<html>

<head>
<!-- Document Prepared With IDEAxfiler Software-->
<!-- Copyright 2009 IDEAxfiler TRADEMARK-->
<!-- All rights reserved EDGAR2.com -->



<title>Forward Industries Form 8-K</title>


</head>

<body lang=EN-US link=blue vlink=purple>

<div style='page:Section1;'>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin:0in;margin-bottom:.0001pt;text-align:center'><b>&nbsp;</b></p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin:0in;margin-bottom:.0001pt;text-align:center'><b>&nbsp;</b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:right'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin:0in;margin-bottom:.0001pt;text-align:center'><b>UNITED
STATES<br>
SECURITIES AND EXCHANGE COMMISSION<br>
Washington, D.C. 20549</b></p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-top:6.0pt;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;text-align:center'><b><br>
FORM 8-K<br>
<br>
</b><b>CURRENT REPORT<br>
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934</b></p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:center'><br>
Date of Report: August 10, 2010<br>
(Date of earliest event reported)</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:center'><br>
<b>FORWARD INDUSTRIES, INC.<br>
</b>(Exact name of registrant as specified in the charter)</p>

<div align="center">

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=699
 style='width:100%;margin-left:-27.75pt'>
 <tr>
  <td width="33%" valign=top style='padding:0in; '>
  <p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:center'><b>New York</b></p>
  </td>
  <td width="34%" valign=top style='padding:0in; '>
  <p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:center'><b>000-6669</b></p>
  </td>
  <td width="33%" valign=top style='padding:0in; '>
  <p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:center'><b>13-1950672</b></p>
  </td>
 </tr>
 <tr>
  <td width="33%" valign=top style='padding:0in; '>
  <p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>(State or other jurisdiction of
  incorporation)</p>
  </td>
  <td width="34%" valign=top style='padding:0in; '>
  <p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>(Commission File Number)</p>
  </td>
  <td width="33%" valign=top style='padding:0in; '>
  <p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>(IRS Employer I.D. No.)</p>
  </td>
 </tr>
</table>

</div>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-top:6.0pt;margin-right:0in;margin-bottom:0in;
margin-left:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p>
<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-top:6.0pt;margin-right:0in;margin-bottom:0in;
margin-left:0in;margin-bottom:.0001pt;text-align:center'><b>1801 Green Road,
Suite E</b></p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-top:0in;margin-right:0in;margin-bottom:2.0pt;
margin-left:0in;text-align:center'><b>Pompano Beach, FL 33064<br>
</b>(Address of Principal Executive Offices)</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-top:6.0pt;margin-right:0in;margin-bottom:0in;
margin-left:0in;margin-bottom:.0001pt;text-align:center'><b>(954) 419-9544</b></p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin:0in;margin-bottom:.0001pt;text-align:center'>(Registrant's
telephone number including area code)</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-top:6.0pt;text-align:center'><b>Not Applicable</b><br>
(Former name or former address, if changed since last report)</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";'>Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:</p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=638
 style='width:100%'>
 <tr>
  <td width="6%" valign=top style='width:6.0%;padding:0in 0in 0in 0in'>
  <p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";'>[ ]</p>
  </td>
  <td width="94%" valign=top style='width:94.0%;padding:0in 0in 0in 0in'>
  <p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";'>Written communications pursuant to Rule 425 under the Securities Act (17
  CFR 230.425)</p>
  </td>
 </tr>
 <tr>
  <td width="6%" valign=top style='width:6.0%;padding:0in 0in 0in 0in'>
  <p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";'>[ ]</p>
  </td>
  <td width="94%" valign=top style='width:94.0%;padding:0in 0in 0in 0in'>
  <p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";'>Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
  240.14a-12)</p>
  </td>
 </tr>
 <tr>
  <td width="6%" valign=top style='width:6.0%;padding:0in 0in 0in 0in'>
  <p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";'>[ ]</p>
  </td>
  <td width="94%" valign=top style='width:94.0%;padding:0in 0in 0in 0in'>
  <p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";'>Pre-commencement communications pursuant to Rule 14d-2(b) under the
  Exchange Act (17 CFR 240.14d-22(b)</p>
  </td>
 </tr>
 <tr>
  <td width="6%" valign=top style='width:6.0%;padding:0in 0in 0in 0in'>
  <p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";'>[ ]</p>
  </td>
  <td width="94%" valign=top style='width:94.0%;padding:0in 0in 0in 0in'>
  <p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";'>Pre-commencement communications pursuant to Rule 13e-4(c) under the
  Exchange Act (17 CFR 240.23e-4(c)</p>
  <p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
</table>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<div style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

</div>

<b><u><br
clear=all style='page-break-before:always'>
</u></b>

<div style='page:Section2;'>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'><a name=Verdatum>&nbsp;</a></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:right'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:12.0pt;text-align:justify'><b>Item
1.01.&nbsp; Entry into a Material Definitive Agreement.</b></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify'><b><i>Settlement Agreement with
the LaGrange Group</i></b></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>On August 10,
2010, the Board of Directors (the &#147;<u>Board</u>&#148;) of Forward Industries, Inc.,
a New York corporation (the &#147;<u>Company</u>&#148;), determined that the interests of
the Company and its shareholders would be best served by, among other things,
avoiding a contested election of directors at a special meeting during 2010 or
at the 2010 annual meeting in 2011 as well as the expense and disruption that
would result therefrom.&nbsp; Accordingly, the Board approved, and the Company
entered into, the Settlement Agreement, dated as of August 10, 2010 (the &#147;<u>Settlement
Agreement</u>&#148;), by and among the Company, LaGrange Capital Partners, L.P.,
LaGrange Capital Partners Offshore Fund, Ltd., LaGrange Special Situations
Yield Master Fund, Ltd.,&nbsp; LaGrange Capital Management, L.L.C., LaGrange Capital
Administration, L.L.C. and Frank LaGrange Johnson (collectively, the &#147;<u>LaGrange
Group</u>&#148;), which contemplated certain changes to the composition of the Board
and the Company&#146;s management team as well as the other matters described below.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>Pursuant to the
Settlement Agreement, the LaGrange Group agreed to withdraw its preliminary
consent materials on file with the Securities and Exchange Commission (the &#147;<u>SEC</u>&#148;),
thus abandoning its previously announced efforts to call a special meeting of
the Company&#146;s shareholders.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>As contemplated
by the terms of the Settlement Agreement, on August 10, 2010, Michael Schiffman
and Bruce Galloway resigned from the Board, and Douglas W. Sabra resigned as
President and Chief Executive Officer of the Company, as Acting Chairman of the
Board and as a member of the Board.&nbsp; Thereafter, as also contemplated by the
terms of the Settlement Agreement, the Board appointed (i)&nbsp;Frank LaGrange
Johnson (&#147;<u>Mr. Grange Johnson</u>&#148;), Stephen L. Key and Owen P.J. King
(collectively, with Mr. Grange Johnson, the &#147;<u>New Appointees</u>&#148;) to fill
the resulting vacancies in the Board, (ii)&nbsp;Mr. Grange Johnson as Chairman
of the Board and (iii)&nbsp;Brett M. Johnson as the Company&#146;s President and
Chief Executive Officer to serve the Company on an &#147;at-will&#148; basis and with the
same base compensation and benefits as the Company&#146;s previous President and
Chief Executive Officer pending his negotiation of a long-term employment
agreement with the Board&#146;s Compensation Committee.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>Under the terms
of the Settlement Agreement, the Company agreed that (i) prior to the time that
it mails its definitive proxy statement for the Company&#146;s 2010 annual meeting,
the Company will take all necessary actions to nominate the New Appointees for
election to the Board at the 2010 Annual Meeting, (ii) it will take no action
to increase the size of the Board above six members prior to the final
certification of the results of the 2010 annual meeting unless such increase is
approved by a majority of the Board and (iii) it will recommend, support and
solicit proxies for the election of the New Appointees in the same manner as
for the Company&#146;s other 2010 nominees for election as directors at the 2010
annual meeting.&nbsp; Also, under the terms of the Settlement Agreement, the
LaGrange Group agreed to vote all of its shares of Company stock in favor of,
and otherwise support, the election of John F. Chiste, Fred Hamilton and Louis
Lipschitz (collectively, the &#147;<u>Continuing Directors</u>&#148;) at the 2010 annual
meeting.</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp; </p>

