| Revision as of 22:07, 20 March 2014 edit71.178.252.123 (talk) →Background← Previous edit | Latest revision as of 04:18, 30 August 2024 edit undo93.57.249.28 (talk)No edit summary | ||
| (69 intermediate revisions by 36 users not shown) | |||
| Line 1: | Line 1: | ||
| {{Infobox company | {{Infobox company | ||
| | |
| name = Fund.com Inc. | ||
| | |
| logo = ] | ||
| | traded_as = {{OTCPink|FNDM|type=noinfo}} | |||
| |subsid =] | |||
| | foundation = {{start date|2007}} | |||
| |homepage = | |||
| | location_city = ] | |||
| | location_country = US | |||
| | key_people = Jason Galanis<ref name=bi_jason>{{cite web |url=https://www.businessinsider.com/the-past-may-be-a-prologue-for-fundcom-and-weston-capital-2011-4 |title=The Past May Be A Prologue For Fund.com And Weston Capital |date=April 20, 2011 |publisher=Business Insider Australia}}</ref> | |||
| }} | }} | ||
| '''Fund.com Inc.''' |
'''Fund.com Inc.''' is a US-based financial services information publishing company and ] that focuses on the ] industry. Its aims were to provide a destination website for investments, including ]s, ]s, money market funds, ]s (ETFs), ]s, ]s, commodity funds and other types of pooled investment vehicles. | ||
| The company saw a significant decline in its share price after a soured business deal in late 2009 after which it has only traded in the “]”. Some of its senior executives were connected to Westmoore Capital from which Fund.com raised $1.5 million in 2008. Westmoore Capital was closed down by the ] for running a $53 million ].<ref name=bi_jason /> | |||
| ==Company Structure and Management== | |||
| ==History== | |||
| Currently Fund.com does not have any executive team responsible for operational activities of the firm. | |||
| The company was formed through a reverse takeover in January 2008 of ''Eastern Services Group'', a state and local tax advisor for Nevada casinos. After the merger the name was changed to Fund.com<ref>{{cite web |url=https://nz.finance.yahoo.com/q/pr?s=FNDM |title=Fund.com Inc. (FNDM) -Other OTC |publisher=Yahoo Finance |date=June 6, 2014}}</ref><ref name=bi_jason /> | |||
| ⚫ | ===Domain name purchase=== | ||
| ==Exchange Traded Funds (ETFs)== | |||
| ⚫ | In March 2008, Clek Media announced that it had brokered the sale of the domain name “Fund.com” for nearly $10 million in an all-cash transaction, to the company Fund.com Inc. Although never confirmed by the company itself, the purchase price would have been the highest recorded price paid for a web site domain up to that point, followed by Porn.com ($9.5 million) ] ($7.5 million) and Diamond.com ($7.5 million).<ref></ref> However, some industry insiders have questioned the validity of the amount reported.<ref>{{cite web |url=http://www.domainnamenews.com/domain-sales/fundcom-sells-for-a-world-record-10-million/1476 |title=Fund.com Sells for a Record $10 Million |date=December 3, 2008 |publisher=DomainNameNews}}</ref> | ||
| ⚫ | ===AdvisorShares acquisition=== | ||
| *Exchange traded funds are the most significant product development since money market funds in the 1970s with ETF asset growth approaching $800 billion. | |||
| In 2008 the company purchased a 60% stake in ] for an initial payment of $275,000, on October 31, 2008.<ref>{{cite web|title=AdvisorShares Investments, LLC Purchase and Contribution Agreement|url=https://www.sec.gov/Archives/edgar/containers/fix230/1335795/000121390008002161/f8k110608ex10i_fund.htm}}</ref> Fund.com agreed to pay Noah Hamman, who founded AdvisorShares, a base salary of $240,000 and a minimum guaranteed bonus of $100,000 per year after the acquisition.