Let me know when YouTube goes live. Hi, Shane. Welcome, everybody. Marcus, appreciate you being here. Marcus, the President of TurnOnGreen. No one really likes this part, but legally, you gotta do it, Marcus. If you could read the forward-looking statements to the best of your ability, we'll move forward into the presentation.
Sounds good. Thank you very much. Forward-looking statements. This presentation and other written or oral statements made from time to time by representatives of Hyperscale Data, Inc. contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements reflect the current view about future events. Statements that are not historical in nature, such as forecasts for the industry in which we operate, in which we may be identified by the use of words like expects, assumes, projects, anticipates, estimates, we believe, could be, future, or the negative of these terms, and other words of similar meaning, are forward-looking statements.
Such statements include, but are not limited to, statements contained in this presentation relating to our business strategy, expansion, growth, products and services we may offer in the future and the timing of their development, sales and marketing strategy and capital outlook. Forward-looking statements are based on management's current expectations and assumptions regarding our business, the economy, and other future conditions, and are subject to inherent risks, uncertainties, and changes in circumstances that are difficult to predict and may cause actual results to differ materially from those contemplated or expressed. We caution you, therefore, against relying on any of these forward-looking statements.
These risks and uncertainties include those risk factors discussed in Part I, Item 1A, Risk Factors of our annual report and Form 10-K for the fiscal year ending December 31st, 2021, and other information contained in subsequently filed current and periodic reports, each of which is available on our website and on the Securities and Exchange Commission's website, www.sec.gov. Any forward-looking statements are qualified in their entirety by reference to the risk factors discussed in the 2021 annual report. Should one or more of these risk factors or uncertainties materialize, or in certain cases fail to materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended or planned.
Important factors that could cause actual results to differ materially from those in the forward-looking statements include a decline in general economic conditions nationally and internationally, decreased demand for our products and services, market acceptance of our products, the ability to protect our intellectual property rights, impact of any litigation or infringement actions brought against us, competition from other providers and products, risk in product development, inability to raise capital to fund continuing operations, changes in government regulation, the ability to complete customer transactions and capital raising transactions. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We cannot guarantee future results, levels of activity, performance, or achievements.
Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results. All forecasts are provided by management in this presentation and are based on information available to us at this time, and management expects that internal projections and expectations may change over time. In addition, the forecasts are based entirely on management's best estimate of our future financial performance given our current contracts, current backlog of opportunity, and conversations with new and existing customers about our products.
Thanks, Marcus . Mike Tyson, he said a long time ago, everyone has a plan till they get punched in the face. We have been pretty resilient, but we're gonna go backwards and talk about the past and then go present to the future and forward. We have the privilege of having Ken Cragun, our CFO, on the call, and William B. Horne, the CEO. I get a lot of text messages and emails about me being the CEO. I wonder how much due diligence people do if they don't realize that there has been a CEO for more than a year and some change, and it's not me. He is my business partner. William B. Horne is here with us.
We've asked Marcus, the president of TurnOnGreen, to be with us because that is the first dividend being issued, and we're pretty excited about that. To go backwards, how this all started was digital DPW, Digital Power Corporation, traded on the NYSE American and had about $3.5 million in assets and was being delisted from the New York Stock Exchange, or at least was in the process of being delisted. We noticed when we talked to Amos, who was the CEO at the time, and is presently the CEO of TurnOnGreen, that they had an excellent power electronics business, and I happen to have sold really early in my days power electronics at a firm called BK Labs.
I had known and understood what they did, and we thought it was an excellent opportunity to buy the control block from the current chairman, who was selling his position and turn that into a long-term plan for a holding company. The strategy you see play out that we're gonna talk about today has always been the strategy. Those of you who have been with us for a long time and experienced the highs and lows that we've experienced together know that we ultimately thought that Digital Power, the business Digital Power, which is now TurnOnGreen, would be a standalone entity. We've always believed the defense business long term would be a standalone entity.
Things have migrated over time, and what you see on the screen today, which is these forward-looking. You know, into the future, what the future outlook looks like is a TurnOnGreen, a Ault Alliance and Giga-tronics slash DPW, which is the combined company today. Of course, BitNile, which we hope long-term will become a super app. As we look through this is our planned structure for the future. The company has announced to restructure certain subsidiaries and distribute ownership of each entity to shareholders of record on such a date. The initial one, Imperalis Holdings, was renamed after it combined in a reverse merger with TurnOnGreen and Digital Power, which is a subsidiary. The company's ownership warrants and repurchase.
The company's ownership of common stock and the warrants of common stock of TurnOnGreen anticipate distributions to stockholders. TurnOnGreen intends to list on the Nasdaq. Talking about that scenario here, this is something where we will take all 140 million shares we have at BitNile Holdings and all 140 million warrants. I've got a couple questions about this, like what will happen since it's on the OTC now. Those shares will go into your brokerage account. Now, the good news here is the company filed an S-1 statement, which we're gonna get into shortly. That was filed last Friday. Fast-forward to Ault Alliance. It's not in this order this will happen, but you look at Ault Alliance, that's really the diversified holding company. That's effectively private equity meets ownership.
Now, since we have such big stakes, it's really. Those are consolidated enterprises. Like when you look at Singing Machine, since we own more than 50%, we consolidate them into our financials, and we back out our minority stake on the second to the bottom line. We plan on this becoming a public reporting company in the first half of 2023, and that'll be the last distribution. The second distribution will be Giga-tronics, GWW. That's our defense business, been around a long time. Some of those businesses are around, I think, some plus sixty-plus years. Those have been long legacy defense businesses, some of them single-source suppliers for the military and for certain applications. Of course, BitNile. BitNile, the pure play BitNile intends to become a platform based around Bitcoin. We're gonna get into that.
