**UNITED
                    STATES**
                  **SECURITIES
                    AND EXCHANGE COMMISSION**
                  **WASHINGTON,
                    D.C. 20549**
                QMB
                  APPROVAL
                  OMB
                    Number: 3235-0063
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                    average burden
                  hours
                    per response 2,196.00


**FORM
      10-K/A**





x ANNUAL
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE


SECURITIES
      EXCHANGE ACT OF 1934





For
      the
      fiscal year ended February 28, 2007





o TRANSITION
      REPORT PURSUANT TO SECTION 13(d) OF THE


SECURITIES
      EXCHANGE ACT OF 1934





For
      the
      transition period from___________to________________





Commission
      file number: 0-52241




**FROMEX
                  EQUITY CORP****.**(Exact
                name registrant as specified in its charter)**Delaware**
            
            **04-3826570**(State
                or other jurisdiction of incorporation or 
                organization)
            
            (I.R.S. Employer
                Identification)**320
                Manville Road, Pleasantville, N.
                Y**.
            
            **10570**(Address
                of principal executive
                offices)
            
            (Zip
                Code)




**(Registrant’s
      telephone number, including area code): (914) 632-6730**





**Securities
      Registered Pursuant To Section 12(b) Of The Act: None**





**Securities
      Registered Pursuant To Section 12(g) Of the Act:**




Title
      of Class


Common
      Stock, $0.01 par value





Indicate
      by check mark if the registrant is a well-known seasoned issuer, as defined
      in
      Rule 405 of the Securities Act.


o Yes   xNo





Indicate
      by check mark if the registrant is not required to file reports pursuant to
      Section 13 or Section 15(d) of the Act.


oYes               x No





**Note** -
      Checking the box above will not relieve any registrant to file reports pursuant
      to Section 13 or 15(d) of the Exchange Act from their obligations under those
      Sections.





**Persons
      who respond to the collection of information contained in this form are not
      required to respond unless the form displays a currently valid OMB control
      number.**




SEC
      1673(03-07)









Indicate
      by check mark whether the registrant (i) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
      the
      preceding 12 months (or for such shorter period that the registrant was required
      to file such reports), and (2) has been subject to such filing requirements
      for
      the past 90 days.


x Yes   o No





Indicate
      by check mark if disclosure of delinquent filers pursuant to Item 405 of
      Regulation S-K (§229.405 of this chapter) is not contained herein, and will not
      be contained, to the best of registrant’s knowledge, in definitive proxy or
      information statements incorporated by reference in Part III of this Form 10-K
      or any amendment to this Form 10-K.


x





Indicate
      by check mark whether the registrant is a large accelerated filer, an
      accelerated filer, or a non-accelerated filer. See definition of “accelerated
      filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check
      One).





Large
      accelerated filero    Accelerated
      filero    Non-accelerated
      filerx




Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Act). o Yes
x No





State
      the
      aggregate market value of the voting and non-voting common equity held by
      non-affiliates computed by reference to the price at which the common equity
      was
      last sold, or the average bid and asked price of such common equity, as of
      the
      last business day of the registrant’s most recently completed second fiscal
      quarter.  $0.





**Note** .
      - If a
      determination as to whether a particular person or entity is an affiliate cannot
      be made without involving unreasonable effort and expense, the aggregate market
      value of the common stock held by non-affiliates may be calculated on the basis
      of assumptions reasonable under the circumstances, provided that the assumptions
      are set forth in this Form.





Indicate
      the number of shares outstanding of each of the registrant’s classes of common
      stock, as of the latest practicable date. As of May 29, 2007, 14,400,000 shares
      were outstanding.




DOCUMENTS
      INCORPORATED BY REFERENCE





List
      hereunder the following documents if incorporated by reference and the Part
      of
      the Form 10-K (e. g., Part I. Part II, etc.) into which the document is
      incorporated: the registrant’s definitive information statement to be filed
      within 120 days after the close of the year ended February 28, 2007 is
      incorporated by reference in Part III of this Form 10-K.




**EXPLANATORY
      NOTE**





The
      sole
      purposes of this amendment are:




1.
              To
                  correct “Item 9A. Controls and Procedures” at page 19 to indicate that
                  management’s evaluation of the effectiveness of its disclosure controls
                  and procedures was conductedas
                  of the end of period covered by this reportand not during the 90-day period prior to the date of this report.
                  See
                  corrected Item 9 with the correct text underlined at the beginning
                  of the
                  second paragraph.


2.
            To
                revise paragraphs 1 and 5a of “Exhibit 31.1 and 31.2 - Certifications” to
                refer to theannualreport in paragraph 1 rather than the quarterly report and to add
                the
                words “and
                material weaknesses”
                in paragraph 5a. See the corrected Exhibits 31.1 and 31.2 herein
                with the
                corrected text underlined.










**FROMEX
      EQUITY CORP.**





**ANNUAL
      REPORT ON FROM 10-K**





**FOR
      THE FISCAL YEAR ENDED FEBRUARY 28, 2007**




Page
                No.**PART
                I**Item 1.
            Business
            1Item 1A.
            Risk Factors
            8Item 2.
            Properties
            11Item 3.
            Legal Proceedings
            11Item 4.
            Submission of Matters to a Vote of Security Holders
                and
              Other
                Information
            11**PART
                II**Item 5.
            Market for Registrant’s Common Equity, Related
                Stockholder
              Matters
                and Issuer Purchases of Equity Securities
            11Item 6.
            Selected Financial Data
            13Item 7.
            Management’s Discussion and Analysis of Financial
                Condition
              and
                Results of Operations
            14Item 7A.
            Quantitative and Qualitative Disclosures
              Of
              Market Risk
            18Item 8.
            Financial Statements and Supplementary
              Date
            19Item 9.
            Changes in and Disagreements with Accountants
                on
                Accounting
              and
                Financial Disclosure
            19Item 9A.
            Controls and Procedures
            19**PART
                III**Item 10.
            Directors, Executive Officers and Corporate
              Governance
            20Item 11.
            Executive Compensation
            20Item 12.
            Security Ownership of Certain Beneficial Owners
                and
                Management
              and
                Related Stockholder Matters
            20Item 13.
            Certain Relationships and Related Transactions,
                and
                Director
              Independence
            20Item 14.
            Principal Accountants Fees and
              Services
            20**PART
                IV**Item 15.
            Exhibits,
              Financial Statements Schedules
            21









**PART
        I**




**ITEM
      1. BUSINESS**




**Organization
      of the Company**





Fromex
      Equity Corp. (the “Company” or “Fromex”) was incorporated in the State of
      Delaware on August 31, 2005 as a wholly owned subsidiary of FRMO Corp. (“FRMO”).
      Fromex has a fiscal year ending on the last day of February, as does its parent
      company FRMO. As of February 28, 2007 Fromex had 14,400,000 shares of common
      stock, par value $.01 per share, issued and outstanding all of which are owned
      by FRMO, for which it paid $844,000, $144,000 for the par value and $700,000
      for
      Fromex’s capital in excess of par value.





**Spin-off
      of Fromex**




On
      August
      31, 2005, FRMO filed Form 8-K with the Securities and Exchange Commission
      disclosing the formation of Fromex and the intended distribution to FRMO
      shareholders of 5% of the Fromex shares. In subsequent Form 8-K information
      filings it was announced that the timing and precise form of the spin-off would
      be postponed until a better procedure was identified for resolving the problem
      created by the new accounting rule (EITF 03-16). That rule, which was effective
      from and after September 1, 2004, mandated a change in the accounting policy
      for
      reporting revenue from FRMO’s 8.4% interest in Kinetics’ Advisers, LLC
      (“Kinetics”) from the cost (cash) method to the equity (accrual) method, as
      reported in FRMO’s Form 8-K dated June 16, 2005. For a variety of reasons,
      including the Kinetics practice, as a private company, of using the cash-basis
      method of accounting and the difficulty of securing audited and accrual-basis
      financial statements suitable for a public reporting company, FRMO could not
      itself report accrual-basis financial statements.




On
      December 9, 2005 the Board of Directors of FRMO authorized the preparation
      of a
      Form 10 Registration Statement for the shares of common stock of Fromex pursuant
      to Section 12(g) of the Securities Exchange Act of 1934 (the “Exchange Act”).
      FRMO plans to distribute, five weeks after all SEC comments with respect to
      this
      Registration Statement have been cleared, to its shareholders as of the close
      of
      business on a date which is 21 days prior to the distribution date (the “record
      date”), one share of Fromex common stock for each 50 shares of FRMO common stock
      then outstanding. FRMO has 36,137,774 shares of common stock presently
      outstanding which means that approximately 720,000 shares of Fromex common
      stock
      (taking into consideration the payment of cash for fractional shares) will
      be
      distributed, representing 5% of the 14,400,000 shares of Fromex issued and
      outstanding. Fractional shares will be paid in cash based on the average of
      the
      high bid price in the first 15 trading days after the distribution date and/or,
      if the Board of Directors deem it necessary or appropriate, on an independent
      appraisal of market value. It is expected that the aggregate of cash paid for
      fractional shares will not exceed $1,000. The distribution of cash in lieu
      of
      fractional shares will not occur at the same time as the distribution of common
      stock.




1




**Control
      Group**





**Murray
      Stahl and Steven Bregman** are the
      Chairman and President of both FRMO and Fromex. They are principal persons
      in
      the Stahl-Bregman Group which controls FRMO and, after the spin-off distribution
      date, will control Fromex. 28,883,274 shares of common stock of FRMO are owned
      by the Stahl Bregman Group, which will receive 577,665 shares of Fromex in
      the
      distribution. The Stahl Bregman Group, includes Murray Stahl, Steven Bregman,
      John Meditz, Peter Doyle, Catherine Bradford, Thomas C. Ewing and Katherine
      Ewing. See Item 12 below.




**Description
      of Business of Fromex**





**Restatement
      of Financial Statements**





The
      financial statements for the period August 31, 2005 (inception) to February
      28,
      2006 have been restated as described below.





FRMO,
      the
      Company’s parent held a 60% interest in Horizon Advisers, a fund management
      firm. On December 1, 2005, FRMO transferred and assigned to Fromex a 66 2/3%
      interest in its share of fees earned by Horizon Advisers, as and when received
      by FRMO. The fair value of this revenue stream, estimated at $250,000, was
      initially recognized as a capital contribution by FRMO to Fromex, generating
      an
      intangible asset of $250,000. This asset was being amortized over an estimated
      useful economic life of 10 years.





Upon
      subsequent analysis, it was determined that, because no value had been assigned
      to the Horizon Advisers revenue stream as reported on the accounts of FRMO,
      the
      Company’s parent, no value should have been attributed to the 66 2/3% interest
      upon transfer to Fromex. Accordingly, financial statements have been restated
      to
      attribute no value to the assigned interest, and the reversal of amortization
      recorded on the initial valuation. This restatement did not result in a change
      to the reported earnings per share.





See
      Note
      2A to Notes to Financial Statements.




**Consulting
      Agreement**




Fromex
      has entered into a contract with FRMO to perform consulting and management
      services to FRMO for which FRMO has agreed to pay Fromex ten (10%) percent
      of
      the cash receipts which FRMO receives from its rights to share in fees generated
      by its third party customers during the term of the agreement (the “Consulting
      Agreement”). The term of the Consulting Agreement is from December 1, 2005 until
      February 28, 2010 (as amended on December 26, 2006) and for each twelve (12)
      month period thereafter unless terminated or amended by an instrument in writing
      signed by both parties on or before January 15 preceding the end of a respective
      term.




2




Fromex’s
      services include the administrative aspect of FRMO’s business activities such as
      operations, bookkeeping, personnel responsibilities and periodic consulting
      with
      the FRMO’s chief financial officer, but do not include the research, business
      development activities or the services rendered by FRMO or its third party
      customers, which produce FRMO’s cash receipts. FRMO shall pay to Fromex as its
      fees an amount equal to 10% of total cash receipts that FRMO receives from
      its
      customers during the term of the Consulting Agreement. Fees for Fromex’s
      services are based only on the fees collected by FRMO in each three (3) month
      period beginning December 1, 2005 and shall not include a percentage of any
      receivable or accrual until the amount is actually received by FRMO. The payment
      of such services shall be made on or before the close of the month following
      the
      end of said three month period.