<ref>{{cite web|title=Employment Agreement|url=http://www.lawinsider.com/contracts/1brpzGDPlgmtiTxQtJVuBN/fundcom-inc/employment-agreement/2008-11-06|publisher=Law Insider}}</ref> Just a week later on November 7, 2008 Noah Hamman's former company, Arrow Funds, commenced arbitration proceedings against Hamman and AdvisorShares for usurping Arrow's intellectual property including its business plan in establishing AdvisorShares. However, Arrow's lawyers mentioned that an unsuccessful mediation had taken place prior to initiating the arbitration proceedings. In January 2009, Arrow Funds requested a hearing with the SEC to challenge AdvisorShares' application for exemptive relief filed the previous month. Arrow and their counsel claimed that Hamman "To enable the Application to proceed, deliberately thwarted and delayed the selection of the Arbitration tribunal members."<ref name=Arrow>{{cite web|title=Request for Hearing on Application of AdvisorSharesInvestments, LLC and AdvisorSharesTrust, Investment Company Act Release No. 28568; 812-13488|url=http://www.sec.gov/comments/812-13488/812-13488-1.pdf}}</ref> This request to block the application for exemptive relief was denied on July 20, 2009.<ref>{{cite web|title=INVESTMENT COMPANY ACT OF 1940 [Release No. 28822|url=http://globaldocuments.morningstar.com/DocumentLibrary/Document/e7d98e8a8d433c15.msdoc/original/f8k072109ex99i_fund.htm|access-date=2014-01-18|archivedate=2013-12-15|archiveurl=https://web.archive.org/web/20131215193954/http://globaldocuments.morningstar.com/DocumentLibrary/Document/e7d98e8a8d433c15.msdoc/original/f8k072109ex99i_fund.htm|url-status=deviated}}</ref> "On March 1, 2010, Mr. Hamman, Arrow and the Members agreed to settle the Arbitration"<ref>{{cite web|title=FORM 8-K Fund.com |url=http://www.sec.gov/Archives/edgar/containers/fix230/1335795/000121390010000804/f8k030110_fund.htm}}</ref> | |||
| *According to Barclays Global Investors, “Just about the only product to see net inflows in 2008 were Exchange Traded Funds." | |||
| *On a global basis: ETF net sales were US$ 187.5 billion; while net sales of mutual funds were minus US$256.7 billion | |||
| *In contrast, Hedge Funds for the first time in their 18-year history had significant outflows according to Hedge Fund Research (HFR). | |||
| *] expects the outflows to be more than US$ 100 billion for all of 2008. | |||
| *According to the National Stock Exchange, ETFs represent $1.3 trillion in trading volume per month. | |||
| *Exchange-traded funds now represent 31 percent of all trading volume in the U.S. equities market, an indication of just how widespread the adoption of ETFs has become in the U.S. | |||
| ⚫ | ==AdvisorShares== | ||
| ===Background=== | |||
| Fund.com purchased its 60% stake in AdvisorShares for an initial payment of $275,000, on October 31, 2008 .<ref>{{cite web|title=AdvisorShares Investments, LLC Purchase and Contribution Agreement|url=http://www.sec.gov/Archives/edgar/containers/fix230/1335795/000121390008002161/f8k110608ex10i_fund.htm}}</ref> | |||
| Three former ] employees, Noah Hamman, Jacob Griffith and Joseph Barrato founded Arrow Funds in February 2006. Less than 7 months after starting Arrow, in August 2006 Noah Hamman, while still acting as the CEO of Arrow Funds, established a separate company called AdvisorShares, allegedly without the knowledge of his two partners "and in violation to his fiduciary duty to Arrow Hamman then systematically diverted to the benefit of himself and AdvisorShares opportunities, assets, and contracts that rightfully belonged to Arrow. When Arrow began to learn of Hamman's competing activities and confronted him regarding those activities, Hamman engaged in further deceptive misconduct by affirmatively misrepresenting the nature and scope of his endeavors on behalf of AdvisorShares". Hamman's employment with Arrow was finally terminated on November 29, 2007, after Arrow Management Committee discovered more information about the nature of Hamman's competing activities.<ref name=Arrow>{{cite web|title=Request for Hearing on Application of AdvisorSharesInvestments,LLC and AdvisorSharesTrust,Investment Company Act Release No. 28568; 812-13488|url=http://www.sec.gov/comments/812-13488/812-13488-1.pdf}}</ref> | |||
