Form 8-K - Current report

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

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FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported):  November 12, 2024

FORIAN INC.

(Exact Name of Registrant as Specified in Charter)

Delaware	001-40146	85-3467693
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

41 University Drive, Suite 400, Newtown, PA		18940
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code:  [phone]

 (Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.001 par value	FORA	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).     ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.    ☐

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Item 1.01

Entry into a Material Definitive Agreement

On each of November 12, 2024, and November 13, 2024, Forian Inc. (the “Company”) entered into a Convertible Promissory Note Redemption Agreement (the “Note Redemption Agreement”) with certain holders of the Company’s 3.5% Convertible Promissory Notes due 2025 (the “Notes”), pursuant to which the Company redeemed $16,000,000 in aggregate principal amount of outstanding Notes and $1,791,041 of accrued interest thereon for an aggregate redemption price of $17,648,408. After giving effect to these redemptions, $6,000,0000 in principal amount of the Notes remains outstanding, which are held by Pamela Wygod, the spouse of Martin J. Wygod, who served as a Class I director of the Company until his death on April 11, 2024.

The Note Redemption Agreement contains customary representations, warranties and covenants and releases. The foregoing description of the Note Redemption Agreement is qualified in its entirety by reference to the text thereof. The form of Note Redemption Agreement is attached as Exhibit 10.1 hereto and incorporated herein by reference.

 

Item 2.02

Results of Operations and Financial Condition

On November 13, 2024, the Company issued a press release announcing its financial results for the quarter ended September 30, 2024. A copy of the press release is furnished herewith as Exhibit 99.1.

The information furnished under Item 2.02 in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, and shall not be incorporated by reference in any filing under the Securities Act of 1933, as amended, except as expressly set forth by specific reference in such a filing.

 

Item 9.01

Financial Statements and Exhibits

(d)

Exhibits.

The Company hereby files or furnishes, as applicable, the following exhibits:

Exhibit No.		Description
10.1		Form of Convertible Promissory Note Redemption Agreement
99.1		Press Release, dated November 13, 2024 (furnished herewith)
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	FORIAN INC.
Dated: November 13, 2024	By:	/s/ Edward Spaniel, Jr.
	Name:	Edward Spaniel, Jr.
	Title:	Executive Vice President, General Counsel and Secretary

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Exhibit 10.1

CONVERTIBLE PROMISSORY NOTE REDEMPTION AGREEMENT

This CONVERTIBLE PROMISSORY NOTE REDEMPTION AGREEMENT (this “Agreement”) is made and entered into effective as of November 12, 2024 (the “Effective Date”), among Forian Inc., a Delaware corporation (the “Company”), on the one hand, and each holder set forth on the signature page hereto (each individually a “Seller” and collectively the “Sellers”). The Company and each Seller are referred to individually as a “Party”, and collectively as the “Parties”.

 

BACKGROUND

 

A.          Each Seller is the holder of those certain 3.5% Convertible Promissory Notes Due 2025, dated September 1, 2021, as set forth on the signature page hereto (each, a “Note”, and collectively, the “Notes”) issued pursuant to that certain Note Purchase Agreement, dated September 1, 2021, by and between the Company and such Seller (the “Note Purchase Agreement” and, together with the Note, the “Note Documents”).

 

B.          The Company desires to repay and redeem the Note and each Seller desires to sell, assign and convey the Note to the Company, each upon the terms and subject to the conditions set forth herein.

 

C.          Capitalized terms used herein by not otherwise defined shall have the meaning ascribed to such terms in the Note Documents.

 

AGREEMENT

 

In consideration of the covenants, agreements, representations and warranties contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, agree as follows:

 

1.            Note Redemption.

 

(a)        Notwithstanding Section 6(a) of each Note, the Company agrees to redeem and each Seller agrees to sell, assign and convey each Note set forth on the signature page attached hereto for the aggregate purchase price set forth on the signature page hereto (the “Redemption Price”) effective as of the Effective Date.

(b)        The Redemption Price shall be paid on the Effective Date (the “Closing”) to each Seller by the Company by wire transfer of immediately available funds, in accordance with the written instructions of Seller set forth on the signature page hereto.

(c)        Upon receipt by each Seller of the Redemption Price, such Seller’s Note shall be deemed fully paid and satisfied by the Company, and the Loan Amount and all accrued interest shall be deemed paid in its entirety and the Note shall be deemed cancelled and discharged, without the need for surrender thereof (the “Redemption”).

(d)        The terms of this Agreement shall, in the event of any conflict with the terms of the Note Documents, supersede such conflicting terms contained in Note Documents.

 

2.            Representations and Warranties of Sellers. Each Seller hereby represents and warrants to the Company that:

 

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(a)       Seller has the right, power and authority to execute, deliver and perform this Agreement and to consummate the transactions contemplated by this Agreement. This Agreement has been duly and validly executed and delivered by Seller and constitutes Seller’s legal, valid and binding obligation, enforceable in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, or moratorium or similar laws affecting creditors’ and contracting parties’ rights generally and except as enforceability may be subject to general principles of equity and except as rights to indemnity and contribution may be limited by state or federal securities laws or public policy underlying such laws.

