-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, U4h2MEf/j/ZgAlqPkDpntNyTLp4GnTHoI9+GnIOyN2FPKZbCVmrL80e63q34XcI+ O4DTVHfYFFkKdk1RfN2VwQ== 0000912057-02-014834.txt : 20020416 0000912057-02-014834.hdr.sgml : 20020416 ACCESSION NUMBER: 0000912057-02-014834 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 20020412 GROUP MEMBERS: ATLANTIS EQUITIES, INC. GROUP MEMBERS: NANCY J. ELLIN GROUP MEMBERS: ROBERT ELLIN FAMILY 1997 TRUST GROUP MEMBERS: ROBERT ELLIN PROFIT SHARING PLAN SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: FORWARD INDUSTRIES INC CENTRAL INDEX KEY: 0000038264 STANDARD INDUSTRIAL CLASSIFICATION: PLASTICS PRODUCTS, NEC [3089] IRS NUMBER: 131950672 STATE OF INCORPORATION: NY FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-40145 FILM NUMBER: 02609196 BUSINESS ADDRESS: STREET 1: 400 POST AVENUE CITY: WESTBURY STATE: NY ZIP: 11590 BUSINESS PHONE: 5163380700 MAIL ADDRESS: STREET 1: 400 POST AVENUE CITY: WESTBURY STATE: NY ZIP: 11590 FORMER COMPANY: FORMER CONFORMED NAME: PROGRESS HEAT SEALING CO INC DATE OF NAME CHANGE: 19721111 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: ELLIN ROBERT S CENTRAL INDEX KEY: 0001071292 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 750 LEXINGTON AVE CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 2127505858 MAIL ADDRESS: STREET 1: 750 LEXINGTON AVE CITY: NEW YORK STATE: NY ZIP: 10022 SC 13D/A 1 a2076574zsc13da.txt SCHEDULE 13D/A SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------- SCHEDULE 13D (RULE 13d-101) INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a) (AMENDMENT NO. 7)(1) Forward Industries, Inc. ----------------------------- (Name of Issuer) Common Stock, Par Value $0.01 Per Share --------------------------------------- (Title of Class of Securities) 34986210 ------------------- (CUSIP Number) Robert S. Ellin Joel M. Handel, Esq. Atlantis Equities, Inc. Brown Raysman Millstein Felder & Steiner LLP 750 Lexington Avenue 900 Third Avenue New York, New York New York, New York 10022 (212) 895-2000 - -------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) APRIL 11, 2002 ------------------------------------------------------- (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g) check the following box / / NOTE. Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7(b) for other parties to whom copies are to be sent. (Continued on following pages) (Page 1 of 13 Pages) - ---------- (1) The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, SEE the NOTES). CUSIP No. 34986210 13D Page 2 of 13 Pages - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS Robert S. Ellin - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) /X/ - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- NUMBER OF 7. SOLE VOTING POWER 2,500 shares SHARES ------------------------------------------------------------------ BENEFICIALLY 8. SHARED VOTING POWER 335,200 shares OWNED BY EACH ------------------------------------------------------------------ REPORTING 9. SOLE DISPOSITIVE POWER 2,500 shares PERSON WITH ------------------------------------------------------------------ 10. SHARED DISPOSITIVE POWER 335,200 shares - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 337,700 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 5.6% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- CUSIP No. 34986210 13D Page 3 of 13 Pages - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS Robert Ellin Family 1997 Trust - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) /X/ - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION New York - -------------------------------------------------------------------------------- NUMBER OF 7. SOLE VOTING POWER 37,500 shares SHARES ------------------------------------------------------------------ BENEFICIALLY 8. SHARED VOTING POWER 0 shares OWNED BY EACH ------------------------------------------------------------------ REPORTING 9. SOLE DISPOSITIVE POWER 37,500 shares PERSON WITH ------------------------------------------------------------------ 10. SHARED DISPOSITIVE POWER 0 shares - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 37,500 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0.6% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON OO - -------------------------------------------------------------------------------- CUSIP No. 34986210 13D Page 4 of 13 Pages - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS Atlantis Equities, Inc. - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) /X/ - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS WC - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION New York - -------------------------------------------------------------------------------- NUMBER OF 7. SOLE VOTING POWER 0 shares SHARES ------------------------------------------------------------------ BENEFICIALLY 8. SHARED VOTING POWER 210,500 shares OWNED BY EACH ------------------------------------------------------------------ REPORTING 9. SOLE DISPOSITIVE POWER 0 shares PERSON WITH ------------------------------------------------------------------ 10. SHARED DISPOSITIVE POWER 210,500 shares - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 210,500 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 3.5% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON CO - -------------------------------------------------------------------------------- CUSIP No. 34986210 13D Page 5 of 13 Pages - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS Robert Ellin Profit Sharing Plan - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) /X/ - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- NUMBER OF 7. SOLE VOTING POWER 0 shares SHARES ------------------------------------------------------------------ BENEFICIALLY 8. SHARED VOTING POWER 335,200 shares OWNED BY EACH ------------------------------------------------------------------ REPORTING 9. SOLE DISPOSITIVE POWER 0 shares PERSON WITH ------------------------------------------------------------------ 10. SHARED DISPOSITIVE POWER 335,200 shares - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 335,200 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 5.6% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON EP - -------------------------------------------------------------------------------- CUSIP No. 34986210 13D Page 6 of 13 Pages - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS Nancy J. Ellin - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) /X/ - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- NUMBER OF 7. SOLE VOTING POWER 110,000 shares SHARES ------------------------------------------------------------------ BENEFICIALLY 8. SHARED VOTING POWER 210,500 shares OWNED BY EACH ------------------------------------------------------------------ REPORTING 9. SOLE DISPOSITIVE POWER 110,000 shares PERSON WITH ------------------------------------------------------------------ 10. SHARED DISPOSITIVE POWER 210,500 shares - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 320,500 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 5.4% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- CUSIP No. 34986210 13D Page 7 of 13 Pages ITEM 1. SECURITY AND ISSUER. This Amendment No. 7 to Schedule 13D (this "Amendment"), amends the Schedule 13D filed in September 1998 (the "Schedule 13D"), as amended by Amendment No. 1 to Schedule 13D filed in October 1998, Amendment No. 2 to Schedule 13D filed in December 1998, Amendment No. 3 to Schedule 13D filed in May 1999, Amendment No. 4 to Schedule 13D filed in September 2000, Amendment No. 5 to Schedule 13D filed in August 2001 and Amendment No. 6 to Schedule 13D, filed in December 2001 by Robert S. Ellin, Robert Ellin Family 1997 Trust, Atlantis Equities, Inc., Robert Ellin Profit Sharing Plan and Nancy J. Ellin (collectively, the "Reporting Persons"). This Amendment relates to the common stock, par value $0.01 per share (the "Common Stock"), of Forward Industries, Inc., a New York corporation (the "Company"). The address of the principal executive offices of the Company is 1801 Green Road, E. Pompano Beach, Florida 33064. ITEM 2. IDENTITY AND BACKGROUND. The information in Item 2 is hereby amended and restated as follows: (a) The names of the Reporting Persons filing the Schedule 13D and this Amendment are Robert S. Ellin, Robert Ellin Profit Sharing Plan (the "Plan"), Atlantis Equities, Inc. ("Atlantis Equities"), Robert Ellin Family 1997 Trust (the "Trust") and Nancy J. Ellin. (b) The business address of each of the Reporting Persons except for the Trust is c/o Atlantis Equities, Inc., 750 Lexington Avenue, New York, New York 10022. The business address of the Trust is Marvin Ellin, Trustee, 106 Central Park South, New York, New York 10019. (c) Robert Ellin's present principal employment is serving as an employee of Atlantis Equities, a merchant banking firm. Nancy Ellin is the sole officer and director and the sole stockholder of Atlantis Equities, and her present principal occupation is serving as such. (d) None of the Reporting Persons nor Marvin Ellin has been convicted during the past five years in a criminal proceeding (excluding traffic violations or similar misdemeanors). (e) None of the Reporting Persons nor Marvin Ellin has been, during the last five years, a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and has not and is not subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. (f) Robert Ellin, Nancy Ellin and Marvin Ellin are each citizens of the United States. Atlantis Equities is a New York corporation. ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. The information previously reported in Item 3 is hereby amended by adding the following after the existing information: From November 27, 2001 to April 9, 2002, the Plan increased its holdings of Common Stock by 10,853 shares through a series of open market sale and purchase transactions. The source of funds used by the Plan to make such purchases was the contributions from its participants. From November 27, 2001 to April 9, 2002, Atlantis Equities decreased its holdings of Common Stock by 66,150 shares through a series of open market sale and purchase transactions. The source of funds used by Atlantis Equities to make such purchases was its working capital. CUSIP No. 34986210 13D Page 8 of 13 Pages ITEM 4. PURPOSE OF TRANSACTION. The information in Item 4 is hereby amended and restated as follows: Robert Ellin and the other Reporting Persons have determined that it would be in the best interests of the Company and the Reporting Persons and would enhance the opportunities of the Company if the Reporting Persons entered into a settlement of certain matters with the Company. On April 11, 2002, the Reporting Persons entered into a settlement agreement with the Company (the "Settlement Agreement") which provides, among other things, that: (i) two of the Company's current directors will resign; (ii) to fill the vacancies resulting from such resignations, the Company's board of directors (the "Board") will nominate and appoint Mr. Bruce Galloway and Mr.Jeff Kuhr, whom the Board intends to appoint as members of the compensation and audit committees, respectively, of the Board; and (iii) the Company reimburse Robert Ellin up to a maximum of $100,000 for his reasonable, out-of-pocket expenses for legal fees and disbursements actually incurred by him in connection with disagreements arising between him and the Company relating to its strategy and certain other matters during the 18 months preceding the date of the Settlement Agreement. In connection with the Settlement Agreement, on April 11, 2002, the Reporting Persons entered into a standstill agreement with the Company (the "Standstill Agreement") which provides, among other things, that for a period of 18 months the Reporting Persons may not, without the prior consent of the Company, engage in certain activities relating to the securities of the Company or make certain statements involving the Company, including but not limited to: acquiring any securities of the Company except under certain limited conditions, participating in any solicitation of proxies or consents or otherwise influencing any person with respect to the voting of any securities of the Company or initiating any shareholder proposals, subjecting any of the Company's voting securities to any arrangement or agreement with respect to the voting or beneficial ownership of any voting securities other than the Standstill Agreement, calling a meeting of stockholders, seeking to control the management, the Board or policies of the Company, or inducing a change of control of the Company or seeking representation on the Board or the removal of any director. In connection with the Standstill Agreement, each of the Company and the Reporting Persons executed a general release of claims and potential claims against the other (the "General Releases"). On April 11, 2002, the Company and Atlantis Equities entered into a letter agreement (the "Letter Agreement") which provides, among other things, for the non-exclusive engagement by the Company of Atlantis Equities to provide certain advisory services in consideration for the payment to Atlantis of up to ten percent of the of the aggregate amount of consideration actually paid by or to the Company in the event that Atlantis makes an introduction of a company that leads to consummation of a business combination involving the Company. The foregoing summary of the terms of the Settlement Agreement, the Standstill Agreement, the Letter Agreement and the General Releases does not purport to be complete and is qualified in its entirety by reference to the text of such agreements, each of which are attached as exhibits to this Amendment. Except as set forth in this Item 4, as of the date hereof the Reporting Persons have not formulated any plans or proposals that relate to or would result in: (a) the acquisition by any person of additional securities of the Company, or the disposition of securities of the Company; (b) an extraordinary corporate transaction; (c) a sale or transfer of a material amount of assets of the Company or any of its subsidiaries; (d) any change in the present board of directors or management of the Company; (e) any material change in the present capitalization or dividend policy of the Company; (f) any other material change in the Company's business or corporate structure; (g) changes in the Company's charter or bylaws or other actions that may impede the acquisition of control of the Company by any person; (h) causing a class of securities of the Company to be delisted from a national securities exchange or securities association; (i) causing a class of equity securities of the Company to become eligible for termination of registration pursuant to Section 12(g)(4) of the Securities Exchange Act of 1934, as amended; or (j) any action similar to those enumerated above. Subject to the terms of the Settlement Agreement and the Standstill Agreement, the Reporting Persons reserve the right in the future to acquire or dispose of their shares of Common Stock, to propose or pursue any of the foregoing transactions or matters or change their intentions with respect to the matters referred to herein. CUSIP No. 34986210 13D Page 9 of 13 Pages ITEM 5. INTEREST IN SECURITIES OF THE ISSUER. The information in Item 5 is hereby amended and restated as follows: (a) In a series of open market transactions effected between November 27 and April 9, 2002, the Plan increased its holdings of Common Stock by 10,853 shares. The Plan now holds an aggregate of 335,200 shares of Common Stock, representing approximately 5.6% of the issued and outstanding shares of Common Stock. In a series of open market transactions effected between November 27, 2001 and April 9, 2002, Atlantis Equities decreased its holdings of Common Stock by 66,150 shares. Atlantis Equities now holds an aggregate of 210,500 shares of Common Stock, representing 3.5% of the issued and outstanding Common Stock. (b) Robert Ellin has sole power to vote and dispose of the 2,500 shares of Common Stock owned by him. Robert Ellin shares the power to vote and dispose of the 335,200 shares of Common Stock owned by the Plan. Marvin Ellin has sole power to vote and dispose of the 37,500 shares of Common Stock owned by the Trust. Nancy Ellin has sole power to vote and dispose of the 110,000 shares of Common Stock owned by her. Nancy Ellin shares the power to vote and dispose of the 210,500 shares of Common Stock owned by Atlantis Equities. Robert Ellin disclaims beneficial ownership of the Common Stock owned by Nancy Ellin, Atlantis Equities and the Trust and this statement shall not be construed as an admission that he is, for the purposes of Section 13(d) or 13(g) of the Securities Exchange Act of 1934 or for any other purpose, the beneficial owner of such securities. Nancy Ellin disclaims beneficial ownership of the Common Stock owned by Robert Ellin, the Plan and the Trust and this statement shall not be construed as an admission that she is, for the purposes of Section 13(d) or 13(g) of the Securities Exchange Act of 1934 or for any other purpose, the beneficial owner of such securities. (c) During the 60 days preceding the filing of this Amendment, the Plan and Atlantis Equities effected the following transactions in the open market: ROBERT ELLIN PROFIT SHARING PLAN
NUMBER OF DATE SHARES PURCHASE/SALE PRICE PER SHARE 2/11/2002 100 Purchase $ 0.96 2/11/2002 100 Purchase 1.00 2/12/2002 100 Purchase 0.99 2/12/2002 100 Purchase 1.00 2/12/2002 100 Purchase 1.00 2/14/2002 100 Purchase 1.01 2/25/2002 100 Purchase 0.98 2/26/2002 100 Purchase 0.95 3/1/2002 100 Purchase 0.92 3/1/2002 100 Purchase 0.95 3/5/2002 100 Purchase 0.92 3/5/2002 100 Purchase 0.95 3/5/2002 400 Purchase 0.92 3/6/2002 100 Sale 0.96 3/6/2002 300 Purchase 1.00 3/8/2002 3,000 Sale 0.98 3/8/2002 2,847 Sale 0.98 3/8/2002 100 Purchase 0.87 3/8/2002 100 Purchase 1.00 3/8/2002 300 Purchase 0.97 3/8/2002 500 Purchase 1.02 3/12/2002 2,100 Sale 0.93 3/12/2002 1,500 Sale 0.96 3/12/2002 1,500 Sale 0.96 3/12/2002 1,000 Sale 0.96 3/12/2002 1,000 Sale 0.96 3/12/2002 500 Sale 0.96
CUSIP No. 34986210 13D Page 10 of 13 Pages
3/12/2002 100 Sale 0.95 3/12/2002 100 Sale 0.95 3/12/2002 100 Sale 0.98 3/12/2002 100 Sale 1.00 3/15/2002 3,000 Sale 0.92 3/15/2002 300 Sale 0.93 3/22/2002 1,200 Sale 0.92 3/22/2002 500 Sale 0.93 3/22/2002 100 Purchase 1.01 3/27/2002 100 Purchase 0.86 3/27/2002 100 Purchase 0.86 3/27/2002 100 Purchase 0.87 3/27/2002 100 Purchase 0.94 3/27/2002 100 Purchase 0.95 3/27/2002 1,000 Purchase 0.86 3/28/2002 100 Sale 0.90 4/2/2002 1,500 Sale 0.85 4/5/2002 2,700 Sale 0.90 4/8/2002 100 Sale 0.90 4/9/2002 900 Sale 0.85 4/9/2002 800 Sale 0.84 4/9/2002 100 Sale 0.84 4/9/2002 100 Sale 0.84 4/9/2002 100 Sale 0.85
ATLANTIS EQUITIES, INC.
