Frmo Corp

Good afternoon, everyone. This is Therese Byers speaking, and I'm the Corporate Secretary of FOMO Corp. Thank you for joining us today. The statements made on this call apply only as of today. The information on this call should not be construed to be a recommendation to purchase or sell any particular security or investment fund. The opinions referenced on this call are not to be a are not intended to be a forecast of future events or a guarantee of future results. It should not be assumed that any of the security transactions referenced today have been or will prove to be profitable, or that future investment decisions will be profitable or will equal or exceed the past performance of the investment. For additional information, you may visit the FRMO Corp website at F-R-M-O-C-O-R-P dot com. Today's discussion will be led by Murray Stahl, Chief Executive Officer, and Stephen Bregman, President and Chief Financial Officer. They will review key points related to the fiscal 2026 second quarter earnings. And now I'll turn the discussion over to Mr. Stahl.

Okay. Thank you, Therese, and thank you, everybody, for joining us today. First, let me apologize for our delayed filing and therefore delayed meeting. You may be aware we had to, we had a little dispute about what our tax liability might be if we were to sell certain securities, so it required a recalculation. We're in a not too distant future because we're now past the February quarter end. We're going to have another meeting in about six weeks to discuss the February results. And you know what? We're going to have a different tax number as well for the simple reason that the market value of the assets have changed. But we'll talk about that then. So my apologies, but such is life. In any event, I'll do some key points right now, just tell you some things that are happening or happened very recently, and then we can go to questions. So, one thing that I think is important, you might recall we have an interest in a company called Hashmaster, and we owned the building, well, we owned the building in which Hashmaster was located. We sold that recently. And part of proceeds were used to prepaid a mortgage or I should say the buyer was a company called Syntec, prepaid our mortgage to zero. So now we are once again debt-free. And the rest of the proceeds we took in Syntec stock. So we're now a proud owner of the small interest in this company, Syntec. which is involved in all things supporting A, the cryptocurrency industry, and B, the emerging data center industry. So we are a proud owner of that. Now, we should point out that that doesn't mean we're getting out of mining. Quite the contrary. We have, in the last year or so, preferred do our mining through a publicly traded company called windlands you might have observed made a number of investments in windland at the moment we own approximately 45 percent of windland if and when we cross the physician barrier we'll be consolidating woodland so our financial statements will have a different look in character However, you can tell a few things right now. We have not bought mining rigs in a little while. So if you look at the line on the balance sheet, digital mining assets and an appreciation, you'll see a de minimis sum of about $31,000. I think you'll find this rather interesting. If you go to digital assets, now digital assets, we didn't buy any digital assets during the quarter. as such we however uh in the half month period of time if you were to look on our balance sheet you compare the digital assets cost basis on may in may versus the cost basis of december in round numbers the cost basis is higher by thirty six thousand dollars that thirty six thousand dollars are the digital assets that we mined during this six-month reporting period. We mine those digital assets with $31,000 worth of equipment. The significance of that. Now, before I go into the significance, I just want to point out, we say the cost of a digital asset is $36,000. The cost of digital assets are the market value that existed on the day we mined them. That doesn't mean it actually cost us $36,000 to mine the assets or create the assets, if you like. That's just what the value would be if we were to sell those assets. So $36,000 of assets on $31,000 of value should tell you something. It tells you that one of the important variables in mining is are the longevity of your assets. So it's not something that people talk about a lot. Longevity assets is not the exact same thing as the life in the appreciation sense. We depreciate the assets generally over three years. That doesn't mean they last three years. So lately, last year and a half or two, we've confined our mining interests in terms of newly purchased equipment, so-called script mining. Script mining is spelled with a Y, so it's S-C-R-Y-P-T. And the idea is that we make a higher return script mining and using some of the revenues to buy Bitcoin than you would if we actually mined the Bitcoin itself. And the more important point is that script mining, since most of the revenues come from Dogecoin, has a unique feature. Script mining has no halving. It does have a halving in relation to the Litecoin assets that are mined. Script mining, for those who aren't familiar with the term, script mining is basically merge mining. You can mine two coins with one electric current. That's