<div style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<br clear=all
style='page-break-before:always'>


<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>In addition,
pursuant to the terms of the Settlement Agreement, the Company agreed to cause
the appointment of (i)&nbsp;the New Appointees to the committees of the Board
such that the New Appointees have at least an equal number of members as the
Continuing Directors on each committee and (ii)&nbsp;Mr. King as Chairman of
the Nominating and Governance Committee at the first meeting of the Board
following the execution of the Settlement Agreement.&nbsp; Furthermore, for any
committee of the Board created after August 10, 2010, pursuant to the terms of
the Settlement Agreement, the Company agreed that the New Appointees shall have
at least an equal number of members on such committee as do the Continuing
Directors.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>Under the terms
of the Settlement Agreement, if any New Appointee leaves the Board (whether by
resignation or otherwise) before the conclusion of the Company&#146;s 2011 annual
meeting, the LaGrange Group will be entitled to recommend to the Board&#146;s
Nominating and Governance Committee a replacement director (each of whom will
be deemed a &#147;New Appointee&#148; for purposes of the Settlement Agreement).&nbsp; The
Settlement Agreement requires that any replacement director recommended by the
LaGrange Group qualify as &#147;independent&#148; pursuant to applicable NASDAQ listing
standards and that the Board&#146;s Nominating and Governance Committee not
unreasonably withhold its acceptance of any replacement director recommended by
the LaGrange Group.&nbsp; In the event the Nominating and Governance Committee does
not accept any replacement director recommended by the LaGrange Group, the
LaGrange Group will have the right to recommend an additional replacement
director for consideration by the Nominating and Governance Committee. The
Company agreed to cause the Board to appoint the replacement director to the
Board no later than five business days after the Nominating and Governance
Committee&#146;s recommendation of the replacement director.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>Similarly, under
the terms of the Settlement Agreement, if any Continuing Director leaves the Board
(whether by resignation or otherwise) before the conclusion of the Company&#146;s
2011 annual meeting, the remaining Continuing Directors (or the remaining
Continuing Director, as applicable), will be entitled to recommend to the
Board&#146;s Nominating and Governance Committee a replacement director (each of
whom will be deemed a &#147;Continuing Director&#148; for purposes of the Settlement
Agreement).&nbsp; The Settlement Agreement requires that any replacement director
recommended by the remaining Continuing Directors qualify as &#147;independent&#148;
pursuant to applicable NASDAQ listing standards and that the Board&#146;s Nominating
and Governance Committee not unreasonably withhold its acceptance of any
replacement director recommended by the remaining Continuing Directors. In the event
the Nominating and Governance Committee does not accept any replacement
director recommended by the remaining Continuing Directors, the remaining
Continuing Directors will have the right to recommend an additional replacement
director for consideration by the Nominating and Governance Committee. The
Company agreed to cause the Board to appoint the replacement director to the
Board no later than five business days after the Nominating and Governance
Committee&#146;s recommendation of the replacement director.</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp; </p>

<div style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<br clear=all
style='page-break-before:always'>


<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>Under the terms
of the Settlement Agreement, the LaGrange Group agreed that before the date
that is 14 days prior to the last date on which a shareholder of the Company
may nominate, in accordance with the applicable procedures set forth in the
Company&#146;s Bylaws, a person for election as a member of the Board at the
Company&#146;s 2011 annual meeting, it shall not take any action in furtherance of
seeking (i) additional Board representation other than as provided herein or
(ii) to call a special meeting of the Company&#146;s shareholders for any purpose.&nbsp;
The LaGrange Group also agreed that it would not enter into any agreement,
understanding or arrangement with the purpose or effect to cause or further any
of the foregoing or otherwise engage in any activities with the purpose or
effect to cause or further any of the foregoing.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>The Company also
agreed to reimburse the LaGrange Group up to $150,000 for its reasonable,
documented out-of-pocket fees and expenses (including legal expenses) incurred
in connection with its consent solicitation, its Schedule 13D and related
filings and the finalization of the Settlement Agreement.&nbsp; The Settlement
Agreement also required (i)&nbsp;certain changes to the Company&#146;s Bylaws,
(ii)&nbsp;the termination of the Shareholder Protection Rights Agreement, dated
as of June 9, 2010 (the &#147;<u>Rights Agreement</u>&#148;), by and between the Company
and American Stock Transfer &amp; Trust Company LLC, as Rights Agent and
(iii)&nbsp;delivery by the Company of its Severance and Release Agreement with
Mr. Sabra, dated August 10, 2010 (the &#147;<u>Sabra Severance and Release Agreement</u>&#148;),
its Retention Agreement with Mr. McKenna, dated August 10, 2010 (the &#147;<u>McKenna
Retention Agreement</u>&#148;), and its Employment Agreement with Mr. McKenna,
effective August 10, 2010 (the &#147;<u>McKenna Employment Agreement</u>&#148;), each as
more fully described below.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>The Settlement
Agreement is filed as an exhibit to this Report and is incorporated herein by
reference. The foregoing description and summary of the Settlement Agreement is
qualified in its entirety by reference to the Settlement Agreement.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify'><b><i>Severance and Release
Agreement with Douglas W. Sabra</i></b></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>The Company
entered into the Sabra Severance and Release Agreement which terminates Mr.
Sabra&#146;s Employment Agreement, effective January 2008, as extended and restated
on August 12, 2008 and as extended again without further modification effective
January 2010 (as so amended, the &#147;<u>Prior Sabra Agreement</u>&#148;).&nbsp; The Sabra
Severance and Release Agreement includes a release of claims against the
Company by Mr. Sabra, his heirs, assigns and anyone acting on his behalf,
reaffirms the Confidentiality, Non-Compete, Non-Solicitation, Separability and
Specific Performance provisions of the Prior Sabra Agreement, bars Mr. Sabra
from making certain disparaging remarks and commits Mr. Sabra to cooperating
with the Company in connection with claims, litigations and proceedings against
the Company and to returning certain confidential Company information.&nbsp; </p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>In consideration
of Mr. Sabra&#146;s execution and performance of the Sabra Severance and Release
Agreement, the Company agreed to (i) pay Mr. Sabra $500,000, of which half was
paid on August 10, 2010 and the remaining half will be paid in 12 equal monthly
installments commencing on September 1, 2010, (ii) immediately vest and
eliminate all restrictions on 26,666 shares of restricted Common Stock of the
Company previously granted to Mr. Sabra under the Company&#146;s Equity Incentive
Plan, (iii) immediately vest the option to purchase 10,000 shares of Common
Stock of the Company at $2.02 per share, previously granted to Mr. Sabra under
the Company&#146;s Equity Incentive Plan, with the right to immediately exercise
such option in accordance with the stock option award agreement and (iv)
release any claims against Mr. Sabra by the Company.</p>
<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp; </p>