NUMBER OF DATE SHARES PURCHASE/SALE PRICE PER SHARE 2/20/2002 100 Sale 0.98 2/22/2002 3,000 Sale 0.95 2/22/2002 2,200 Sale 0.95 2/22/2002 1,000 Sale 0.98 2/22/2002 800 Sale 0.95 2/25/2002 1,000 Sale 0.96 2/25/2002 1,000 Sale 0.96 2/25/2002 1,000 Sale 0.95 2/25/2002 100 Sale 0.96 2/26/2002 3,000 Sale 0.95 2/26/2002 800 Sale 0.99 2/28/2002 1,000 Sale 0.92 2/28/2002 800 Sale 0.95 2/28/2002 100 Sale 0.95 3/4/2002 100 Purchase 1.00 3/4/2002 100 Purchase 1.00 3/4/2002 100 Purchase 0.95 3/4/2002 200 Purchase 1.00 3/4/2002 200 Purchase 0.97 3/6/2002 3,000 Sale 0.96 3/6/2002 1,500 Sale 0.96 3/6/2002 100 Purchase 0.96 3/7/2002 3,000 Sale 0.93 3/7/2002 1,000 Sale 0.94 3/7/2002 885 Sale 0.93
CUSIP No. 34986210 13D Page 11 of 13 Pages 3/7/2002 500 Sell 0.93 3/7/2002 500 Sell 0.94 3/7/2002 500 Sell 0.96 3/7/2002 500 Sell 0.96 3/8/2002 2,465 Sell 0.98 3/8/2002 1,200 Purchase 1.02 3/12/2002 1,200 Sell 0.93 3/13/2002 3,000 Sell 1.00 3/13/2002 2,000 Sell 1.00 3/13/2002 100 Purchase 0.95 3/14/2002 1,500 Sell 0.95 3/14/2002 900 Sell 0.95 3/14/2002 600 Sell 0.95 3/14/2002 400 Sell 0.95 3/14/2002 400 Sell 0.98 3/14/2002 100 Sell 0.95 3/15/2002 1,700 Sell 0.93 3/15/2002 1,200 Sell 0.92 3/15/2002 1,000 Sell 0.93 3/21/2002 2,600 Sell 0.93 3/21/2002 1,000 Sell 0.93 3/22/2002 1,500 Sell 0.92 3/22/2002 100 Sell 0.92 3/25/2002 1,200 Sell 0.95 3/25/2002 500 Sell 0.95 3/26/2002 100 Sell 0.95 3/27/2002 3,000 Sell 0.90 3/28/2002 1,000 Sell 0.90 4/2/2002 1,800 Sell 0.85 4/2/2002 1,500 Sell 0.85 4/2/2002 1,500 Sell 0.85 4/2/2002 1,500 Sell 0.85 4/2/2002 1,500 Sell 0.85 4/3/2002 1,000 Sell 0.86 4/3/2002 500 Sell 0.87 4/3/2002 500 Sell 0.88 4/3/2002 500 Sell 0.89 4/3/2002 500 Sell 0.90 4/3/2002 500 Sell 0.91 4/4/2002 1,500 Sell 0.87 4/4/2002 500 Sell 0.86 4/4/2002 500 Sell 0.87 4/5/2002 1,000 Sell 0.89 4/9/2002 900 Sell 0.86 4/9/2002 100 Sell 0.86
(d) Not applicable. (e) Not applicable. CUSIP No. 34986210 13D Page 12 of 13 Pages ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER. The information in Item 6 is hereby amended and restated as follows: Except as set forth in Item 4 and the Exhibits to this Amendment, there are no contracts, arrangements, understandings or relationships between the Reporting Persons and any other person with respect to securities of the Company. ITEM 7. MATERIAL TO BE FILED AS EXHIBITS. * EXHIBIT 1. Joint Filing Agreement of the Reporting Persons pursuant to Rule 13d-1(k). EXHIBIT 2. Settlement Agreement, dated April 11, 2002, by and between Robert S. Ellin, Nancy J. Ellin, Atlantis Equities, Inc., Robert Ellin Family 1997 Trust, Robert Ellin Profit Sharing Plan and Forward Industries, Inc. EXHIBIT 3. Standstill Agreement, dated April 11, 2002, by and between Robert S. Ellin, Nancy J. Ellin, Atlantis Equities, Inc., Robert Ellin Family 1997 Trust, Robert Ellin Profit Sharing Plan and Forward Industries, Inc. EXHIBIT 4. Form of Letter Agreement, dated April 11, 2002, regarding the non-exclusive engagement by the Company of Atlantis Equities, Inc. for advisory services. EXHIBIT 5. General Release, dated April 11, 2002, of Robert S. Ellin, Nancy J. Ellin, Atlantis Equities, Inc., Robert Ellin Family 1997 Trust and Robert Ellin Profit Sharing Plan. EXHIBIT 6. General Release, dated April 11, 2002, of Forward Industries, Inc. - ---------- * Previously filed as Exhibit 1 to Amendment No. 2 to Schedule 13D of the Reporting Persons filed on December 30, 1998. CUSIP No. 34986210 13D Page 13 of 13 Pages SIGNATURES After reasonable inquiry and to the best of their knowledge and belief, the undersigned certify the information set forth in this Amendment is true, complete and correct. Dated: April 11, 2002 /s/ Robert S. Ellin -------------------------------- Robert S. Ellin ROBERT ELLIN FAMILY 1997 TRUST By: /s/ Marvin Ellin, Trustee ---------------------------- Marvin Ellin, Trustee ATLANTIS EQUITIES, INC. By: /s/ Nancy J. Ellin ---------------------------- Nancy J. Ellin, President ROBERT ELLIN PROFIT SHARING PLAN By: /s/ Robert S. Ellin, Trustee ---------------------------- Robert S. Ellin, Trustee /s/ Nancy J. Ellin ---------------------------- Nancy J. Ellin EX-2 3 a2076574zex-2.txt EXHIBIT 2 Exhibit 2 SETTLEMENT AGREEMENT Settlement Agreement, dated April 11, 2002 (this "Agreement"), by and between Robert S. Ellin, an individual residing at 350 East 79th Street, Apt. 38A, New York, NY 10021 ("Ellin"), Nancy J. Ellin, an individual residing at 350 East 79th Street, Apt. 38A, New York, NY 10021 ("Nancy Ellin"), Atlantis Equities, Inc., a New York corporation ("Atlantis"), Robert Ellin Family 1997 Trust, a trust formed under the laws of the State of New York (the "Trust"), Robert Ellin Profit Sharing Plan, an employee benefit plan formed under the laws of the United States (the "Plan", and together with Ellin, Nancy Ellin, Atlantis and the "Trust", the "Ellin Group"), and Forward Industries, Inc., a New York corporation (the "Company"). WHEREAS, members of the Ellin Group own of record and/or beneficially 695,700 shares of common stock, par value $0.01 per share, of the Company (the "Common Stock"); WHEREAS, members of the Ellin Group have from time to time stated their views with respect to certain corporate governance and other matters relating to the Company and its business and affairs; and WHEREAS, the Ellin Group and the Company desire to resolve all outstanding disagreements that have arisen between them and to set forth the resolution of such disagreements in this Settlement Agreement and the Standstill Agreement and Release annexed as exhibits hereto (this Settlement Agreement, collectively with such exhibits, the "Agreements"); NOW, THEREFORE, the parties hereto, in consideration of the premises hereinabove set forth, the mutual promises, conditions and undertakings set forth herein and other good and valuable consideration, intending to be legally bound hereby, do set forth their agreement as follows: 1. REPRESENTATIONS AND WARRANTIES. (a) Each individual member of the Ellin Group hereby represents and warrants that he or she (i) has the requisite power and legal capacity to enter into the Agreements; (ii) is subject to no condition, conflict, disability, limitation or other restriction with respect to the execution and delivery of the Agreements and discharge of his or her obligations relating thereto under the terms of any agreement, contract, arrangement or understanding, whether written or oral or the terms of any order, ruling, decision or decree of any court, administrative body or other governmental agency; (iii) together with the other members of the Ellin Group, accounts for 100% of the record and beneficial ownership of Common Stock (including securities convertible into and exercisable or exchangeable for Common Stock) owned by Ellin, his Affiliates, associates and all other persons with whom Ellin would constitute a group; (iv) has duly executed and delivered each Agreement, and each such Agreement constitutes his/her binding obligation enforceable in accordance with its respective terms; and (v) is subject to no requirement or obligation with respect to any authorization, approval or other action by, or any notice or application to, or any registration or filing with, any Federal, State or local governmental authority, agency, department or other regulatory body in connection with the due execution, delivery and performance of the Agreements pursuant to any applicable laws or any order, ruling, decision or decree of any court or administrative body, except for such filings as may be required pursuant to Section 13 under the Securities Exchange Act of 1934 (the "Exchange Act"); (b) each of Atlantis, the Plan and the Trust hereby represents and warrants that (i) it is duly organized under the laws of the jurisdiction of its organization and is validly subsisting as a corporation, Plan or trust, respectively, thereunder; (ii) it has the requisite power and authority to enter into the Agreements and perform its obligations hereunder and thereunder; (iii) together with the other members of the Ellin Group, accounts for 100% of the record and beneficial ownership of Common Stock (including securities convertible into and exercisable or exchangeable for Common Stock) owned by Ellin, his Affiliates, associates and all other persons with whom Ellin would constitute a group; (iv) the execution and delivery of the Agreements and the performance of its obligations hereunder and thereunder have been duly authorized by all necessary corporate or other applicable action and do not contravene the certificate of incorporation or bylaws, or other charter documents and instruments of such entity, as the case may be, and do not and will not violate the provisions of any agreement, indenture, contract, arrangement or understanding, whether written or oral, or the terms of any order, ruling, decision or decree of any court, administrative body or other governmental agency; to which such entity is a party or by which it may be bound, and the Agreements constitute its binding obligations enforceable in accordance with the respective terms thereof; and (v) no authorization, approval or other action by, no notice or application to, and no registration or filing with, any Federal, State or local governmental authority, agency, department or other regulatory body is required for the due execution, delivery and performance of this Agreement pursuant to any applicable laws or the order, ruling, decision or decree of any court or other administrative body, except for such filings as may be required pursuant to Section 13 under the Exchange Act; (c) the Company hereby represents and warrants that (i) it is corporation duly organized and validly subsisting under the laws of the State of New York; (ii) it has the requisite power and authority to enter into the Agreements and perform its obligations hereunder and thereunder; (iii) the execution and delivery of the Agreements and the performance of its obligations hereunder and thereunder have been duly authorized by all necessary corporate action, do not contravene its certificate of incorporation or bylaws and do not and will not violate the provisions of any agreement, indenture, contract, arrangement or understanding, whether written or oral, or the terms of any order, ruling, decision or decree of any court, administrative body or other governmental agency; to which the Company is a party or by which it may be bound and the several Agreements constitute its binding obligations enforceable in accordance with the respective terms thereof; and (iv) no authorization, approval or other action by, no notice or application to, and no registration or filing with, any Federal, State or local governmental authority, agency, department or other regulatory body is required for the due execution, delivery and performance of this Agreement pursuant to any applicable laws or the order, ruling, decision or decree of any court or other administrative body, except for such filings as may be required pursuant to Section 13 under the Exchange Act. (d) As used in this Agreement, the term "beneficial ownership" with respect to any securities has the meaning set forth in Rule 13d-3 under the Exchange Act; the terms "affiliates" and "associates" have the meanings as defined under the Exchange Act and the term "group" is used within the meaning of Section 13(d) of the Exchange Act and the rules promulgated thereunder. (e) The foregoing representations and warranties shall not terminate upon the execution and delivery of this Agreement but shall survive until such time as the Standstill Agreement referred to in Section 5 hereof is terminated in accordance with its terms. 