FRMO Corporation ‘s transcript of the 2016 annual meeting of shareholders.

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Therese Byars - Corporate Secretary

Welcome to the 2016 FRMO Annual Meeting of Shareholders. My name is Therese Byars, and I’m the corporate secretary of FRMO Corp. (the “Company”). Joining me are Murray Stahl, Chairman and Chief Executive Officer, and Steven Bregman, President and Chief Financial Officer.

Murray Stahl FRMO Corporation

Before we begin, we want to be sure that you know where the two emergency exits are located. There is the door you came in through and there is one in the corner here at the front of the room. The stairs are on either side of the elevators. We also ask that you silence all mobile devices and be advised that all audio and video recordings are prohibited.

The FRMO annual and quarterly reports can be found on our website at If you would like a hard copy of the 2016 annual report or the proxy statement, we have a few copies here. And you may request one at the end of the meeting. A summary transcript of today’s meeting will be posted on our website in the coming weeks.

Now I’d like to present the seven directors, all of whom are candidates for re-election. They are Murray Stahl, Steven Bregman, Peter Doyle, Lawrence J. Goldstein, Lester J. Tanner, Allan Kornfeld, and Jay P. Hirschson. Also present today is FRMO’s general counsel, Jay Kesslen and, from our auditors, Baker Tilly Virchow Krause, we have John Basile.

We now proceed to the report on the tabulation of the proxies for the two proposals. The proxy committee, appointed by the FRMO Board of Directors, is here this afternoon to represent those shareholders who gave their proxies to the committee. Notice of this meeting and proxy voting materials were sent to shareholders of record as of July 12, 2016 on or about July 25, 2016. The inspectors of election report that proxies were received from FRMO shareholders holding approximately 38.8 million shares of common stock, or 88.4% of the total common stock entitled to vote. Therefore, this meeting is properly organized with a quorum present, and we can proceed.

There are two items of business for this meeting. The first is the election of the seven directors, who were nominated in accordance with the company’s governing documents. The second item of business is the proposal to ratify the appointment of Baker Tilly Virchow Krause LLP as the independent registered public accounting firm of the Company for the fiscal year ending May 31, 2017. The board recommends a vote For on both items.

Before I report the preliminary vote count for the two proposals, I would like to offer a ballot to any shareholder present who wishes to vote in person at this meeting. If you have already submitted your proxy, you do not need to submit a ballot, unless you wish to change your vote. Does anyone need a ballot who hasn’t voted already? I see no hands, so the voting polls are now closed.

Based on the preliminary report of the inspectors of election, all seven director nominees have been elected to the board, with all nominees receiving at least 99.5% of the votes cast and 88% of the shares outstanding. The proposal to ratify the appointment of Baker Tilly Virchow Krause LLP as the independent registered public accounting firm of the Company for the fiscal year ending May 31, 2017 has been approved, with approximately 99% of the votes cast and 88.4% of the shares outstanding. This completes our formal business.

The next item on the agenda is the Chairman’s report to the shareholders. Mr. Stahl will review key points related to the 2016 financial results. When he has finished his remarks, he and Mr. Bregman will answer questions. At that time, if you have a question, please raise your hand. When you’re recognized, I will bring the microphone to you. Please clearly give your name, and to whom your question is directed. Please speak clearly so everyone can hear the question. Please limit your questions and comments to matters that are of general interest to shareholders. We can continue for a brief time after this meeting is adjourned and before the board meets in executive session.

And now, I will turn the meeting over to the Chairman of the board, Mr. Murray Stahl.

FRMO Corporation - Murray Stahl - Chairman & Chief Executive Officer

Thank you, Thérèse, and thanks to everybody for coming today. I presume you’ve seen or read the shareholder letter, so we won’t reprise the information in it. Instead, we’ll cover the same topics from an entirely different perspective, with a view to giving you more of what our intent is and, to the extent that we can, something about our plans for the future.

First, let me share a fact that has, in and of itself, nothing to do with FRMO, but that you might find intriguing. There is an institution called the Swiss National Bank, which is the central bank of Switzerland. It filed a Form 13F with the Securities and Exchange Commission (SEC), which you can see on the SEC’s website. As far as I can tell, that form discloses that the Swiss National Bank has bought about CHF150 billion (about USD150 billion) of equities. You’ll see the U.S. companies on the Form 13F.

What in the world do the Swiss National Bank equity purchases have to do with FRMO? First, a minor point about the securities list. You can imagine the size and prestige of the companies. Well, they didn’t buy any FRMO. [LAUGHTER] It might be a great thing if they did. Perhaps you might mention it to them if you work in Switzerland.

But the bank’s practice of purchasing equities has more profound implications. In the academic literature regarding investment performance, the idea of indexation, not as an investment vehicle but as a benchmark, is that while it’s possible, in principle, to manipulate a stock, it should not be possible to manipulate the whole index. Think how much money there is, all the flows in and out of the various securities; it’s not seriously possible, except for an entity that has the ability to print its own money.

I mentioned the Swiss National Bank only because it has an SEC filing and you can view that if you care to. But I could have said the Bank of Japan, which is becoming the largest shareholder in every major company in the Nikei 225. I even could have mentioned the Bank of the Czech Republic, the Bank of Israel, or the People’s Bank of China which, as far as I can tell, doesn’t want the Shanghai Stock Index to go below 3,000.

This observation requires everybody’s attention because, for the market to function, there has to be genuine price discovery. Without it, the market does not function properly. If the market is not functioning, then what do the prices really mean? As an investor, you need to contend with a number of things, not the least of which is the question of to what degree the central banks will continue this practice? And how will we know when they cease, if at all? If they do cease, what will

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