<div style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<br clear=all
style='page-break-before:always'>


<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>The Sabra
Severance and Release Agreement is filed as an exhibit to this Report and is
incorporated herein by reference.&nbsp; The foregoing description and summary of the
Sabra Severance and Release Agreement is qualified in its entirety by reference
to the Sabra Severance and Release Agreement.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify'><b><i>Employment Agreement and
Retention Agreement with James O. McKenna III</i></b></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>Wishing to retain
and secure the services of Mr. McKenna, the Company&#146;s Chief Financial Officer,
the Company has entered into the McKenna Employment Agreement, employing Mr.
McKenna as Chief Financial Officer and Treasurer of the Company at a salary of
$175,000 per annum.&nbsp; In connection with the McKenna Employment Agreement, the
Employment Agreement, dated August 12, 2008 (the &#147;<u>Prior McKenna Agreement</u>&#148;),
between Mr. McKenna and the Company was terminated.&nbsp; Under the McKenna
Employment Agreement, Mr. McKenna will be eligible to earn bonus compensation
based on achievement of targets set by the Board&#146;s Compensation Committee in
respect of each fiscal year during the term.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>The term of the
McKenna Employment Agreement expires on December 31, 2011, and either party may
give notice of non-renewal not less than 90 days prior to that date.&nbsp; If the
Company gives such notice, which is considered a termination without cause, Mr.
McKenna would be entitled to receive a payment from the Company equal to one
year of his salary.&nbsp; Mr. McKenna is also entitled to a payment equal to one
year of his salary as severance in the event of his termination &#147;without cause&#148;
in circumstances other than non-renewal and termination for &#147;good reason&#148; (as
such terms are defined in the McKenna Employment Agreement).</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>Under the terms
of the McKenna Employment Agreement, Mr. McKenna is subject to the terms of
restrictive covenants that prohibit him from competing against the Company,
soliciting its employees, or soliciting its customers, in each case for a
period one year after expiration of the term or any renewal thereof.&nbsp; He is
also bound not to disclose material, non-public information pertaining to the
Company after expiration of the term.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>As a condition to
Mr. McKenna receiving any potential severance payments under the McKenna
Employment Agreement, he has agreed (for heirs, assigns and anyone acting on
his behalf) to release the Company of claims against the Company, not to make
certain disparaging remarks against the Company and committed to cooperating
with the Company in connection with claims, litigations and proceedings against
the Company and to returning certain confidential Company information.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>&nbsp;In addition, the
Company has entered into the McKenna Retention Agreement, providing Mr. McKenna
with a retention payment of $175,000 if Mr. McKenna performs his duties under
the McKenna Employment Agreement in the capacities set forth therein until at
least March 1, 2011.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>Each of the
McKenna Employment Agreement and the McKenna Retention Agreement is filed as an
exhibit to this Report and is incorporated herein by reference. The foregoing
descriptions and summaries of the McKenna Employment Agreement and the McKenna
Retention Agreement are qualified in their entirety by reference to the McKenna
Employment Agreement and the McKenna Retention Agreement, respectively.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>&nbsp;</p>
<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp; </p>

<div style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<br clear=all
style='page-break-before:always'>


<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;page-break-after:avoid'><b><i>Amendment
to the Rights Agreement</i></b></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>Pursuant to the
terms of the Settlement Agreement, the Company was required to terminate the
Rights Agreement.&nbsp; In connection therewith, on August 10, 2010, the Board
approved the Amendment to the Rights Agreement, which was entered into by the
Company as of August 10, 2010 (the &#147;<u>Amendment</u>&#148;).&nbsp; Pursuant to the terms
of the Amendment, the definition of the term &#147;Expiration Time&#148; in the Rights
Agreement was amended such that the Rights Agreement expired at 11:59 pm EDT on
August 10, 2010.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>The Amendment is
filed as an exhibit to this Report and is incorporated herein by reference. The
foregoing description and summary of the Amendment is qualified in its entirety
by reference to the Amendment.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:12.0pt;text-align:justify'><b>Item
1.02.&nbsp; Termination of a Material Definitive Agreement.</b></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>In response to
this Item 1.02, the Company hereby incorporates by reference the descriptions
under Item 1.01 of this Report included under the caption &#147;<i>Severance and
Release Agreement with Douglas W. Sabra</i>&#148; relating to the termination of the
Prior Sabra Agreement,&nbsp; the caption &#147;<i>Employment Agreement and Retention
Agreement with James O. McKenna III</i>&#148; relating to the termination of the
Prior McKenna Agreement and the caption &#147;<i>Amendment to the Rights Agreement</i>&#148;
relating to the termination of the Rights Agreement.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>The Sabra
Severance and Release Agreement and the Amendment are each filed as an exhibit
to this Report and are each incorporated herein by reference. The foregoing
descriptions and summaries of the Sabra Severance and Release Agreement and the
Amendment are qualified in its entirety by reference to the Sabra Severance and
Release Agreement and the Amendment.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:12.0pt;text-align:justify;page-break-after:
avoid'><b>Item 3.03.&nbsp; Material Modification to Rights of Security Holders.</b></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>In response to
this Item 1.02, the Company hereby incorporates by reference the description
under Item 1.01 of this Report included under the caption &#147;<i>Amendment to the
Rights Agreement</i>&#148; relating to the termination of certain rights of
shareholders of the Company under the Rights Agreement as of 11:59 am EDT on
August 10, 2010.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>The Amendment is
filed as an exhibit to this Report and is incorporated herein by reference. The
foregoing description and summary of the Amendment is qualified in its entirety
by reference to the Amendment.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:12.0pt;text-align:justify'><b>Item
5.02.&nbsp; Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.</b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp; </p>

<div style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<br clear=all
style='page-break-before:always'>