2. APPOINTMENT OF DIRECTORS. Contemporaneously with the execution and delivery of this Agreement, (i) two members of the Company's Board of Directors (the "Board of Directors") will resign as members of the Board of Directors and (ii) the Board of Directors of the Company shall nominate and appoint Mr. Bruce Galloway and Mr. Jeff Kuhr to fill the vacancies on the Board of Directors resulting from such resignations, each to serve as a non-employee director on the Board of Directors. It is the intention of the Board of Directors to appoint each of Mr. Galloway and Mr. Kuhr as members of the compensation and audit committees, respectively, of the Board of Directors. 3. REIMBURSEMENT OF CERTAIN EXPENSES. The Company shall reimburse Ellin up to a maximum of $100,000 for his reasonable, out-of-pocket expenses for legal fees and disbursements actually incurred by Ellin in connection with the disagreements arising between Ellin and the Company, its officers or its directors during the 18 months next preceding the date of this Agreement (the "Claims"). All such legal fees and expenses to be reimbursed in respect of the Claims must be substantiated and documented in accordance with the Company's current payment policies. The Company shall effect such reimbursement by issuing its checks to Ellin's attorneys upon their delivery to the Company of appropriate documentation that substantiates the nature and expenditure of legal fees and expenses incurred in respect of the Claims. 4. ENGAGEMENT LETTER. Contemporaneously with the execution and delivery of this Agreement, Atlantis and the Company shall enter into an engagement letter, in substantially the form annexed hereto as Exhibit A, pursuant to which Atlantis will perform certain services for the Company, as set forth therein. 5. STANDSTILL AGREEMENT. Contemporaneously with the execution and delivery of this Agreement, the parties hereto shall execute and deliver the Standstill Agreement, of even date herewith, in substantially the form annexed hereto as Exhibit B. 6. EXCHANGE ACT FILINGS. Contemporaneously with the execution and delivery of this Agreement (but in any event not later than one business day thereafter), (i) the Ellin Group shall file an amended Schedule 13D with the Securities and Exchange Commission in accordance with applicable rules and regulations of the Exchange Act in order to reflect the terms and conditions of this Agreement, or, if required in the reasonable opinion of legal counsel to Ellin, file a new Statement on Schedule 13D, in either case in substantially the form annexed hereto as Exhibit C, and (ii) as the parties may agree, Ellin or the Company, may cause to be issued a press release that describes or summarizes the agreements and undertakings set forth herein. The language to be contained in the amended Schedule 13D, or the new Schedule 13D, as the case may be, and the press release, as the case may be, shall have been agreed upon in form and substance by Ellin and the Company prior to such filing and issuance, respectively. None of the Ellin Group or any member thereof shall thereafter during the Standstill Period (as such term is defined in the Standstill Agreement) file an amendment to said Schedule 13D, file a new Schedule 13D or issue any press release with respect to the subject matter hereof or of the Standstill Agreement unless and until the Company shall have agreed in form and substance to the contents thereof prior to such filing or release. 7. GENERAL RELEASES. (a) Contemporaneously with the execution and delivery of this Agreement, Ellin and each other member of the Ellin Group shall execute and deliver to the Company a general release (the "Ellin Releases") of all claims against, or relating to, the Company, its officers, directors, agents and attorneys and their respective affiliates, including without limitation the Claims, in substantially the form annexed hereto as Exhibit D-1. (b) Contemporaneously with the execution and delivery of this Agreement, the Company shall execute and deliver to each member of the Ellin Group a general release (the "Company Releases") of all claims against each member of the Ellin Group, and where applicable their respective officers, directors, trustees, agents and attorneys and their respective affiliates, including without limitation the Claims, in substantially the form annexed hereto as Exhibit D-2. 8. MISCELLANEOUS. (a) This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all other prior agreements and understandings, both written and oral, between the parties with respect to the subject matter hereof. (b) All costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such expenses. (c) This Agreement may not be amended, changed, supplemented, or otherwise modified or terminated, except upon the execution and delivery of a written agreement executed by each of the parties hereto. The parties may waive compliance by the other parties hereto with any representation, agreement or condition otherwise required to be complied with by such other party hereunder, but any such waiver shall be effective only if in writing executed by the waiving party. (d) All notices, requests, claims, demands and other communications hereunder shall be in writing and shall be given (and shall be deemed to have been duly received if given) by hand delivery of telecopy (with a confirmation copy sent for next day delivery via courier service, such as Federal Express), or by any courier service, such as Federal Express, providing proof of delivery. All communications hereunder shall be delivered to the respective parties at the following addresses: REST OF PAGE INTENTIONALLY LEFT BLANK If to Ellin: Mr. Robert S. Ellin 350 East 79th Street Apt. 38A New York, NY 10021 copy to: Brown Raysman Millstein Felder & Steiner 900 Third Avenue New York, NY 10022 Facsimile: (212) 702-5941 Attention: Joel M. Handel, Esq. If to Nancy Ellin: Mrs. Nancy J. Ellin 350 East 79th Street Apt. 38A New York, NY 10021 copy to: Brown Raysman Millstein Felder & Steiner 900 Third Avenue New York, NY 10022 Facsimile: (212) 702-5941 Attention: Joel M. Handel, Esq.] If to Atlantis Equities, Inc.: Atlantis Equities, Inc. Robert S. Ellin, President 750 Lexington Avenue 23rd Floor New York, NY 10022 Attention: Robert S. Ellin If to Robert Ellin Family 1997 Trust: Robert Ellin Family 1997 Trust Marvin Ellin, Trustee 106 Central Park South New York, NY 10019 If to Robert Ellin Profit Sharing Plan: c/o Robert Ellin, Trustee c/o Atlantis Equities, Inc. 750 Lexington Avenue New York, NY 10022 If to the Company: Forward Industries, Inc. 1801 Green Road Pompano Beach, FL 33064 copy to: Hogan & Hartson 551 Fifth Avenue New York, NY 10176 Facsimile: (212) 697-6686 Attention: Jeffrey W. Rubin, Esq. or too such other address as to the person to whom notice is given may have previously furnished to the others in writing in the manner set forth above. (e) Whenever possible, each provision or portion of any provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law but if any provision or potion of any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or portion of any provision in such jurisdiction, and this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision or portion of any provision had never been contained herein. (f) All rights, powers and remedies provided under this Agreement or otherwise available in respect hereof at law or in equity shall be cumulative and not alternative, and the exercise of any thereof by any party shall not preclude the simultaneous or later exercise of any other such right, power or remedy by such party. The failure of any party hereto to exercise any right, power or remedy provided under this Agreement or otherwise available in respect hereof at law or in equity, or to insist upon compliance by any other party hereto with its obligations hereunder, and any custom or practice of the parties at variance with the terms hereof, shall not constitute a waiver by such party of its right to exercise any such or other right, power or remedy or to demand such compliance. (g) This Agreement shall be governed and construed in accordance with the laws of the State of New York, without giving effect to the principles of conflicts of laws thereof. (h) Any suit, action or proceeding arising under or relating to this Agreement shall be brought in the Courts of the State of New York, and the parties hereto consent to the jurisdiction of any such courts, agree to service of process in any such suit, action or proceeding in any such court and agree that any such court and agree that any such court will be the proper and convenient forum for any such suit, action or proceeding. (i) The agreements, undertakings, obligations and covenants set forth herein or in any Exhibit hereto on the part of the members of the Ellin Group shall bind them jointly and severally. (j) The descriptive headings used herein are inserted for convenience of reference only and are not intended to be part of or to affect the meaning or interpretation of this Agreement. (k) This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all of which, taken together, shall constitute one and the same Agreement. REST OF PAGE INTENTIONALLY LEFT BLANK IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the day and year first above written. ROBERT S. ELLIN /s/ Robert S. Ellin -------------------------------- NANCY ELLIN /s/ Nancy Ellin -------------------------------- ATLANTIS EQUITIES, INC. /s/ Nancy Ellin -------------------------------- By: Name: Nancy Ellin Title: President ROBERT ELLIN FAMILY 1997 TRUST /s/ Marvin Ellin, Trustee -------------------------------- By: Name: Marvin Ellin Title: Trustee ROBERT ELLIN PROFIT SHARING PLAN /s/ Robert Ellin -------------------------------- By: Name: Robert Ellin Title: Trustee FORWARD INDUSTRIES, INC. /s/ Jerome E. Ball -------------------------------- By: Name: Jerome E. Ball Title: Chairman and CEO EX-3 4 a2076574zex-3.txt EXHIBIT 3 Exhibit 3 STANDSTILL AGREEMENT ("Agreement") entered into as of April 11, 2002 by and between Robert S. Ellin, an individual residing at 350 East 79th Street, Apt. 38A, New York, NY 10021 ("Ellin"), Nancy J. Ellin, an individual residing at 350 East 79th Street, Apt. 38A, New York, NY 10021 ("Nancy Ellin"), Atlantis Equities, Inc., a New York corporation ("Atlantis"), Robert Ellin Family 1997 Trust, a trust formed under the laws of the State of New York (the "Trust"), Robert Ellin Profit Sharing Plan, an employee benefit plan formed under the laws of the United States (the "Plan", and together with Ellin, Nancy Ellin, Atlantis and the "Trust", the "Ellin Group"), and Forward Industries, Inc., a New York corporation, with offices at 1801 Green Road, Pompano Beach, FL 33064 (the "Company"). RECITALS: WHEREAS, in connection with the transactions to be consummated by it under that certain Settlement Agreement of even