The
      first
      accounting period was the three months which commenced December 1, 2005 and
      ended February 28, 2006, for which Fromex received $117,013 on March 24, 2006,
      based on the following cash receipts of FRMO in that quarterly period. In
      addition, the FRMO cash receipts in the current fiscal year, namely from March
      1, 2006 to February 28, 2007 were as set forth below.




FRMO’s
                Cash Receipts From
              
              3/1/06
                  - 2/28/07
              
              12/1/05
                  - 2/28/06Kinetics
                  Advisers’ Hedge Funds
              
              $
              2,656,523
              
              $
              959,311Kinetics
                  Paradigm Mutual Fund
              
              
              1,984,247
              
              
              174,332Sub
                  - Advisory Fees
              
              
              317,935
              
              
              0Other
                  Fees
              
              
              151,617
              
              
              36,491Total
              
              $
              5,110,322
              
              $
              1,170,13410%
                  payable to Fromex
              
              $
              511,032
              
              $
              117,013




FRMO’s
      cash receipts increased in the two prior fiscal years, which are set forth
      below
      to illustrate its growth in that period. See the total of $5,110,322 above
      for
      the last fiscal year, but past performance is no guaranty of future
      results:




FRMO’s
                Cash Receipts From:
              
              
              3/1/05
                  - 2/28/06
              
              
              3/1/04
                  - 2/28/05Kinetics
                  Advisers’ Hedge Funds
              
              $
              1,978,026
              
              $
              274,728Kinetics
                  Paradigm Mutual Fund
              
              
              410,020
              
              
              118,394Sub-Advisory
                  Fees
              
              
              74,770
              
              
              (9,335
              )Other
                  Fees
              
              
              142,925
              
              
              134,308Total
              
              $
              2,605,741
              
              $
              518,095


Since
      the
      Consulting Agreement commenced December 1, 2005, only $489,711 was received
      by
      Fromex.




The
      business of FRMO, and its third party customers focuses on intellectual capital,
      research and analysis of public companies within a framework of identifying
      investment strategies and techniques that reduce risk. This includes the
      identification of assets, particularly in the early stages of the expression
      of
      their ultimate value, and the participation with them in ways that are
      calculated to increase the value of the interest of FRMO’s shareholders. Such
      assets include, but are not limited to, those whose value and earnings are
      based
      on intellectual capital.





3





FRMO’s
      cash receipts derive from its rights to share in fees generated by the third
      parties customers in the programs described below, namely (i) from an 8.4%
      equity interest in Kinetics Advisers LLC which earns management and performance
      fees as investment advisor to hedge funds, (ii) from 100% of the research fees
      to which Horizon Research Group a division of Horizon Asset Management, Inc.
      (“Horizon Management”) is entitled to receive from Kinetics Paradigm Fund, a
      publicly traded mutual fund and (iii) from a one-third interest in the
      Sub-Advisory Fee Revenue that Horizon Management receives from a large
      investment firm. See Item 7 below as to the relationship with Horizon
      Management, which provides the strategic research and business development
      with
      a view to produce better than average investment returns and growth in assets
      under management. This, in turn, increases the fees which are received and
      FRMO’s share thereof. The three significant programs are:




(i)  Kinetics
      Advisers’ Hedge Funds .
      FRMO
      has an 8.4% equity interest, which it acquired for common stock, in Kinetics
      Advisers’ LLC, which provides investment advice to hedge funds that were small
      when FRMO acquired its interest but which have been expanding dramatically.
      Kinetics Advisers LLC manages the portfolios of both (i) Kinetics Partners,
      LP,
      a Delaware limited partnership (the “domestic portion of the hedge fund”) and
      (ii) Kinetics Fund, Inc., an exempted company registered under the Caymen
      Islands Mutual Funds Law (the “offshore portion of the hedge fund”) with the
      same strategies. On a cumulative basis over its 5 year - 4 month period from
      inception through December 31, 2005, the domestic portion of the hedge fund
      returned 150% and over the 4 year - 11 month period from inception through
      December 31, 2005 the offshore portion of the hedge fund returned 108% whereas
      the S&P 500 Index
      lost 10% and gained 1%, respectively. In the period from January 1, 2006 to
      December 31, 2006 both the domestic and offshore portions of the hedge fund
      returned 33.2% compared to 15.8% for the S&P 500 Index.




Kinetics
      Advisers, LLC earns a monthly management fee based on a percentage of the net
      assets of each Fund on the last day of each month. The percentage is 1% per
      annum for the domestic fund and 1 1⁄4% per annum for the offshore fund. In
      addition a quarterly performance fee for both funds is earned equal to 20%
      of
      net profits. In the case of the offshore fund Kinetics Advisers LLC elects
      to
      defer a portion of its management and performance fees earned for a particular
      fiscal year because such deferred compensation from the offshore fund is not
      taxable for United States income tax purposes until the year in which it is
      received by Kinetics Advisers, LLC. Kinetics Advisers LLC distributes, generally
      on a quarterly basis, substantially all of the management and performance fees
      it receives in cash, after paying its expenses, to its equity investors and
      FRMO
      receives 8.4% of such cash distributions. Kinetics Advisers, LLC reports to
      its
      equity investors and files its United States income tax returns on a cash basis
      without accruing the portion of the deferred management and performance fees
      until the deferred compensation is received.





4




(ii)  Kinetics
      Paradigm Mutual Fund .
      FRMO
      acquired for its common stock 100% of the research fees to which Horizon
      Management is entitled from the open-end mutual fund Kinetics Paradigm Fund
      (trading symbol WWNPX). That fund was small when the acquisition was made but
      it
      has grown significantly based on its performance. That research fee is 0.12%
      per
      annum of the net assets of the fund which FRMO receives on a monthly basis
      from
      Kinetics Paradigm Fund. Kinetics Paradigm Fund was assigned a five-star rating
      by Morningstar, Inc. in May 2003, the first time it became eligible for rating,
      and has continued to receive that highest Morningstar rating. In the period
      from
      January 1, 2006 to December 31, 2006 the Kinetics Paradigm Fund returned 27.8%
      compared to 15.8% for the S&P 500 Index.




(iii)  Sub-Advisory
      Fees .  On
      June
      1, 2004, FRMO acquired for common stock a one-third interest in the Sub-Advisory
      Fee Revenue that Horizon Asset Management, Inc. receives in its sub-advisory
      program for a large investment firm. Under this program, Horizon Management
      provides investment advisory services to certain clients of the investment
      firm,
      its fees being calculated on the basis of assets under management. While the
      assets under management in this program were quite modest at the time of
      acquisition, they have expanded significantly as shown below. Horizon Management
      receives 0.50% per annum of the net assets in the program on a quarterly basis
      and pays one-third of that amount, net of marketing expenses, to FRMO on a
      quarterly basis. In the period from January 1, 2006 to December 31, 2006 the
      Sub-Advisory Program returned 28.5% compared to 15.8% for the S&P 500
      Index.




FRMO’s
      share of the fees which are received under these three programs, and therefore
      Fromex’s 10% share of the cash receipts therefrom, are based on the assets under
      management. The approximate net asset levels for these three programs at
      specific dates are presented below. All three have continued to produce
      portfolio-level investment returns in the double-digit range, which appears
      to
      be the critical requirement for continued asset accumulation. This past
      performance, however, is not a guaranty of future result.




Asset
                  Levels in Millions (000,000
                  omitted)December
                  31,
              
              
              December
                  31,
              
              
              December
                  31,Program
              
              
              2004
              
              
              2005
              
              
              2006Kinetics
                  Advisers’ Hedge Funds
              
              $
              1,085
              
              $
              l,730
              
              $
              2,800Kinetics
                  Paradigm Fund
              
              
              125
              
              
              530
              
              
              2,145Sub-Advisory
                  Program
              
              
              115
              
              
              615
              
              
              1,630Total
              
              $
              1,325
              
              $
              2,875
              
              $
              6,575




FRMO
      also
      receives other fees from two sources: from a consulting agreement with a hedge
      fund that pays FRMO about $35,000 per year for access to consultation with
      FRMO’s officers; and from a small interest in the subscription revenues of an
      investment research publication. These two sources of cash receipts have been
      small and are not expected to grow or be significant in FRMO’s future revenue
      stream.




**Fromex’s
      Other Business Activities.**





5





**Horizon
      Global Advisers, LLC**





Horizon
      Global Advisers, LLC is a registered United States Investment adviser organized
      in Delaware (“Horizon Advisers”). On April 24, 2007 FRMO transferred to Fromex
      its 60% equity interest in Horizon Advisers as a contribution to the capital
      of
      Fromex. The other 40% ownership interest is owned by an individual who is an
      officer and employee of Horizon Advisers but not an officer or director of
      Fromex. Fromex’s 60% ownership interest subsumes its prior 40% revenue interest
      in FRMO’s receipt of net fees. FRMO has no further interest in Horizon Advisers.
      Fromex and Horizon Advisers will be filing consolidated financial statements
      for
      the three months ending May 31, 2007.





Horizon
      Advisers has four employees, other than the executive officers of Fromex. They
      are responsible for the management of the two funds described below, for which
      Horizon Advisers is the investment manager. Their activities also include the
      development of new funds for which Horizon Advisers may be appointed as
      investment manager as well as other funds, like the Protostar Fund described
      below, in which Fromex purchased a revenue interest.




Since
      December 26, 2006 Fromex’s Board of Directors is composed of a majority of
      persons who are not directors of FRMO. They are responsible for the oversight
      of
      Fromex’s subsidiary, Horizon Advisers, and development of additional business
      opportunities, including the compensation of the experienced investment
      professionals who will deliver idea generation and execution across Fromex’s
      business model. Revenues in Fromex’s fiscal year, March 1, 2007 to February 28,
      2008 will include revenue to be derived from Fromex’s equity interest in the net
      fees received from the two funds described below:




(i)  **Horizon
      Global Advisers Fund, plc** (the
      “Horizon Fund” **)** is
      an **** open-ended
      variable capital investment company incorporated with limited liability in
      Ireland. Horizon Advisers is the investment manager for the Horizon Fund. The
      Horizon Fund is constituted as an umbrella fund insofar as its share capital
      will be divided into different series of shares with each series of shares
      representing a separate portfolio of assets, and comprising a separate sub-fund
      (a “Fund”) of the Horizon Fund. The first of said sub-funds, Horizon
      Opportunistic Value Fund, has been listed for trading on the Irish Stock
      Exchange. As of March 31, 2007 Horizon Advisers managed $72 million of assets
      in
      the Horizon Fund and $111 million in domestic advisory accounts. Horizon
      Advisers receives management fees based on assets under management. See Item
      7
      below.




(ii)   **Horizon
      Multi-Strategy Fund** (the
      “Multi-Strategy Fund”) is a hedge fund with a domestic portion (a Delaware
      limited partnership) and an offshore portion (an exempted company incorporated
      pursuant to the Companies Law of the Caymen Islands). Horizon Advisers, is
      the
      investment manager, which uses the same long and short strategies for both
      the
      domestic and offshore portions, the objective of which is to achieve long-term
      capital appreciation. Horizon Advisers has entered into a placement agreement
      with Credit Suisse Securities (USA) LLC to provide marketing services, investor
      relations and support services for the Multi-Strategy Fund. As of March 31,
      2007
      the Multi-Strategy Fund had $206 million dollars of assets under management.
      Horizon Advisers receives management and performance fees. See Item 7
      below.





6





**Protostar
      Fund** (the
“Protostar Fund”) is a hedge fund with a domestic portion (a Delaware limited
      partnership) and an offshore portion (an exempted company incorporated pursuant
      to the Companies Law of the Caymen Islands). Horizon Asset Management, Inc.
      (“Horizon Management”) has a 45% general partner interest in Protostar Fund and
      is its investment manager, using the same strategies for both the domestic
      and
      offshore portions. The Fund’s principal investment objective is to achieve
      long-term superior risk-adjusted capital growth by investing primarily in
      equity-securities and equity-related instruments. The Fund’s portfolio includes
      both long and short positions in securities of companies. As of April 30, 2007
      when the Protostar Fund had $16 million dollars of assets under management,
      Fromex acquired for $72,000 a one-third share of the net amounts to be received
      in cash by Horizon Management by reason of its interests as a general partner
      and investment manager of Protostar Fund. See Item 7 below.