<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>As disclosed in
Item 1.01 of this Report, in connection with the Company&#146;s entry into the
Settlement Agreement, Messrs. Schiffman and Galloway resigned from the Board,
and Mr. Sabra resigned as Acting Chairman of the Board and as a member of the
Board, on August 10, 2010.&nbsp; In connection with their resignations from the
Board, Messrs. Sabra, Schiffman and Galloway also resigned from all committees
of the Board.&nbsp; Also on August 10, 2010, Mr. Sabra resigned as President and Chief
Executive Officer of the Company.&nbsp; In connection with his resignation from the
Board, Mr. Schiffman agreed to serve as an ongoing advisor to the Company
without any compensation.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>In connection
with the aforementioned resignations by Messrs. Sabra, Schiffman and Galloway,
on August 10, 2010, the Board determined that (i)&nbsp;the vesting date for
options held by each of Messrs. Galloway and Schiffman to purchase 15,000
shares of Common Stock at a price of $2.43 per share, scheduled to vest on
February 10, 2011, would be accelerated to August 10, 2010, and (ii) that the
provision of the Company&#146;s Equity Incentive Plan which otherwise would cause
all outstanding stock options of the Company to expire 90 days after a
grantee&#146;s employment or service terminates, would be waived for all outstanding
options held by Messrs. Sabra, Galloway and Schiffman.&nbsp; Thus, these options may
be exercised at any time prior to their expiration..</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>After the
aforementioned resignations from the Board by Messrs. Sabra, Schiffman and
Galloway, on August 10, 2010, the remaining members of the Board appointed
(i)&nbsp;Messrs. Grange Johnson, Key and King to fill the vacancies created by
the resignations, (ii)&nbsp;Mr. Grange Johnson as Chairman of the Board and
(iii)&nbsp;Mr. King as a member of the Board&#146;s Nominating and Governance
Committee and as Chairman of the Committee.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>In addition, on
August 10, 2010, the Board appointed Mr. Brett Johnson as the Company&#146;s
President and Chief Executive Officer, on an &#147;at-will&#148; basis with the same base
compensation and benefits as the Company&#146;s previous President and Chief
Executive Officer pending his negotiation of a long-term employment agreement
with the Board&#146;s Compensation Committee.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>Mr. Brett M. Johnson
is the founder of Benevolent Capital Partners, LLC (&#147;<u>BCP</u>&#148;), a diversified
investment company whose investments include Yak Pak, Inc. and Terracycle.&nbsp;
Prior to founding BCP in October 2005, Mr. Johnson was President of Targus
Group International, Inc. (&#147;<u>Targus</u>&#148;), a global supplier of notebook
carrying cases and accessories, from 2001 to 2004, during which time he led a
comprehensive restructuring of the business.&nbsp; Prior thereto, Mr. Johnson was
managing director of Targus&#146;s Europe, Middle East and Africa region and its
Asia-Pacific region.&nbsp; Under Mr. Johnson&#146;s leadership, Targus was a two-time
winner of the Queen&#146;s Award for Enterprise and a six-time winner of Gartner
Group&#146;s Best Vendor Award at RetailVision and VarVision.&nbsp; In addition, from
1998 to 2009, Mr. Johnson was a member of the of Board of Director of Targus and
a member of the Audit Committee of the Board of Directors of Targus from 2006
to 2009.&nbsp; Mr. Johnson is 40 years old.&nbsp; Messrs. Brett Johnson and Grange
Johnson are brothers.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>In response to
this Item 5.02, in addition to the description provided above under this Item
5.02, the Company hereby incorporates by reference the disclosure included in
response to Item 1.01 of this Report.</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp; </p>

<div style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<br clear=all
style='page-break-before:always'>


<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>Each of the
Settlement Agreement, the Sabra Severance and Release Agreement, the McKenna
Employment Agreement and the McKenna Retention Agreement is filed as an exhibit
to this Report and is incorporated herein by reference. The foregoing
descriptions and summaries of the Settlement Agreement, the Sabra Severance and
Release Agreement, McKenna Employment Agreement and the McKenna Retention
Agreement are qualified in their entirety by reference to respective agreements.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:12.0pt;text-align:justify'><b>Item
5.03.&nbsp; Amendments to Articles of Incorporation or Bylaws; Change in Fiscal
Year.</b></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>As previously
reported by the Company, on June 9, 2010, the Board had amended and restated
the Amended and Restated Bylaws of the Company that had become effective on
February 13, 2008 and were filed with the SEC on December 5, 2007 (the &#147;<u>Former
Bylaws</u>&#148;).&nbsp; Pursuant to the terms of the Settlement Agreement, on August 10,
2010, the Company repealed all provisions of the Bylaws that were in effect on
August 10, 2010 (the &#147;<u>Second Amended and Restated Bylaws</u>&#148;) but that were
not included in the Former Bylaws, and amended and restated the Second Amended
and Restated Bylaws as the Third Amended and Restated Bylaws, effective as of
August 10, 2010 (the &#147;<u>Third Amended and Restated Bylaws</u>&#148;).</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>Section 203 of
the Second Amended and Restated Bylaws provided that special meetings of the
shareholders of the Company may be called at any time by, among others,
Qualified Shareholders (as defined in the Second Amended and Restated Bylaws)
holding at least forty percent (40%) of all the votes entitled to be cast on
any issue proposed to be considered at the special meeting.&nbsp; This provision was
amended on August 10, 2010 in the Third Amended and Restated Bylaws to revert
to the language of the Former Bylaws, such that the forty percent (40%) was
decreased to thirty percent (30%).</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.5in'>Section 301
(&#147;Management by Board of Directors&#148;) of the Second Amended and Restated Bylaws
provided for three classes of directors and specified the terms of office of
each of the classes of directors.&nbsp; Section 301 also contained a proviso that
the amendment relating to the classification of the Board would only be
effective and be part of the Bylaws of the Company if and when such amendment
would have been duly approved by the shareholders of the Company.&nbsp; Section 301
was amended on August 10, 2010 in the Third Amended and Restated Bylaws to
revert to the language of the Former Bylaws, removing the classification of
directors and the related proviso.</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:12.0pt;text-align:justify;text-indent:
..5in'>The Third Amended and Restated Bylaws is filed herewith and is
incorporated herein by reference.&nbsp; The foregoing description and summary of the
Third Amended and Restated Bylaws is qualified in its entirety by reference to
the Third Amended and Restated Bylaws.</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:12.0pt;text-align:justify;text-indent:
..5in'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:12.0pt;text-align:justify;text-indent:
..5in'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:12.0pt;text-align:justify'><b>Item
7.01.&nbsp; Regulation FD Disclosure.</b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp; </p>

<div style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<br clear=all
style='page-break-before:always'>


<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:12.0pt;text-align:justify;text-indent:
..5in'>On August 10, 2010, the Company issued a press release discussing future
opportunities for the Company and describing the changes to the Board, the new
management team and corporate planning (the &#147;<u>Press Release</u>&#148;).</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:12.0pt;text-align:justify;text-indent:
..5in'>The Press Release is furnished herewith and is incorporated by reference
in response to this Item 7.01.</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:12.0pt;text-align:justify'><b>&nbsp;</b></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=638
 style='width:100%'>
 <tr>
  <td width="100%" colspan=2 valign=top style='width:100.0%;padding:0in 0in 0in 0in'>&nbsp;<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";'><b>Item 9.01. Financial Statements and Exhibits</b>.</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-bottom:0;font-size:12.0pt;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>(d) Exhibits&nbsp;</p>
  <p style='margin-bottom:0;font-size:12.0pt;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;&nbsp; </p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-bottom:0;font-size:12.0pt;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'><u>Exhibit Number</u></p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'><u>Description</u></p>
  </td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-bottom:0;font-size:12.0pt;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp;</p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-bottom:0;font-size:12.0pt;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>&nbsp; </p>
  </td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-left:.25in'>3.1</p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'>Third Amended and Restated Bylaws of Forward Industries,
  Inc., as amended and restated on August 10, 2010</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  &nbsp;</td>
  <td valign=top style='width:84%;padding:0in; '>
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-left:.25in'>4.1</p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'>Amendment to the Shareholder Protection Rights Agreement,
  dated as of August 10, 2010, by and between Forward Industries, Inc. and
  American Stock Transfer &amp; Trust Company LLC, as Rights Agent</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  &nbsp;</td>
  <td valign=top style='width:84%;padding:0in; '>
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-left:.25in'>10.1</p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'>Settlement Agreement, dated as of August 10, 2010, by and
  among Forward Industries, Inc., LaGrange Capital Partners, L.P., LaGrange
  Capital Partners Offshore Fund, Ltd., LaGrange Special Situations Yield
  Master Fund, Ltd.,&nbsp; LaGrange Capital Management, L.L.C., LaGrange Capital
  Administration, L.L.C. and Frank LaGrange Johnson</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  &nbsp;</td>
  <td valign=top style='width:84%;padding:0in; '>
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-left:.25in'>10.2</p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'>Severance and Release Agreement, dated August 10, 2010, by
  and between Forward Industries, Inc. and Douglas W. Sabra</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  &nbsp;</td>
  <td valign=top style='width:84%;padding:0in; '>
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-left:.25in'>10.3</p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'>Employment Agreement, dated August 10, 2010, by and between
  Forward Industries, Inc. and James O. McKenna III</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  &nbsp;</td>
  <td valign=top style='width:84%;padding:0in; '>
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-left:.25in'>10.4</p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'>Retention Agreement, dated August 10, 2010, by and between
  Forward Industries, Inc. and James O. McKenna III</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  &nbsp;</td>
  <td valign=top style='width:84%;padding:0in; '>
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-left:.25in'>99.1</p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'>Press Release, dated August 10, 2010</p>
  </td>
 </tr>
</table>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<div style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<br clear=all
style='page-break-before:always'>