(b)        Seller’s execution hereof and the consummation of the transactions contemplated hereby will not (i) result in a violation of Seller’s organization documents; (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) in any respect under, or give to others any rights of termination, amendment, acceleration or cancellation of, any material agreement, indenture or instrument to which Seller is a party; or (iii) result in a violation of any law, rule, regulation, order, judgment or decree applicable to Seller or by which any property or asset of Seller is bound or affected.

 

(c)         Seller (i) is the sole, true and lawful beneficial and record owner of the Note and no other entity or person has a direct or indirect interest in the Note; (ii) has good and marketable title to the Note, free and clear of any security interests, liens, claims, charges, encumbrances, equities, options, warrants or rights to purchase or otherwise acquire the Note or any portion thereof (collectively, “Liens”); (iii) is not a Party to or bound by any agreement affecting or relating to its right to transfer the Note hereunder; and (iv) is not subject to any prior agreements, covenants or other restrictions that would prevent Seller from entering into or fully performing its obligations under this Agreement.

 

(d)         Seller (i) is capable of evaluating the merits and risks of Seller’s decision to sell the Note, has read the Agreement and understands and assents to the terms and conditions herein; (ii) has had an opportunity to ask questions of the Company and has made a full evaluation of the risks and merits of the Redemption; (iii) understands and acknowledges that the value of the Company, and therefore the value of the shares issuable upon conversion of the Note, may appreciate in the future and that upon and by virtue of the Redemption, Seller will be precluded from sharing in such appreciation; and (iv) acknowledges that the Redemption Price is fair and reasonable consideration for the Note, regardless of whether the Company may be in possession of any information regarding the Company that has not been shared with Seller.

 

(e)        Seller has made its own decision to consummate the transactions contemplated under this Agreement based on its own independent review and consultations with such investment, legal, tax, accounting and other advisers as it in its sole discretion deemed necessary or appropriate in connection with the Redemption and without reliance on any representation or warranty of, or advice from, the Company, or the actions of any other holder of Notes. Seller has had an opportunity to review the federal, state and local tax consequences of the Redemption with Seller’s own tax advisors understands that Seller (and not the Company) shall be responsible for Seller’s own tax liability that may arise as a result of the transactions contemplated by this Agreement.

 

3.           Representations and Warranties of the Company. The Company hereby represents and warrants to each Seller that:

 

(a)        The Company has the right, power and authority to execute, deliver and perform this Agreement and to consummate the transactions contemplated by this Agreement. This Agreement has been duly and validly executed and delivered by the Company and constitutes the Company’s legal, valid and binding obligation, enforceable in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, or moratorium or similar laws affecting creditors’ and contracting parties’ rights generally and except as enforceability may be subject to general principles of equity and except as rights to indemnity and contribution may be limited by state or federal securities laws or public policy underlying such laws.

 

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(b)         The Company’s execution hereof and the consummation of the transactions contemplated hereby will not (i) result in a violation of the Company’s organization documents; (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) in any respect under, or give to others any rights of termination, amendment, acceleration or cancellation of, any material agreement, indenture or instrument to which the Company is a party; or (iii) result in a violation of any law, rule, regulation, order, judgment or decree applicable to the Company or by which any property or asset of the Company is bound or affected.

4.          Further Assurances. At the Closing and at any time thereafter, each of the Company and each Seller covenants and agrees to take such further actions, and execute and deliver such other assignments, bills of sale, endorsements, transfers and other instruments of transfer and conveyance in such form, including warranties of title, as Seller or the Company shall reasonably request in order to more fully evidence or effectuate the transactions contemplated by this Agreement, including as may be necessary to perfect title of the Company to the Note.

 