See
      Item
      13 below for the relationships among Fromex, Horizon Advisers, Horizon
      Management and the Stahl-Bregman Group.




**Marketing**





Currently,
      the marketing of the Company’s services and the development of new programs are
      by the employees of Fromex and its subsidiary, Horizon Advisers.




**Competition**





The
      business activities of Fromex and Horizon Advisers are founded on the
      independent research experience of its personnel who provide in-depth analysis
      of information-poor, under-researched or complex companies and securities,
      and
      develop related strategies that can offer an advantage to the investor. This
      research is distinct from, but competes with, the traditional “sell side”
research supported by the trading commissions and corporate finance fees of
      brokerage firms that produce the great majority of “Wall Street” research.
      Fromex will be competing with these firms as well as other investment management
      firms. Fromex is small in relation to such competitors but their services and
      programs are designed to reach a niche market of sophisticated analysts and
      accredited investors.





**Trademarks**





None.





**Employees**





As
      of
      April 30, 2007 Fromex had four employees excluding its three executive officers.





7





**Regulatory
      Laws** .




The
      Company is in compliance with the labor, health, occupancy and environmental
      regulatory laws that relate to businesses generally. The cost of such compliance
      does not have a material effect on its business. Its operations do not fall
      within the definition of an investment company so as to require it to register
      under the Investment Company Act of 1940. On December 13, 2006, the Securities
      and Exchange Commission issued proposed regulations that (i) would increase
      the
      financial qualifications for investors in hedge funds to a net worth of $2.5
      million from the current standard of $1 million and (ii) would enact a new
      provision on fraud to protect hedge fund investors. The proposed new rules
      will
      not have a material adverse affect on the revenue of Fromex or FRMO. If further
      laws and regulations were to be adopted which impose tougher requirements on
      hedge funds or additional financial burdens on managers of hedge funds, this
      could decrease the Company’s revenues and impede its growth.




**Item
      1A. Risk Factors**




Some
      of
      the information in this Form 10, including the risk factors listed below,
      contain “forward looking statements” that involve risk and uncertainties.
“Forward-looking statements” are those that relate to continuing business and
      the Company’s future financial performance. In


many
      cases, forward-looking statements can be identified by words such as
“anticipate”, “believe”. “continue”, “estimate”, “expect”, “may”, “plan”,
“potential”, “predict”, “should”, “will”,
      or the negative of such words and other comparable terminology that bespeak
      of
      the future rather than historical fact.





Undue
      reliance should not be placed on these statements, which speak only as of the
      date that they were made. Actual results could differ materially from those
      anticipated in these forward-looking statements as a result of certain factors,
      including the risks described below and elsewhere in this Form 10-K. The Company
      does not undertake any obligation to publicly update any revisions to
      forward-looking statements to reflect later circumstances or to reflect the
      occurrence of unanticipated events.





The
      Company believes it is important to communicate its expectations to
      shareholders. However, there may be events in the future that management is
      not
      able to predict accurately or over which it has no control. The risk factors
      listed below include a discussion of all known material risks to investors
      that
      may cause actual results to differ materially from the expectations described
      in
      the forward-looking statements.





**The
      Company’s common stock has never been publicly traded, the price may fluctuate
      significantly and a market may not develop for its shares.**





There
      has
      never been a market for the common stock of Fromex and quotation on the
      Over-the-Counter Bulletin Board, which the Company intends to seek, may not
      happen promptly or at all. A
      market
      maker will need to apply to have the Company’s shares traded on the Bulletin
      Board. An active trading market may not develop even if quotes on Fromex’s stock
      do appear on the Over-the-Counter Bulletin Board.





8





**Because
      FRMO will continue to own more than 50% of the Company’s common stock, other
      shareholders may have no effective voting power or control over the Company’s
      affairs or decisions.**




After
      the
      distribution date of the spin-off, FRMO will continue to own 95% of the issued
      and outstanding shares of common stock of Fromex and the other shareholders
      will
      effectively have no control over the Company’s operations or future business
      decisions. FRMO’s management control over the Company’s affairs will include the
      power to (i) elect directors, (ii) appoint management and (iii) approve, without
      a shareholder’s meeting or vote, any action that usually requires shareholder
      authorization, including the adoption of amendments to the certificate of
      incorporation and approval of mergers or sales of substantially all of the
      Company’s assets. FRMO, in turn, is controlled by the Stahl-Bregman Group. See
      Item 13 below.




**Because
      the Company may, at some time in the future, issue additional securities,
      shareholders are subject to dilution of their ownership.**




Although
      the Company has no present intention to raise additional capital through the
      issuance of additional shares of common stock, it may at some time in the future
      do so. Any such issuance would likely dilute shareholders’ ownership interest in
      the Company and may have an adverse impact on the price of the Company’s common
      stock. The Company does not presently have a Stock Option Plan for key
      management personnel but may adopt one in the future and the exercise of options
      issued under the plan will also dilute the shareholders’ ownership
      interest.




**Government
      regulations and legal uncertainties may place financial burdens on the Company’s
      business.**




The
      Company ultimately derives its revenue from investment management fees, a
      business which is currently subject to federal and state laws and regulations
      affecting investment advisers and managers, which afford protection to investors
      in mutual and hedge funds. Moreover new laws and regulations may be adopted
      which will adversely affect the revenue of the Company as well as the Company’s
      ability to be profitable on its business development programs. These factors
      may
      place new or additional financial burdens on managers of hedge funds and thereby
      decrease the Company’s revenues and impede its growth.




**The
      Company’s revenues are derived in part from agreements with companies controlled
      by members of the Stahl-Bregman Group, doing business as advisers in the capital
      markets.**





9





The
      executive officers of the Company are the principal beneficial owners in the
      Stahl-Bregman Group, which controls Fromex, FRMO, and Horizon Asset Management,
      Inc. Fromex’s present agreements with those entities will provide a portion of
      the revenue of the Company. A decline in the capital markets may adversely
      affect the revenues from those agreements. Additional business development
      programs, which are not independent of those entities depend in large part
      on
      future decisions of the Stahl-Bregman Group, which cannot be assured. Horizon
      Advisers is controlled by Fromex and its revenues are not dependent on
      agreements with companies controlled by the Stahl-Bregman Group.




**There
      are inherent conflicts of interest between FRMO and Fromex associated with
      the
      common management and Board of Directors.**




After
      the
      spin-off, when Fromex will be a 95%, instead of 100%, subsidiary of FRMO, there
      may be transactions between the two corporations which present a conflict of
      interest. In such event it will be incumbent on the respective Boards of
      Directors to determine that the transaction would have been the same if there
      had not been such a conflict of interest. Fromex’s Code of Ethics provides that
      a conflict of interest exists when a person’s personal interests influence, or
      reasonably appear to influence, their judgment or ability to act in the best
      interests of the Company and its shareholders and it is the person’s duty to
      make a full disclosure of the situation to the Company and/or the Board of
      Directors. An example of a conflict of interest would be a transaction whereby
      FRMO sells to Fromex the rights to a portion of the revenues under an agreement
      with a third party if the negotiation between FRMO and Fromex would not be
      at
      arms length because the Boards of Directors were composed of a majority of
      the
      same persons. From December 26, 2006 to May 29, 2006 a majority of the Board
      of
      Directors of Fromex were composed of persons who are not officers or directors
      of FRMO.




**Fromex
      is dependent on FRMO with respect to the Consulting Agreement that is terminable
      each year after February 28, 2010 by consent of both parties, which are
      controlled by the same individuals.**




The
      Consulting Agreement between Fromex and FRMO provides that it continues until
      February 28, 2010 and thereafter from fiscal year to fiscal year unless
      terminated or amended by an instrument in writing signed by both parties on
      or
      before January 15 preceding the end of a respective term. The risk for Fromex
      is
      that the controlling share ownership of both corporations is with the
      Stahl-Bregman Group which may act adversely to the interests of Fromex. If
      the
      Consulting Agreement were not to be continued after February 28, 2010 Fromex
      would not generate any revenues from that source. It would be left with the
      revenue interests in the fees received by the investment managers of the Horizon
      Fund, the Multi-Strategy Fund, the Protostar Fund and any future activities
      it
      may develop.





10





**ITEM
      2. PROPERTIES**





Fromex
      does not now own any property. The Company’s principal place of business is
      located at 320 Manville Road, Pleasantville, N. Y. 10570.




**ITEM
      3. LEGAL PROCEEDINGS**





Fromex
      is
      not a party to any material litigation.





**ITEM
      4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS AND**


**OTHER
      INFORMATION**





None.





**PART
      II**




**ITEM
      5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED**


**** **STOCKHOLDER
      MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES**








**Registration
      and Market Prices of Common Stock**





The
      authorized capital stock of the Company consists of 20,000,000 shares of common
      stock, $.01 par value, of which 14,400,000 shares are outstanding, all of which
      are owned by FRMO, the Company’s parent. Holders of common stock are
      entitled:





- to
      receive dividends as are declared by Fromex’s Board of Directors out of funds
      legally available; and


- to
      full
      voting rights, each share being entitled to one vote.





The
      Fromex Board of Directors may issue additional authorized shares of common
      stock
      without shareholder approval. Fromex shareholders do not have any cumulative
      rights or any preemptive rights to subscribe for additional securities that
      Fromex may issue without obtaining shareholder consent. In the event of
      liquidation, dissolution, or winding up of the company, common shareholders
      would be entitled to receive, on a pro rata basis, any assets distributable
      to
      shareholders in respect of shares owned by them.





Fromex
      has filed with the SEC a General Form Registration (Form 10), as amended May
      11,
      2007, to register its common stock pursuant to Section 12(g) of the Securities
      Exchange Act of 1934.
      As
      of May 29, 2007, the SEC’s comments with respect to the May 11, 2007 amendment
      to Form 10 have not been received.





**Market**





The
      Company’s common stock has never been traded and a market may not develop for
      its shares. See the first risk factor under Item 1A above.




11




**Dividends**





No
      cash
      dividend has been paid by Fromex since its inception. The Company has no present
      intention of paying any cash dividends on its common stock.





**Holders**





As
      of May
      29, 2007, FRMO owned all of the 14,400,000 outstanding shares of common stock.
      See “Spin-off of Fromex” in Item 1 above. There are no options or warrants to
      purchase common stock of the Company outstanding. The Company has not agreed
      to
      register any common stock for sale under the Securities Act by any shareholder
      or the Company, the offering of which could have a material effect on the market
      price of the Company’s common equity.





In
      addition to the 14,400,000 shares of the Fromex’s common stock, which are issued
      and outstanding, a total of 1,420 shares of Fromex common stock are reserved
      for
      issuance to provide for the equitable adjustment required by FRMO’s outstanding
      stock options and convertible preferred stock as follows:




(i)
            1
                share of Fromex common stock for each 50 shares of FRMO common stock
                issued upon conversion of Series R Preferred Stock of FRMO (a maximum
                of
                1,000 shares of Fromex common stock on conversion of all outstanding
                preferred stock of FRMO).(ii)
            1
                share of Fromex common stock for each 50 shares of FRMO common stock
                issued upon exercise of the following stock options (a maximum of
                420
                shares of Fromex common stock on exercise of all outstanding stock
                options) held by persons named in the table
                below:





Name
              
              
              No.
                  of FRMO
                Shares
              
              
              Expiration
                Date
              
              
              Option
                  price
                Per
                  ShareAllan
                  Kornfeld,
              
              
              3,000
              
              
              7/17/08
              
              $
              0.40Director
              
              
              3,000
              
              
              7/15/11
              
              
              1.006,000
              
              
              6/19/13
              
              
              4.00Jay
                  Hirschson,
              
              
              3,000
              
              
              6/19/13
              
              
              4.00DirectorDavid
                  Michael,
              
              
              3,000
              
              
              7/18/07
              
              
              .40Former
                    Director
              
              
              3,000
              
              
              7/17/08
              
              
              .40


**Issuer
      Purchases of Equity Securities**





None




12





**ITEM
      6. SELECTED FINANCIAL DATA**





The
      Company had no operations prior to August 31, 2005 and accordingly, there is
      no
      selected financial data to report before that date.