That's an incredibly exciting opportunity and something. If you look at the Twitter account of BitNile, you'll see that it was formed in 2017. This is something that I've been working on with my staff for a long time, and we're excited to see this come and move forward here. So let's talk about the distribution of TurnOnGreen. We filed a S-1 registration statement last Friday. Ken, I wanted you to talk about your experience in terms of like what could happen here now that we're in registration. We're gonna register the 140 million shares of common. We're gonna register the 140 million shares of warrants.
Then we're gonna get into once those are distributed, we'll ask Will to explain to everybody what that does from a book value perspective once those shares are paid out. Ken, can you kind of give us your commentary? It took a long time to get this done because that was a legacy business.
Right.
Going back some 26 years of it, or 23 years of it being public, the old Digital Power.
Yeah. Yeah. We got this teed up by taking TurnOnGreen public through a merger with Imperalis. Imperalis was a small public company. Now, TurnOnGreen has merged into it and two companies under our control. Now, TurnOnGreen is a public company. We got through the audit. The carve-out financials were audited by Marcum, and we were able to file those financials. Then on Friday, we filed a registration statement related to the shares that we plan on distributing to the BitNile shareholders. It does say there is a process, the SEC needs to declare this registration statement effective, for those shares to be tradable. We'll work through the process and wait to hear back from the SEC.
This was another milestone in our previously announced plan to get tradable shares distributed to our shareholders so they would own. First step is you'd own a share of BitNile, and then you'll own a share and a warrant distributed kind of pro rata. Those 140 million shares will be distributed to our shareholders. So you'll have shares of BitNile and shares of TurnOnGreen in your account. As Todd mentioned, once the S-1 is declared effective, those shares will be registered.
Yeah. I wanna cover something that I talked to legal about. We're trying to be very careful here 'cause this is a little complicated. Those people asking about the proxy and the potential increase in the number of shares that'll be authorized by BitNile, we want this distribution to take place before anything happens long term with potentially issuing any future shares for what will be the new BitNile in terms of BitNile and the marketplace. The present shares we have outstanding and authorized today will be getting this dividend. That is the plan. The record date is to be set very shortly, right after we get what we call a cleared S-1, where these shares are registered and tradable in your account.
It's important to understand that not only will the shares appear in your account, but so will the warrant. Then soon after that, we hope the warrant will be tradable just like the common stock in the sense that you'll see a TurnOnGreen stock and a warrant that trades, and that warrant is good for five years. Will, to prep you, I'm gonna be asking you about some of the provisions and the warrants that provide the investors some protection. They're limited protection, but they are a five-year warrant. If you've ever traded warrants, it's important to understand that those usually trade on a time value.
Given the fact that Marcus and the team are experiencing so much opportunity in terms of EV, we thought this warrant would give the shareholders a notional extra value in terms of a bonus to participate in the future of the EV business as a pure play and as the EV business stands alone and measured by its peers. Now, this is something we're pretty excited about. I'm excited about it. I'm a shareholder of BitNile, and so I'll get a distribution along with you, and so will everybody who is a shareholder of BitNile. Will, can you talk about carefully the best you can about what those warrants will look like and the protections there? I know they have a little bit of down round protection.
Can you kinda give us a little bit of what these will look like? I think he's on mute, Will. Yeah, you're on mute, Will.
There you go. I apologize. Right now we're still in the process of finalizing that warrant, the final document, but we do envision that there will be some protections. It is limited. You have a five-year option to, once these things are registered, to exercise the warrants. As Todd pointed out, they do trade based upon, to a certain extent, the time value as well as, you know, overall volatility, for the underlying security and common stock in TurnOnGreen. You know, the biggest factor is gonna be what the exercise price is. The exercise price is going to be most likely a ten-day VWAP, which again, we've yet to define what the final period is gonna be, but something that allows the warrant to have, we hope, value on day one.
I appreciate it, Will. We created a separate company. Ken talked about this. We created a separate warrant, we just heard from Will on this subject, and there's gonna be an elimination of what they call consolidation, right? I want everyone to walk through this with me. When you have a consolidated entity, if you lend money to a subsidiary or invest in a subsidiary, those are wiped out in consolidation. You should see an aggregate, and I'm gonna be careful here to explain how this works, but you should see an aggregate increase in terms of asset value of approximately, and I'm giving you a very narrow range here because I don't know the actual outcome.
Will, can you talk about deconsolidation and what that does for us as a company in terms of making things easier for BitNile going forward and more, the prospects of TurnOnGreen's future and its future financing when they get to deconsolidate?
Obviously when you consolidate, you're taking two companies and you're combining the two sets of financial statements, and then you're eliminating any of your intercompany transactions. In this case, once we make the distribution, we'll no longer be the primary shareholder, whether it's fully owned or majority owned. You know, once that 50% threshold is crossed, we'll deconsolidate. Those assets you'll no longer see on our balance sheet. You won't see their cash, you won't see their accounts receivable, you won't see their inventory, and you won't see their results of operations. What will be left on BitNile Holdings financial statements is our preferred position, which we have 25,000 shares that will be remaining of Series A preferred, and that will be valued on our financial statements as an investment valued at fair market value.
All right. Appreciate that, Will. Obviously this is the first step, and we filed the registration statement. The next step will be to set the record date once the registration statement is cleared, and soon after that will be the ex-date. Now, I spoke to legal this morning, and the goal is to have these shares. This is a goal. I wanna be clear. There's no assurance, but this is a pure goal that Will and I have set for the company and legal has signed off on that we're gonna try to do, and that is we wanna have these shares in the hands of the shareholders in their accounts before year-end.
We're hoping sometime early in December, but there's no way to assure what the SEC is gonna say about it, but we're fairly confident that we can move forward in an expeditious manner. I've gotten some questions about this, which I'm gonna answer, which one of them was, what happens if you have a Robinhood account and you own shares of BitNile? You will get the share of TurnOnGreen and the warrant. Robinhood, we spoke to them. They made it clear that you will be able to liquidate your position. You will not be able to buy more shares because it's on the OTC, but you will be able to sell your position, and you'll be able to sell your warrant when you're ready too. We spoke to Webull. It's the same scenario.