5.          Release and Waiver. For and in consideration of the Redemption and the other covenants and promises set forth in this Agreement, each Seller, on its behalf, and the Company, on its behalf, and in each case their respective affiliates, subsidiaries, parents, predecessors, successors, assigns, trustees, creditors, insurers and fiduciaries and its and their respective directors, managers, officers, employees, partners, equity holders, members, beneficiaries, administrators, attorneys, representatives or agents, past, present and future (the “Releasing Parties”), hereby fully and finally releases, acquits and forever discharges the Company, on the one hand, and such Seller, on the other hand, and each of their respective affiliates, subsidiaries, parents, predecessors, successors, assigns, trustees, creditors, insurers and fiduciaries and its and their respective directors, managers, officers, employees, partners, equity holders, members, beneficiaries, administrators, attorneys, representatives or agents, past, present and future (collectively, the “Released Parties”) from any and all actions, debts, claims, counterclaims, demands, liabilities, damages, causes of action, costs, expenses, and compensation of every kind and nature whatsoever, past, present, or future, at law or in equity, whether known or unknown, which such Releasing Parties, or any of them, had, has, or may have had at any time in the past until and including the Effective Date against the Released Parties, or any of them, that relate to or arise out of the ownership of the Note or Seller’s rights or status as a debt holder of the Company (collectively, “Claims”). The released Claims include (i) any and all claims relating to, or arising from, any proposed or actual purchase, sale or ownership of the Note, including any claims for fraud, misrepresentation, breach of fiduciary duty, breach of duty under applicable state corporate law, and securities fraud under any state or federal law; and (ii) any claim for any loss, cost, damage, or expense arising out of any dispute over the non-withholding or other tax treatment of any of the proceeds received by Seller as a result of this Agreement. The Released Parties are intended third-party beneficiaries of this Section 5 and shall have the right, power and authority to enforce the provisions hereof as though they were a party hereto. Notwithstanding any provision of this Section 5 to the contrary, the provisions hereof shall not release claims made by Seller for breach of this Agreement. Seller understands and acknowledges that the significance and consequence of this waiver is that even if Seller or its attorneys or agents discover claims or facts in addition to or different from those which they now know or believe to exist with respect to the subject matter of this Agreement such that Seller should eventually suffer additional damages, Seller will not be able to make any claim for those damages. Furthermore, Seller and the Company each acknowledges that Seller and the Company each intends these consequences even as to claims for damages that may exist as of the date of this Agreement but of which Seller or the Company, as applicable, is unaware and which, if known, would materially affect Seller’s or the Company’s, as applicable, decision to execute this Agreement, regardless whether such lack of knowledge is the result of ignorance, oversight, error, negligence or any other cause.

 

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6.           Covenant Not To Sue. Each Seller and the Company further agrees not to institute any litigation, lawsuit, claim, proceeding or action against the Company or any Seller or any other Released Party with respect to any and all Claims released in Section 5 of this Agreement.

 

7.            Entire Agreement; Assignment; Amendment. This Agreement and the documents and instruments referred to herein and to be delivered pursuant hereto: (a) constitute the entire agreement between the Parties with respect to the subject matter hereof and supersede all other prior agreements and understandings, both written and oral, between the Parties with respect to the subject matter hereof and (b) shall not be assigned, by operation of law or otherwise, by either Party without the prior written consent of the other Party. No amendment, modification or alteration of the terms or provisions of this Agreement shall be binding unless the same shall be in writing and duly executed by the Parties hereto.

 

8.           Severability. If any provision or any part of any provision of this Agreement shall be determined to be invalid, unenforceable or illegal for any reason, such provision shall be entirely severable from, and shall have no effect upon, the remainder of this Agreement. Any such invalid, unenforceable or illegal provision shall be subject to partial enforcement to the extent necessary to protect the intent of the Parties hereto. The Parties further agree to alter the balance of this Agreement in order to render the same valid and enforceable.

9.          Governing Law; Venue. This Agreement shall be governed by and construed in accordance with the domestic laws of the State of Delaware without respect to principles of choice or conflict of laws (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware. Each Seller and the Company hereby irrevocably and unconditionally agrees to be subject to, and hereby consents and submits to, the jurisdiction of the state or federal courts located in the State of Delaware.

 

10.         Expenses. Each Party shall pay its respective expenses incurred in connection with the negotiation and execution of this Agreement and each other agreement, document and instrument contemplated by this Agreement and the consummation of the transactions contemplated hereby.

 

11.          Survival. The representations and warranties made by the Parties under this Agreement, together with the provisions of this Agreement which, by their meaning or content, are intended to survive the Closing, including Sections 4 through 6 of this Agreement, shall survive the Closing.

 

12.          Public Announcement. No Party will publicly disclose or divulge any provisions of this Agreement or the transactions contemplated hereby without the other Parties’ written consent, except as may be required by applicable law (including applicable rules and regulations of the U.S. Securities and Exchange Commission) or stock exchange regulation; provided, however, that in no event will the identity of any Seller be publicly disclosed unless approved in advance in writing by such Seller.

 

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13.          Interpretation. When a reference is made in this Agreement to a Section, such reference shall be to a Section of this Agreement unless otherwise indicated. The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. 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,” “hereto,” “hereby,” “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. The term “or” is not exclusive. The word “extent” in the phrase “to the extent” shall mean the degree to which a subject or other thing extends, and such phrase shall not mean simply “if.” The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms. All pronouns and all variations thereof shall be deemed to refer to the masculine, feminine or neuter, singular or plural, as the identity of the person or persons or entity may require. Any agreement, instrument or law defined or referred to herein means such agreement, instrument or law as from time to time amended, modified or supplemented, unless otherwise specifically indicated. References to a person or entity are also to its permitted successors and assigns. Unless otherwise specifically indicated, all references to “dollars” and “$” will be deemed references to the lawful money of the U.S. The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or a question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring by virtue of the authorship of any provisions of this Agreement.