<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";text-align:center'><b>SIGNATURE</b></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:0in;margin-bottom:.0001pt'>&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:0in;margin-bottom:.0001pt'>&nbsp;</p>

<table border="0" style="border-collapse: collapse" width="100%" id="table1">
	<tr>
		<td width="50%">&nbsp;</td>
		<td width="50%">

<p style='margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-top:5.0pt;margin-right:0in;margin-bottom:5.0pt;
text-autospace:none'>FORWARD INDUSTRIES, INC.</p>

		</td>
	</tr>
	<tr>
		<td width="50%">&nbsp;</td>
		<td width="50%">

<p style='margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-top:5.0pt;margin-right:0in;margin-bottom:5.0pt;
text-autospace:none'>&nbsp;</p>

		</td>
	</tr>
	<tr>
		<td width="50%">Date: August 16, 2010</td>
		<td width="50%">

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:0in;margin-bottom:.0001pt'>
<u>/s/ Brett M. Johnson</u>___________<br>
Brett
M. Johnson<br>
President
&amp; Chief Executive Officer</p>

		</td>
	</tr>
</table>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:0in;margin-bottom:.0001pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<div style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

</div>

<br clear=all
style='page-break-before:always'>


<div style='page:Section3;'>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'><b>EXHIBIT INDEX</b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=638
 style='width:100%'>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'><u>Exhibit Number</u></p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'><u>Description</u></p>
  </td>
 </tr>
 <tr style='height:9.9pt'>
  <td valign=top style='width:16%;padding:0in;
  height:9.9pt'>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:.25in;margin-bottom:0'>&nbsp;</p>
  </td>
  <td valign=top style='width:84%;padding:0in;
  height:9.9pt'>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-bottom:0in;margin-bottom:0'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-left:.25in'>3.1</p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'>Third Amended and Restated Bylaws of Forward Industries,
  Inc., as amended and restated on August 10, 2010</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  &nbsp;</td>
  <td valign=top style='width:84%;padding:0in; '>
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-left:.25in'>4.1</p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'>Amendment to the Shareholder Protection Rights Agreement,
  dated as of August 10, 2010, by and between Forward Industries, Inc. and
  American Stock Transfer &amp; Trust Company LLC, as Rights Agent.</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  &nbsp;</td>
  <td valign=top style='width:84%;padding:0in; '>
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-left:.25in'>10.1</p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'>Settlement Agreement, dated as of August 10, 2010, by and
  among Forward Industries, Inc., LaGrange Capital Partners, L.P., LaGrange
  Capital Partners Offshore Fund, Ltd., LaGrange Special Situations Yield
  Master Fund, Ltd.,&nbsp; LaGrange Capital Management, L.L.C., LaGrange Capital
  Administration, L.L.C. and Frank LaGrange Johnson</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  &nbsp;</td>
  <td valign=top style='width:84%;padding:0in; '>
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-left:.25in'>10.2</p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'>Severance and Release Agreement, dated August 10, 2010, by
  and between Forward Industries, Inc. and Douglas W. Sabra</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  &nbsp;</td>
  <td valign=top style='width:84%;padding:0in; '>
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-left:.25in'>10.3</p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'>Employment Agreement, dated August 10, 2010, by and between
  Forward Industries, Inc. and James O. McKenna III</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  &nbsp;</td>
  <td valign=top style='width:84%;padding:0in; '>
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-left:.25in'>10.4</p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'>Retention Agreement, dated August 10, 2010, by and between
  Forward Industries, Inc. and James O. McKenna III</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  &nbsp;</td>
  <td valign=top style='width:84%;padding:0in; '>
  &nbsp;</td>
 </tr>
 <tr>
  <td valign=top style='width:16%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-left:.25in'>99.1</p>
  </td>
  <td valign=top style='width:84%;padding:0in; '>
  <p style='margin-top:0in;margin-right:0in;margin-bottom:0;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman"'>Press Release, dated August 10, 2010</p>
  </td>
 </tr>
</table>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>