E*TRADE and other firms don't have a moratorium on OTC stocks, so you will be able to buy and sell with most other firms. We specifically talked to Robinhood because there's so many shareholders of Robinhood that own the stock. Now, the company will endeavor to list on the Nasdaq later next year, and that's because Marcus is working on plans, et cetera, and they wanna be solidified in terms of how big their network is. I got a chance to sit with Amos, the CEO of TurnOnGreen. He basically showed me the network, how people were using the charger and how they were installing the charger, and the spread between the power bill and the charger being installed.
Marcus, I know that you're in a quiet period, so you can't really say a lot, but you did do that deal with Avis Rent a Car, at least the affiliate of Avis Rent a Car. You are speaking at the conference in terms of all those rental car companies, and I know you have a lot of prospects there in terms of, let's just say I know there's a lot of demand for EV. I thought maybe you could give people the status quo on what's happening in the EV space and what's the prospects for TurnOnGreen.
Absolutely. Thank you, milton. Well, in terms of electric vehicle sales, I mean, many of us are aware that this is the future of transportation. You know, EV registrations were up 60% in Q1 2022. Right now, EVs account for about 12.5% of the U.S. market, as of Q2 2022. There is no question that the country is, and North America really is transitioning towards electric vehicles. The sales are outpacing the infrastructure. It is really a great opportunity for a company like ours to be in the space because the demand is growing and will continue to grow over the next 10 years-15 years, especially as governments, both federal, and state and local governments mandate zero emission vehicle goals.
You know, California, for example, you know, has 2035 as their target for all new vehicles being sold in California will be electric or non-gas burning cars. We could leave that. Hydrogen would potentially be part of that deal too. From where we stand right now, from a segment standpoint, there is multiple markets entering the EV space right now, hospitality, fleet, healthcare, you know, last mile delivery. Mass transit. There are so many verticals that are electrifying, and all of them are going to need charging solutions. There are not enough charging companies right now. There are a handful. One of them is ChargePoint is probably the largest one by far, at this point.
We in the charging industry look at ChargePoint kind of the way BlackBerry was, where if you think back to the early 2000s and you look at how BlackBerry, everybody had a BlackBerry and it was secure, and that's just what everybody used. That's just sort of how we look at ChargePoint now, and that as the market progresses and accessible, there will be better, faster, more flexible solutions like TurnOnGreen to enter the marketplace. As you saw in the cell phone market where people diversified into iPhones and other, you know, Android phones, you'll see a very similar pattern in the EV charging world.
Marcus, is there any turning back? I mean, you think that the U.S. can turn back on EV? I know that here in Vegas, I have a lot of people come visit me and they drive from California, and there just aren't enough charging ports here. There just are not, right? Is there any turning back, though? Because what I see here is there's so much need for it, but not enough electric infrastructure. You saw that $900 million get approved by Biden. Is there really any turning back or what do you think the growth curve looks like for TOG for, like, say, the next 10 years or so?
Well, the growth curve for the industry will continue to be very steep. The industry from electric vehicles and EV charging is gonna grow very fast. Our hope is that TurnOnGreen will be able to participate in that verticality. You know, a big part of the positioning for our company is being in the game now because this is infrastructure. The reason why the five-year warrant is so important is because infrastructure takes a while to build. It does take time to build our network. We need to put the pieces in place. We've talked about it in the past where we've gotten approved with California rebate programs like CALeVIP and SoCal Edison Charge Ready program, the PG&E program.
There are other public utility programs that we've been approved by as well. That's a huge first step in the life cycle of EV charging, is making yourselves available, making yourselves compliant. To answer your question specifically, the future of the country is electric. It doesn't mean that it's going to be all powered by solar or wind. I mean, there's still going to be large fossil fuel components to powering our grids. I think you're gonna see a real opportunity for natural gas providers to be able to provide solutions for microgrids and for utilities as well.
Because one of the questions we get a lot, especially, by the non-EV sort of, we'll use as the word, kind of the everyday person, is how is the world, you know, how is the country gonna support everybody once they all go electric, right? The grids aren't set up for it. Well, the grids are modernizing quickly. They're building out a variety of solutions, so they're not sort of pinning all their hopes on solar or wind. I do think that as the grids modernize, adoption for e-mobility is just gonna become easier. What you see in the world now between, you know, OPEC and, you know, what's happening with gas prices and all these things, the market really favors e-mobility. It's not just cars. You see them already.
Like, if you live in big cities, you see a lot of electric scooters around, a lot of electric bikes around. You're starting to see three-wheelers, electric, you know, vehicles. The world understands that it's cheaper and sometimes better and faster to get around in an electric vehicle. Doesn't mean the gas vehicle is gonna be gone forever, but the way that people move will be electric.
I wanted to point out something that you gotta be really careful when you give these forecasts, but why TOG is so important right now, right? That is they have their own growth curve. In fact, if you looked at our estimated financials for the third quarter, I think they had a pretty substantial forecast in terms of what they would grow quarter-over-quarter and how they're doing. They have experienced that whole delivery of product.
It was, you know, the supply chain was really messed up for a while, especially since so many things are brought in from overseas. One of the things I'll point out to you is I tweeted out this morning the book value as of the end of June that the CFO helped me calculate, and it was $1.06 a share, which I believe, Ken, was roughly around. Ken, do you remember the number? It was around $300 million in terms of book value.
Yeah. The kind of book value is over $300 million on 300 million shares, so it was $6 per share.