14.          Counterparts; Delivery. This Agreement may be executed in any number of counterparts, each of which is deemed to be an original, and all of which taken together shall constitute one and the same Agreement. This Agreement may be executed and delivered by PDF transmission.

 

[Signatures Follow]

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IN WITNESS WHEREOF, each of the Parties hereto has duly executed this Convertible Promissory Note Redemption Agreement to be effective as of the Effective Date.

	COMPANY:
	FORIAN INC.
	By:
	Name:	Max Wygod
	Title:	Chief Executive Officer
	SELLER:
	By:
	Name:
	Title:

Note No. __ / Principal Amount:

$

Aggregate Redemption Price:

$

	Seller Wire Instructions:

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Exhibit 99.1

Forian Inc.

Announces Third Quarter 2024 Financial Results

Newtown, PA, November 13, 2024 (GLOBE NEWSWIRE) – Forian Inc. (Nasdaq: FORA), a leading provider of data science driven information and analytics solutions to the life science, healthcare and financial services industries, today announced results for the quarter ended September 30, 2024.

“While this quarter’s revenue remained steady, our team’s commitment to driving long-term value has resulted in progress in our strategic vision. The addition of Kyber Data Science enhances the momentum we are building to position us well to capitalize on emerging opportunities and deliver sustained success for our stakeholders,” stated Max Wygod, Chairman and Chief Executive Officer of Forian.

Third Quarter 2024 Financial Results

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Forian delivered the following results for the third quarter of 2024:

		Three Months Ended September 30,
										Period-over-
		2024				2023				Period %
		Unaudited				Unaudited				Change
Revenue		$	4,686,312			$	5,348,469				-12%
(Loss) income from continuing operations, net of tax		$	(204,907	)		$	5,453,643				-104%
(Loss) income from discontinued operations, net of tax		$	-			$	(1,111,552	)			100%
Net (loss) income		$	(204,907	)		$	4,342,091				-105%
(Loss) income from continuing operations, net of tax per share - diluted		$	(0.01	)		$	0.16				-106%
(Loss) income from discontinued operations, net of tax per share - diluted		$	-			$	(0.03	)			-
(Loss) income per share - diluted		$	(0.01	)		$	0.13				-108%
Adjusted EBITDA (a non-GAAP financial measure defined below)		$	185,916			$	1,072,147				-83%

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Revenue for the quarter was $4.7 million, a $0.6 decrease from $5.3 million in the prior year

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Net loss from continuing operations for the quarter was $0.2 million, or $0.01 per share, compared to net income of $4.3 million, or $0.14 per share, in the prior year

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Adjusted EBITDA for the quarter was $0.2 million, compared to $1.1 million in the prior year

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Cash, cash equivalents and marketable securities at September 30, 2024 totaled $49.4 million

Highlights

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Acquired Kyber Data Science on October 31, 2024, adding a portfolio of solutions and machine learning-empowered analytics offerings to Forian’s offering suite and expanding the markets served

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Redeemed 3.5% Convertible Notes and outstanding equity of over $15 million and $0.10 million, respectively, in October and November 2024

This release uses non-GAAP financial measures that are adjusted for the impact of various U.S. GAAP items. See the section titled “Non-GAAP Financial Measures” and the table entitled “Reconciliation of U.S. GAAP to Non-GAAP Financial Measures” below for details.

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Quarterly Conference Call and Webcast

Forian will host a conference call and webcast at 4:30 p.m. ET on November 13, 2024 to discuss its financial results with the investment community. To register for the conference call, click here. The webcast will be available live at https://edge.media-server.com/mmc/p/rj92ayah. This information is also available on our website at www.forian.com/investors. To be included on the Company’s email distribution list, please sign up at www.forian.com/investors.

About Forian

Forian provides a unique suite of data management capabilities and proprietary information and analytics solutions to optimize and measure operational, clinical and financial performance for customers within the traditional and emerging life sciences and healthcare payer and provider segments and, with its recent acquisition of Kyber Data Science, the financial services industry. Forian has industry leading expertise in acquiring, integrating, normalizing and commercializing large scale healthcare data assets. Forian’s information products overlay sophisticated data management and data science capabilities on top of a comprehensive clinical data lake to identify unique relationships, create distinctive information assets and generate proprietary insights. For more information, please visit the Company’s website at www.forian.com.

