FRMO Corp. (FRMO-OTC-PINK) ("FRMO" or "Company") today announced the completion of threepreviously communicated transactions. The first was a private placement of FRMOshares for certain accredited investors. The second was to amend the terms of theCompany's product-specific revenue interests in products managed by HorizonKinetics LLC ("Horizon Kinetics") and its subsidiaries so as to receive asingle revenue interest in the gross revenues of Horizon Kinetics. The thirdwas the exchange of certain privately held units of Horizon Kinetics for sharesof FRMO.
PrivatePlacement Completed
Pursuant to a private placement, the Companyinvited subscriptions from certain accredited investors to purchase up to amaximum of 1,730,103 shares of its common stock at $2.89 per share.Subscriptions were received by April 15, 2013 from 72 investors for 100% of theshares offered by the Company. The subscriptions were accepted by the Company,and the shares were issued on May 1, 2013 when the Company received payment of $4,999,997.67.
Adjustmentof Product-Specific Revenue Interests
By agreement dated April 16, 2013, the Companyamended the terms of its product-specific revenue interests in certain productsmanaged by Horizon Kinetics and its subsidiaries: (i) a mutual fund, (ii) twoprivate investment funds, (iii) a consultative relationship with aninstitutional investor and, (iv) an institutional separate account. Thetransaction was consummated at the close of business on May 31, 2013. FRMO willnow receive a single revenue interest equal to 4.199% of the gross revenues ofHorizon Kinetics.
As a result of this transaction, the Company expectsto realize a gain in the transaction equal to the value of the 4.199% interestat the close of business May 31, 2013 less the cost basis of the revenueinterests in the Horizon Kinetics related products transferred to HorizonKinetics at that date. This gain will be reported in the Company's auditedFinancial Statement for the fiscal year ended May 31, 2013. The income taxes onthat gain will be deferred pursuant to Section 1031 of the Internal RevenueCode relating to "like exchanges" and will be reported as part of the Company'sDeferred Tax Liability.
FRMO Horizon Kinetics Share Exchange
On April 16, 2013, the Company announced anagreement with Horizon Kinetics LLC to exchange certain privately held units ofHorizon Kinetics for common shares of FRMO based upon pre-determined prices ofeach. The exchange period expired on May 31, 2013 resulting in FRMO owning4.95% of Horizon Kinetics and the individual Horizon Kinetics' unit sellersreceiving 2,387,715 shares of FRMO common stock. Immediately prior to theexchange, FRMO held a 0.86% interest in Horizon Kinetics.
AugustRelease of FRMO's Year-End Audited Financial Statement
It is expected that the audited Report onConsolidated Financial Statements for FRMO and its Subsidiary, Fromex EquityCorp, will be released in August. The Company believes that, with theabove-referenced gain, the Report will reflect material increases over theprevious year-end in Net Income, Total Stockholders' Equity and Book Value pershare.
Annual Meeting of Shareholders to be Held onAugust 27, 2013
The Company willhold its Annual Meeting of Shareholders on Tuesday, August 27, 2013 at 3 PM atThe Harvard Club, 35 West 44th Street in New York City to elect itsBoard of Directors for the ensuing year. At the meeting, the Executive Officerswill review the Company?s Fiscal 2013 financial results and outlook for thefuture. They will be available to answer shareholder questions and, as is thecase for quarterly conference calls, a transcript of the meeting will be postedon the Company?s website: www.frmocorp.com.
The Proxy Statementand the formal Notice of the Shareholders Meeting will be distributed on orabout Monday, July 22, 2013.
AboutFRMO Corp.
FRMO Corp. invests in and receives revenuesbased upon consulting and advisory fee interests in the asset managementsector.
FRMO has 43,260,559 shares of common stockoutstanding.
For more information, visit ourWeb site at www frmocorp.com.
Safe Harbor Statement Under the Private Securities LitigationReform Act of 1995 ? With the exception ofhistorical information, the matters discussed in this press release areforward-looking statements that involve a number of risks and uncertainties.Words like ?believe,? ?expect? and ?anticipate? mean that these are our bestestimates as of this writing, but that there can be no assurances that expectedor anticipated results or events will actually take place, so our actual futureresults could differ significantly from those statements. Factors that couldcause or contribute to such differences include, but are not limited to: ourability to maintain our competitive advantages, the general economics of thefinancial industry, our ability to finance growth, our ability to identify andclose acquisitions on terms favorable to the Company, and a sustainable market.
Further information on our risk factors is contained in ourquarterly and annual reports as filed on our website www.frmocorp.com and on www.otcmarkets.com/stock/FRMO/filings.
Contact
ThereseByars
Corporate Secretary
Email: info@frmocorp.com
Telephone: 646-495-7337
www.frmocorp.com