<div style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>

<hr size=2 width="100%" noshade color=navy align=center>

</div>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>

</div>

</body>

</html>
[{"type": "8-K", "sequence": "1", "filename": "esforward8k8-16.htm", "secsgml_size_bytes": 68020}]
{"company-data": {"conformed-name": "FORWARD INDUSTRIES INC", "cik": "0000038264", "assigned-sic": "3089", "irs-number": "131950672", "state-of-incorporation": "NY", "fiscal-year-end": "0930"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-34780", "film-number": "101019164"}, "business-address": {"street1": "1801 GREEN ROAD", "street2": "SUITE E", "city": "POMPANO BEACH", "state": "FL", "zip": "33064", "phone": "9544199544"}, "mail-address": {"street1": "1801 GREEN RD", "street2": "SUITE E", "city": "POMPANO BEACH", "state": "FL", "zip": "33064"}, "former-company": {"former-conformed-name": "PROGRESS HEAT SEALING CO INC", "date-changed": "19721111"}}
Forward Industries Form 8-K
UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report: August 10, 2010
(Date of earliest event reported)
FORWARD INDUSTRIES, INC.
(Exact name of registrant as specified in the charter)
New York
000-6669
13-1950672
(State or other jurisdiction of
  incorporation)
(Commission File Number)
(IRS Employer I.D. No.)
1801 Green Road,
Suite E
Pompano Beach, FL 33064
(Address of Principal Executive Offices)
(954) 419-9544
(Registrant's
telephone number including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ]
Written communications pursuant to Rule 425 under the Securities Act (17
  CFR 230.425)
[ ]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
  240.14a-12)
[ ]
Pre-commencement communications pursuant to Rule 14d-2(b) under the
  Exchange Act (17 CFR 240.14d-22(b)
[ ]
Pre-commencement communications pursuant to Rule 13e-4(c) under the
  Exchange Act (17 CFR 240.23e-4(c)
Item
1.01.  Entry into a Material Definitive Agreement.
Settlement Agreement with
the LaGrange Group
On August 10,
2010, the Board of Directors (the "
Board
") of Forward Industries, Inc.,
a New York corporation (the "
Company
"), determined that the interests of
the Company and its shareholders would be best served by, among other things,
avoiding a contested election of directors at a special meeting during 2010 or
at the 2010 annual meeting in 2011 as well as the expense and disruption that
would result therefrom.  Accordingly, the Board approved, and the Company
entered into, the Settlement Agreement, dated as of August 10, 2010 (the "
Settlement
Agreement
"), by and among the Company, LaGrange Capital Partners, L.P.,
LaGrange Capital Partners Offshore Fund, Ltd., LaGrange Special Situations
Yield Master Fund, Ltd.,  LaGrange Capital Management, L.L.C., LaGrange Capital
Administration, L.L.C. and Frank LaGrange Johnson (collectively, the "
LaGrange
Group
"), which contemplated certain changes to the composition of the Board
and the Company's management team as well as the other matters described below.
Pursuant to the
Settlement Agreement, the LaGrange Group agreed to withdraw its preliminary
consent materials on file with the Securities and Exchange Commission (the "
SEC
"),
thus abandoning its previously announced efforts to call a special meeting of
the Company's shareholders.
As contemplated
by the terms of the Settlement Agreement, on August 10, 2010, Michael Schiffman
and Bruce Galloway resigned from the Board, and Douglas W. Sabra resigned as
President and Chief Executive Officer of the Company, as Acting Chairman of the
Board and as a member of the Board.  Thereafter, as also contemplated by the
terms of the Settlement Agreement, the Board appointed (i) Frank LaGrange
Johnson ("
Mr. Grange Johnson
"), Stephen L. Key and Owen P.J. King
(collectively, with Mr. Grange Johnson, the "
New Appointees
") to fill
the resulting vacancies in the Board, (ii) Mr. Grange Johnson as Chairman
of the Board and (iii) Brett M. Johnson as the Company's President and
Chief Executive Officer to serve the Company on an "at-will" basis and with the
same base compensation and benefits as the Company's previous President and
Chief Executive Officer pending his negotiation of a long-term employment
agreement with the Board's Compensation Committee.
Under the terms
of the Settlement Agreement, the Company agreed that (i) prior to the time that
it mails its definitive proxy statement for the Company's 2010 annual meeting,
the Company will take all necessary actions to nominate the New Appointees for
election to the Board at the 2010 Annual Meeting, (ii) it will take no action
to increase the size of the Board above six members prior to the final
certification of the results of the 2010 annual meeting unless such increase is
approved by a majority of the Board and (iii) it will recommend, support and
solicit proxies for the election of the New Appointees in the same manner as
for the Company's other 2010 nominees for election as directors at the 2010
annual meeting.  Also, under the terms of the Settlement Agreement, the
LaGrange Group agreed to vote all of its shares of Company stock in favor of,
and otherwise support, the election of John F. Chiste, Fred Hamilton and Louis
Lipschitz (collectively, the "
Continuing Directors
") at the 2010 annual
meeting.
In addition,
pursuant to the terms of the Settlement Agreement, the Company agreed to cause
the appointment of (i) the New Appointees to the committees of the Board
such that the New Appointees have at least an equal number of members as the
Continuing Directors on each committee and (ii) Mr. King as Chairman of
the Nominating and Governance Committee at the first meeting of the Board
following the execution of the Settlement Agreement.  Furthermore, for any
committee of the Board created after August 10, 2010, pursuant to the terms of
the Settlement Agreement, the Company agreed that the New Appointees shall have
at least an equal number of members on such committee as do the Continuing
Directors.
Under the terms
of the Settlement Agreement, if any New Appointee leaves the Board (whether by
resignation or otherwise) before the conclusion of the Company's 2011 annual
meeting, the LaGrange Group will be entitled to recommend to the Board's
Nominating and Governance Committee a replacement director (each of whom will
be deemed a "New Appointee" for purposes of the Settlement Agreement).  The
Settlement Agreement requires that any replacement director recommended by the
LaGrange Group qualify as "independent" pursuant to applicable NASDAQ listing
standards and that the Board's Nominating and Governance Committee not
unreasonably withhold its acceptance of any replacement director recommended by
the LaGrange Group.  In the event the Nominating and Governance Committee does
not accept any replacement director recommended by the LaGrange Group, the
LaGrange Group will have the right to recommend an additional replacement
director for consideration by the Nominating and Governance Committee. The
Company agreed to cause the Board to appoint the replacement director to the
Board no later than five business days after the Nominating and Governance
Committee's recommendation of the replacement director.
Similarly, under
the terms of the Settlement Agreement, if any Continuing Director leaves the Board
(whether by resignation or otherwise) before the conclusion of the Company's
2011 annual meeting, the remaining Continuing Directors (or the remaining
Continuing Director, as applicable), will be entitled to recommend to the
Board's Nominating and Governance Committee a replacement director (each of
whom will be deemed a "Continuing Director" for purposes of the Settlement
Agreement).  The Settlement Agreement requires that any replacement director
recommended by the remaining Continuing Directors qualify as "independent"
pursuant to applicable NASDAQ listing standards and that the Board's Nominating
and Governance Committee not unreasonably withhold its acceptance of any
replacement director recommended by the remaining Continuing Directors. In the event
the Nominating and Governance Committee does not accept any replacement
director recommended by the remaining Continuing Directors, the remaining
Continuing Directors will have the right to recommend an additional replacement
director for consideration by the Nominating and Governance Committee. The
Company agreed to cause the Board to appoint the replacement director to the
Board no later than five business days after the Nominating and Governance
Committee's recommendation of the replacement director.
Under the terms
of the Settlement Agreement, the LaGrange Group agreed that before the date
that is 14 days prior to the last date on which a shareholder of the Company
may nominate, in accordance with the applicable procedures set forth in the
Company's Bylaws, a person for election as a member of the Board at the
Company's 2011 annual meeting, it shall not take any action in furtherance of