Cautionary Statements Regarding Forward-Looking Statements

This release contains “forward-looking statements” within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In this context, forward-looking statements often address expected future business and financial performance and financial condition, which may include GAAP and non-GAAP financial measures, and often contain words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “see,” “will,” “would,” “target,” similar expressions and variations or negatives of these words. Forward-looking statements by their nature address matters that involve risks and uncertainties, many of which are beyond our control and are not guarantees of future results, such as statements about future financial and operating results, company strategy and intended product offerings and market positioning. These and other forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward-looking statements. Accordingly, there are or will be important factors that could cause actual results to differ materially from those indicated in such statements and, therefore, you should not place undue reliance on any such statements and caution must be exercised in relying on forward-looking statements. Factors that could cause actual results to differ include, but are not limited to, those risks and uncertainties associated with operations, strategy and goals, our ability to execute on our strategy and the additional risks and uncertainties set forth more fully under the caption “Risk Factors” in Forian’s Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on March 29, 2024, and elsewhere in Forian’s filings and reports with the SEC. Forward-looking statements contained in this release are made as of the date hereof, and we undertake no duty to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable law.

Media and Investor Contact:

forian.com/investors

[e-mail]

267-225-6263

SOURCE: Forian Inc.

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FORIAN INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

		September 30,				December 31,
		2024				2023
		(UNAUDITED)
ASSETS
Current assets:
Cash and cash equivalents		$	2,707,688			$	6,042,986
Marketable securities			46,650,200				42,296,589
Accounts receivable, net			3,546,582				2,572,931
Proceeds receivable from sale of discontinued operation, net			-				1,645,954
Contract assets			875,032				1,126,713
Prepaid expenses			697,780				1,077,233
Other assets			1,349,364				2,515,509
Total current assets			55,826,646				57,277,915
Property and equipment, net			52,680				76,085
Right of use assets, net			41,244				10,664
Deposits and other assets			1,591,420				1,523,948
Total assets		$	57,511,990			$	58,888,612
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable		$	843,829			$	161,590
Accrued expenses			2,618,108				4,252,257
Short-term operating lease liabilities			23,146				10,664
Warrant liability			-				563
Deferred revenues			2,243,719				2,413,551
Convertible notes payable, net of debt issuance costs ($6,000,000 in principal is held by a related party)			24,370,509
Total current liabilities			30,099,311				6,838,625
Long-term liabilities:
Other liabilities			518,098				1,000,000
Convertible notes payable, net of debt issuance costs ($6,000,000 in principal is held by a related party)			-				24,870,181
Total long-term liabilities			518,098				25,870,181
Total liabilities			30,617,409				32,708,806
Commitments and contingencies
Stockholders' equity:
Preferred Stock; par value $0.001; 5,000,000 Shares authorized; 0 issued and outstanding as of September 30, 2024 and December 31, 2023			-				-
Common Stock; par value $0.001; 95,000,000 Shares authorized; 31,092,695 issued and outstanding as of  September 30, 2024 and 30,920,450 issued and outstanding as of December 31, 2023			31,093				30,920
Additional paid-in capital			78,519,683				73,834,300
Accumulated deficit			(51,656,195	)			(47,685,414	)
Total stockholders' equity			26,894,581				26,179,806
Total liabilities and stockholders' equity		$	57,511,990			$	58,888,612

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FORIAN INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)

		For the Three Months Ended September 30,								For the Nine Months Ended September 30,
		2024				2023				2024				2023
Revenue		$	4,686,312			$	5,348,469			$	14,340,791			$	15,112,398
Costs and Expenses:
Cost of revenue			1,402,920				1,362,555				4,913,195				3,891,482
Research and development			291,962				264,781				989,052				1,100,657
Sales and marketing			956,983				1,313,212				3,029,783				3,746,731
General and administrative			2,822,253				2,887,771				9,771,343				9,641,536
Separation expenses			-				-				-				599,832
Depreciation and amortization			6,629				10,598				23,405				64,285
Litigation settlements and related expenses			1,394				316,820				1,152,670				751,480
Total costs and expenses			5,482,141				6,155,737				19,879,448				19,796,003
Operating Loss From Continuing Operations			(795,829	)			(807,268	)			(5,538,657	)			(4,683,605	)
Other Income (Expense):
Change in fair value of warrant liability			20				1,594				563				4,088
Interest and investment income			658,339				646,832				1,951,812				1,666,786
Gain on sale of investment			32,082				5,805,858				80,694				5,805,858
Interest expense			(195,415	)			(211,333	)			(587,684	)			(630,547	)
Gain on debt redemption			-				111,151				137,356				111,151
Total other income, net			495,026				6,354,102				1,582,741				6,957,336
(Loss) income from continuing operations before income taxes			(300,803	)			5,546,834				(3,955,916	)			2,273,731
Income taxes			95,896				(93,191	)			(14,865	)			(159,287	)
(Loss) income from continuing operations, net of tax			(204,907	)			5,453,643				(3,970,781	)			2,114,444
Loss from discontinued operations			-				-				-				(94,427	)
Gain on sale of discontinued operations			-				-				-				11,531,849
Income tax effect on discontinued operations			-				(1,111,552	)			-				(3,834,122	)
(Loss) income from discontinued operations, net of tax			-				(1,111,552	)			-				7,603,300
Net (loss) income		$	(204,907	)		$	4,342,091			$	(3,970,781	)		$	9,717,744
Net (loss) income per share:
Basic
Continuing operations		$	(0.01	)		$	0.17			$	(0.13	)		$	0.07
Discontinued operations		$	-			$	(0.03	)		$	-			$	0.23
Net (loss) income per share - basic		$	(0.01	)		$	0.14			$	(0.13	)		$	0.30
Diluted
Continuing operations		$	(0.01	)		$	0.16			$	(0.13	)		$	0.07
Discontinued operations		$	-			$	(0.03	)		$	-			$	0.23
Net (loss) income per share - diluted		$	(0.01	)		$	0.13			$	(0.13	)		$	0.30
Weighted-average shares outstanding - basic			31,098,180				32,459,838				31,064,418				32,397,090
Weighted-average shares outstanding - diluted			31,098,180				35,068,716				31,064,418				32,503,359