date herewith between the Ellin Group and the Company (the "Settlement Agreement"), the Company and the members of the Ellin Group have agreed to enter into this Agreement; WHEREAS, the Existing Position (as defined herein) owned beneficially or of record by the Ellin Group constitutes 100% of the Company Voting Securities (as defined herein) owned beneficially or of record, individually or collectively, by the Ellin Group and their Affiliates, associates and other persons with whom such Persons could constitute a group with respect to the Company Voting Securities; NOW, THEREFORE, in consideration of the foregoing and the mutual premises, representations, warranties, covenants and agreements set forth herein, intending to be legally bound hereby, the parties hereto, agree as follows: AGREEMENT 1. CERTAIN DEFINITIONS. For purposes of this Agreement: (a) "Affiliate" shall mean, with respect to any specified Person, any Person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Person specified. In the case of Ellin, his Affiliates shall include without limitation the Robert Ellin Family 1997 Trust, the Trustee of said Trust, Atlantis Equities, Inc., a New York corporation having an address at 750 Lexington Avenue, New York, NY, and its officers and directors, the Robert Ellin Profit Sharing Plan, the administrator of said Plan, and Nancy J. Ellin. (b) "beneficially own" or "beneficial ownership" (or terms of similar import) with respect to any securities shall mean having "beneficial ownership" of such securities (as determined pursuant to Rule 13d-3 under the Exchange Act), including pursuant to any agreement, arrangement or understanding, whether or not in writing. Securities Beneficially Owned by a Person shall include securities Beneficially Owned by all Affiliates and "associates" (as defined under Exchange Act) of such Person and all other Persons with whom such Person would constitute a "group" within the meaning of Section 13(d) of the Exchange Act and the rules promulgated thereunder. (c) "Change of Control" shall mean the occurrence of any of the following: (i) any "person" or "group" (for the purposes of this definition, as such terms are used in Section 13(d) or 14(d)(2) under the Exchange Act) becomes the ultimate "beneficial owner" (as defined above in Section 1(b)) of 40% or more of the Company Voting Securities; or (ii) any "person" or "group" (other than existing executive officers and employee-directors of the Company and their Affiliates as of the date hereof), together with any Affiliates or Related Persons thereof, shall succeed in having a sufficient number of its nominees appointed to the Board of Directors of the Company such that the nominees, when added to any existing member remaining on the Board of Directors of the Company after such appointment who was a nominee of or is an Affiliate or Related Person of such "person" or "group", will constitute a majority of the board of Directors of the Company. (d) "Common Stock" shall mean the Company's Common Stock, par value $0.01 per share. (e) "Company Voting Securities" shall mean the Company's Common Stock and any other securities issued by the Company entitled, or which may be entitled, to vote (whether or not entitled to vote generally in the election of directors) and any securities convertible into or exercisable or exchangeable for such securities (whether or not subject to contingencies with respect to any matter or proposal submitted for the vote or consent of shareholders of the Company). (f) "Exchange Act" shall mean the Securities Exchange Act of 1934. (g) "Existing Position" shall mean the 695,700 shares of Common Stock owned beneficially or of record, individually or collectively, by Ellin, his immediate family members and his Affiliates, associates and other persons forming a group as of the date of this Agreement. (h) "Person" shall mean an individual, corporation, partnership, joint venture, association, trust, unincorporated organization or other entity. (i) "Related Person" shall mean, with respect to any Person, any other Person directly or indirectly owning 10% or more of the outstanding voting securities or combined voting power of such Person. (j) "Standstill Period" shall mean the period commencing on the date that this Agreement is executed by the parties hereto and ending on the date that is eighteen months (547 days) after such date of execution; provided, however, that if the Ellin Group or any member thereof, or their Affiliates, agents or representatives, is determined by a court of applicable jurisdiction to have breached this Agreement, the date on which the Standstill Period shall end shall be extended for a period of time equivalent to the period during which such one or more such Persons were in breach. 2. STANDSTILL AND RELATED PROVISIONS. (a) During the Standstill Period the Ellin Group, and each member thereof, agrees that without the prior written consent of the Board of Directors of the Company specifically expressed in a resolution adopted by a majority of the directors of the Company, the Ellin Group 2 will not, each member of the Ellin Group will not, and Ellin will cause each of his other Affiliates, agents and representatives not to, directly or indirectly, alone or in concert with others: (i) acquire or offer, propose or agree to acquire, directly or indirectly, whether by purchase, tender or exchange offer, through the acquisition of control of another Person or otherwise, any Company Voting Securities or other securities of the Company; (ii) make, or in any way participate, directly or indirectly, in any "solicitation" (as such term is used in the proxy rules of the Securities and Exchange Commission as in effect on the date hereof) of proxies or consents (whether or not relating to the election or removal of directors), advise, seek to advise, encourage or influence any Person with respect to the voting of any Company Voting Securities, initiate, propose or otherwise "solicit" (as such term is used in the proxy rules of the Securities and Exchange Commission as in effect on the date hereof) stockholders of the Company for the approval of shareholder proposals, whether made pursuant to Rule 14a-8 of the Exchange Act or otherwise, or induce or attempt to induce any other Person to initiate any such shareholder proposal or initiate any other action described in this Section 2(a)(ii); (iii) seek, propose, or make any statement with respect to, a merger, consolidation, business combination, tender or exchange offer, sale or purchase of assets, sale or purchase of securities, dissolution, liquidation, reorganization, recapitalization or similar transaction involving the Company, its subsidiaries or its business, whether or not any such transaction involves a Change of Control of the Company; (iv) form, join or in any way participate in a "group" (within the meaning of Section 13(d)(3) of the Exchange Act) with respect to Beneficial Ownership of any Company Voting Securities or otherwise involving a transaction described in Section 2(a)(iii) above; (v) deposit any Company Voting Securities in any voting trust or subject any Company Voting Securities to any arrangement or agreement with respect to the voting or beneficial ownership of any Company Voting Securities other than this Agreement; (vi) call or seek to have called any meeting of the stockholders of the Company or execute any written consent with respect to the Company or Company Voting Securities; (vii) otherwise act to control or seek to control or influence or seek to influence the management, Board of Directors or policies of the Company, or to induce a Change of Control of the Company; (viii)seek representation on the Board of Directors of the Company or seek the removal of any member of such Board; provided, however, that the appointment of Messrs. Galloway and Kuhr to the Board of Directors of the Company in accordance with the Settlement Agreement shall not constitute a violation of this provision; 3 (ix) make any proposal or publicly disclose any intention to make any proposal (whether or not subject to conditions) or enter into any discussion regarding any of the actions described in this Section 2(a); (x) take any action which might encourage, induce, persuade or force another Person to make a public announcement relating in any way to the Company, its subsidiaries or its business regarding any of the types of matters set forth in this subsection; or encourage, solicit, assist, institute, participate in, finance or support, or enter into any discussions, negotiations, understandings, agreements or arrangements with, any other Person, individual, entity or party with respect to any of the foregoing; (xi) make any proposal, statement or inquiry, or disclose any intention, plan or arrangement (whether written or oral) inconsistent with the foregoing, or make or disclose any request to amend, waive or terminate any provision of this Agreement; or (xii) have any discussions or communications, or enter into any arrangements, understandings, or agreements (whether written or oral) with, or advise, finance, assist or encourage, any other Person in connection with any of the foregoing, or make any investment in or enter into any arrangement with, any other Person that engages, or offers or proposes to engage, in any of the foregoing. (b) During the Standstill Period none of the Ellin Group or any member thereof shall, and Ellin shall cause his other Affiliates, agents and representatives not to, directly or indirectly, effect, cause, participate in, or seek, offer, attempt or propose (whether publicly or otherwise) to effect, cause, participate in, seek, offer, attempt or propose any of the activities described in Section 2(a) above. (c) Provided that none of the Ellin Group, its Affiliates, agents and representatives engages in any conduct otherwise prohibited by Section 2(a) above, (i) the record and/or beneficial ownership by the Ellin Group of the Existing Position (together with any Common Stock permitted to be purchased pursuant to Section 2(d) below), (ii) the fact that the Ellin Group may constitute a "group" within the meaning of Section 13(d) of the Exchange Act, (iii) their voting of the Common Stock represented by the Existing Position (together with any Common Stock permitted to be purchased pursuant to Section 2(d) below) and (iv) Ellin's private communications with the Nominee Directors (as defined in Section 2(e) hereof) for the purpose of conveying his views to them and to management generally with respect to governance and other matters affecting the business and affairs of the Company shall not be deemed to constitute a breach of Sections 2(a)(iv), (v) or (vii) of this Agreement, provided that such activities are not associated with any public statements of any kind relating thereto or other actions otherwise prohibited by this Agreement. (d) During the Standstill Period, provided that each and all of the members of the Ellin Group have at all times complied and are then in compliance with all provisions of this Agreement, and Ellin provides to the Company written certification containing a representation and warranty to that effect, then notwithstanding the provisions of Section 2(a)(i) above: (i) Ellin or