| === Application for Exemptive Relief === | |||
| On November 7, 2008 Arrow commenced ] proceedings against Hamman and AdvisorShares for usurping Arrow's intellectual property including its business plan in establishing AdvisorShares. Asked when he expected to get SEC approval, Hamman told IndexUniverse, on November 11, 2008 "I do believe we're within a week or two of getting it, based on the feedback we're receiving from the SEC." <ref>{{cite web|title=AdvisorShares' Hamman: No Transparency Issues with Active ETFs|url=http://seekingalpha.com/article/105362-advisorshares-hamman-no-transparency-issues-with-active-etfs|publisher=IndexUniverse}}</ref> In January 2009, Arrow Funds requested a hearing with the SEC to challenge AdvisorShares' application for exemptive relief filed the previous month. Arrow and their counsel claimed that Hamman "To enable the Application to proceed, deliberately thwarted and delayed the selection of the Arbitration tribunal members." | |||
| <ref name=Arrow>{{cite web|title=Request for Hearing on Application of AdvisorSharesInvestments,LLC and AdvisorSharesTrust,Investment Company Act Release No. 28568; 812-13488|url=http://www.sec.gov/comments/812-13488/812-13488-1.pdf}}</ref> This request to block the application for exemptive relief was denied on July 20, 2009.<ref>{{cite web|title=INVESTMENT COMPANY ACT OF 1940 [Release No. 28822|url=http://globaldocuments.morningstar.com/DocumentLibrary/Document/e7d98e8a8d433c15.msdoc/original/f8k072109ex99i_fund.htm}}</ref> "On March 1, 2010, Mr. Hamman, Arrow and the Members agreed to settle the Arbitration"<ref>{{cite web|title=FORM 8-K Fund.com |url=http://www.sec.gov/Archives/edgar/containers/fix230/1335795/000121390010000804/f8k030110_fund.htm}}</ref> | |||
| === Unsuccessful Petition for Dissolution of Arrow === | |||
| On October 10, 2008, Noah Hamman petitioned (under §18-802 of the Deleware LLC Act) a Court in Delaware to dissolve Arrow Investment Advisors, LLC. He claimed that Arrow's managers had mismanaged the company and could not achieve the goals set forth in the original business plan. He alleged that Arrow's managers had: 1) "exposed the Company to liability by violating the particular federal securities laws and regulations | |||
| under which the Company is required to operate, and have failed to seek | |||
| appropriate supervision from the broker-dealer for the Company’s specific | |||
| obligations as a FINRA-licensed representative" 2) "operated the Company for their own | |||
| financial benefit, and have spent Company funds for their own private use | |||
| and enjoyment, while paying wages to various employees in an erratic and | |||
| tardy fashion." 3)"failed to provide to all members an annual operating plan for 2008 as required by the LLC Agreement". On April 23, 2009, the judge in the case dismissed the Petition with ] (meaning that because of misconduct on the part of the claimant it can not be refiled), as Hamman failed to provide factual evidence to back his claims and "Hamman was required to press his fiduciary claims in binding arbitration under the Arrow LLC Agreement". "Hamman suggests that merely stating these allegations, virtually without any factual support, is enough to survive a motion to dismiss. Here, the | |||
| Petition is devoid of any facts supporting Hamman’s first two allegations, such as | |||
| which of the myriad federal securities laws Arrow must comply with were violated or for | |||
| what improper personal purposes Barrato and Griffith used Arrow funds and | |||
