain and one of the most active onchain ecosystems, primarily due to its differentiated approach to blockchain design, committed and growing developer community, and strong social layer. There can be no assurance that the value of SOL will increase, and investors should carefully consider the risks associated with digital assets.

See “ Risk Factors – Risks Related to the Company’s Digital Assets Strategy and Holdings ” for additional information. How We Earn Staking Rewards To earn staking rewards, we intend to delegate our SOL to our own validators, which are operated by third-party service providers through a white-label arrangement.

We may also delegate to other third-party SOL validators via Solana’s in-protocol delegation system. We will continue to keep the SOL in custody with third party custodians. This means we deposit our SOL into a stake account, which is then delegated to a validator’s vote account.

Both our validators and the third-party validators we select are integrated into our qualified custodians’ platforms, allowing us to stake SOL to them directly from our custody accounts. We maintain beneficial ownership of the SOL during the staking process.

We will work closely with our white-label service provider for our validators to achieve a track record of high performance, high yield generation, and attractive delegator economics. We will also delegate to other third-party validators who, in our opinion, have demonstrated a similar track record.

We will use multiple validators, both our own and third-party, to seek to maximize the return on our SOL treasury and to mitigate the risk of having only one or two validators for our treasury staking. We may also negotiate bespoke arrangements with DeFi teams and validator operators to further enhance returns.

How We Manage Liquidity We acknowledge that during the deactivation period, as described below, staked SOL is not earning rewards and is not yet liquid. We factor this into our liquidity and risk management framework. Our staking program involves a temporary loss of transferability of staked SOL during the “deactivation” or cooldown period when staking has ceased.

Under normal conditions, we expect to regain complete control over un-staked SOL within approximately 48 hours; however, network conditions could extend this period. To mitigate liquidity risk, we intend to maintain a portion of our treasury in un-staked SOL and cash to meet short-term obligations.

We may also utilize capital markets instruments, such as structured products and non-dilutive debt, to enhance liquidity and expand our SOL holdings. Our use of SOL options may involve margin requirements or collateral posting, which could reduce available liquidity. Option premiums paid or received may also create volatility in our near-term cash flows.

We also intend to participate in liquid staking protocols by converting a portion of our SOL holdings into Liquid Staking Tokens (“ LSTs ”). This will allow us to earn staking rewards while maintaining the liquidity of our underlying SOL and enabling us to use the LSTs in various DeFi applications.

We may manage a mix of traditionally staked SOL and LSTs to optimize liquidity. Use of Custodians and Storage of SOL We utilize multiple U.S. based and regulated third-party qualified custodians to hold our SOL, except for a nominal amount held in a hot wallet used for petty payments.

We believe these qualified custodians utilize risk management and operational best practices related to key management, hardware and software components, access controls, cyber security and insurance, among other practices. Our primary custodians generally maintain the majority of their custodied SOL holdings in cold storage (>95%), with hot wallets used only for limited operational purposes.

Custodians employ SOC 2–audited security controls, geographic redundancy, multi-person approval processes, and conduct key-generation ceremonies in offline, secure facilities. Private keys are never exposed to networked devices. Custodians maintain insurance coverage, which is in addition to policies we maintain ourselves.

Our custody agreements typically run for one to three years, may be terminated on 30 days’ notice, and include fees for storage and transactions.

Our qualified custodians do not rehypothecate or otherwise use our SOL. 3 Use of DeFi Protocols We may from time to time interact with DeFi protocols, either directly or indirectly through staking, validator operations, custody arrangements, or liquidity management activities. DeFi protocols generally rely on open-source smart contracts deployed on public blockchains, including SOL.

While these smart contracts are intended to operate automatically according to their code, they may contain coding errors, vulnerabilities, or design flaws that can be exploited. We actively evaluate DeFi opportunities within the Solana ecosystem to enhance treasury productivity, while maintaining robust risk management practices.

SOL - The Token of the Solana Blockchain SOL is the native token of the Solana blockchain. SOL was created with an initial supply of 500 million SOL, though much of the initial supply was locked or earmarked for various use cases including the community, the foundation and investors.

New SOL are brought into existence primarily through inflationary rewards distributed to validators and delegators. The SOL staking yield is made up of three primary components: inflationary rewards, transaction/priority fees, and maximal extractable value. Inflationary rewards started out at 8.0%, and are currently 4.3%, and will fall 15% every epoch-year until they reach a long-term floor of 1.5%.