another member of the Ellin Group may, by written request made not more frequently 4 than once each calendar quarter (a "Request"), upon the written approval of such Request by the Company's Board of Directors as evidenced by written authorization of an executive officer of the Company, purchase additional shares of Common Stock by transactions executed regular way on the Nasdaq Stock Market--Small Cap Market (the "Nasdaq Stock Market") only, such that after such purchase or purchases the aggregate beneficial ownership of Common Stock held by the Ellin Group in all capacities shall be not more than 15.0% of the shares of Common Stock outstanding (as of the date hereof, 873,846 shares), including the Company Voting Securities represented by the Existing Position. Any such purchases must be completed within 60 days of the approval of the Board of Directors, which may be given or withheld in its sole discretion. The Company shall notify Ellin of its decision to approve or reject a Request not later than fifteen calendar days after receipt thereof; and (ii) Without regard to the disposition of any Request under clause (d)(i) above, in the event that the Company receives written notification from the Nasdaq Stock Market that it intends to de-list, or to commence a de-listing proceeding with respect to, the Common Stock and the reason given for such de-listing or proceeding relates solely and exclusively to the prevailing trading prices of the Common Stock on the Nasdaq Stock Market, the Company shall promptly so advise Ellin in writing. Ellin, or other members of the Ellin Group, may, after the action or proposed action by the Nasdaq Stock Market has been made public, thereupon purchase shares of Common Stock by transactions executed regular way on the Nasdaq Stock Market only, in an amount not to exceed the amount of shares and percentage set forth in clause (i) of this Section 2(d), it being understood and agreed that such amount and percentage caps shall apply to all purchases, if any, made pursuant to clause (d)(i) and clause (d)(ii) in the aggregate; and (iii) Each purchase of Common Stock permitted pursuant to Section 2(d)(i) or (ii) above is subject to the following: (A) Each and all of the members of the Ellin Group must at all times be in compliance with all provisions of this Agreement and all applicable provisions of United States Federal and state securities laws, including without limitation Sections 10, 13(d), and 16 under the Exchange Act and the rules and regulations promulgated thereunder by the Securities and Exchange Commission, including without limitation Rule 10b-5 and Rules 13d-1-13d-5, inclusive, thereof, the rules of the Nasdaq Stock Market and the rules of the National Association of Securities Dealers; (B) the Ellin Group shall on a timely basis amend and file Schedule 13D with respect to the Company Voting Securities, as required, and in addition, not later than two business days after each such purchase, notify the Company in writing by facsimile transmission as to each such purchase, the amount thereof and the aggregate holdings of Common Stock held by each and every member of the Ellin Group after giving effect to such purchase; (C) any purchase permitted by this Section 2(d) shall in not in any respect whatsoever constitute a waiver or modification of any of the other terms of this Agreement or diminish the obligations of each and every member of the Ellin Group or otherwise expand their rights hereunder; and (D)(x) having approved the purchase of Common Stock under Section 2(d)(i), as the case may be, the Company may at any time thereafter instruct Ellin by written notice to stop such purchases, or (y) if the condition precedent to purchases permitted under Section 2(d)(ii) shall have been satisfied, the Company may at any time thereafter instruct Ellin by written notice to stop such purchases if the Company deems such action advisable in order to comply with applicable laws or if the Company has been advised by the Nasdaq Stock Market that proceedings to de-list the Common Stock have been terminated and the Common Stock shall not have been de-listed, and 5 in each case described under clause (x) or (y), as the case may be, each and all members of the Ellin Group shall thereupon refrain from further purchases, unless and until again permitted to do so under the foregoing provisions. (e) It is contemplated under the Settlement Agreement that Messrs. Bruce Galloway and Jeff Kuhr (collectively, the "Nominee Directors") will be appointed to the Company's Board of Directors in accordance with the terms thereof. Notwithstanding Section 1(j) above, if during the Standstill Period (i) each of Messrs. Galloway and Kuhr (x) is ready, willing and able to stand for nomination and election to the Company's Board of Directors and (y) has not been determined to be ineligible for such nomination or election in accordance with the Company's policies, certificate of incorporation and by-laws and applicable laws, and the Company refuses or fails to nominate either such person for election as a director to the Board of Directors at the same time that other candidates for election are so nominated, or (ii) either or both of Messrs. Galloway and Kuhr are removed from office without cause, then in either case the Standstill Period shall thereupon immediately terminate. Termination of the Standstill Period prior to the term specified in Section 1(j) pursuant to this Section 2(e) shall not apply in the case of a failure or refusal of either or both of Messrs. Galloway or Kuhr to stand for nomination or election, the resignation of either or both of them, the removal from office for cause or the inability of either or both to stand for election or serve as a director as a result of disability or death. 3. LITIGATION. (a) During the Standstill Period, the Ellin Group shall not, each member thereof shall not, and Ellin shall cause his Affiliates, agents and representatives not to, file (or encourage, participate in, finance or support the filing or maintenance of) any suit or other proceeding in any court against the Company or any of its directors, officers, employees or agents, or any of their respective Affiliates, except a suit to enforce this Agreement, the Settlement Agreement (and any exhibits thereto) or any subsequent agreement entered into by the parties during the Standstill Period. (b) During the Standstill Period, the Company shall not file (or encourage, participate in, finance or support the filing or maintenance of) any suit in any court against any of the Ellin Group, Ellin, his Affiliates, agents and representatives except a suit to enforce this Agreement, the Settlement Agreement (and any exhibits thereto) or any subsequent agreement entered into by the parties during the Standstill Period. 4. CONFIDENTIALITY. (a) Each member of the Ellin Group acknowledges and agrees that one or more of Ellin and other members of the Ellin Group may have access to certain confidential and/or proprietary information of the Company and its subsidiaries and affiliates and that such information constitutes valuable, special and unique property of the Company (the "Confidential Information"). Each member of the Ellin Group further agrees that, during the Standstill Period and thereafter, it shall keep confidential and will not, directly or indirectly, in any manner or capacity, disclose any Confidential Information to any other Person, firm, corporation, association or other entity for any reason or purpose whatsoever and shall only disclose the same to Ellin's attorneys, accountants and financial advisors on a need-to-know basis, and will not, 6 directly or indirectly, utilize or exploit such information. Ellin shall cause his Affiliates, agents and representatives to comply with the terms of this Section 4(a).] (b) In addition, during the Standstill Period, the Company and the Ellin Group will keep confidential and will not, directly or indirectly, in any capacity or manner except as and to the extent required by law (including any disclosure requirements under Section 13(d) of the Exchange Act) or necessary to accomplish the undertakings set forth in this Agreement, disclose the existence of this Agreement or any subsequent agreement entered into by the parties during the Standstill Period, the terms and conditions of this Agreement or any such agreement and the transactions contemplated herein or therein, nor information regarding the discussions and negotiations related thereto, and shall only disclose the same to such of Ellin's attorneys, accountants and financial advisors on a need-to-know basis and to such other persons as are necessary to accomplish the undertakings set forth in this Agreement. Ellin shall cause his Affiliates, agents and representatives to comply with the terms of this Section 4(b). (c) Subject to compliance with the terms of this Agreement, contemporaneously with the execution and delivery of this Agreement (but in any event not later than one business day thereafter), Ellin and the Ellin Group shall file with the Securities and Exchange Commission one or more amendments to the Statement on Schedule 13D previously filed by them for the purpose of attaching a copy of this Agreement as an exhibit thereto or, if required in the reasonable opinion of legal counsel to them, file a new Statement on Schedule 13D. In order to facilitate any such filings, the Company shall provide Ellin with an electronic copy of this Agreement on or before the execution and delivery thereof by e-mail or diskette in Microsoft Word format. In addition, Ellin and the Ellin Group may in their discretion agree to cause to be issued a press release that describes or summarizes the agreements and undertakings set forth herein. The language to be contained in the amended Schedule 13D, or the new Schedule 13D, as the case may be, and the press release, as the case may be, shall have been agreed upon in form and substance by Ellin and the Company prior to such filing and issuance, respectively. None of the Ellin Group or any member thereof shall thereafter during the Standstill Period file an amendment to said Schedule 13D, file a new Schedule 13D or issue any press release with respect to the subject matter hereof unless the Company shall have agreed in form and substance to the contents thereof prior to such filing or release. (d) In the event that any member of the Ellin Group or any Person to whom any of the foregoing transmits Confidential Information pursuant to this Agreement is requested or becomes legally compelled (by oral questions, interrogatories, request for information or documents, subpoena, civil investigative demand or similar process) to disclose any of the Confidential Information, Ellin shall, and he shall cause his Affiliates, agents and representatives to, provide the Company with prompt written notice so that the Company may seek a protective order or other appropriate remedy and/or waive compliance with the provisions of this Agreement. In the event that a protective order or other remedy is not obtained or the provisions of this Agreement are not waived, such person will furnish only that portion of the Confidential Information which is legally required and will exercise his or her reasonable efforts to obtain reliable assurance that confidential treatment will be accorded any Confidential Information so disclosed. 