| approximately when and how much of Arrow’s funds they misused." The judge seems to suggest revenge as a possible motivation for filing the suit: "And, although Hamman might be disappointed that he has been ousted from the management of a company he helped establish," <ref>{{cite web|title=IN RE ARROW INVESTMENT ADVISORS, LLC,|url=https://www.casetext.com/case/in-re-arrow-investment-advisors-llc-ca-no-4091-vcs-del-ch-4232009|publisher=casetext}}</ref> | |||
| ===The DENT Tactical ETF (NYSE: DENT)=== | |||
| An example of ]’s growth and business model is the which commenced trading on the New York Stock Exchange on September 15, 2009 under the NYSE Ticker: DENT. This is the first product of ], an investment management company that was formed for the purpose of offering a series of actively managed ETFs. DENT is actively managed by HS Dent Investment Management, LLC, an independent economic research and forecasting company and publisher of The Dent Method. HS Dent Investment Management is managed by New York Times best selling financial author, ]. Previously, HS Dent has previously raised and managed a $1.7 billion mutual fund. | |||
| DENT was closed in August 2012 is no longer an operating ETF. <ref>{{cite web|title=Harry Dent Tactical ETF Gets The Ax|url=http://news.investors.com/investing-etfs/080612-621147-harry-dent-tactical-etf-folds.htm}}</ref> | |||
| ⚫ | === |
||
| (pages 6 and 7) | |||
| ⚫ | == |
||
| ⚫ | ===Vensure Employer Services attempted acquisition=== | ||
| On November 4, 2009, Fund.com announced its purchase of an equity interest in Mesa, AZ.-based Vensure Employer Services, Inc., a professional employer organization that provides benefits and payroll administration, health and workers' compensation insurance programs, employee training and development services, and retirement benefits plans, such as 401k's, for small and medium businesses. The equity is represented by $21.9 million of participating preferred stock of Vensure. | On November 4, 2009, Fund.com announced its purchase of an equity interest in Mesa, AZ.-based Vensure Employer Services, Inc., a professional employer organization that provides benefits and payroll administration, health and workers' compensation insurance programs, employee training and development services, and retirement benefits plans, such as 401k's, for small and medium businesses. The equity is represented by $21.9 million of participating preferred stock of Vensure. | ||
| Fund.com was unable to meet the contractual obligations of the purchase and the transaction was subsequently reversed. | Fund.com was unable to meet the contractual obligations of the purchase and the transaction was subsequently reversed.<ref>{{cite web |url=http://biz.yahoo.com/e/100824/fndm.pk8-k.html |title=Termination of a Material Definitive Agreement, Notice of Delisting or Failure to S |date=August 24, 2010 }}</ref> | ||
| ==Acquisition of Whyte Lyon Socratic, Inc.== | |||
| ===Whyte Lyon Socratic acquisition=== | |||
| In November 2009, the company also announced that it had purchased 100% of the capital stock of Whyte Lyon Socratic, Inc., a developer of online education programs for | |||
| investors, debtors and professionals. As part of that transaction, Whyte Lyon's president Joseph J. Bianco was named chairman of the board of Fund.com.<ref></ref> | investors, debtors and professionals. As part of that transaction, Whyte Lyon's president Joseph J. Bianco was named chairman of the board of Fund.com.<ref></ref> | ||
| Whyte Lyon Socratic |
Whyte Lyon Socratic specialized in long-distance learning and assisting online students in developing the necessary skills to understand financial transactions and financial markets; develop money management skills to help them manage their income and wealth; and reach particular goals, including homeownership, debt reconciliation, and improved credit scores. | ||
| ⚫ | ===Decline=== | ||
| ⚫ | ==Domain |
||