what makes it interesting. So we mine Litecoin and Dogecoin. We keep the Litecoin. We sell Dogecoin. We use some of Dogecoin to pay our electricity charges, and we use some of Dogecoin to actually buy some Bitcoin. That's how we increase our Bitcoin. Because Dogecoin represents the bulk of the assets, there is no halving in Dogecoin. And halving, H-A-L-V-I-N-G, is central to understanding of Bitcoin. Every four years, the block reward increases. is reduced in half or by 50%. That's why they call it the halving. So one of the most important things, arguably the most important thing you can do in cryptocurrency mining is to prepare for the halving. So it's my personal observation that A, very few people prepare for the halving, and B, very few people even talk about the halving, and C, many people are unaware that there is such a thing as a having and when we get close enough to the having and various participants become aware there is such a thing as a having and preparations have to be made for the having well it has a tendency for reasons maybe i'll get some questions have an opportunity to expand on this at length has a tendency to be very disruptive to the Bitcoin markets. In principle, everything in cryptocurrency, everything in Bitcoin should be completely and totally transparent to everybody. Why? Because everything one needs to know is contained in the original working paper, the protocol. There should be no surprises. However, very few people are aware of the protocol and are aware of the havoc. And therefore, there are surprises And surprises typically tend to happen about more or less about two years before the next halving. The next halving is going to occur in approximately April 18th, 2028. This is March 2026. So, let's say, crudely speaking, we're about two years away from the halving. So, disruption is right on schedule. ultimately the market will sort it out and Bitcoin will continue as it always has. So it won't be a big issue. But until such time, it's an issue. Essentially what people have to do is there has to be a changeover in equipment. So the equipment you have today, unless you're doing script mining equipment, but there's no having, you're going to have to get new equipment. So you're going to have to get new equipment. How are you going to pay for the equipment? So the practice is, many people is to sell some of in some cases a lot of the bitcoin they accumulated during the prior period and then everybody has to prepare for the having more or less simultaneously that cryptocurrency comes on the market and it's a seasonal phenomenon so to speak eventually I think people will master the reality and prepare gradually or prepare to do something else where there's not a havoc. So, eventually, it'll work its way out. In the meantime, it's just something we have to live with it. Some other points of interest, liquidity. You will observe the liquidity, not just the cash and the balance sheet, but the fact that we have no debt, I believe, this is the most liquid we've ever been on the balance sheet and we have a lot of borrowing power that we really have never used we could use it if we have to but it's worthwhile reflecting on how much liquidity we really have if we choose to use it so it's the best position we've ever had in our history Another one point that I'd like to make that's not germane to the subject of crypto is exchanges. It's another big focus of ours. You might have noticed that in the summer, MYAX came public. So, MYAX was a private investment. MYAX, for those that are new to FRMO, its origin is we were at one time the largest holder of two exchanges. one being the Minneapolis Green Exchange, the other being the Bermuda Stock Exchange, and we merged those in exchange for an interest in MyEx. MyEx is not our only exchange investment. We have some other small exchange investments, but largely we're in MyEx. So the IPO was – I think extremely successful, and that required a markup in value, and I commend MyEx for your attention. I think it's well worthwhile following. They're doing a lot of interesting things, but rather than go into what they're doing, I'll let the company speak for itself and just relate to you. I couldn't be more pleased what's going on at MyEx. And I'm really proud of everybody in the team and all they've been able to accomplish in what is really a short period of time. So that's what I had in terms of general remarks. And now I think it would be great if we could take some questions. So, Therese, if you'd be so kind as to read them, I'd be delighted to respond.

I hope you do this, though. The first is, first of all, congratulations on your call regarding Zcash, which has performed exceptionally well in 2025. As you previously explained, a key driver of its success has been its monetary policy, which is similar to Bitcoin's. Could you share your thoughts on Litecoin, particularly in light of the recent launch of the first Litecoin ETF? What potential trigger points do you see for Litecoin that could lead to a similar performance pattern as Zcash? While Litecoin has the privacy upgrade MWeb, it seems that Zcash may have an edge in certain aspects. Additionally, Ethereum appears to be attempting to capitalize on the same anonymity trend. Would you elaborate on EFRO's most broader altcoin strategy? and what shareholders might expect in this regard?