5. NO DEROGATORY REMARKS. 7 (a) Each member of the Ellin Group hereby agrees that it will not, and each shall cause its Affiliates, agents and representatives to agree not to, during the Standstill Period, directly or indirectly, in any capacity or manner, make, express, transmit, speak, write, verbalize or otherwise communicate in any way (or cause, further, assist, solicit, encourage, support or participate in any of the foregoing), any remark, comment, message, information, declaration, communication or other statement of any kind, whether verbal, in writing, electronically transferred or otherwise, that might reasonably be construed to be derogatory or critical of, or negative toward, the Company or any of its directors, officers, affiliates, subsidiaries, employees, agents or representatives (collectively, the "Company's Representatives"), or to malign, harm, disparage, defame or damage the reputation or good name of the Company, its business or any of the Company's Representatives, and/or that reveals, discloses, incorporates, is based upon, discusses, includes or otherwise involves any Confidential Information. (b) the Company hereby agrees that, during the Standstill Period, the Company will not, directly or indirectly, in any capacity or manner, make, express, transmit, speak, write, verbalize or otherwise communicate in any way (or cause, further, assist, solicit, encourage, support or participate in any of the foregoing), any remark, comment, message, information, declaration, communication or other statement of any kind, whether verbal, in writing, electronically transferred or otherwise, that might reasonably be construed to be derogatory or critical of, or negative toward, any of Ellin or any other member of the Ellin Group, or to malign, harm, disparage, defame or damage the reputation or good name of Ellin or any member of the Ellin Group (or their businesses, as applicable), agents or representatives. 6. REMEDIES. The Company and each member of the Ellin Group acknowledge and agree that the covenants and agreements set forth in this Agreement are an essential inducement for the Company and the Ellin Group to have entered into this Agreement, and the restrictions imposed herein are not greater than are fair and reasonable and necessary for the protection of the Company and the Ellin Group in light of the substantial harm that the Company and the Ellin Group will suffer in the event of a breach of any of the provisions of said covenants or agreements. The Company and each member of the Ellin Group further acknowledge and agree that the parties would not have an adequate remedy at law and would be irreparably harmed in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that, in the event of an actual or threatened breach of this Agreement by the Company, the Ellin Group or any member thereof (or any of their Affiliates, agents or representatives), each party hereto shall be entitled to injunctive or other equitable remedy or relief to enjoin, restrain, prohibit and/or prevent breaches or violations of this Agreement and to specifically enforce the terms and provisions hereof (including, without limitation, requiring each and every member of the Ellin Group and any nominee, broker or other Person acting on their behalf, to dispose of shares of Common Stock in order to be in compliance with the terms of this Agreement), in addition to any other remedy at law or in equity to which such party may be entitled. Each of the Company and the members of the Ellin Group hereby waives, and the Company agrees to cause the Company's Representatives to waive, and Ellin agrees to cause Ellin's Affiliates, agents and representatives, as the case may be, to waive, any requirement for the securing or posting of any bond or the proving of actual damages in connection with such remedy or relief. 7. MISCELLANEOUS. 8 (a) NOTICES. All notices, consents, waivers and other communications under this Agreement must be in writing and will be deemed to have been duly given if delivered by hand, by overnight delivery, or by United States mail, postage prepaid, registered or certified mail, return receipt requested, upon delivery or refusal of delivery, in each case to the appropriate addresses set forth below (or to such other addresses as a party may designate by notice to the other party hereto): If to Ellin: Mr. Robert S. Ellin 350 East 79th Street Apt. 38A New York, NY 10021 copy to: Brown Raysman Millstein Felder & Steiner 900 Third Avenue New York, NY 10022 Facsimile: (212) 702-5941 Attention: Joel M. Handel, Esq. If to Nancy Ellin: Mrs. Nancy J. Ellin 350 East 79th Street Apt. 38A New York, NY 10021 copy to: Brown Raysman Millstein Felder & Steiner 900 Third Avenue New York, NY 10022 Facsimile: (212) 702-5941 Attention: Joel M. Handel, Esq.] If to Atlantis Equities, Inc.: 9 Atlantis Equities, Inc. Robert S. Ellin, President 750 Lexington Avenue 23rd Floor New York, NY 10022 Attention: Robert S. Ellin If to Robert Ellin Family 1997 Trust: Robert Ellin Family 1997 Trust Marvin Ellin, Trustee 106 Central Park South New York, NY 10019 If to Robert Ellin Profit Sharing Plan: c/o Robert Ellin, Trustee c/o Atlantis Equities, Inc. 750 Lexington Avenue New York, NY 10022 If to the Company: Forward Industries, Inc. 1801 Green Road Pompano Beach, FL 33064 copy to: Hogan & Hartson 551 Fifth Avenue New York, NY 10176 Facsimile: (212) 697-6686 Attention: Jeffrey W. Rubin, Esq. or too such other address as to the person to whom notice is given may have previously furnished to the others in writing in the manner set forth above. (b) ENTIRE AGREEMENT. This Agreement constitutes the entire agreement, and supersedes any prior agreements and understandings (oral or written), between the parties hereto relating to the subject matter of this Agreement. To be effective, any modification, amendment or supplement of this Agreement must be in writing and signed by the party to be charged thereby. (c) CHOICE OF LAW. The validity and construction of this Agreement shall be governed by the laws of the State of New York, without regard to the principles of conflict of laws thereof. (d) HEADINGS. The Section headings herein are for reference only and shall not limit or control the meaning of any provision of this Agreement. 10 (e) NO WAIVER. No delay or omission on the part of any party hereto in exercising any right hereunder shall operate as a waiver of such right or any other right under this Agreement. (f) ASSIGNMENT. No party hereto shall assign this Agreement, or any rights, benefits, duties or obligations hereunder, or any interest therein, without first obtaining the written consent of the other party hereto. Without waiver of the foregoing provisions, all of the rights, benefits, duties, liabilities, and obligations of the parties hereto shall inure to the benefit of and be binding upon the parties and their respective heirs, successors and permitted assigns. (g) INTERPRETATION. The parties hereto have each negotiated the terms hereof and reviewed this Agreement carefully. It is the intent of the parties that each word, phrase, and sentence and other part hereof shall be given its plain meaning, and that rules of interpretation or construction of contracts that would construe any ambiguity of any part hereof against the draftsman, by virtue of being the draftsman, shall not apply. Whenever the words "include", "includes" or "including" are used in this Agreement, they shall be deemed to be followed by the words "without limitation." The words "hereof", "herein" and "hereunder" and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement. All terms defined in this Agreement shall have the defined meanings when used in any certificate or other document made or delivered pursuant hereto unless otherwise defined therein. The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such term. Unless the context otherwise indicates, any agreement, instrument or statute defined or referred to herein or in any agreement or instrument that is referred to herein means such agreement, instrument or statute as from time to time amended, modified or supplemented, including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes and references to all attachments thereto and instruments incorporated therein. References to a person are also to its heirs, successors and permitted assigns. (h) COUNTERPARTS. This Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall comprise one and the same document. Delivery of an executed counterpart of this Agreement by facsimile shall be equally as effective as delivery of a manually executed counterpart of this Agreement. (i) ATTORNEYS' FEES. If legal action is commenced to enforce this Agreement, the prevailing party in such action shall be entitled to recover its reasonable costs and reasonable attorneys' fees and expenses in addition to any other relief granted. The term "prevailing party" shall mean the party in whose favor final judgment after appeal (if any) is rendered with respect to the claims asserted in a complaint. (j) The agreements, undertakings, obligations and covenants set forth herein or in any Exhibit hereto on the part of the members of the Ellin Group shall be bind them jointly and severally. (k) SEVERABILITY. If any provision of this Agreement shall be held invalid under any applicable laws, such invalidity shall not affect any other provision of this Agreement that can be given effect without the invalid provision, and, to this end, the provisions hereof are severable. 11 (l) EXPENSES. All costs and expenses incurred in connection herewith shall be borne by the respective parties incurring such expense, whether or not such transactions are consummated. (m) NO THIRD PARTY BENEFICIARIES. Except as expressly provided herein, this Agreement and its provisions, terms and conditions are for the sole and exclusive benefit of the parties to this Agreement and their heirs, successors and permitted assigns. 12 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the day and year first above written. ROBERT S. ELLIN /s/ Robert S. Ellin -------------------------------- NANCY ELLIN /s/ Nancy Ellin -------------------------------- ATLANTIS EQUITIES, INC. /s/ Nancy Ellin -------------------------------- By: Name: Nancy Ellin Title: President ROBERT ELLIN FAMILY 1997 TRUST /s/ Marvin Ellin, Trustee -------------------------------- By: Name: Marvin Ellin Title: Trustee ROBERT ELLIN PROFIT SHARING PLAN /s/ Robert Ellin -------------------------------- By: Name: Robert Ellin Title: Trustee FORWARD INDUSTRIES, INC. /s/ Jerome E. Ball -------------------------------- By: Name: Jerome E. Ball Title: Chairman and CEO 13 EX-4 5 a2076574zex-4.txt EXHIBIT 4 Exhibit 4 ATLANTIS EQUITIES, INC. 750 LEXINGTON AVENUE, 23RD FLOOR NEW YORK, NEW YORK 10022 TEL: (212) 755-8612 FAX: (212) 750-6667 April 11, 2002 Mr. Jerome Ball Chairman and Chief Executive Officer Forward Industries, Inc. 1801 Green Road Suite E Pompano Beach, FL 33064 Dear Jerry: As discussed, the purpose of this letter is to confirm our understanding with respect to the introduction by Atlantis Equities, Inc., a New York corporation ("Atlantis"), to Forward Industries, Inc., a New York corporation (the "Company"), of a company called for purposes of this letter XYZ Corp. ("XYZ") for the purpose of the Company's consideration of a proposed financial transaction, which may be in the form of an acquisition or business combination involving XYZ (the "Transaction"). XYZ has authorized Atlantis to make such introduction for the purposes stated herein. 