What do they mean by preparing for the great expansion during the next few years? Well the company Financial Gravity Inc. has a disruptive business model by acquiring financial services and apply their talent and knowledge to it. Bringing them all together to provide the best financial services to their clients in terms of brokerage, wealth management, estate planning, family office services, risk management, business and personal tax planning, business consulting, and financial advisory services.
Their latest acquisition: Financial Gravity received the formal FINRA’s approval of the acquisition of the Broker-Dealer Forta Financial Group Inc.
Who is Forta Financial Group Inc.?
Forta Financial is a dually registered broker-dealer and registered investment advisor with the vast resources necessary to help advisors compete and win. Forta helps advisors achieve their goals and grow their business utilizing four key differentiators — Entrepreneurship, Practice Management, Marketing/Leads, and Financial Innovation. Forta Financial was originally named Presidential Brokerage, Inc. and has been in business since 1991.
Financial Gravity was able to acquire this company through its partnership with GHS Investment LLC back in 2017/2018.
In November 2018 they partnered with GHS Investment LLC and closed a deal worth over $11,000,000 in equity.
Company Chief Executive Officer, John Pollock, stated, “We are pleased to announce that we have partnered with GHS Investments, LLC for an equity line of up to 6,000,000 shares or 11 million dollars. This will help us continue to develop the disruptive business model we are executing on and will allow us to extend our technology to a level that does not exist currently in the marketplace. Automating and enhancing the offerings we have to our three distribution channels of Independent Agents, CPAs and EAs and Financial Advisors will to drive value into the businesses of their clients.”
With a market cap of only around $7,000,000 (as of 21st May 2020), that is pretty big news and makes this stock undervalued for several reasons.
The accompanying consolidated financial statements have been prepared to assume that the Company will continue as a going concern, which contemplates the Company will need to manage additional asset units under contract and/or additional financing to fully implement its business plan, including continued growth and establishment of a stronger brand.
For OTC terms that they state that the company is assuming that they are a going concern means that this company is legitimate and works towards a healthy operation of its company.
On May 23, 2017, the Company and GHS Investments, LLC (“GHS Investments”) entered into an Equity Financing Agreement (the “Agreement”). The Agreement was filed as an exhibit to a registration statement on Form S-1, filed with the Securities and Exchange Commission on September 18, 2017. The Agreement contemplates a series of transactions, pursuant to which the Company will “put” shares of its common stock to GHS in consideration of the payment to the Company of eighty percent (80%) of the “Market Price” of such shares. “Market Price” shall mean the average of the two lowest trading prices of the Company’s Common Stock during the ten (10) consecutive trading days preceding the receipt of the applicable put notice. Accordingly, on each instance the Company exercises a put option, the Company will know in advance, both the number of shares issuable upon exercise of the put option, and the dollar amount of the purchase price for such shares. The maximum purchase price for shares to be purchased by GHS Investments under the Agreement is $11,000,000. To facilitate the sale of the shares so purchased by GHS Investments, the Company agreed to file a registration statement with the Securities and Exchange Commission. The Company also entered into a Registration Rights Agreement with GHS Investments, pursuant to which the Company has agreed to provide certain registration rights under the Securities Act of 1933, the rules and regulations promulgated thereunder, and applicable state securities laws. The Agreement will terminate (i) when GHS Investments has purchased an aggregate of $11,000,000 of the common stock of the Company, or (ii) 36 months after the effective date of the Agreement, or (iii) at such time that the registration statement is no longer in effect.
You can do the math, after 36 months/3 years, and here we are in 2020. The equity line up purchase has been completed and they immediately acquired Forta Financial Group inc. to achieve their goals and start their expansion!
Scott Winters, Chairman & Chief Executive Officer of Financial Gravity agreed that “This transaction has been in the works for quite some time and the public stock of the parent company creates an enormous opportunity for all current and future participants.” Winters added, “The Financial Gravity team combined with the Forta Financial team, along with all the new team members we are bringing in from other firms has created an incredible amount of talent that we continue to grow. We are preparing for great expansion during the next few years and are amazed at the momentum that has kicked in already.”
The Financial Gravity Podcast!
John Pollock – CEO of FGCO and board member as described in his biography, he aired weekly podcast about numerous topics that had anything related to financial terms for example:
This gives the gravity of their knowledge about finance and their motivation to share it with the world and with you.
Financial Gravity Companies, Inc. Announces Approval of S-1/A with GHS Capital Investments, LLC
ABOUT FINANCIAL GRAVITY (OTCQB: FGCO)
Founded in 2005, Financial Gravity (OTCQB: FGCO) has evolved into the innovative financial company it is today. Financial Gravity is a parent company that aims to bring together best of breed financial services companies including brokerage, wealth management, estate planning, family office services, risk management, business and personal tax planning, business consulting and financial advisor services. Financial Gravity’s mission is to synergistically bring together companies that create symbiotic advantages.
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