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FORIAN INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED

		For the Period Ended September 30,
		2024				2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income		$	(3,970,781	)		$	9,717,744
Less: Income from discontinued operations			-				7,603,300
(Loss) income from continuing operations			(3,970,781	)			2,114,444
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities - continuing operations:
Depreciation and amortization			23,405				64,285
Amortization on right of use asset			16,296				16,750
Amortization of debt issuance costs			3,999				3,999
Accrued interest on convertible Notes			583,685				626,549
Amortization of discount - proceeds from sale of discontinued operations			(20,712	)			(341,205	)
Accretion of discount - marketable securities			(1,876,074	)			(1,318,083	)
Gain on sale of investment			(80,694	)			(5,805,858	)
Gain on debt redemption			(137,356	)			(111,151	)
Allowance for credit losses			225,000				-
Stock-based compensation expense			4,873,593				4,920,572
Change in fair value of warrant liability			(563	)			(4,088	)
Change in operating assets and liabilities:
Accounts receivable			(1,198,651	)			(1,109,505	)
Contract assets			251,681				983,499
Prepaid expenses			379,453				(34,542	)
Changes in lease liabilities during the period			(27,505	)			(16,750	)
Deposits and other assets			1,098,673				57,767
Accounts payable			682,239				(56,313	)
Accrued expenses			(1,634,149	)			1,224,648
Deferred revenues			(169,832	)			172,332
Other liabilities			(488,791	)			-
Net cash (used in) provided by operating activities - continuing operations			(1,467,084	)			1,387,350
Net cash used in operating activities - discontinued operations			-				(59,075	)
Net cash (used in) provided by operating activities			(1,467,084	)			1,328,275
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property and equipment			-				(75,493	)
Purchase of marketable securities			(133,894,613	)			(103,468,975	)
Sale of marketable securities			131,417,076				78,597,821
Proceeds from sale of investment			80,694				5,805,858
Cash from sale of discontinued operations			1,666,666				21,501,841
Net cash (used in) provided by investing activities - continuing operations			(730,177	)			2,361,052
Net cash (used in) provided by investing activities			(730,177	)			2,361,052
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash used to redeem convertible notes			(950,000	)			(960,000	)
Repurchase of common stock			(74,400	)
Tax payments related to shares withheld for vested restricted stock units			(113,637	)			(147,991	)
Net cash used in financing activities- continuing operations			(1,138,037	)			(1,107,991	)
Net cash used in financing activities			(1,138,037	)			(1,107,991	)
Net change in cash			(3,335,298	)			2,581,336
Cash and cash equivalents, beginning of period			6,042,986				2,795,743
Cash and cash equivalents, end of period		$	2,707,688			$	5,377,079
Supplemental disclosure of cash flow information:
Cash for (received) paid for taxes		$	(1,346,108	)		$	3,276,800

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Non-GAAP Financial Measures

In this press release, we have provided certain non-GAAP measures, which we define as financial information that has not been prepared in accordance with U.S. GAAP. The non-GAAP financial measure provided herein is earnings before interest, taxes, non-cash and other items (“Adjusted EBITDA”), which should be viewed as supplemental to, and not as an alternative for, net income or loss calculated in accordance with U.S. GAAP (referred to below as “net loss”).

Adjusted EBITDA is used by our management as an additional measure of our Company’s performance for purposes of business decision-making, including developing budgets, managing expenditures and evaluating potential acquisitions or divestitures. Period-to-period comparisons of Adjusted EBITDA help our management identify additional trends in our Company’s financial results that may not be shown solely by period-to-period comparisons of net income. In addition, we may use Adjusted EBITDA in the incentive compensation programs applicable to some of our employees in order to evaluate our Company’s performance. Our management recognizes that Adjusted EBITDA has inherent limitations because of the excluded items, particularly those items that are recurring in nature. In order to compensate for those limitations, management also reviews the specific items that are excluded from Adjusted EBITDA, but included in net income, as well as trends in those items.