| In September 2011 an unusually large 1 for 120 reverse split of Fund.com shares failed to stop the share price slide. Fund.com lost 99% of its value that year giving a market value of around $8.4 million<ref name=bi_jason /> | |||
| === Recovery === | |||
| ⚫ | In March 2008, Clek Media announced that it had brokered the sale of the domain name “Fund.com” for nearly $10 |
||
| In late 2016, Thomas Braziel was assigned as a receiver to Fund.com and investigated how he could monetize the remaining assets of the company on behalf of shareholders. Among other things, he is trying to recover the fund.com URL that the previous management sold in an allegedly fraudulent transaction involving John Galanis. In addition, fund.com and ] settled a lawsuit over an ownership dispute. While AdvisorShare has already paid fund.com $2 million, Braziel is trying to recover an additional $2.2 million owed by AdvisorShares and unseal the terms of the confidential settlement made with the previous owners of fund.com.<ref>{{cite web|last1=Svenda|first1=Jan|title=Fund.com - Peculiar Legal Opportunity With Activist Catalyst|url=https://seekingalpha.com/article/4091377-fund-com-peculiar-legal-opportunity-activist-catalyst|website=Seeking Alpha|accessdate=20 August 2017}}</ref> In July 2018 Braziel successfully recovered the fund.com domain name for the receivership and is pursuing further action against previous insiders and recovery of other assets.<ref>{{Cite web|url=http://www.fndmreceivership.com|title=Fund.com Inc.|website=Fund.com Inc.|access-date=2018-07-25}}</ref> In July 2024 Braziel was stripped of his position as receiver.<ref>{{Cite web |date=July 18, 2024 |title=MEMORANDUM OPINION ADDRESSING EXCEPTIONS TO SPECIAL MAGISTRATE’S REPORT AND RECOMMENDATION |url=https://courts.delaware.gov/Opinions/Download.aspx?id=366760 }}</ref> | |||
| ==See also== | ==See also== | ||
| *] | *] | ||
| *] | |||
| *] | |||
| * | |||
| == References == | == References == | ||
| {{Reflist|2}} | {{Reflist|2}} | ||
| ⚫ | ] | ||
| ==References== | |||
| * | |||
| * | |||
| * | |||
| * | |||
| * | |||
| * | |||
| ⚫ | ] | ||
| ] | ] | ||
| ] | ] | ||
| ] | ] | ||
| ] | ] | ||
Latest revision as of 04:18, 30 August 2024
 | |
| Traded as | OTC Pink No Information: FNDM |
|---|---|
| Founded | 2007 (2007) |
| Headquarters | New York City, US |
| Key people | Jason Galanis |
Fund.com Inc. is a US-based financial services information publishing company and fund platform that focuses on the fund management industry. Its aims were to provide a destination website for investments, including mutual funds, hedge funds, money market funds, exchange-traded funds (ETFs), closed-end funds, index funds, commodity funds and other types of pooled investment vehicles.
The company saw a significant decline in its share price after a soured business deal in late 2009 after which it has only traded in the “pink sheets”. Some of its senior executives were connected to Westmoore Capital from which Fund.com raised $1.5 million in 2008. Westmoore Capital was closed down by the SEC for running a $53 million Ponzi scheme.
History
The company was formed through a reverse takeover in January 2008 of Eastern Services Group, a state and local tax advisor for Nevada casinos. After the merger the name was changed to Fund.com
Domain name purchase
In March 2008, Clek Media announced that it had brokered the sale of the domain name “Fund.com” for nearly $10 million in an all-cash transaction, to the company Fund.com Inc. Although never confirmed by the company itself, the purchase price would have been the highest recorded price paid for a web site domain up to that point, followed by Porn.com ($9.5 million) Business.com ($7.5 million) and Diamond.com ($7.5 million). However, some industry insiders have questioned the validity of the amount reported.