Fromex
      Equity Corp.


Selected
      Consolidated Financial Data




Year
                Ended
                February
                  28, 2007
              
              
              Period
                August
                  31, 2005
                (Inception)
                  to
                February
                  28, 2006(Restated)Income
                  Statement Data:Total
                  Revenue
              
              $
              511,032
              
              $
              117,013Costs
                  and expenses
              
              
              124,009
              
              
              47,126Income
                  from operations
              
              
              387,023
              
              
              69,887Interest
                  Income
              
              
              19,436
              
              
              1,316Income
                  before provisionfor
                  income taxes
              
              
              406,459
              
              
              71,203Provision
                  for income taxes
              
              
              (190,000
              )
              
              (23,000
              )Net
                  Income
              
              $
              216,459
              
              $
              48,203Earnings
                  per common share:Primary
                  and fully diluted
              
              $
              0.02
              
              $
              0.00Number
                  of shares used in computation ofprimary
                  and diluted earnings per share
              
              
              14,400,000
              
              
              14,400,000
  As
                  of
                February
                  28, 2007
              
              As
                  of
                  February
                    28, 2006(Restated)Balance
                  Sheet Data:Working
                  Capital
              
              $
              1,205,537
              
              $
              913.078Total
                  Assets
              
              $
              1,276,037
              
              $
              1,267,548Long-Term
                  Debt
              
              $
              -
              
              $
              -Stockholder’s
                  Equity
              
              $
              1,205,537
              
              $
              914,078Book
                  Value per Share
              
              $
              0.08
              
              $
              0.06Common
                  Shares Outstanding
              
              
              14,400,000
              
              
              14,400,000




13




**ITEM
      7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
      OPERATIONS**




All
      statements contained herein that are not historical facts, including but not
      limited to, statements regarding future operations, financial condition and
      liquidity, capital requirements and the Company’s future development plans are
      based on current expectations. These statements are forward looking in nature
      and involve a number of risks and uncertainties. Actual results
      may differ materially. Among the factors that could cause actual results to
      differ materially are the following: changes in the financial markets, and
      other
      risk factors described herein and in the Company’s reports to be filed from time
      to time with the Commission. The discussion and analysis below is based on
      the
      Company’s Financial Statements and related Notes thereto included herein and
      incorporated herein by reference.




**RESTATEMENT
      OF FINANCIAL STATEMENTS**




The
      financial statements for the period August 31, 2005 (inception) to February
      28,
      2006 and for the nine months ended November 30, 2006 have been restated. FRMO,
      the Company’s parent held a 60% interest in Horizon Advisers, a fund management
      firm. On December 1, 2005, FRMO transferred and assigned to Fromex a 66 2/3%
      interest in its share of fees earned by Horizon Advisers, as and when received
      by FRMO. The fair value of this revenue stream, estimated at $250,000, was
      initially recognized as a capital contribution by FRMO to Fromex, generating
      an
      intangible asset of $250,000. This asset was being amortized over an estimated
      useful economic life of 10 years. Upon subsequent analysis, it was determined
      that, because no value had been assigned to the Horizon Advisers revenue stream
      as reported in the accounts of FRMO, the Company’s parent, no value should have
      been attributed to the 66 2/3% interest upon transfer
      to Fromex. Accordingly, financial statements have been restated to attribute
      no
      value to the assigned interest, and the reversal of amortization recorded on
      the
      initial valuation. See Note 2A of the Notes to Financial
      Statements.




**OVERVIEW**





**Critical
      Accounting Policies**




*Revenue
      Recognition*




Fromex
      has entered into a contract with FRMO to perform consulting and management
      services to FRMO for which FRMO has agreed to pay Fromex ten (10%) percent
      of
      the cash receipts which FRMO receives from its rights to share in fees generated
      by its third party customers during the term of the agreement (the “Consulting
      Agreement”). The term of the Consulting Agreement is from December 1, 2005 until
      February 28, 2010 (as amended on December 26, 2006) and for each twelve (12)
      month period thereafter unless terminated or amended by an instrument in writing
      signed by both parties on or before January 15 preceding the end of a respective
      term.





14





Fromex’s
      services include the administrative aspect of FRMO’s business activities such as
      operations, bookkeeping, personnel responsibilities and periodic consulting
      with
      the FRMO’s chief financial officer, but do not include the research, business
      development activities or the services rendered by FRMO or its third party
      customers, which produce FRMO’s cash receipts. FRMO shall pay to Fromex as its
      fees an amount equal to 10% of total cash receipts that FRMO receives from
      its
      customers during the term of the Consulting Agreement. Fees for Fromex’s
      services are based only on the fees collected by FRMO in each three (3) month
      period beginning December 1, 2005 and shall not include a percentage of any
      receivable or accrual until the amount is actually received by FRMO. The payment
      of such services shall be made on or before the close of the month following
      the
      end of said three month period.




**Revenues
      From Consulting Agreement**





In
      its
      fiscal year ended February 28, 2007, Fromex generated its revenues from the
      Consulting Agreement with FRMO whereby it agreed to provide management services
      to FRMO including the administrative aspect of FRMO’s business activities such
      as operations, bookkeeping and personnel responsibilities. As compensation
      for
      these services, Fromex is entitled to receive ten percent of the cash receipts
      which FRMO receives from its third party customers, namely, fees received from
      Kinetics Advisers Hedge Funds, Kinetics Paradigm Mutual Fund and Sub-Advisory
      fees from a large investment firm, as described in Item 1 above; and to a lesser
      extent, about $35,000 per year received from a consulting agreement with Santa
      Monica Partners and a 2% interest in the subscription revenues of an investment
      research publication (FRMO’s “Other Fees”). Revenues of Fromex from these may
      vary substantially from period to period depending on when FRMO actually
      receives the fees, which are subject to the 10% payment, as shown by the
      following table.





15


**Program**
              
              **Fees**
              
              **When
                  Paid**
              
              **When
                  received by FRMO**Kinetics
                  Advisers
              
              Management
                  fee
              
              Management
                  fee
              
              Kinetics
                  Advisers, LLCDomestic
                  Hedge
              
              of
                  1% per annum
              
              paid
                  monthly,
              
              distributes
                  to FRMO generallyFund
              
              of
                  net assets and
              
              and
                  performance
              
              on
                  a quarterly basis, 8.4%20%
                  per annum of
              
              fee
                  paid quarterly,
              
              of
                  the fees it receives in cashof
                  net profits
              
              to
                  Kinetics Advisers,
              
              after
                  paying its expenses.LLCKinetics
                  Advisers
              
              Management
                  fee
              
              Kinetics
                  Advisers
              
              When
                  Kinetics Advisers doesOffshore
                  Hedge
              
              of
                  1 1⁄4% per annum
              
              may
                  elect to defer
              
              receive
                  management andFund
              
              of
                  net assets and
              
              a
                  portion of its fees
              
              performance
                  fees in cash it20%
                  per annum of
              
              
              
              distributes
                  to FRMO, generallynet
                  profits
              
              
              
              on
                  a quarterly basis, 8.4% ofthose
                  fees after paying itsexpenses.Kinetics
                  Paradigm
              
              Research
                  fee of
              
              Monthly
                  by
              
              MonthlyFund
              
              0.12%
                  per annum
              
              Kinetics
                  Paradigmof
                  the net assets
              
              Fund
                  to FRMOof
                  the FundSub-Advisory
              
              Fee
                  of 0.50%
              
              Horizon
                  Asset
              
              Horizon
                  Asset Management, Inc.Program
              
              per
                  annum of
              
              Management,
                  Inc.
              
              pays
                  to FRMO one-third of thenet
                  assets.
              
              receives
                  the fee
              
              fees
                  it has received, net of marketingfrom
                  the investment
              
              expenses,
                  on a quarterly basisfirm
                  on a quarterlybasis.Consulting
                  Agreement
              
              Approximately
              
              Paid
                  to FRMO in
              
              Received
                  by FRMO by advancewith
                  Santa Monica
              
              $35,000
                  per.
              
              advance
              
              payments
                  determined by Santaannum
              
              
              
              Monica
                  Partners.Interest
                  in
              
              2%
                  per annum of
              
              Paid
                  to FRMO for
              
              Received
                  by FRMO in advanceSubscription
              
              of
                  subscription
              
              periods
                  determined
              
              as
                  determined by the publication.Revenues
                  of
              
              receipts.
              
              by
                  publication.Publication





**Revenues
      Not Derived From Consulting Agreement** .





In
      its
      fiscal year ending February 28, 2008, Fromex will receive the revenues from
      its
      60% equity interest in Horizon Advisers and its revenue interest in the amounts
      received by Horizon Management from the Protostar Fund, as follows:





16




**Fund**
              
              **Fees
                  paid to**
                **Investment
                  Manager**
              
              **Fromex’s
                  Interest**Horizon
                  Fund managed
              
              Management
                  fees of 0.55% of
              
              60%
                  equity interest inby
                  Horizon Advisers
              
              net
                  assets in Class A shares
              
              Horizon
                  Advisers.and
                  0.80% of net assets inClass
                  B shares and advisoryfees
                  on individual accountsmanaged
                  domestically.Multi-Strategy
                  Fund
              
              Management
                  fee of 2% per
              
              60%
                  equity interest inmanaged
                  by Horizon
              
              annum
                  of net assets and
              
              Horizon
                  Advisers.Advisers
              
              a
                  performance fee of 20%of
                  net profits.Protostar
                  Fund
              
              Management
                  fee of 1% per
              
              33
                  1/3% of the net amountsmanaged
                  by
              
              annum
                  of net assets and
              
              received
                  in cash by HorizonHorizon
                  Management
              
              a
                  performance fee of
              
              Management
                  from the fund.which
                  is a 45% general
              
              20%
                  of net profits.partner
                  of the fund


The
      revenues of Fromex rely on the performance of hedge funds and mutual funds,
      for
      which past performance is no guarantee of future performance. The net assets
      of
      all hedge funds in the United States, and mutual funds as well, have grown
      exponentially in recent years as to call attention to the financial problems
      of
      a few of those funds which has led, in turn, to the prospect of changes in
      the
      securities laws and regulations which protect investors and provide more
      disclosure by investment managers. While such changes could have an adverse
      effect on Fromex, the Company does not anticipate that they will.





**RESULTS
      OF OPERATIONS (Restated)**




**Fiscal
      Year Ended February 28, 2007 Compared to Prior Fiscal
      Period**





The
      Company’s revenues from continuing operations in this period were $511,032, an
      increase of $394,019 from the prior fiscal period, all of which were generated
      from the Consulting Agreement as set forth in Item 1 above. Expenses were
      $31,000 for accounting, $14,309 for shareholder reporting, $75,000 for the
      non-cash compensation of its executive officers and $3,700 for miscellaneous
      expenses, for a total of $124,009 of expenses, leaving $387,023 as income from
      operations before interest income and provision for income taxes. Interest
      income was $19,436, and, after a $190,000 provision for income taxes, Fromex
      earned net income of $216,459 or $0.02 per share, an increase of $168,256 from
      the prior fiscal period. The increases in revenues and net income result from
      increased fees received by FRMO subject to the Consulting Agreement and the
      shorter initial fiscal period.





17




**First
      Fiscal Year Ended February 28, 2006 (August 31, 2005 (Inception) to February
      28,
      2006).**




This
      is
      the Company’s first accounting period in which it received revenue since its
      incorporation. Fromex’s revenues from continuing operations were $117,013, all
      of which were generated from the Consulting Agreement as set forth in Item
      1
      above. Its expenses were $20,000 for accounting, $2,000 for shareholder
      reporting, $21,875 for the non-cash compensation of its executive officers
      and
      $3,251 for miscellaneous expenses, for a total of $47,126 of expenses, leaving
      $69,887 as income from operations before interest income and provision for
      income taxes. Interest income was $1,316 and, after a $23,000 provision for
      income taxes, Fromex earned net income of $48,203 or $0.00 per share on the
      14,400,000 shares of common stock issued and outstanding.