seeking (i) additional Board representation other than as provided herein or
(ii) to call a special meeting of the Company's shareholders for any purpose. 
The LaGrange Group also agreed that it would not enter into any agreement,
understanding or arrangement with the purpose or effect to cause or further any
of the foregoing or otherwise engage in any activities with the purpose or
effect to cause or further any of the foregoing.
The Company also
agreed to reimburse the LaGrange Group up to $150,000 for its reasonable,
documented out-of-pocket fees and expenses (including legal expenses) incurred
in connection with its consent solicitation, its Schedule 13D and related
filings and the finalization of the Settlement Agreement.  The Settlement
Agreement also required (i) certain changes to the Company's Bylaws,
(ii) the termination of the Shareholder Protection Rights Agreement, dated
as of June 9, 2010 (the "
Rights Agreement
"), by and between the Company
and American Stock Transfer & Trust Company LLC, as Rights Agent and
(iii) delivery by the Company of its Severance and Release Agreement with
Mr. Sabra, dated August 10, 2010 (the "
Sabra Severance and Release Agreement
"),
its Retention Agreement with Mr. McKenna, dated August 10, 2010 (the "
McKenna
Retention Agreement
"), and its Employment Agreement with Mr. McKenna,
effective August 10, 2010 (the "
McKenna Employment Agreement
"), each as
more fully described below.
The Settlement
Agreement is filed as an exhibit to this Report and is incorporated herein by
reference. The foregoing description and summary of the Settlement Agreement is
qualified in its entirety by reference to the Settlement Agreement.
Severance and Release
Agreement with Douglas W. Sabra
The Company
entered into the Sabra Severance and Release Agreement which terminates Mr.
Sabra's Employment Agreement, effective January 2008, as extended and restated
on August 12, 2008 and as extended again without further modification effective
January 2010 (as so amended, the "
Prior Sabra Agreement
").  The Sabra
Severance and Release Agreement includes a release of claims against the
Company by Mr. Sabra, his heirs, assigns and anyone acting on his behalf,
reaffirms the Confidentiality, Non-Compete, Non-Solicitation, Separability and
Specific Performance provisions of the Prior Sabra Agreement, bars Mr. Sabra
from making certain disparaging remarks and commits Mr. Sabra to cooperating
with the Company in connection with claims, litigations and proceedings against
the Company and to returning certain confidential Company information.
In consideration
of Mr. Sabra's execution and performance of the Sabra Severance and Release
Agreement, the Company agreed to (i) pay Mr. Sabra $500,000, of which half was
paid on August 10, 2010 and the remaining half will be paid in 12 equal monthly
installments commencing on September 1, 2010, (ii) immediately vest and
eliminate all restrictions on 26,666 shares of restricted Common Stock of the
Company previously granted to Mr. Sabra under the Company's Equity Incentive
Plan, (iii) immediately vest the option to purchase 10,000 shares of Common
Stock of the Company at $2.02 per share, previously granted to Mr. Sabra under
the Company's Equity Incentive Plan, with the right to immediately exercise
such option in accordance with the stock option award agreement and (iv)
release any claims against Mr. Sabra by the Company.
The Sabra
Severance and Release Agreement is filed as an exhibit to this Report and is
incorporated herein by reference.  The foregoing description and summary of the
Sabra Severance and Release Agreement is qualified in its entirety by reference
to the Sabra Severance and Release Agreement.
Employment Agreement and
Retention Agreement with James O. McKenna III
Wishing to retain
and secure the services of Mr. McKenna, the Company's Chief Financial Officer,
the Company has entered into the McKenna Employment Agreement, employing Mr.
McKenna as Chief Financial Officer and Treasurer of the Company at a salary of
$175,000 per annum.  In connection with the McKenna Employment Agreement, the
Employment Agreement, dated August 12, 2008 (the "
Prior McKenna Agreement
"),
between Mr. McKenna and the Company was terminated.  Under the McKenna
Employment Agreement, Mr. McKenna will be eligible to earn bonus compensation
based on achievement of targets set by the Board's Compensation Committee in
respect of each fiscal year during the term.
The term of the
McKenna Employment Agreement expires on December 31, 2011, and either party may
give notice of non-renewal not less than 90 days prior to that date.  If the
Company gives such notice, which is considered a termination without cause, Mr.
McKenna would be entitled to receive a payment from the Company equal to one
year of his salary.  Mr. McKenna is also entitled to a payment equal to one
year of his salary as severance in the event of his termination "without cause"
in circumstances other than non-renewal and termination for "good reason" (as
such terms are defined in the McKenna Employment Agreement).
Under the terms
of the McKenna Employment Agreement, Mr. McKenna is subject to the terms of
restrictive covenants that prohibit him from competing against the Company,
soliciting its employees, or soliciting its customers, in each case for a
period one year after expiration of the term or any renewal thereof.  He is
also bound not to disclose material, non-public information pertaining to the
Company after expiration of the term.
As a condition to
Mr. McKenna receiving any potential severance payments under the McKenna
Employment Agreement, he has agreed (for heirs, assigns and anyone acting on
his behalf) to release the Company of claims against the Company, not to make
certain disparaging remarks against the Company and committed to cooperating
with the Company in connection with claims, litigations and proceedings against
the Company and to returning certain confidential Company information.
In addition, the
Company has entered into the McKenna Retention Agreement, providing Mr. McKenna
with a retention payment of $175,000 if Mr. McKenna performs his duties under
the McKenna Employment Agreement in the capacities set forth therein until at
least March 1, 2011.
Each of the
McKenna Employment Agreement and the McKenna Retention Agreement is filed as an
exhibit to this Report and is incorporated herein by reference. The foregoing
descriptions and summaries of the McKenna Employment Agreement and the McKenna
Retention Agreement are qualified in their entirety by reference to the McKenna
Employment Agreement and the McKenna Retention Agreement, respectively.
Amendment
to the Rights Agreement
Pursuant to the
terms of the Settlement Agreement, the Company was required to terminate the
Rights Agreement.  In connection therewith, on August 10, 2010, the Board
approved the Amendment to the Rights Agreement, which was entered into by the
Company as of August 10, 2010 (the "
Amendment
").  Pursuant to the terms
of the Amendment, the definition of the term "Expiration Time" in the Rights
Agreement was amended such that the Rights Agreement expired at 11:59 pm EDT on
August 10, 2010.
The Amendment is
filed as an exhibit to this Report and is incorporated herein by reference. The
foregoing description and summary of the Amendment is qualified in its entirety
by reference to the Amendment.
Item
1.02.  Termination of a Material Definitive Agreement.
In response to
this Item 1.02, the Company hereby incorporates by reference the descriptions
under Item 1.01 of this Report included under the caption "
Severance and
Release Agreement with Douglas W. Sabra
" relating to the termination of the
Prior Sabra Agreement,  the caption "
Employment Agreement and Retention
Agreement with James O. McKenna III
" relating to the termination of the
Prior McKenna Agreement and the caption "
Amendment to the Rights Agreement
"
relating to the termination of the Rights Agreement.
The Sabra
Severance and Release Agreement and the Amendment are each filed as an exhibit
to this Report and are each incorporated herein by reference. The foregoing
descriptions and summaries of the Sabra Severance and Release Agreement and the
Amendment are qualified in its entirety by reference to the Sabra Severance and
Release Agreement and the Amendment.
Item 3.03.  Material Modification to Rights of Security Holders.
In response to
this Item 1.02, the Company hereby incorporates by reference the description
under Item 1.01 of this Report included under the caption "
Amendment to the
Rights Agreement
" relating to the termination of certain rights of
shareholders of the Company under the Rights Agreement as of 11:59 am EDT on
August 10, 2010.
The Amendment is
filed as an exhibit to this Report and is incorporated herein by reference. The
foregoing description and summary of the Amendment is qualified in its entirety
by reference to the Amendment.
Item
5.02.  Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