We believe that the presentation of Adjusted EBITDA is useful to investors in their analysis of our results for reasons similar to the reasons why our management finds it useful and because it helps facilitate investor understanding of decisions made by management in light of the performance metrics used in making those decisions. In addition, as more fully described below, we believe that providing Adjusted EBITDA, together with a reconciliation of net loss to Adjusted EBITDA, helps investors make comparisons between our Company and other companies that may have different capital structures, different effective income tax rates and tax attributes, different capitalized asset values and/or different forms of employee compensation. However, Adjusted EBITDA is not intended as a substitute for comparisons based on net loss. In making any comparisons to other companies, investors need to be aware that companies use different non-GAAP measures to evaluate their financial performance. Investors should pay close attention to the specific definition being used and to the reconciliation between such measures and the corresponding U.S. GAAP measures provided by each company under applicable SEC rules.

The following is an explanation of the items excluded by us from Adjusted EBITDA but included in net loss:

•

Depreciation and Amortization. Depreciation and amortization expense is a non-cash expense relating to capital expenditures and intangible assets arising from acquisitions that are expensed on a straight-line basis over the estimated useful life of the related assets. The Company excludes depreciation and amortization expense from Adjusted EBITDA because management believes that (i) the amount of such expenses in any specific period may not directly correlate to the underlying performance of the business operations and (ii) such expenses can vary significantly between periods as a result of new acquisitions and full amortization of previously acquired tangible and intangible assets. Accordingly, management believes that this exclusion assists management and investors in making period-to-period comparisons of operating performance. Investors should note that the use of tangible and intangible assets contributed to revenue in the periods presented and will contribute to future revenue generation and should also note that such expense will recur in future periods.

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•

Stock-Based Compensation Expense. Stock-based compensation expense is a non-cash expense arising from the grant of stock-based awards to employees. Management believes that excluding the effect of stock-based compensation from Adjusted EBITDA assists management and investors in making period-to-period comparisons in the Company’s operating performance because (i) the amount of such expenses in any specific period may not directly correlate to the underlying performance of business operations and (ii) such expenses can vary significantly between periods as a result of the timing of grants of new stock-based awards, including grants in connection with acquisitions. Stock-based compensation expense includes certain separation expenses related to the vesting of stock options. Effective February 10, 2023, the Company’s Chief Executive Officer, President and Class II member of the Board of Directors resigned. In connection with the resignation, the Company entered into a separation agreement providing for, among other things, accelerated vesting of 106,656 unvested restricted shares of the Company common stock. Stock based compensation expense for 2023 includes $349,832 related to the accelerated vesting of stock, which is recognized in separation expenses in the condensed consolidated statements of operations. These expenses were incurred during the three months ended March 31, 2023, and there were no additional related expenses incurred during the three months ended September 30, 2023. Management believes that excluding stock-based compensation from Adjusted EBITDA assists management and investors in making meaningful comparisons between the Company’s operating performance and the operating performance of other companies that may use different forms of employee compensation or different valuation methodologies for their stock-based compensation. Investors should note that stock-based compensation is a key incentive offered to employees whose efforts contributed to the operating results in the periods presented and are expected to contribute to operating results in future periods. Investors should also note that such expenses will recur in the future.

•

Interest Expense. Interest expense is associated with the convertible notes entered into on September 1, 2021 in the amount of $24,000,000. The Notes are due on September 1, 2025, and accrue interest at an annual rate of 3.5%. Management excludes interest expense from Adjusted EBITDA (i) because it is not directly attributable to the performance of business operations and, accordingly, its exclusion assists management and investors in making period-to-period comparisons of operating performance and (ii) to assist management and investors in making comparisons to companies with different capital structures. Investors should note that interest expense associated with the Notes will recur in future periods.

•

Interest and Investment Income. Interest and Investment income is associated with the level of marketable debt securities and other interest-bearing accounts in which the Company invests. Interest and investment income can vary over time due to changes in interest rates and level of investments. Management excludes interest and investment income from Adjusted EBITDA (i) because these items are not directly attributable to the performance of business operations and, accordingly, their exclusion assists management and investors in making period-to-period comparisons of operating performance and (ii) to assist management and investors in making comparisons to companies with different capital structures. Investors should note that interest income will recur in future periods.

•

Other Items. The Company engages in other activities and transactions that can impact net income (loss). In the periods reported, these other items included (i) change in fair value of warrant liability relating to warrants assumed in the acquisition of Helix; (ii) gain on sale of investment relating to the sale of a minority equity interest; and (iii) gain on debt redemption which relates to a gain on the early retirement of a portion of the convertible notes. Management excludes these other items from Adjusted EBITDA because management believes these activities or transactions are not directly attributable to the performance of business operations and, accordingly, their exclusion assists management and investors in making period-to-period comparisons of operating performance. Investors should note that some of these other items may recur in future periods.