Right. When you look at that and you figure out even in today's numbers and look at what we forecast for the quarter, in the third quarter, you will look at these shares and you put your own value on what the market's valuing, whether it's $0.10 a share on 140 million shares, which is $14 million. If you put $0.10 a share on the warrants or $0.05 a share on the warrants, you can come up with your own number. Depending on what number you come up with, in some cases it's half the entire market cap of BitNile. Now, I'm not telling you it's gonna be like that. Could it be $0.20 ? Could it be $0.05 ? Could it be $0.50 ? The market will determine that. We're not.
Our goal is to get Marcus and his team, Amos, and that team at TurnOnGreen out there and independent so they can grow independently and get valued on their own. One of the reasons why it's so important to us to give you the five-year warrant is we've looked at their growth curve and said, "These guys are gonna need a long time to grow into what the demand is, so let's give the shareholders an opportunity to hold onto that warrant for that five-year period, and let's make it tradable so if you get an opportunity, a run-up, et cetera, you can take advantage of that." That's the plan there. Will, do you wanna add anything about TurnOnGreen before we move on to the next section?
You're on mute.
You're on mute, William B. Horne.
He's mute. I apologize. When you're working from home, sometimes you don't want interruptions on a call. No, the only thing I'd point out is when we look at the number of shares, I think what the investors can expect is, and this is approximate, for every 3 shares that somebody owns of BitNile Holdings, they're gonna receive 1 share of TurnOnGreen and 1 warrant. And that's approximate. It's gonna fluctuate a little bit. We won't know the final until we set the record date. And you know, it's gonna be interesting to see how these warrants ultimately trade.
Yeah. I
I do think it's beneficial. I think it's beneficial for both, right, Todd? Ultimately, if the stock does run, you know, appreciates significantly based upon TurnOnGreen's place in the marketplace, you know, this could also be a great opportunity for TurnOnGreen to bring in capital.
Yeah. I want to point out something. If you were to give it whatever valuation you wanted to as a shareholder, and you were just to give it $0.10 or $0.20 worth of value for each warrant and per share, you'd be looking at a company relative to its peers that's trading at a discount. Let's assume you'll give it whatever value you can. At $0.10 for both the warrant and the share, that five-year warrant, you're talking about $28 million and a market cap of BitNile, not including the real estate equity, right? Let's remember that. We'll come to that later in the conversation. Because all combined, our real estate purchases and equity-wise totals close to $68 million, or excuse me, $65 million.
If you look at the market cap of BitNile today, something isn't making sense, right? Because then you go and say, "Well, how much did you pay for the miners, Bitcoin miners?" I think that's another close to $150 million. So not making sense, the market cap. We're trying to unpack that for you. Make sense, but not give forecast 'cause we're really not allowed to do that. The stock's gonna trade what it trades. Ken, do you have anything else to add about the spin-off of TurnOnGreen? 'Cause I know this is something we really wanna have happen in December. We're pushing hard for that as subject, obviously, to the SEC clearing the proxy. I mean, clearing the S-1.
No. We're happy for TurnOnGreen and the team there and their ability to be an independent public company with a path to becoming traded on Nasdaq, so they can be properly valued as a pure play EV charging company and EV solutions, EV network, and a path to get the capital they need, because this will be capital intensive to build this infrastructure. I think it puts them on a great path, and I think it's a tremendous upside for our current shareholders.
Marcus, as we wrap up and we move on to the next company that's gonna be spun out, I had the privilege of sitting in front of Amos and him showing me the network while people were actually using it. I thought maybe you could talk to people about when you guys make that infrastructure installation. He said he's been cutting checks to places that put in these EV chargers. Can you maybe talk about the network a little bit?
Sure. We have a public network that we're building across North America and Canada and, you know, in the United States, both level two and DC fast charging ports, some of which we own and operate, others we sell to site hosts, and they own and operate, and we charge them a management fee. There's a couple different ways for us to generate revenue from these units. We're very selective about where we put our machines because we definitely want them to get used. You know, and there's also a lot of rebate and grant opportunities in specific regions of the country that allow us to build affordably and our site hosts to build affordably.
We partner with, you know, with a couple different site hosts to develop charging plans that make sense and build units in areas where they're gonna get used. I will say that, you know, part of our advantage of TurnOnGreen is that we do have a subsidiary, Digital Power Corporation, that has been in existence since 1969, and can buttress us as we grow and support us as we grow, and have some interesting projects as well. We're a diversified company, with our eyes very much on the EV market and looking to grow and expand into the new markets that are coming online because the coasts have dominated electric vehicles.
We're looking at Texas, you know, Illinois. There's a lot of areas in the Midwest where electric vehicles have been slower to adopt. You know, we wanna be there. We wanna be there first, and we wanna build the infrastructure there to provide charging solutions for those drivers.
Marcus, I've been told to not encourage any more statements 'cause you're in a quiet period, but I think all that's already been out there, so not necessarily worried about that.
It has all been out there.
Yeah, I know that. I know you guys have made that clear to everybody. Marcus, I know you're gonna hang around, but thanks for that. Guys, we're gonna answer questions for TurnOnGreen in a few minutes when we get towards the end of the presentation. Moving on to Giga-tronics/Gresham. The original Gresham, I think, has been around 63 years. Different growth curve than TurnOnGreen. Really a different model in the sense that they provide bespoke defense solutions. This is a business combination that took place, and this took a long time to get done. The company presently trades under the symbol GIGA on the OTC. About 70% of the company is presently owned by Vidnow Holdings.
I wanna take you to read something very important to understand what you're getting here. The company owns approximately 2.9 million shares of common stock and 514.8 shares of preferred stock on a convertible into 3.9 million of common stock, for a total of around 6.88 million shares of common stock on a converted basis. All of those shares will be distributed on the ex-date, there'll be a record date, will be distributed to the shareholders of BitNile. We have a similar timeframe. I don't know when the S-1 will be filed for this company, but those shares will be held for the shareholders, and we wanna distribute this to the shareholders like we're doing with TurnOnGreen.