1. a. As compensation for making such introduction, the Company hereby agrees to pay Atlantis a fee (the "Fee") upon the consummation, if any, of the Transaction between the Company and XYZ (which, for the purposes of a Transaction relating to which Atlantis shall be entitled to the Fee hereunder, shall be deemed to include any company or companies controlled by, under common control with or in control of XYZ (collectively, an "XYZ Affiliate")). The amount of the Fee shall be 10% of the aggregate consideration paid by the Company (if it is the acquirer or survivor of a merger or other business combination) or by XYZ or an XYZ Affiliate (if it is the acquirer or survivor of a merger or other business combination) in connection with the Transaction. "Aggregate consideration" includes without limitation cash, stock, assumption of debt, earnout payments and other types consideration, without duplication, as and when paid in connection with the Transaction. b. Although Atlantis will, if requested by the Company, use reasonable efforts to assist and advise the Company in connection with the Transaction, the Fee that is payable to Atlantis pursuant to this paragraph 1 is solely as a result of (i) having made the foregoing introduction and (ii) the consummation of a Transaction within 24 months from the date hereof and is in no way dependent upon any such advisory efforts by Atlantis. The Fee that is payable to Atlantis pursuant to this paragraph 1 shall be paid by the Company to Atlantis in cash by Company check at the closing of the Transaction (with respect to the amount of consideration being transferred at such time) and thereafter as and when additional consideration, if any, is paid or payable. 2. The Company shall have no obligation to enter into any Transaction and shall have the right in its sole discretion to reject any Transaction or to terminate negotiations with respect thereto or this letter agreement at any time, it being understood and agreed that neither XYZ (or any XYZ Affiliate, as applicable) nor the Company shall incur any obligation hereunder (except pursuant to paragraph 3 hereof) unless and until their respective boards of directors (and shareholders, if applicable) determine to approve a Transaction in accordance with their certificates of incorporation and by-laws (or other charter documents) and applicable laws and a Transaction is consummated pursuant to definitive agreements in customary form. 3. Each of Atlantis and its affiliates and the Company agrees that: (i) if either has or comes into possession of material non-public information with respect to the other or XYZ, it shall at all times maintain the strict confidentiality thereof except as may be required to be disclosed pursuant to applicable laws; (ii) the Company and XYZ may enter into a confidentiality agreement in connection with a possible Transaction and information to be exchanged relating thereto; (iii) it shall otherwise comply with all applicable laws and agreements to which each is now or may hereafter be a party in connection with the Transaction or other matters involving them; and (iv) except as may be required by applicable laws, it shall not make or issue, or cause or permit to be made or issued, any disclosure or announcement of any kind in any medium, directly or indirectly, alone or in concert with others, concerning this letter or the subject matter hereof. The undertakings contained herein shall survive any termination of this letter unless and until superseded pursuant to any definitive agreement executed in connection with a Transaction. If the foregoing correctly sets forth the understanding and agreement between Atlantis and the Company, please so indicate by signing the enclosed copy of this letter, which may be executed in counterparts, whereupon it shall become a binding agreement between the parties hereto in accordance with the laws of the State of New York as of the date first above written. This Agreement constitutes the entire agreement, and supersedes any prior agreements and understandings (oral or written), between the parties hereto relating to the subject matter of this Agreement. To be effective, any modification, amendment or supplement of this Agreement must be in writing and signed by the party to be charged thereby. Very truly yours, ATLANTIS EQUITIES, INC. By:______________________ Name: Title: Accepted and agreed to as of the date first written above: FORWARD INDUSTRIES, INC. By:________________________ Name: Jerome Ball Title: Chief Executive Officer EX-5 6 a2076574zex-5.txt EXHIBIT 5 Exhibit 5 GENERAL RELEASE TO ALL WHOM THESE PRESENTS SHALL COME OR MAY CONCERN, KNOW THAT ROBERT S. ELLIN, NANCY ELLIN, ATLANTIS EQUITIES, INC., ROBERT ELLIN FAMILY 1997 TRUST, ROBERT ELLIN PROFIT SHARING PLAN, collectively the RELEASOR in consideration of the sum of $10.00 and other good and valuable consideration received from FORWARD INDUSTRIES, INC. as RELEASEE, receipt whereof is hereby acknowledged, releases and discharges RELEASEE, its successors, affiliates and assigns, the RELEASEE'S officers, directors, employees and their respective affiliates, successors and assigns (all of the foregoing, collectively, the "RELEASEES") from all actions, causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, specialties, covenants, contracts, controversies, agreements, promises, variances, trespasses, damages, judgments, extents, executions, claims, and demands whatsoever, in law, admiralty or equity, including without limitation claims and demands referred to in RELEASOR'S filings on Schedule 13D or relating to compensation policy, loans and contracts with vendors, which, against the RELEASEES, the RELEASOR, RELEASOR'S heirs, executors, administrators, trustees, successors and assigns ever had, now have or hereafter can, shall or may, have for, upon, or by reasons of any matter, cause or thing whatsoever from the beginning of the world to the date of the date of this RELEASE, except that RELEASOR expressly acknowledges and agrees that this RELEASE shall not apply to RELEASEE'S agreements, obligations, covenants, undertakings, representations and warranties contained in that certain (a) Settlement Agreement, dated April 11, 2002, between Robert S. Ellin, an individual residing at 350 East 79th Street, New York, NY 10021 ("Ellin"), Nancy J. Ellin, an individual residing at 350 East 79th Street, New York, NY 10021 ("Nancy Ellin"), Atlantis Equities, Inc., a New York corporation ("Atlantis"), Robert Ellin Family 1997 Trust, a trust formed under the laws of the United States of America (the "Trust"), Robert Ellin Profit Sharing Plan, a Plan formed under the laws of the United States of America (the "Plan", and together with Ellin, Nancy Ellin, Atlantis and the "Trust", the "Ellin Group") and Forward Industries, Inc., (b) Standstill Agreement, dated April 11, 2002, between Ellin, Nancy Ellin, Atlantis, the Trust and the Plan and Forward Industries, Inc., or (c) Letter Agreement, dated April 11, 2002, between Atlantis Equities, Inc. and Forward Industries, Inc., the agreements, terms and conditions of each of which (x) are hereby ratified and reaffirmed and (y) shall survive the execution and delivery of this RELEASE and which constitute in sum and substance the consideration for which this RELEASE is given. Page 1 of 2 This RELEASE may not be changed orally. IN WITNESS WHEREOF, the RELEASOR has caused this RELEASE to be executed on April 11, 2002. /s/ Robert S. Ellin ---------------------------------- Robert S. Ellin /s/ Nancy Ellin ---------------------------------- Nancy Ellin Atlantis Equities, Inc. By: /s/ Robert Ellin ------------------------------- Name: Robert Ellin Title: Managing Director Robert Ellin Family 1997 Trust By: /s/ Marvin Ellin ------------------------------- Name: Marvin Ellin Title: Trustee Robert Ellin Profit Sharing Plan By: /s/ Robert Ellin ------------------------------- Name: Robert Ellin Title: Trustee Page 2 of 2 EX-6 7 a2076574zex-6.txt EXHIBIT 6 Exhibit 6 GENERAL RELEASE TO ALL WHOM THESE PRESENTS SHALL COME OR MAY CONCERN, KNOW THAT FORWARD INDUSTRIES, INC., a New York corporation, as RELEASOR, in consideration of the sum of $10.00 and other good and valuable consideration received from ROBERT S. ELLIN, NANCY ELLIN, ATLANTIS EQUITIES, INC., ROBERT ELLIN FAMILY 1997 TRUST, ROBERT ELLIN PROFIT SHARING PLAN, as RELEASEE, receipt whereof is hereby acknowledged, releases and discharges RELEASEE, RELEASEE'S, successors, affiliates and assigns, officers, directors, employees and their respective affiliates, successors and assigns (all of the foregoing, collectively, the "RELEASEES") from all actions, causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, specialties, covenants, contracts, controversies, agreements, promises, variances, trespasses, damages, judgments, extents, executions, claims, and demands whatsoever, in law, admiralty or equity, which, against the RELEASEES, the RELEASOR, RELEASOR'S successors and assigns ever had, now have or hereafter can, shall or may, have for, upon, or by reasons of any matter, cause or thing whatsoever from the beginning of the world to the date of the date of this RELEASE, except that RELEASOR expressly acknowledges and agrees that this RELEASE shall not apply to RELEASEE'S agreements, obligations, covenants, undertakings, representations and warranties contained in that certain (a) Settlement Agreement, dated April 11, 2002, between Robert S. Ellin, an individual residing at 350 East 79th Street, New York, NY 10021 ("Ellin"), Nancy J. Ellin, an individual residing at 350 East 79th Street, New York, NY 10021 ("Nancy Ellin"), Atlantis Equities, Inc., a New York corporation ("Atlantis"), Robert Ellin Family 1997 Trust, a trust formed under the laws of the State of New York (the "Trust"), Robert Ellin Profit Sharing Plan, a Plan formed under the laws of the United States of America (the "Plan", and together with Ellin, Nancy Ellin, Atlantis and the "Trust", the "Ellin Group") and Forward Industries, Inc., (b) Standstill Agreement, dated April 11, 2002, between Ellin, Nancy Ellin, Atlantis, the Trust and the Plan and Forward Industries, Inc., or (c) Letter Agreement, dated April 11, 2002, between Atlantis Equities, Inc. and Forward Industries, Inc., the agreements, terms and conditions of each of which (x) are hereby ratified and reaffirmed and (y) shall survive the execution and delivery of this RELEASE and which constitute in sum and substance the consideration for which this RELEASE is given. Page 1 of 2 This RELEASE may not be changed orally. IN WITNESS WHEREOF, the RELEASOR has caused this RELEASE to be executed on April 11, 2002. FORWARD INDUSTRIES, INC. By: /s/ Jerome E. Ball --------------------------------- Name: Jerome E. Ball Title: Chairman and CEO Page 2 of 2 -----END PRIVACY-ENHANCED MESSAGE-----