**LIQUIDITY
      AND CAPITAL RESOURCES (Restated)**





In
      the
      period August 31, 2005 (inception) through February 28, 2006 the Company
      reported net cash provided by operating activities of $1,316 and $306,219 from
      financing activities (which was an advance from FRMO), resulting in cash at
      the
      end of its first accounting period of $307,535. At the close of the fiscal
      year
      ended February 28, 2007, the cash on hand has increased by $830,168 to
      $1,137,703. This increase came from net cash of $292,387 provided from operating
      activities and $537,781 from financing activities (which consisted of $844,000
      from the issuance of Fromex’s capital stock to FRMO, less the $306,219 which had
      been advanced in the prior accounting period). The Company expects to have
      continuing net cash provided from its operating activities as the management
      and
      advisory fees, which generate Fromex’s revenues and are derived from assets
      under management, increase in existing funds and new funds in which Fromex
      has
      the equity and revenue interests described in Item 1 above, including the 60%
      equity interest in Horizon Global Advisers, LLC, which FRMO transferred to
      Fromex on April 24, 2007 as a contribution to the capital of Fromex. FRMO does
      not have any commitment or obligation to further fund the Company’s operations
      by way of additional financing activities.




The
      Company believes that its present cash resources and cash available from
      operations over the next 12 months will be sufficient to cover its operating
      expenses and provide for the continued expansion of its business.




**ITEM
      7A. QUANTATIVE AND QUALITATIVE DISCLOSURES OF MARKET
      RISK.**




Financial
      instruments that potentially subject the Company to risk consist principally
      of
      cash, money market funds and receivables. The Company maintains cash and cash
      equivalents with major financial institutions, and at times such amounts may
      exceed the FDIC limits.





18





**ITEM
      8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.**




Financial
      Statements and supplementary data required by this Item 8 are set forth at
      the
      pages indicated at page F-1 below.




**ITEM
      9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON**


**ACCOUNTING
      AND FINANCIAL DISCLOSURE.**





None.




**ITEM
      9A. CONTROLS AND PROCEDURES**




Fromex
      maintains disclosure controls and procedures that are designed to ensure that
      information required to be disclosed in the Company’s Securities Exchange Act
      reports is recorded, processed, summarized and reported within the time periods
      specified in the SEC’s rules and forms, and that such information is accumulated
      and communicated to the Company’s management, including its Chief Executive
      Officer and Chief Financial Officer, as appropriate, to allow timely decisions
      regarding required disclosure. In designing and evaluating the disclosure
      controls and procedures, management recognized that any controls and procedures,
      no matter how well designed and operated, can provide only reasonable assurance
      of achieving the desired control objectives, as ours are designed to do, and
      management necessarily was required to apply its judgment in evaluating the
      cost-benefit relationship of possible controls and procedures.





During
      the 90-day period prior to the date of this report, an evaluation was performed
      under the supervision and with the participation of our Company’s management,
      including the Chief Executive Officer and the Chief Financial Officer, of the
      effectiveness of the design and operation of our disclosure controls and
      procedures. Based upon that evaluation, the Chief Executive Officer and the
      Chief Financial Officer concluded that the disclosure controls and procedures
      were effective. Subsequent to the date of this evaluation, there have been
      no
      significant changes in the Company’s internal controls or in other factors that
      could significantly affect these controls, and no corrective actions taken
      with
      regards to significant deficiencies or material weaknesses in such
      controls.





19




**PART
      III**




**ITEM
      10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE**





The
      information required by this Item is set forth in the Company’s definitive
      information statement, which will be filed with the Securities and Exchange
      Commission within 120 days of February 28, 2007. Such information is
      incorporated herein by reference and made apart thereof.




**ITEM
      11. EXECUTIVE COMPENSATION.**





The
      information required by this Item is set forth in the Company ‘s definitive
      information statement, which will be filed with the Securities and Exchange
      Commission within 120 days of February 28, 2007. Such information is
      incorporated herein by reference and made a part hereof.




**ITEM
      12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
      AND**


**MANAGEMENT
      AND RELATED STOCKHOLDER MATTERS.**





The
      information required by this Item is set forth in the Company’s definitive
      information statement, which will be filed with the Securities and Exchange
      Commission within 120 days of February 28, 2007. Such information is
      incorporated herein by reference and made a part hereof.




**ITEM
      13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND**


**DIRECTOR
      INDEPENDENCE.**





The
      information required by this Item is set forth in the Company’s definitive
      information statement, which will be filed with the Securities and Exchange
      Commission within 120 days of February 28, 2007. Such information is
      incorporated herein by reference and made a part hereof.




**ITEM
      14. PRINCIPAL ACOUNTANTS FEES AND SERVICES.**





The
      information required by this Item is set forth in the Company’s definitive
      information statement, which will be filed with the Securities and Exchange
      Commission within 120 days of February 28, 2007. Such information is
      incorporated herein by reference and made a part hereof.





20





**PART
      IV**




**ITEM
      15. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES.**




**(a)**
            **Financial
                Statement, Schedules And
                Exhibits**




**(1)**
            **Financial
                Statements:**See
                the Index to Financial Statements at page F-1
                herein.




**(2)**
              **Financial
                  Statement Schedules;**




All
      schedules are omitted because they are not applicable, not required, or because
      the required information is included in the financial statements or notes
      herein.




**(3)**
              **Exhibits:**
  Exhibit
                  Number
                Description3.01
                Amended
                    Certificate of Incorporation of the Company.*3.02
                By-laws
                    of the Company.*5.01
                Opinion
                    of Tanner McColgan, LLP.*10.01
                Consulting
                    Agreement.*10.02
                Assignment
                    of Revenue Interest.*10.03
                Amendment
                    to Consulting Agreement.**10.04
                Transfer
                    and Assignment of Equity Interest.***10.05
                Assignment
                    and Bill of Sale14.01
                Code
                    of Ethics of the Company.*31.1
                Certification
                    by the Chief Executive Officer Pursuant to Section 302 of the
                    Sarbanes-Oxley Act of 2002.31.2
                Certification
                    by the Chief Financial Officer Pursuant to Section 302 of the
                    Sarbanes-Oxley Act of 2002.32.1
                Certification
                    of the Chief Executive Officer and Chief Financial Officer Pursuant
                    to 18
                    U.S.C. Section 1350 Adopted Pursuant to Section 906 of the Sarbanes-Oxley
                    Act of 2002.


__________


*
      Previously filed with Form 10 on September 28, 2006


**
      Previously filed with Form 10 on January 18, 2007


***
      Previously filed with Form 10 on May 11, 2007





21





**SIGNATURES**




Pursuant
      to the requirements of Section 13 or 15(d)2 of the Securities Exchange Act
      of
      1934 as amended, the Registrant has duly cause this Report to be signed on
      its
      behalf by the undersigned, thereunto duly authorized on July 23,
      2007


FROMEX EQUITY CORP.By:
            /s/ STEVEN
              BREGMANSteven
              Bregman*President
                and Chief Financial Officer*
              *(Principal
                Financial and Accounting
                Officer)*




Pursuant
      to the requirements of the Securities Exchange Act of 1934, as amended, this
      Report has been signed below by the following persons on behalf of the
      Registrant and in the capacities indicated on July 23, 2007.


Signature
              
              Title/s/
                  MURRAY STAHL
              
              Chairman
                  of the BoardMurray
                  Stahl
              
              (Principal
                  Executive Officer)/s/
                  STEVEN BREGMAN
              
              President,
                  DirectorSteven
                  Bregman/s/
                  JAY HIRSCHSON
              
              DirectorJay
                  Hirschson/s/
                  ALLAN KORNFELD
              
              DirectorAllan
                  Kornfeld/s/
                  LESTER TANNER
              
              DirectorLester
                  Tanner




22





**Fromex
      Equity Corp.**





**Index
      to Financial Statements**




This
                  Index
              F-1Report
                  of Independent Registered Public Accounting Firm
              F-2Balance
                  Sheets- as of February 28, 2006 (restated) andFebruary
                  28, 2007
              F-3Statements
                  of Income - Period August 31, 2005 (Inception)through
                  February 28, 2006 (restated) and Twelve months endedFebruary
                  28, 2007
              F-4Statements
                  of Cash Flows - Period August 31, 2005 (Inception)through
                  February 28, 2006 (restated) and Twelve months endedFebruary
                  28,2007
              F-5Statements
                  of Stockholders’ Equity - Period August 31, 2005 (Inception)through
                  February 28, 2006 (restated) and Twelve months endedFebruary
                  28, 2007
              F-6Notes
                  to Financial Statements
              F-7


*The
      data required by financial statement schedules is either included in the
      financial statements or is not required.*




F-1




**Report
      of Independent Registered Public Accounting Firm**




The
      Board
      of Directors and Shareholder


Fromex
      Equity Corp.




We
      have
      audited the accompanying balance sheets of Fromex Equity Corp. as of February
      28, 2007 and February 28, 2006 (restated) and the related statements of income,
      stockholder’s equity and cash flows for the year ended February 28, 2007 and for
      the period August 31, 2005 (inception) through February 28, 2006 (as restated).
      These financial statements are the responsibility of the Company’s management.
      Our responsibility is to express an opinion on these financial statements based
      on our audits.





We
      conducted our audits in accordance with the standards of the Public Company
      Accounting Oversight Board (United States). Those standards require that we
      plan
      and perform the audit to obtain reasonable assurance about whether the financial
      statements are free of material misstatement. An audit includes examining,
      on a
      test basis, evidence supporting the amounts and disclosures in the financial
      statements. An audit also includes assessing the accounting principles used
      and
      significant estimates made by management, as well as evaluating the overall
      financial statement presentation. We believe that our audits provide a
      reasonable basis for our opinion.





In
      our
      opinion, the financial statements referred to above present fairly, in all
      material respects, the financial position of Fromex Equity Corp. at February
      28,
      2007 and February 28, 2006 (restated) and the results of its operations and
      cash
      flows for the year ended February 28, 2007 and for the period August 31, 2005
      (inception) through February 28, 2006 in conformity with accounting principles
      generally accepted in the United States of America.





As
      discussed in Note 2A to the Financial Statements, the 2006 financial statements
      have been restated to correct an error in the accounting for an assignment
      of a
      revenue stream from the Company’s parent.




/s/ HOLTZ RUBENSTEIN REMINICK LLPNew
              York, New YorkMay
              23,
              2007




F-2




**Fromex
                Equity Corp.****Balance
                Sheets****February
                28,**
            
            February
                28,**2007**
            
            2006(Restated)**Assets**Current
                assets:Cash
                and cash equivalents
            
            **$**
            **1,137,703**
            
            $
            307,535Subscription
                receivable from parent
            
            
            **-**
            
            
            844,000Accounts
                receivable from parent
            
            
            **138,334**
            
            
            117,013Total
                current assets
            
            
            **1,276,037**
            
            
            1,268,548**Total
                Assets**
            
            **$**
            **1,276,037**
            
            $
            1,268,548**Liabilites
                and Stockholder's Equity**Current
                liabilites:Accounts
                payable and accrued expenses
            
            **$**
            **35,000**
            
            $
            25,251Income
                taxes payable
            
            
            **35,500**
            
            
            23,000Due
                to parent
            
            
            **-**
            
            
            306,219Total
                current liabilities
            
            
            **70,500**
            
            
            354,470Total
                Liabiliites
            
            
            **70,500**
            
            
            354,470Stockholder's
                Equity:Common
                Stock - $.01 par value:Authorized
                - 20,000,000 sharesIssued
                and outstanding - 14,400,000 shares
            
            
            **144,000**
            
            
            144,000Capital
                in excess of par value
            
            
            **796,875**
            
            
            721,875Retained
                earnings
            
            
            **264,662**
            
            
            48,203Total
                stockholder's equity
            
            
            **1,205,537**
            
            
            914,078**Total
                liabilities and stockholder's equity**
            
            **$**
            **1,276,037**
            
            $
            1,268,548





*See
      accompanying notes to financial statements*




F-3




**Fromex
                Equity Corp.****Statements
                of Income**




Period**Year**
            
            August
                31, 2005**Ended**
            
            (Inception)
                to**February
                28,**
            
            February
                28,**2007**
            
            2006(Restated)**Revenues**Consulting
                Fees
            
            **$**
            **511,032**
            
            $
            117,013Total
                revenue
            
            
            **511,032**
            
            
            117,013**Costs
                and Expenses**Accounting
            
            
            **31,000**
            
            
            20,000Shareholder
                reporting
            
            
            **14,309**
            
            
            2,000Compensation
                (all non-cash)
            