The Ault Lending portion of the company, which is formerly Digital Power Lending, which is owned by Ault Alliance, will still hold preferred shares in the company, and the company is seeking up-listing in early 2023. Now, if you look on our reported financials, Ken, what's the run rate that you know of in terms of the combined Giga-tronics, Gresham run rate? They got a lot of long-tail contracts.
Right.
It's kinda hard to predict.
Yeah.
I know that Enertec is inside of this also. We've given you an example of some of the customers that are inside here. This is a legacy defense business run by J.R. Reed and Tim Long and Spike out of Israel. What's the legacy, what's the current run rate?
Yeah. I think they've been targeting a $40 million run rate for that business. You know, GWW, Gresham for us, had been you know, approximately $30 million, and they were about 70%. They are about 70% of the combined entity. You know, you can see we've made filings on this, and we have some pro forma financial information there. If that $40 million run rate's not quite right, you can look at the pro forma financial information in the filings and see what it would look like combined.
Ken, Will, when I talk about the distribution of these shares to the shareholders of BitNile, this is how I've done the math, right? I'll do some simple math and say, if the shares are $1.25, and you're gonna give them out to all the shareholders of BitNile, that represents what looks like to be around a $8.5 million dividend based on the price being $1.25 and the number of shares being close to 6.8 million. If you look at the market cap of the company, it looks like it's, like, a 12%-15% dividend. I don't know how you do that math in terms of how you calculate the value because, you know, you never know where the price of Giga-tronics will be when you distribute it out.
Can you walk people through how you think this is gonna transpire? You're on mute. You're on mute.
Difficult question, Todd. When you start thinking about the value for OTC companies, you know, they're volatile. You've got a stock that in Giga-tronics that was at $3.25 around the time that we entered into this exchange agreement back in, what, December. Now you've got a company where the stock price has decreased to $1.25. You know, where is the real fair value of this security? I don't think it's being reflected in the markets, and I think that's predominantly an issue with small-cap and micro-cap companies right now. They've just been devastated.
Yeah, it is a difficult question to answer. You have a $40 million defense business or something in that range in terms of run rate. You have a business that's been around, some of them for more than 60 years. In the case, I think, of Digital Power, I mean, excuse me, in the case of Gresham, I think it's 63 years. Then you have a valuation of them of a fraction of what their sales are and, what, you know, relative to other metrics. But this, in terms of timing, this is a more legacy business for us, different growth curve. Will, can you talk about what'll happen to our balance sheet when this comes off? 'Cause this will have another effect on the overall company when this comes off our balance sheet.
Yeah, it's gonna be a similar effect that the TurnOnGreen distribution's gonna have. We're gonna distribute effectively 100% of the shares of common stock that we own. It will leave us a small position, actually a convertible note that will convert on the presumed up listing. But again, that convertible note is gonna just be valued at fair value. So again, we won't be showing results of operations of this once we deconsolidate. It will be gone.
I think our
The shareholders will own it.
Yeah, we're trying to expeditiously make this happen. I think the reason why we're so sensitive to what's transpiring is you guys can see that we have a 10b5-1 plan in place, and we've been buying at Ault Alpha Capital, and I've been buying personally and Ault and Company's been buying. What we're trying to make clear to the marketplace is that the math is not making sense in terms of the valuation of BitNile, because what you have is millions, basically $100+ million invested just in Bitcoin mining operations and data center, and then another $65 million of equity in real estate. Then you look at the defense business in TurnOnGreen, you start to ask yourself, "Why are you selling the stock to me at this price?" I am not you, and I'm not a shareholder.
I'm not an affiliate in the sense that I'm not a selling shareholder. I'm a buyer and have been a buyer for many years. We're trying to outline the value for everybody. You can make your own determination as to whether you should keep your shares of BitNile, sell them or whatever you wanna do. That's completely up to you. We're not making a recommendation. We're just pointing out that with TOG and Gresham, those are two businesses that are gonna be in your account soon, and we've set the stage for this to happen. That has an effect on BitNile Holdings because obviously once those liabilities are off our balance sheet, those become their own independent companies. Will, Ken, do you have anything to add about Giga?
I know that Giga-tronics has some overseas operations with Enertec, and it has Relec over there, which is doing really well. When I look at this, the market cap just in Giga-tronics alone doesn't make any sense at all to me. I mean, in fact,
Yeah.
I'm perplexed beyond all reason that it makes any sense. I wonder if you could kind of outline your thoughts. You've been around a long time. You were a CEO or CFO of a billion-dollar Nasdaq company before you joined us. You were, I think, at Deloitte a while ago. You have a lot of experience.
Right.
A little gray hair. Tell us about your thoughts here.
Right. Yeah. Yeah. Also, I want to clarify. I was looking at our preliminary revenue projections for Q3 for the combined Gresham and Giga-tronics. I guess they were standalone $30 million. You know, tack on the Giga-tronics. I think that $40 million is kind of a good aspirational long-term run rate for them. These are steady businesses, and as you said, it's a little bit of a different model. These are blue chip defense contractors and governments that are their contractors, so it's steady. There are some key programs that they have. We believe that the combined companies have some good synergies. Gresham Worldwide is worldwide. They have operations in the U.K. and in Israel. Giga-tronics historically is U.S. only.
This opens up opportunities for Giga-tronics to expand internationally. Then when we looked at Giga-tronics, we noticed they have some really good engineering talent. The legacy Gresham Worldwide can leverage the engineering talent of Giga-tronics. We think combined, there's some good synergies in geographic footprint and technical expanding of technical knowledge. But it's again, this will be a pure play. It is now a pure play, and investors can look at it and understand the business. They don't have to try to tease out the information from our mining or lending operations, but it's all defense and that company can really be evaluated by investors that wanna have that steady decent size.
Well, it's a small public company, but the combined company has a little more scale than it did individually. Again, it's a vehicle for them to grow and perhaps tack on additional smaller defense companies that could provide further synergies and some economies of scale as they have their growth plans.