As disclosed in
Item 1.01 of this Report, in connection with the Company's entry into the
Settlement Agreement, Messrs. Schiffman and Galloway resigned from the Board,
and Mr. Sabra resigned as Acting Chairman of the Board and as a member of the
Board, on August 10, 2010.  In connection with their resignations from the
Board, Messrs. Sabra, Schiffman and Galloway also resigned from all committees
of the Board.  Also on August 10, 2010, Mr. Sabra resigned as President and Chief
Executive Officer of the Company.  In connection with his resignation from the
Board, Mr. Schiffman agreed to serve as an ongoing advisor to the Company
without any compensation.
In connection
with the aforementioned resignations by Messrs. Sabra, Schiffman and Galloway,
on August 10, 2010, the Board determined that (i) the vesting date for
options held by each of Messrs. Galloway and Schiffman to purchase 15,000
shares of Common Stock at a price of $2.43 per share, scheduled to vest on
February 10, 2011, would be accelerated to August 10, 2010, and (ii) that the
provision of the Company's Equity Incentive Plan which otherwise would cause
all outstanding stock options of the Company to expire 90 days after a
grantee's employment or service terminates, would be waived for all outstanding
options held by Messrs. Sabra, Galloway and Schiffman.  Thus, these options may
be exercised at any time prior to their expiration..
After the
aforementioned resignations from the Board by Messrs. Sabra, Schiffman and
Galloway, on August 10, 2010, the remaining members of the Board appointed
(i) Messrs. Grange Johnson, Key and King to fill the vacancies created by
the resignations, (ii) Mr. Grange Johnson as Chairman of the Board and
(iii) Mr. King as a member of the Board's Nominating and Governance
Committee and as Chairman of the Committee.
In addition, on
August 10, 2010, the Board appointed Mr. Brett Johnson as the Company's
President and Chief Executive Officer, on an "at-will" basis with the same base
compensation and benefits as the Company's previous President and Chief
Executive Officer pending his negotiation of a long-term employment agreement
with the Board's Compensation Committee.
Mr. Brett M. Johnson
is the founder of Benevolent Capital Partners, LLC ("
BCP
"), a diversified
investment company whose investments include Yak Pak, Inc. and Terracycle. 
Prior to founding BCP in October 2005, Mr. Johnson was President of Targus
Group International, Inc. ("
Targus
"), a global supplier of notebook
carrying cases and accessories, from 2001 to 2004, during which time he led a
comprehensive restructuring of the business.  Prior thereto, Mr. Johnson was
managing director of Targus's Europe, Middle East and Africa region and its
Asia-Pacific region.  Under Mr. Johnson's leadership, Targus was a two-time
winner of the Queen's Award for Enterprise and a six-time winner of Gartner
Group's Best Vendor Award at RetailVision and VarVision.  In addition, from
1998 to 2009, Mr. Johnson was a member of the of Board of Director of Targus and
a member of the Audit Committee of the Board of Directors of Targus from 2006
to 2009.  Mr. Johnson is 40 years old.  Messrs. Brett Johnson and Grange
Johnson are brothers.
In response to
this Item 5.02, in addition to the description provided above under this Item
5.02, the Company hereby incorporates by reference the disclosure included in
response to Item 1.01 of this Report.
Each of the
Settlement Agreement, the Sabra Severance and Release Agreement, the McKenna
Employment Agreement and the McKenna Retention Agreement is filed as an exhibit
to this Report and is incorporated herein by reference. The foregoing
descriptions and summaries of the Settlement Agreement, the Sabra Severance and
Release Agreement, McKenna Employment Agreement and the McKenna Retention
Agreement are qualified in their entirety by reference to respective agreements.
Item
5.03.  Amendments to Articles of Incorporation or Bylaws; Change in Fiscal
Year.
As previously
reported by the Company, on June 9, 2010, the Board had amended and restated
the Amended and Restated Bylaws of the Company that had become effective on
February 13, 2008 and were filed with the SEC on December 5, 2007 (the "
Former
Bylaws
").  Pursuant to the terms of the Settlement Agreement, on August 10,
2010, the Company repealed all provisions of the Bylaws that were in effect on
August 10, 2010 (the "
Second Amended and Restated Bylaws
") but that were
not included in the Former Bylaws, and amended and restated the Second Amended
and Restated Bylaws as the Third Amended and Restated Bylaws, effective as of
August 10, 2010 (the "
Third Amended and Restated Bylaws
").
Section 203 of
the Second Amended and Restated Bylaws provided that special meetings of the
shareholders of the Company may be called at any time by, among others,
Qualified Shareholders (as defined in the Second Amended and Restated Bylaws)
holding at least forty percent (40%) of all the votes entitled to be cast on
any issue proposed to be considered at the special meeting.  This provision was
amended on August 10, 2010 in the Third Amended and Restated Bylaws to revert
to the language of the Former Bylaws, such that the forty percent (40%) was
decreased to thirty percent (30%).
Section 301
("Management by Board of Directors") of the Second Amended and Restated Bylaws
provided for three classes of directors and specified the terms of office of
each of the classes of directors.  Section 301 also contained a proviso that
the amendment relating to the classification of the Board would only be
effective and be part of the Bylaws of the Company if and when such amendment
would have been duly approved by the shareholders of the Company.  Section 301
was amended on August 10, 2010 in the Third Amended and Restated Bylaws to
revert to the language of the Former Bylaws, removing the classification of
directors and the related proviso.
The Third Amended and Restated Bylaws is filed herewith and is
incorporated herein by reference.  The foregoing description and summary of the
Third Amended and Restated Bylaws is qualified in its entirety by reference to
the Third Amended and Restated Bylaws.
Item
7.01.  Regulation FD Disclosure.
On August 10, 2010, the Company issued a press release discussing future
opportunities for the Company and describing the changes to the Board, the new
management team and corporate planning (the "
Press Release
").
The Press Release is furnished herewith and is incorporated by reference
in response to this Item 7.01.
Item 9.01. Financial Statements and Exhibits
.
(d) Exhibits
Exhibit Number
Description
3.1
Third Amended and Restated Bylaws of Forward Industries,
  Inc., as amended and restated on August 10, 2010
4.1
Amendment to the Shareholder Protection Rights Agreement,
  dated as of August 10, 2010, by and between Forward Industries, Inc. and
  American Stock Transfer & Trust Company LLC, as Rights Agent
10.1
Settlement Agreement, dated as of August 10, 2010, by and
  among Forward Industries, Inc., LaGrange Capital Partners, L.P., LaGrange
  Capital Partners Offshore Fund, Ltd., LaGrange Special Situations Yield
  Master Fund, Ltd.,  LaGrange Capital Management, L.L.C., LaGrange Capital
  Administration, L.L.C. and Frank LaGrange Johnson
10.2
Severance and Release Agreement, dated August 10, 2010, by
  and between Forward Industries, Inc. and Douglas W. Sabra
10.3
Employment Agreement, dated August 10, 2010, by and between
  Forward Industries, Inc. and James O. McKenna III
10.4
Retention Agreement, dated August 10, 2010, by and between
  Forward Industries, Inc. and James O. McKenna III
99.1
Press Release, dated August 10, 2010
SIGNATURE
Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
FORWARD INDUSTRIES, INC.
Date: August 16, 2010
/s/ Brett M. Johnson
___________
Brett
M. Johnson
President
& Chief Executive Officer
EXHIBIT INDEX
Exhibit Number
Description
3.1
Third Amended and Restated Bylaws of Forward Industries,
  Inc., as amended and restated on August 10, 2010
4.1
Amendment to the Shareholder Protection Rights Agreement,
  dated as of August 10, 2010, by and between Forward Industries, Inc. and
  American Stock Transfer & Trust Company LLC, as Rights Agent.
10.1
Settlement Agreement, dated as of August 10, 2010, by and
  among Forward Industries, Inc., LaGrange Capital Partners, L.P., LaGrange
  Capital Partners Offshore Fund, Ltd., LaGrange Special Situations Yield
  Master Fund, Ltd.,  LaGrange Capital Management, L.L.C., LaGrange Capital
  Administration, L.L.C. and Frank LaGrange Johnson
10.2
Severance and Release Agreement, dated August 10, 2010, by
  and between Forward Industries, Inc. and Douglas W. Sabra
10.3
Employment Agreement, dated August 10, 2010, by and between
  Forward Industries, Inc. and James O. McKenna III
10.4
Retention Agreement, dated August 10, 2010, by and between
  Forward Industries, Inc. and James O. McKenna III
99.1
Press Release, dated August 10, 2010