            
            **75,000**
            
            
            21,875Other
                expenses
            
            
            **3,700**
            
            
            3,251**124,009**
            
            
            47,126Income
                from operations
            
            
            **387,023**
            
            
            69,887Interest
                Income
            
            
            **19,436**
            
            
            1,316Income
                before provision forincome
                taxes
            
            
            **406,459**
            
            
            71,203Provision
                for income taxes
            
            
            **(190,000**
            **)**
            
            (23,000
            )**Net
                Income**
            
            **$**
            **216,459**
            
            $
            48,203Earnings
                per share-primary and fully diluted:Shares
                of common stock outstanding
            
            
            **14,400,000**
            
            
            14,400,000Net
                income per share
            
            **$**
            **0.02**
            
            $
            0.00




*See
      accompanying notes to financial statements*




F-4




**Fromex
                Equity Corp.****Statements
                of Cash Flows**




Period**Year**
            
            August
                31, 2005**Ended**
            
            (Inception)
                to**February
                28,**
            
            February
                28,**2007**
            
            2006(Restated)**Cash
                flows from operating activities**Net
                Income
            
            **$**
            **216,459**
            
            $
            48,203Adjustments
                to reconcile net incometo
                net cash provided by operatingactivities:Non-cash
                compensation
            
            
            **75,000**
            
            
            21,875Changes
                in operating assets and liabilitiesAccounts
                receivable
            
            
            **(21,321**
            **)**
            
            (117,013
            )Accounts
                payable and accrued expenses
            
            
            **9,749**
            
            
            25,251Income
                taxes payable
            
            
            **12,500**
            
            
            23,000Net
                cash provided by operating activities
            
            
            **292,387**
            
            
            1,316**Cash
                flows from financing activities**Issuance
                of common stock
            
            
            **844,000**
            
            
            -Advances
                from parent
            
            
            **-**
            
            
            306,219Repayments
                to parent
            
            
            **(306,219**
            **)**
            
            -Net
                cash provided by financing activities
            
            
            **537,781**
            
            
            306,219Net
                increase in cash
            
            
            **830,168**
            
            
            307,535Cash
                and cash equivalents at beginning of period
            
            
            **307,535**
            
            
            -Cash
                and cash equivalents at end of period
            
            **$**
            **1,137,703**
            
            $
            307,535**Additonal
                cash flow information**Income
                taxes paid
            
            **$**
            **177,500**
            
            
            -




**During
                the twelve months ended February 28, 2007, the Company received cash
                proceeds****of
                $844,000 from the Fiscal 2006 issuance of its common
                stock.**




*See
        accompanying notes to financial statements*




F-5




**Fromex
                Equity Corp.****Statements
                of Stockholder's Equity**




TotalAdditional
            
            
            
            Share-Common
                Stock
            
            Paid-In
            
            Retained
            
            Holder'sShares
            
            Amount
            
            Capital
            
            Earnings
            
            EquityBalance
                August 31, 2005
              (inception)
            
            
            -
            
            $
            -
            
            $
            -
            
            $
            -
            
            $
            -Issuance
                of Stock
            
            
            14,400,000
            
            
            144,000
            
            
            700,000
            
            
            -
            
            
            844,000Non-cash
                compensation
            
            
            -
            
            
            -
            
            
            21,875
            
            
            -
            
            
            21,875Net
                Income (restated)
            
            
            -
            
            
            -
            
            
            -
            
            
            48,203
            
            
            48,203**Balance
                February 28, 2006**
              **(restated)**
            
            
            14,400,000
            
            
            144,000
            
            
            721,875
            
            
            48,203
            
            
            914,078Non-cash
                compensation
            
            
            -
            
            
            -
            
            
            75,000
            
            
            -
            
            
            75,000Net
                income
            
            
            -
            
            
            -
            
            
            -
            
            
            216,459
            
            
            216,459Balance
                February 28, 2007
            
            
            14,400,000
            
            $
            144,000
            
            $
            796,875
            
            $
            264,662
            
            $
            1,205,537




*See
      accompanying notes to financial statements*




F-6


**Fromex
        Equity Corp.**
 **Notes
        To Financial Statements**




**1.
      Organization of the Company**





Fromex
      Equity Corp. (the “Company” or “Fromex”) was incorporated in the State of
      Delaware on August 31, 2005 as a wholly owned subsidiary of FRMO Corp. (“FRMO”).
      Fromex has a fiscal year ending on the last day of February, as does its parent
      company FRMO. As of February 28, 2007 and February 28, 2006 Fromex had
      14,400,000 shares of common stock, par value $.01 per share, issued and
      outstanding, all of which are owned by FRMO for which it paid
      $844,000.





Spin-off
      of Fromex








On
      August
      31, 2005, FRMO filed a Form 8-K with the Securities and Exchange Commission
      disclosing the formation of Fromex and the intended distribution to FRMO
      shareholders of 5% of the Fromex shares. In subsequent Form 8-K information
      filings it was announced that the timing and precise form of the spin-off would
      be postponed until a better procedure was identified for resolving the problem
      created by the new accounting rule (EITF 03-16). That rule, which was effective
      from and after September 1, 2004, mandated a change in the accounting policy
      for
      reporting revenue from FRMO’s 8.4% interest in Kinetics Advisers, LLC
      (“Kinetics”) from the cost (cash) method to the equity (accrual) method, as
      reported in FRMO’s Form 8-K dated June 16, 2005. For a variety of reasons,
      including the Kinetics practice, as a private company, of using the cash-basis
      method of accounting and the difficulty of securing audited and accrual-basis
      financial statements suitable for a public reporting company, FRMO could not
      itself report accrual-basis financial statements.




On
      December 9, 2005 the Board of Directors of FRMO authorized the preparation
      of
      the Form 10 Registration Statement for the shares of common stock of Fromex
      pursuant to Section 12(g) of the Securities Exchange Act of 1934 (the “Exchange
      Act”). FRMO plans to distribute, five weeks after all SEC comments with respect
      to the Form 10 have been cleared, to its shareholders as of the close of
      business on a date, which is 21 days prior to the distribution date (the “record
      date”), one share of Fromex common stock for each 50 shares of FRMO common stock
      then outstanding. FRMO has 36,137,774 shares of common stock presently
      outstanding which means that approximately 720,000 shares of Fromex common
      stock
      (taking into consideration the payment of cash for fractional shares) will
      be
      distributed, representing 5% of the 14,400,000 shares of Fromex issued and
      outstanding.





F-7




**Fromex
        Equity Corp.**
 **Notes
        To Financial Statements**




**2.
      Basis of Presentation**





**Consulting
      Agreement**





Effective
      December 1, 2005, Fromex entered into a contract with FRMO to perform consulting
      and management services to FRMO for which FRMO has agreed to pay Fromex ten
      (10%) percent of the cash receipts which FRMO receives from its customers during
      the term of the agreement (The “Consulting Agreement”). The term of the
      Consulting Agreement is from December 1, 2005 until February 28, 2010 and for
      each twelve (12) month period thereafter unless terminated or amended by an
      instrument in writing signed by both parties on or before January 15 preceding
      the end of a respective term.








Fromex’s
      services include the administrative aspect of FRMO’s business activities such as
      operations, bookkeeping, personnel responsibilities and periodic consulting
      with
      the FRMO’s chief financial officer, but do not include the research, business
      development activities or the services rendered by FRMO itself to its customers,
      which produce FRMO’s cash receipts. FRMO shall pay to Fromex as its compensation
      an amount equal to 10% of total cash receipts that FRMO receives from its
      customers during the term of the Consulting Agreement. Said compensation is
      based only on the money received by FRMO in each three (3) month period
      beginning December 1, 2005 and shall not include a percentage of any receivable
      or accrual until the amount is actually received by FRMO. The payment of such
      compensation shall be made on or before the close of the month following the
      end
      of said three month period.




The
      first
      accounting period is the three months which commenced December 1, 2005 and
      ended
      February 28, 2006, for which Fromex received $117,013 on March 24, 2006 based
      on
      the following cash receipts of FRMO in that quarterly period. In addition the
      FRMO cash receipts in the fiscal year, from March 1, 2006 to February 28, 2007
      were as set forth below.




FRMO’s
                Cash Receipts From:
              
              12/1/05
                  - 2/28/06
              
              3/1/06
                  - 2/28/07Kinetics
                  Advisers’ Hedge Funds
              
              $
              959,311
              
              $
              2,656,523Kinetics
                  Paradigm Mutual Fund
              
              
              174,332
              
              
              1,984,247Sub
                  - Advisory Fees
              
              
              0
              
              
              317,935Other
                  Fees
              
              
              36,491
              
              
              151,617Total
              
              $
              1,170,134
              
              $
              5,110,32210%
                  payable to Fromex
              
              $
              117,013
              
              $
              511,032
  F-8




**Fromex
        Equity Corp.**
 **Notes
        To Financial Statements**




FRMO’s
      cash receipts have been increasing in its last three fiscal years, which are
      set
      forth below to illustrate its growth, but past performance is no guaranty of
      future results:




FRMO’s
                  Cash Receipts From:
              
              3/1/04
                  - 2/28/05
              
              3/1/05
                  - 2/28/06
              
              3/1/06
                  - 2/28/07Kinetics
                  Advisers’ Hedge Funds
              
              $
              274,728
              
              $
              1,978,026
              
              $
              2,656,523Kinetics
                  Paradigm Mutual Fund
              
              
              118,394
              
              
              410,020
              
              
              1,984,247Sub-Advisory
                  Fees
              
              
              (9,335
              )
              
              74,770
              
              
              317,935Other
                  Fees
              
              
              134,308
              
              
              142,925
              
              
              151,617Total
              
              $
              518,095
              
              $
              2,605,741
              
              $
              5,110,322


Since
      the
      Consulting Agreement commenced December 1, 2005 Fromex received $117,013 in
      the
      period from December 1, 2005 to February 28, 2006 and $511,032 in the year
      ended
      February 28, 2007.




The
      business of FRMO, on which Fromex receives its 10% of cash receipts, is as
      an
      intellectual capital firm. FRMO’s research and business development activities
      focus on the analysis of public companies within a framework of identifying
      investment strategies and techniques that reduce risk. Its business includes
      the
      identification of assets, particularly in the early stages of the expression
      of
      their ultimate value, and the participation with them in ways that are
      calculated to increase the value of the interest of FRMO’s shareholders. Such
      assets include, but are not limited to, those whose value and earnings are
      based
      on intellectual capital.




FRMO’s
      fees derive from assets managed by other parties based on the research of the
      Horizon Research Group, composed of the same principals who are the officers
      of
      FRMO. The three programs significant to FRMO’s fees are:




(i)  Kinetics
      Advisers’ Hedge Funds .
      FRMO
      has an 8.4% equity interest, which it acquired for common stock, in Kinetics
      Advisers’ LLC, which controls and provides investment advice to hedge funds
      which were small when FRMO acquired its interest but which have been expanding
      dramatically.




(ii)  Kinetics
      Paradigm Mutual Fund .
      FRMO
      acquired for its common stock 100% of the research fees to which Horizon
      Research Group is entitled from the open-end mutual fund Kinetics Paradigm
      Fund
      (trading symbol WWNPX). That fund was small when the acquisition was made but
      it
      has grown significantly based on its performance. Kinetics Paradigm Fund was
      assigned a five-star rating by Morningstar, Inc. in May 2003, the first time
      it
      became eligible for rating, and has continued to receive that highest
      Morningstar rating since May 2003 to date.




F-9




**Fromex
        Equity Corp.**
 **Notes
        To Financial Statements**




(iii)  Sub-Advisory
      Fees .  On
      June
      1, 2004, FRMO acquired for common stock a one-third interest in the Sub-Advisory
      Fee Revenue that Horizon Asset Management, Inc. receives in its sub-advisory
      program for a large investment firm. Under this program, Horizon Asset
      Management, Inc. provides investment advisory services to certain clients of
      the
      investment firm, its fees being calculated on the basis of assets under
      management.