Yeah, I know that.
Well, Ken.
Go ahead.
I'm sorry, Todd.
Go ahead. Go ahead, Will.
Also to point out, when we start talking about the defense company in particular, you know, these are companies collectively that have relatively strong balance sheets. I mean, they're not burdened with a lot of debt. I know, Todd, you mentioned that we're getting those liabilities off our balance sheet, but the reality is we're getting those assets off our balance sheet. We're putting those in the hands of our shareholders.
Yep. Makes sense. I get it. With these two things in mind, TurnOnGreen and Gresham being sent out to shareholders, if you were to do the math, you'd say, "Okay, I'm a BitNile shareholder. I'm gonna wake up with a share of TurnOnGreen, a warrant in TurnOnGreen, and then I'm gonna get a share of Giga-tronics," whatever that looks like in terms of different securities. You'll have four different securities in your account from what is BitNile today. We're gonna move on, away from the business combination of Giga-tronics, and this is pretty much. These are pretty much the TOG and the Gresham on autopilot. This is subject to clearing comments from the SEC and setting those record dates, and we have a goal of getting that done ASAP.
TOG should be first, and then Giga will be second. As we move to Ault Alliance, the divestiture here, this is a much bigger operation when it comes to assets. If you were just to look alone at the equity we have in real estate, we have, I think, 23.5 Million of equity in the four hotels. Well, actually, if you combined all the hotels, I think it's closer to 26 million, 25.5 Million of equity in the hotels alone. We have the equity in terms of valuation of the 617,000 sq ft building and data center, 34.5-acre in Michigan, and we have the building in St. Petersburg, I think that combined total is around $65 million.
Those businesses, this is what's really important, the Michigan location continues to install Bitcoin miners, and that's on track to be the first level of capacity, I believe, by the end of November or early December in terms of miners. That's a really critical business for us. Remember, when you continue to look at market cap of BitNile, and you say to yourself, Will, if the stock were trading. I think it's not really super important we get into those details, but assuming the stock is trading where it was at the close today, and assuming that's a market cap of somewhere around $60 million, just the real estate equity alone is the entire value of the company.
that doesn't include TOG, and that doesn't include Gresham. That goes back to that market cap, that book value of $1.06. Inside there, you'll have other examples companies we own, including Alzamend Neuro, which I believe is around 10 million shares of Alzamend Neuro, and then an additional 12 million shares with investment rights and warrants. I think it's a total ten. I'm approximately correct there, around 22 million shares.
Yeah.
Of that.
Potential, yeah.
Yeah, potential.
Potential.
We have only about $1 million in Ault Energy right now because that company has done its first oil well, which we did say was economically viable. I think we own another $10 million worth of Singing Machine, which we do consolidate. I think somewhere in the neighborhood of around $20 million or so of MTX. Correct me if I'm wrong there, Will, but is that investment in MTX around $20 million something?
Little bit more than that.
Little bit more than that. Of course, we have the SPAC and our equity in the SPAC, which we put in about $7.5 million. What you don't pay attention to, and really nobody does in value, is we own a big position in AdTech Pharma, which we hope goes public in 2023. That is a glaucoma drug. We have other investments in UES, which is an EV company. What we really is a driving force, and if you look at our forecast, is the lender. We are a licensed California lender. That is a very high margin business. It's very volatile. Will, I was kinda.
You always have a different perspective than I do in terms of talking about volatility and the lender, what we had earlier this year in Mullen, and kind of like the lumpiness of this, but the pure margin that is lending to other public companies. I thought maybe you could comment on the lender, which we really haven't went into in detail.
Yeah. I mean, look, it's a great vehicle for us. It's short-term, typically short-term investments. If you look at Mullen, those were all short-term. It's an untapped market. There's not a lot of people that participate in lending to, you know, small early-stage public companies. Done properly, though, it certainly does bolster our net income and our revenue, but it is choppy. There's periods that we're going to have mark-to-market fluctuations, and there's periods that we may not be active in our lending activities. It does vary. It's less predictable than, say, the defense business.
Yeah, it is a volatile operation, but there is not a lot of people that lend to smaller public companies. For us, and it's a business that I've been part of for what feels like decades, I don't actually know how long it's been. I've been on Wall Street for about 33 years. Having a licensed lender and the ability and the connections and the know-how and the people and the lawyers to make these opportunities happen, the lender has a portfolio of companies that are being incubated that we funded that have the potential to be public. This is a long-term opportunity for us to continue to operate the lender. Now, this business, Ault Alliance, is the biggest of them in terms of assets with the hotels and others. Will, how do you describe...
This is, I'll read it through real quickly, and then we'll talk about this dividend 'cause this is a really interesting scenario here. Ault Alliance will continue to focus on long-term growth of its operations. It has Bitcoin mining, data center operations, commercial lending, activist investing, oil exploration, hotels, commercial real estate, textiles, medical biopharma, and of course, the karaoke company, which we think will transform over time into a bigger retailer and distribution network, which we're gonna talk about next with BitNile. Will, how do you describe the size of this in terms of the economics of that?
$300 million+ in equity, that $1.06 in book value, to me, it's remarkable, and I continue, when I'm legally allowed to buy BitNile, I mean, they're just giving it to me, and I'm fine with that if they're gonna give it to me. But how do you describe this dividend and what you kind of think? I know you got to give it all the parameters of forward-looking statements. I know you can't be certain, but this is a big dividend, right? And what people don't understand is that one thing can happen, right?
If Alzamend gets good results or if AdTech Pharma gets good results or any of the hotels are sold or Singing Machine has good results or the oil and gas does well or the lending does well, there's a tremendous opportunity here for growth in this diversified holding company that's stuck inside BitNile. I wonder if you could give your commentary.