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•

Severance expenses. Effective February 10, 2023, the Company’s Chief Executive Officer, President and Class II member of the Board of Directors resigned. In connection with the resignation, the Company entered into a separation agreement providing for, among other things, (i) salary continuation for twelve months and (ii) accelerated vesting of 106,656 unvested restricted shares of the Company common stock. Severance expenses for the nine months ended September 30, 2023 includes $250,000 related to the salary continuation. Management excludes these other items from Adjusted EBITDA because management believes these costs are not recurring and not directly attributable to the performance of business operations and, accordingly, their exclusion assists management and investors in making period-to-period comparisons of operating performance. In addition, the Company records normal course of business severance expenses in the operating expense line item related to its employees’ activities.

•

Litigation related expenses. Management excludes litigation expenses that are extraordinary in nature and are unrelated to the Company’s day-to-day business operations. The nature of these expenses is primarily related to direct and incremental third-party legal expenses associated with such litigation, which pertains to entities acquired in the Helix merger.

•

Strategic review related expenses. Management excludes certain professional expenses that are extraordinary in nature and are unrelated to the Company’s day-to-day business operations. The nature of these expenses is primarily related to a strategic review of the Company’s operations.

•

Contract termination impacts. Management excludes certain expenses that are extraordinary in nature and are unrelated to the Company’s day-to-day business operations. The nature of these expenses is primarily related to the impact of an adjustment related to the cancellation of an inbound information contract. On September 23, 2024, the Company was informed by one of its information vendors that it was exercising the right to terminate the agreement with the Company effective September 25, 2024, based on restrictions imposed by the information vendor’s upstream licensor. As a result, the Company recorded an adjustment of $542,389 during the quarter ended September 30, 2024, representing previously recorded charges under the contract that will not be paid.

•

Income tax (benefit) expense. Management excludes the income tax (benefit) expense from Adjusted EBITDA (i) because management believes that the income tax (benefit) expense is not directly attributable to the underlying performance of business operations and, accordingly, its exclusion assists management and investors in making period-to-period comparisons of operating performance and (ii) to assist management and investors in making comparisons to companies with different tax attributes.

There are limitations to using non-GAAP financial measures because non-GAAP financial measures are not prepared in accordance with U.S. GAAP and may be different from non-GAAP financial measures provided by other companies.

The non-GAAP financial measures are limited in value because they exclude certain items that may have a material impact upon our reported financial results. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by management about which items are adjusted to calculate our non-GAAP financial measures. We compensate for these limitations by analyzing current and future results on a U.S. GAAP basis as well as a non-GAAP basis and also by providing U.S. GAAP measures in our public disclosures.

Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with U.S. GAAP. We encourage investors and others to review our financial information in its entirety, not to rely on any single financial measure to evaluate our business and to view our non-GAAP financial measures in conjunction with the most directly comparable U.S. GAAP financial measures.

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The following table reconciles the specific items excluded from U.S. GAAP metrics in the calculation of non-GAAP metrics for the periods shown below:

		For the Three Months Ended September 30,								For the Nine Months Ended September 30,
		2024				2023				2024				2023
Revenue		$	4,686,312			$	5,348,469			$	14,340,791			$	15,112,398
Net (loss) income from continuing operations		$	(204,907	)		$	5,453,643			$	(3,970,781	)		$	2,114,444
Depreciation and amortization			6,629				10,598				23,405				64,285
Stock based compensation expense			1,552,042				1,551,997				4,873,593				4,920,572
Change in fair value of warrant liability			(20	)			(1,594	)			(563	)			(4,088	)
Interest and investment income			(658,339	)			(646,832	)			(1,951,812	)			(1,666,786	)
Interest expense			195,415				211,333				587,684				630,547
Gain on sale of investment			(32,082	)			(5,805,858	)			(80,694	)			(5,805,858	)
Gain on debt redemption			-				(111,151	)			(137,356	)			(111,151	)
Severance expense			-				-				-				250,000
Litigation settlement and related expenses			1,394				316,820				1,152,670				751,480
Strategic review related expenses			(35,931	)			-				399,913				-
Impact of contract termination			(542,389	)			-				(542,389	)			-
Income tax expense			(95,896	)			93,191				14,865				159,287
Adjusted EBITDA - continuing operations		$	185,916			$	1,072,147			$	368,535			$	1,302,732

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Document and Entity Information	Nov. 12, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Nov. 12, 2024
Entity File Number	001-40146
Entity Registrant Name	FORIAN INC.
Entity Central Index Key	0001829280
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	85-3467693
Entity Address, Address Line One	41 University Drive
Entity Address, Address Line Two	Suite 400
Entity Address, City or Town	Newtown
Entity Address, State or Province	PA
Entity Address, Postal Zip Code	18940
City Area Code	267
Local Phone Number	225-6263
Title of 12(b) Security	Common Stock, $0.001 par value
Trading Symbol	FORA
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false

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