FRMO’s
      fees which are received under these three programs, and therefore Fromex’s 10%
      share of the cash receipts therefrom, are based on the assets under management.
      The approximate net asset levels for these three programs at specific dates
      are
      presented below.




Asset
                  Levels in Millions (000,000
                  omitted)Program
              
              
              December
                  31,
                2004
              
              
              December
                  31,
                2005
              
              
              December
                  31,
                2006Kinetics
                  Advisers’ Hedge Funds
              
              $
              1,085
              
              $
              l,730
              
              $
              2,800Kinetics
                  Paradigm Fund
              
              
              125
              
              
              530
              
              
              2,145Sub-Advisory
                  Program
              
              
              115
              
              
              615
              
              
              1,630Total
              
              $
              1,325
              
              $
              2,875
              
              $
              6,575


FRMO
      also
      receives other fees from two sources; from a consulting agreement with a hedge
      fund that pays FRMO about $35,000 per year for access to consultation with
      FRMO’s officers and from a small interest in the subscription revenues of an
      investment research publication. These two sources of cash receipts have been
      small and are not expected to grow or be significant in FRMO’s future revenue
      stream.




**Fromex’s
      Investment Management Business** .




While
      the
      foregoing 10% interest of Fromex in FRMO’s cash receipts constituted all of
      Fromex’s revenue from inception on August 31, 2005 to February 28, 2007, future
      revenues may be derived from Fromex’s investment management business in Fiscal
      February 29, 2008.




**Horizon
      Global Advisers, LLC**





Horizon
      Global Advisers, LLC is a registered United States Investment adviser organized
      in Delaware (“Horizon Advisers”). On April 24, 2007 FRMO transferred to Fromex
      its 60% equity interest in Horizon Advisers as a contribution to the capital
      of
      Fromex. The other 40% ownership
      interest is owned by an individual who is an officer and employee of Horizon
      Advisers but not an officer or director of Fromex. FRMO has no further interest
      in Horizon Advisers. Fromex and Horizon Advisers will be filing consolidated
      financial statements for the three months ending May 31, 2007.




F-10




**Fromex
        Equity Corp.**
 **Notes
        To Financial Statements**




Horizon
      Advisers has four employees, other than the executive officers of Fromex. They
      are responsible for the management of the two funds described below, for which
      Horizon Advisers is the investment manager. Their activities also include the
      development of new funds for which Horizon Advisers may be appointed as
      investment manager as well as other funds, like the Protostar Fund described
      below, in which Fromex purchased a revenue interest.




Since
      December 26, 2006 Fromex’s Board of Directors is composed of a majority of
      persons who are not directors of FRMO. They are responsible for the oversight
      of
      Fromex’s subsidiary, Horizon Advisers, and development of additional business
      opportunities, including the compensation of the experienced investment
      professionals who will deliver idea generation and execution across Fromex’s
      business model. Revenues in Fromex’s fiscal year, March 1, 2007 to February 28,
      2008 will include revenue to be derived from Fromex’s equity interest in the two
      funds described below:




(i)  **Horizon
      Global Advisers Fund, plc** (the
      “Horizon Fund” **)** is
      an **** open-ended
      variable capital investment company incorporated with limited liability in
      Ireland. Horizon Advisers is the investment manager for the Horizon Fund. The
      Horizon Fund is constituted as an umbrella fund insofar as its share capital
      will be divided into different series of shares with each series of shares
      representing a separate portfolio of assets, and comprising a separate sub-fund
      (a “Fund”) of the Horizon Fund. The first of said sub-funds, Horizon
      Opportunistic Value Fund, has been listed for trading on the Irish Stock
      Exchange. As of March 31, 2007 Horizon Advisers managed $72 million of assets
      in
      the Horizon Fund and $111 million in domestic advisory accounts. Horizon
      Advisers receives management fees based on assets under management.




(ii)   **Horizon
      Multi-Strategy Fund** (the
      “Multi-Strategy Fund”) is a hedge fund with a domestic portion (a Delaware
      limited partnership) and an offshore portion (an exempted company incorporated
      pursuant to the Companies Law of the Caymen Islands). Fromex participated in
      the
      development of this fund. Horizon Advisers, is the investment manager, which
      uses the same long and short strategies for both the domestic and offshore
      portions, the objective of which is to achieve long-term capital appreciation.
      Horizon Advisers has entered into a placement agreement with Credit Suisse
      Securities (USA) LLC to provide marketing services, investor relations and
      support services for the Multi-Strategy Fund. As of March 31, 2007 the
      Multi-Strategy Fund had $206 million dollars of assets under management. Horizon
      Advisers receives management and performance fees.




F-11
 
  **Fromex
          Equity Corp.**
 **Notes
          To Financial Statements**


**Protostar
      Fund** (the
“Protostar Fund”) is a hedge fund with a domestic portion (a Delaware limited
      partnership) and an offshore portion (an exempted company incorporated pursuant
      to the Companies Law of the Caymen Islands). Horizon Asset Management, Inc.
      (“Horizon Management”) has a 45% general partner interest in Protostar Fund and
      is its investment manager, using the same strategies for both the domestic
      and
      offshore portions. The Fund’s principal investment objective is to achieve
      long-term superior risk-adjusted capital growth by investing primarily in
      equity-securities and equity-related instruments. The Fund’s portfolio includes
      both long and short positions in securities of companies. As of April 30, 2007,
      when the Protostar Fund had $16 million dollars of assets under management,
      Fromex acquired for $72,000 a one-third share of the net amounts to be received
      in cash by Horizon Management by reason of its interests as a general partner
      and investment manager of the Protostar Fund.




2A.  **Restatement
      of Financial Statements**





The
      financial statements for the period August 31, 2005 (inception) to February
      28,
      2006 have been restated as described below.





FRMO,
      the
      Company’s parent held a 60% interest in Horizon Advisers, a fund management
      firm. On December 1, 2005, FRMO transferred and assigned to Fromex a 66 2/3%
      interest in its share of fees earned by Horizon Advisers, as and when received
      by FRMO. The fair value of this revenue stream, estimated at $250,000, was
      initially recognized as a capital contribution by FRMO to Fromex, generating
      an
      intangible asset of $250,000. This asset was being amortized over an estimated
      useful economic life of 10 years.





Upon
      subsequent analysis, it was determined that, because no value had been assigned
      to the Horizon Advisers revenue stream as reported on the accounts of FRMO,
      the
      Company’s parent, no value should have been attributed to the 66 2/3% interest
      upon transfer to Fromex. Accordingly, financial statements have been restated
      to
      attribute no value to the assigned interest, and the reversal of amortization
      recorded on the initial valuation. This restatement did not result in a change
      to the reported earnings per share.





The
      following two tables set forth the impact of the above adjustments and the
      related tax effects on our historical balance sheets and statements of
      income.





F-12




**Fromex
                Equity Corp.****Notes
                to Financial Statements****FROMEX
                EQUITY CORP.****Balance
                Sheet**February
                28, 2006PreviouslyReported
            
            Adjustments
            
            Restated**Assets**Current
                assets:Cash
                and cash equivalents
            
            $
            307,535
            
            
            -
            
            $
            307,535Subscription
                receivable from parent
            
            
            844,000
            
            
            -
            
            
            844,000Accounts
                receivable from parent
            
            
            117,013
            
            
            -
            
            
            117,013Total
                current assets
            
            
            1,268,548
            
            
            -
            
            
            1,268,548Other
                assets:Intangible
                assets, net of accumulated amortization
            
            
            244,167
            
            
            (244,167
            )
            
            -Total
                other assets
            
            
            244,167
            
            
            (244,167
            )
            
            -**Total
                Assets**
            
            $
            1,512,715
            
            $
            (244,167
            )
            $
            1,268,548**Liabilities
                and Stockholder's Equity**Current
                liabilities:Accounts
                payable and accrued expenses
            
            $
            25,251
            
            
            -
            
            $
            25,251Income
                taxes payable
            
            
            23,000
            
            
            -
            
            
            23,000Due
                to parent
            
            
            306,219
            
            
            -
            
            
            306,219Total
                current liabilities
            
            
            354,470
            
            
            -
            
            
            354,470Total
                Liabilities
            
            
            354,470
            
            
            -
            
            
            354,470Stockholder's
                Equity:Common
                stock - $.01 par value:Authorized
                - 20,000,000 sharesIssued
                and outstanding - 14,400,000 shares
            
            
            144,000
            
            
            -
            
            
            144,000Capital
                in excess of par value
            
            
            971,875
            
            
            (250,000
            )
            
            721,875Retained
                earnings
            
            
            42,370
            
            
            5,833
            
            
            48,203Total
                stockholder's equity
            
            
            1,158,245
            
            
            (244,167
            )
            
            914,078**Total
                liabilities and stockholder's equity**
            
            $
            1,512,715
            
            $
            (244,167
            )
            $
            1,268,548





F-13





**Fromex
                  Equity Corp.**Notes to Financial Statements




**FROMEX
                EQUITY CORP.****Statement
                of Income**




Period
                August 31, 2005 (Inception)to
                February 28, 2006PreviouislyReported
            
            Adjustments
            
            Restated**Revenues**Consulting
                Fees
            
            $
            117,013
            
            
            -
            
            $
            117,013Total
                Revenue
            
            
            117,013
            
            
            -
            
            
            117,013**Costs
                and Expenses**Accounting
            
            
            20,000
            
            
            -
            
            
            20,000Shareholder
                reporting
            
            
            2,000
            
            
            -
            
            
            2,000Amortization
            
            
            5,833
            
            
            (5,833
            )
            
            -Compensation
                (all non-cash)
            
            
            21,875
            
            
            -
            
            
            21,875Other
                expenses
            
            
            3,251
            
            
            -
            
            
            3,25152,959
            
            
            (5,833
            )
            
            47,126Income
                from operations
            
            
            64,054
            
            
            5,833
            
            
            69,887Interest
                Income
            
            
            1,316
            
            
            -
            
            
            1,316Income
                before provision forincome
                taxes
            
            
            65,370
            
            
            5,833
            
            
            71,203Provision
                for income taxes
            
            
            (23,000
            )
            
            -
            
            
            23,000**Net
                Income**
            
            $
            42,370
            
            $
            5,833
            
            $
            48,203Earnings
                per share-primary and fully diluted:Shares
                of common stock outstanding
            
            
            14,400,000
            
            
            -
            
            
            14,400,000Net
                income per share
            
            
            0.00
            
            
            -
            
            
            0.00





F-14




**Fromex
        Equity Corp.**
 **Notes
        To Financial Statements**




**3.** **Significant
      Accounting Policies**




*Revenue
      Recognition*




Fromex
      has entered into a contract with FRMO to perform consulting and management
      services to FRMO for which FRMO has agreed to pay Fromex ten (10%) percent
      of
      the cash receipts which FRMO receives from its rights to share in fees generated
      by its third party customers during the term of the agreement (the “Consulting
      Agreement”). The term of the Consulting Agreement is from December 1, 2005 until
      February 28, 2010 (as amended on December 26, 2006) and for each twelve (12)
      month period thereafter unless terminated or amended by an instrument in writing
      signed by both parties on or before January 15 preceding the end of a respective
      term.




Fromex’s
      services include the administrative aspect of FRMO’s business activities such as
      operations, bookkeeping, personnel responsibilities and periodic consulting
      with
      the FRMO’s chief financial officer, but do not include the research, business
      development activities or the services rendered by FRMO or its third party
      customers, which produce FRMO’s cash receipts. FRMO shall pay to Fromex as its
      fees an amount equal to 10% of total cash receipts that FRMO receives from
      its
      customers during the term of the Consulting Agreement. Fees for Fromex’s
      services are based only on the fees collected by FRMO in each three (3) month
      period beginning December 1, 2005 and shall not include a percentage of any
      receivable or accrual until the amount is actually received by FRMO. The payment
      of such services shall be made on or before the close of the month following
      the
      end of said three month period.




***Receivables***




Accounts
      receivable and subscriptions receivable are due from FRMO Corp. No allowance
      was
      necessary at February 28, 2007 and February 28, 2006.