Yeah. Again, if you look at what's happened to small cap companies, micro caps, they've been devastated. It's not just us, it's not BitNile Holdings, it's a slew of them. You know, we see it with the Dow, we see it with the Nasdaq. There's more red days than we'd like. I think this company is grossly undervalued by the market right now when you look at what we've invested and what our equity is. Again, our book value, Ken and Todd already said today it's around $300 million. I know what we've invested in the crypto marketplace, but the crypto mining section and the data center operations, and that's north of $150 million.
Todd, as you pointed out, we've got $65 million in equity in the properties alone. You have the potential for Alzamend, MTX Group, Singing Machine, all of these companies combined. Certainly it's hundreds of millions of dollars. I don't know how you value a distribution or dividend of any of these companies when the system to me is somewhat broken and you're not getting a proper value for the company to begin with.
Right. It's a tough call, but we're trying to deal with the circumstances that we have. It's an interesting scenario because if you look at the amount of Bitcoin mined, you start to look at I think we mined somewhere. I'd have to get the numbers, but I think we've mined somewhere this year more than 10%, 15% of the market cap of the company. When you keep bringing miners online, even with the increase in difficulty and the decline in price, we face the headwind of rising difficulty, declining in price, declining market cap, declining stock market, declining small cap market, and yet we continue to plow along mining Bitcoin.
We continue to plow along with the lender and Alzamend. You know, obviously announced that they plan on putting the vaccine into human beings and filed the IND. Singing Machine, of course, is now contributing. It's really hard for us to look at this and say, "Are we making the wrong decisions?" I think that the management believes we're making the right decisions that we laid out a few years ago and that we're gonna separate the companies. One of the most common questions I get is about the ATM. The funny part about the ATM is it doesn't make any sense as an investor if you raise money on the ATM and you put it in assets that are becoming productive, that shouldn't be a negative.
That's the number one question I get. Which makes no sense because we're spending the money on things that are gonna help grow the company. It gets very hard to use an ATM when you got a price we have now, right? Will, I talked about this with legal because I really want to make it clear to people. It is not our intention to get the shares authorized on the proxy and use an ATM. That is not our intention. We intend to use those shares strategically for what's gonna help happen in the marketplace, and that's why we want to get the distribution of TurnOnGreen and Gresham out to people. We don't want there to be further long-term dilution before those shares are issued to people and they're in their hands.
We want the current shareholders to get the bulk of the TOG and Gresham and of course, ultimately, Ault Alliance, and we're shareholders of them too. Let's go through this real quickly and then we'll move on to the marketplace. We'll answer questions and we'll wrap this up. Additionally, Ault Alliance through Ault Lending entities will continue to explore special situations, unique opportunities. Given the macro environment, Ault Alliance expects distressed opportunities in abundance the next 18-36 months. Ault Lending as the foundation will remain committed to nurturing and growing operating businesses, new investments in years to come. This will be the long-term vehicle that will allow us to spin out more companies longer term.
As Gresham goes away, as TurnOnGreen goes away, TurnOnGreen goes away and becomes its own public company, Ault Alliance will still be there as a holding company listed on a different exchange. That's the plan. It will separate from BitNile eventually. That's a more complicated separation because obviously the existing BitNile Holdings, which will run the marketplace, has to be in a position to be able to keep its listing and people to understand what they're getting out of that. We're gonna structure distribution in the coming year, and we expect the company to be public reporting as a segment in the first half of 2023. What you're gonna see is a public BitNile Holdings and a public reporting Ault Alliance.
You'll be able to separate internally how you wanna value those, how analysts wanna value them, like, the guys at Spartan. Well, it's Barry. He's asked those questions about what the separate valuations are. This should make it easier for analysts and people that follow us to understand what they own. Obviously, TurnOnGreen and Gresham will be off our balance sheet. That'll make it easier for you to understand what you own there. I hope that makes sense. Ken, do you have anything to add about the Ault Alliance divestiture and sort of like your thoughts on why this should happen and what this will look like? Any commentary? You've been around a long time, as I pointed out.
Yeah. I think the talking points that we've had for TurnOnGreen and Giga-tronics are also applicable for this Bitcoin marketplace that we're gonna talk about next. That's a massive opportunity, and that opportunity should also have a chance to be a pure play public company and to be assessed properly. What you're left with is that the Ault Alliance continues to be a diversified holding company. Less diversified 'cause it won't have the EV, it won't have the defense business, it won't have this marketplace opportunity, but still plenty diversified, and there's some real hard assets there for Ault Alliance. Ault Alliance has this baseline of hard assets in real estate, the miners that are productive, but then we have really tremendous upside opportunities with the lending and investing.
It kinda is a combination of bedrock of hard assets, but also tremendous upside in these investing scenarios that we have.
Yeah. This is something that I hope that my partner and I, and Ken, and the team, Henry and James, we continue to run a holding company long term. That is the plan there. Obviously we bought some through Ault Alpha. We bought some through Ault and Company, and I bought some through my private account, and we look forward to receiving the dividend just like you. We'll be eating the same cooking. We'll be getting the same stocks you get, and we're pretty excited about that. This is a big dividend. I think ultimately I'm excited about what happens here. A lot of assets here, and not a lot of debt on the balance sheet.
In terms of the only debt really that's serious, and I wouldn't even say it's serious, it's not recourse to the parent, is that the hotels have some debt, but that's individual properties. There presently is no debt on the vast majority of the assets, and there's a lot of leverage opportunities and opportunities to use the balance sheet to strengthen the company. Will, do you have any further commentary before we talk about moving on to the marketplace and something that I'm the most excited about when it comes to undervalued situations? What do you think about this dividend? And maybe give people your thoughts on the nature of what's gonna happen here.