AdvisorShares acquisition
In 2008 the company purchased a 60% stake in AdvisorShares for an initial payment of $275,000, on October 31, 2008. Fund.com agreed to pay Noah Hamman, who founded AdvisorShares, a base salary of $240,000 and a minimum guaranteed bonus of $100,000 per year after the acquisition. Just a week later on November 7, 2008 Noah Hamman's former company, Arrow Funds, commenced arbitration proceedings against Hamman and AdvisorShares for usurping Arrow's intellectual property including its business plan in establishing AdvisorShares. However, Arrow's lawyers mentioned that an unsuccessful mediation had taken place prior to initiating the arbitration proceedings. In January 2009, Arrow Funds requested a hearing with the SEC to challenge AdvisorShares' application for exemptive relief filed the previous month. Arrow and their counsel claimed that Hamman "To enable the Application to proceed, deliberately thwarted and delayed the selection of the Arbitration tribunal members." This request to block the application for exemptive relief was denied on July 20, 2009. "On March 1, 2010, Mr. Hamman, Arrow and the Members agreed to settle the Arbitration"
Vensure Employer Services attempted acquisition
On November 4, 2009, Fund.com announced its purchase of an equity interest in Mesa, AZ.-based Vensure Employer Services, Inc., a professional employer organization that provides benefits and payroll administration, health and workers' compensation insurance programs, employee training and development services, and retirement benefits plans, such as 401k's, for small and medium businesses. The equity is represented by $21.9 million of participating preferred stock of Vensure.
Fund.com was unable to meet the contractual obligations of the purchase and the transaction was subsequently reversed.
Whyte Lyon Socratic acquisition
In November 2009, the company also announced that it had purchased 100% of the capital stock of Whyte Lyon Socratic, Inc., a developer of online education programs for investors, debtors and professionals. As part of that transaction, Whyte Lyon's president Joseph J. Bianco was named chairman of the board of Fund.com.
Whyte Lyon Socratic specialized in long-distance learning and assisting online students in developing the necessary skills to understand financial transactions and financial markets; develop money management skills to help them manage their income and wealth; and reach particular goals, including homeownership, debt reconciliation, and improved credit scores.
Decline
In September 2011 an unusually large 1 for 120 reverse split of Fund.com shares failed to stop the share price slide. Fund.com lost 99% of its value that year giving a market value of around $8.4 million
Recovery
In late 2016, Thomas Braziel was assigned as a receiver to Fund.com and investigated how he could monetize the remaining assets of the company on behalf of shareholders. Among other things, he is trying to recover the fund.com URL that the previous management sold in an allegedly fraudulent transaction involving John Galanis. In addition, fund.com and AdvisorShares settled a lawsuit over an ownership dispute. While AdvisorShare has already paid fund.com $2 million, Braziel is trying to recover an additional $2.2 million owed by AdvisorShares and unseal the terms of the confidential settlement made with the previous owners of fund.com. In July 2018 Braziel successfully recovered the fund.com domain name for the receivership and is pursuing further action against previous insiders and recovery of other assets. In July 2024 Braziel was stripped of his position as receiver.
See also
References
- ^ "The Past May Be A Prologue For Fund.com And Weston Capital". Business Insider Australia. April 20, 2011.
- "Fund.com Inc. (FNDM) -Other OTC". Yahoo Finance. June 6, 2014.
- 'Clek Media Inc. Brokers World-Record $10 Million Domain Sale'
- "Fund.com Sells for a Record $10 Million". DomainNameNews. December 3, 2008.
- "AdvisorShares Investments, LLC Purchase and Contribution Agreement".
- "Employment Agreement". Law Insider.
- "Request for Hearing on Application of AdvisorSharesInvestments, LLC and AdvisorSharesTrust, Investment Company Act Release No. 28568; 812-13488" (PDF).
- "INVESTMENT COMPANY ACT OF 1940 [Release No. 28822". Archived from the original on 2013-12-15. Retrieved 2014-01-18.
- "FORM 8-K Fund.com".
- "Termination of a Material Definitive Agreement, Notice of Delisting or Failure to S". August 24, 2010.
- 'Fund.com Acquires an Equity Interest in Vensure Employer Services and Whyte Lyon Socratic, Names Joseph J. Bianco as Chairman of the Board'
- Svenda, Jan. "Fund.com - Peculiar Legal Opportunity With Activist Catalyst". Seeking Alpha. Retrieved 20 August 2017.
- "Fund.com Inc". Fund.com Inc. Retrieved 2018-07-25.
- "MEMORANDUM OPINION ADDRESSING EXCEPTIONS TO SPECIAL MAGISTRATE'S REPORT AND RECOMMENDATION". July 18, 2024.