*Income
      Taxes*





Income
      taxes follow the reported results of the Company’s operations. There were no
      material differences between the financial reporting and the tax reporting
      of
      the Company’s revenue, assets and liabilities. The income tax provisions and
      liability for income taxes are based on enacted tax laws and statutory tax
      rates
      applicable to the respective periods.





*Cash
      and Cash Equivalents*





For
      purposes of the statements of cash flows, the Company considers all highly
      liquid, short-term investments with an original maturity of three months or
      less
      to be cash equivalents.





F-15




**Fromex
        Equity Corp.**
 **Notes
        To Financial Statements**


**3.**  **Significant
      Accounting Policies (continued)**





*Concentration
      of Credit Risk*





Financial
      instruments that potentially subject the Company to concentrations of credit
      risk consist principally of cash, money market mutual funds, and trade
      receivables. The Company maintains cash and cash equivalents with major
      financial institutions, and at times such amounts may exceed the FDIC
      limits.





*Advertising
      Costs*





The
      Company’s policy is to expense the cost of advertising as incurred. There were
      no advertising expenses for the period August 31, 2005 (inception) to February
      28, 2006 or the year ended February 28, 2007.





*Fair
      Value of Financial Instruments*





The
      following disclosure of the estimated fair value of financial instruments is
      made in accordance with the requirements of Statement of Financial Accounting
      Standards No. 107. “Disclosures about Fair Value of Financial Instruments”. The
      estimated fair values of financial instruments will be determined by the Company
      using available market information and appropriate valuation methodologies.
      Considerable judgment is required in interpreting market data to develop the
      estimates of fair value. Accordingly, the estimates when presented herein are
      not necessarily indicative of the amounts that the Company could realize in
      a
      sale. There were no financial instruments at the balance sheet
      dates.





*Use
      of Estimates*





The
      preparation of financial statements in conformity with generally accepted
      accounting principles requires management to make estimates and assumptions
      that
      affect the reported amounts of assets and liabilities and disclosure of
      contingent assets and liabilities at the date of the financial statements and
      the reported amounts of revenues and expenses during the reporting period.
      Actual results could differ from those estimates.





*Comprehensive
      Income*





Other
      comprehensive income refers to revenues, expenses, gains and losses that under
      generally accepted accounting principles are included in comprehensive income
      but are excluded from net income,
      as these amounts are recorded directly as an adjustment to stockholders’ equity.
      Comprehensive income was equivalent to net income for the year ended February
      28, 2007, and the period August 31, 2005 (inception) to February 28,
      2006.





F-16




**Fromex
        Equity Corp.**
 **Notes
        To Financial Statements**




**3.
      Significant Accounting Policies (continued)**




*Effect
      of New Accounting Pronouncements*




In
      December 2004, the FASB issued Statement No. 123(R), “Stock-Based Payment” (“FAS
      123(R)”). FAS 123(R) supercedes APB Opinion No. 25, “Accounting for Stock Issued
      to Employees,” and amends FAS No. 95, “Statement of Cash Flows.” Generally, the
      approach in FAS 123(R) is similar to the approach described in FAS 123. FAS
      123(R) establishes standards for the accounting for transactions in which an
      entity exchanges its equity instruments for goods or
      services. This statement focuses primarily on accounting for transactions in
      which an entity obtains employee services in share-based payment transactions.
      FAS 123(R) requires that the fair value of such equity instruments be recognized
      as an expense in the historical financial statements as services are performed.
      Prior to FAS 123(R), only certain pro forma disclosures of fair value were
      required. The Company adopted the provisions of this statement effective March
      1, 2006. The adoption of FAS 123(R) did not have an impact on the Company’s
      financial position and results of operations.




In
      December 2004, the FASB issued Statement No. 153, “Exchange of Non-monetary
      Assets”, (“FAS 153”). FAS 153 provides a general exception from fair value
      measurement for exchanges of non-monetary assets that do not have commercial
      substance. The Company adopted the provisions of FAS 153 effective March 1,
      2006. The adoption of FAS 153 did not have a material impact on the Company’s
      financial position or results of operations.




In
      May
      2005, the FASB issued statement No. 154, “Accounting Changes and Error
      Corrections - a replacement of APB Opinion No. 20 and FASB Statement no. 3”
(“FAS 154”). This Statement requires retrospective application to prior period
      financial statements of a voluntary change in accounting principle unless it
      is
      impracticable and is effective for fiscal years beginning after March 1, 2006
      for the Company.




In
      September 2006, the FASB issued FAS No. 157, “Fair Value Measurements.” FAS No.
      157 defines fair value, establishes a framework for measuring fair value and
      requires enhanced disclosures about fair value measurements. FAS No. 157
      requires companies to disclose the fair value of their financial instruments
      according to a fair value hierarchy as defined in the standard. Additionally,
      companies are required to provide enhanced disclosure regarding financial
      instruments in one of the categories (level 3), including a reconciliation
      of
      the beginning and ending balances separately for each major category of assets
      and liabilities. FAS No. 157 is effective for financial statements issued for
      fiscal years beginning after November 15, 2007, and interim periods within
      those
      fiscal years. The Company believes that the adoption of FAS No. 157 will not
      have a material impact on its financial statements.




F-17




**Fromex
        Equity Corp.**
 **Notes
        To Financial Statements**




**3.
      Significant Accounting Policies (continued)**




In
      July
      2006, FASB issued FASB Interpretation 48, “Accounting for Uncertainty in Income
      Taxes (“FIN 48”). FIN 48 clarifies the accounting for uncertainty in income
      taxes recognized in an enterprise’s financial statements in accordance with FAS
      No. 109, “Accounting for Income Taxes.” This interpretation prescribes a
      recognition threshold and measurement attribute for the financial statement
      recognition and measurement of a tax position taken or expected to be taken
      in a
      tax return. FIN 48 also provides a guidance on de-recognition, classification
      interest and penalties, accounting in interim periods, disclosure and
      transition. The Company believes that the adoption of FIN 48 will not have
      a
      material impact on its financial statements. This interpretation will be
      effective for the Company beginning March 1, 2007.




The
      SEC
      issued Staff Accounting Bulletin No. 108 (“SAB 108”) in September 2006. SAB 108
      expresses the views of the SEC staff regarding the process of quantifying the
      materiality of financial misstatements. SAB requires both the balance sheet
      and
      income statement approaches to be used when quantifying the materiality of
      misstatement amounts. In addition, SAB 108 contains guidance on correcting
      errors under the dual approach and provides transition guidance for correcting
      errors existing in prior years. SAB 108 did not have a material impact on the
      Company’s financial statements.




**4.** **Commitments
      And Contingencies**





As
      of
      February 28, 2007 and February 28, 2006, the Company did not enter into any
      material commitments and management believes that there were no
      contingencies.




**5.** **Receivables
      From Shareholders For Issuance Of Common Stock**





The
      14,400,000 shares of common stock of Fromex owned by FRMO Corp. as of February
      28, 2006 were paid for as indicated in Note 1 above.




**6.** **Net
      Income Per Common Share And Per Common Share
      Equivalent**




Basis
      earnings per common share for the year ended February 28, 2007 and the period
      August 31, 2005 (inception) through February 28, 2006 are calculated by dividing
      net income by the weighted average common shares outstanding during the period,
      which were 14,400,000 shares. There were no dilutive potential common shares
      outstanding.





F-18




**Fromex
        Equity Corp.**
 **Notes
        To Financial Statements**


**7.** **Income
      Taxes**





The
      provision for income taxes consists of the following:




Year
                Ended
                February
                  28,
                2007
              
              
              PeriodAugust
                  31, 2005(Inception)
                to
                February
                  28,
                2006Federal
              
              $
              149,000
              
              $
              15,300State
              
              
              41,000
              
              
              7,700Total
                  provision
              
              $
              190,000
              
              $
              23,000
  YearEnded
                February
                  28,
                2007
              
              
              Period
                August
                  31, 2005(Inception)to
                February
                  28,
                2006%
                  of Pretax Income
              
              
              %
                  of Pretax IncomeStatutory
                  federal income tax expense rate
              
              
              34.0
              
              
              34.0Non-deductible
                  compensation expense
              
              
              6.3
              
              
              10.4Effect
                  of graduated tax rates
              
              
              (0.3
              )
              
              (19.2
              )State
                  taxes, less federal tax effect
              
              
              6.7
              
              
              7.1Total
                  percentage
              
              
              46.7
              
              
              32.3




**8.** **Subsequent
      Events**




**Horizon
      Global Advisers, LLC**





Horizon
      Global Advisers, LLC is a registered United States Investment adviser organized
      in Delaware (“Horizon Advisers”). On April 24, 2007 FRMO transferred to Fromex
      its 60% equity interest in Horizon Advisers as a contribution to the capital
      of
      Fromex. The other 40% ownership interest is owned by an individual who is an
      officer and employee of Horizon Advisers but not an officer or director of
      Fromex. Fromex’s 60% ownership interest subsumed its prior 40% revenue interest
      in FRMO’s receipt of net fees. FRMO has no further interest in Horizon Advisers.
      Fromex and Horizon Advisers will be filing consolidated financial statements
      for
      the three months ending May 31, 2007.




F-19




**Fromex
        Equity Corp.**
 **Notes
        To Financial Statements**




**9.
                Supplemental Financial Information****Selected
                Quarterly Financial Data (Unaudited)**QuarterFirst
            
            Second
            
            Third
            
            Fourth
            
            Totalrestated
            
            
            restated
            
            
            restated**Year
                ended February 28, 2007**
            
            $
            162,073
            
            $
            137,009
            
            $
            73,615
            
            $
            138,335
            
            $
            511,032Total
                revenueIncome
                from operations
            
            $
            135,072
            
            $
            109,950
            
            $
            43,485
            
            $
            98,516
            
            $
            387,023Net
                Income
            
            $
            74,248
            
            $
            63,105
            
            $
            23,375
            
            $
            55,731
            
            $
            216,459Earnings
                per common shareprimary
                and fully diluted
            
            $
            0.01
            
            $
            0.00
            
            $
            0.00
            
            $
            0.00
            
            $
            0.02Number
                of shares used in computationof
                earnings per share;primary
                and fully diluted
            
            
            14,400,000
            
            
            14,400,000
            
            
            14,400,000
            
            
            14,400,000
            
            
            14,400,000





F-20




**Fromex
        Equity Corp.**
 **Notes
        To Financial Statements**


**10.
      FRMO’s Results of Operations (Unaudited)**





The
      following financial information of FRMO Corp., the parent of Fromex, is provided
      to enable Fromex’s shareholders to evaluate that portion of Fromex’s business
      that is derived from the Consulting Agreement between FRMO and Fromex, pursuant
      to which Fromex received 10% of FRMO’s cash receipts subsequent to December 1,
      2005. The revenues of FRMO shown below do not include accrued revenue
      attributable to FRMO’s equity interest in the investment management fees of
      Kinetics Advisers, LLC from an offshore hedge fund, which fees are retained
      offshore. It is only when those fees are received in cash by FRMO in the United
      States that Fromex is entitled to 10% under the Consulting Agreement. FRMO
      has
      an 8.4% equity interest in Kinetics Advisers, LLC, a private company that
      reports only on a cash basis, so that the accrual of such additional revenue
      by
      FRMO is not audited and excluded from the revenues and Pre-Tax Income shown
      below.





FRMO
      Corp.


Stand
      alone, Unconsolidated Pre-Tax Income




Year
                  Ended February 28,2007
              
              2006**Revenues
                  - Cash receipts only**
              
              $
              5,110,322
              
              $
              2,605,741
              *Costs
                  and expensesFromex
                  consulting agreement
              
              
              511,032
              
              
              117,013
              *Amortization
              
              
              8,413
              
              
              8,413Accounting
              
              
              51,703
              
              
              18,594Shareholder
                  reporting
              
              
              5,506
              
              
              6,863Other
              
              
              3,857
              
              
              1,643Total
                  costs and expenses
              
              
              580,511
              
              
              152,526**Income
                  from operations**
              
              
              4,529,811
              
              
              2,453,215Dividend,
                  interest income
              
              
              97,198
              
              
              58,213**Pre-Tax
                  income**
              
              $
              4,627,009
              
              $
              2,511,428


______


*
      Cash
      receipts in the period December 1, 2005 to February 28, 2006 were
      $1,170,134





F-21