Look, I think it makes it simpler for people to understand the companies, the four companies. You're gonna have a defense business. You're gonna have an EV business. You're going to have a holding company that's still complex, apparently for people to understand. That holding company is predominantly, I'll call it two different, you know, asset categories. You've got real estate, and you've got the data center and cryptocurrency mining operations when you look at it from an asset base. Lenders is a distant third, but, you know, depending on what happens with those investments, it could certainly skyrocket to number one on that list. You know, having each company with access to capital, dedicated access, is certainly a plus. As far as the marketplace goes, yeah, that's gonna be an interesting project.
Yeah. Let's move on to the marketplace. By the way, we're trying to make this very clear for everybody, exactly what our plans are. You got the TurnOnGreen first date coming out right after the S-1 is cleared. You got Gresham after that, and then you move into 2023 and what we're doing with Ault. All right. Onto the marketplace. BitNile is a really simple concept, but it will sound complicated, but it's not. That is, if you've ever had an opportunity to look at the spam bots on Twitter, spam in terms of phone calls, networks, and you understand what a super app is.
If you look at something like WeChat and Tencent, and then you overlay Bitcoin to it, this is really what I think is a remarkable opportunity. This is led by Douglas Gintz, and Douglas Gintz was recruited by William B. Horne. Will worked with him prior, and Will liked his capabilities in the software side of the business and the marketing side of the business. We just announced the hiring of Frank Fresto, who was a Googler. I think he was a 300th employee at Google. We have been building a team here behind the scenes for the marketplace. For those of you who see our sponsorship of IndyCar, we have been networking very hard in that B2B category. There's a lot of people that present there, and what you see here is a verified marketplace. Excuse me for a second.
We expect to see here is a situation where you have a verified seller and a verified buyer. It's one of the most unusual things that I'm told has not been done before, and that is that we're gonna verify every buyer and seller, and we're also gonna be the transaction network between those buyers and sellers. We're gonna guarantee that the person gets their Bitcoin returned to them, so there's a payment mechanism. These are our plans to make that happen. I wanna give a couple things about what a super app is because most people on this call who have not used a super app like WeChat or Tencent don't understand that the marketplace doesn't represent just retail, but it represents an opportunity to transact. Our main category is Bitcoin, okay?
Let's say you don't have Bitcoin, but you have 39 other different cryptocurrencies. The marketplace is being set up so that you can come to the marketplace, and you can use those other cryptocurrencies too. You don't just have to use Bitcoin. You don't get the BitNile digital reward, the reward token, you don't get that token or that opportunity to get a reward unless you use Bitcoin. The marketplace should allow you, and this is our plans, it should allow you to convert any of your cryptocurrency that we accept into Bitcoin automatically, very transparently and quickly. It also should allow you to convert up to 22 different forms of fiat currency. That's pounds, that's euros, that's US dollars, that's Canadian dollars. There's about 22 on the list that will be able to be converted into Bitcoin and used to transact.
We think this functionality is a big deal. The way Douglas is building the system, it'll be modular, so we can add on additional features and benefits. If you look at the use case for Bitcoin, and this is a big bet on the future, we believe that it's not gonna be just the trading of the asset, the digital asset. By the way, we do have an investment in Earnity. We'll get to that later in the year when we talk about the integration of people that are gonna be on the network. What should you be looking for with the marketplace? You should be looking for strategic partnerships, people joining the marketplace. I mean big names, not small names. I mean people that are credible names that are gonna be accepting Bitcoin and making it really easy.
This is what we talk about with reimagining the way a marketplace works. We're not an Amazon. I know people say, "Oh, what are you trying to be a retailer?" No, we're this is a software enabler. This is a company that's gonna allow others to use the system. There will be some proprietary stuff that we'll use it for. And I'm gonna read through this 'cause I really wanna say to you guys that as you can see that I've been buying through the hedge fund, and I've been buying personally when I'm legally allowed to.
We're very committed to the separation of the four companies, and it really is hard for me to explain this to people, but when you see the stock trading for where it's trading today, it really does suck, but our long-term plans are just so valuable that we're just looking through that and saying, "What are we gonna build over the next 5-10 years?" You gotta have this thesis. If you have a thesis that Bitcoin is here to stay and there's gonna be a use case for that Bitcoin, then it's gonna be hard to ignore the marketplace. By the way, those of you who say that other people have a lead, I would love for you to show me where there's a marketplace where Bitcoin is the standard, where it starts at Bitcoin.
I'm not talking about trading Bitcoin, where I can buy and sell it. Of course, you're gonna be able to do that on BitNile. The original merchant, you know, the original merchant ship, right? The original merchant place in the world before Christ was the Nile River. This is the concept, right? The merger of what was old and new is gonna happen here, and this is something that we've taken a long time to think about and how this would develop, and this is where this is why we are getting more authorized shares, 'cause we don't know what is gonna happen here, but we wanna get the assets out to the shareholders now and then let BitNile become what it becomes. Now, one of the things you've seen me say is that we do not intend to reverse the stock.
We're big shareholders. Why would we want to? If we were ever gonna reverse it, and Will, I want you to chime in here about this, 'cause our plan is, if we ever had to reverse down the road, it would be our plans would be to be after these assets were distributed and BitNile was its own marketplace. It doesn't make any sense for us because obviously we've raised, back in March, close to $167 million, and we've raised a lot of required capital to do what we need to do, and now it's an asset allocation decision. What is that noise? We okay? Now it's an asset allocation decision, and we want the individual companies to be able to raise their own individual capital the way they need to. Remember, TurnOnGreen has its own managers.
I'm not on that board. I don't run that company. They'll make their own decisions. Gresham Worldwide, Giga has their own managers. They'll make their own decisions. Ault Alliance, obviously, I'll still be there running the lender and doing what I'm doing, for the business, and so will Will. BitNile has a new president, and that is, Douglas Gintz, and that software platform will acquire what it requires. The plan here is to set these things free. Today, you know, obviously pay close attention to what I'm saying here. In my opinion, the opportunity for Bitcoin is not going away. As more and more people acquire it, some 100 million wallets around the world, some 80 million wallets, I believe, I don't know what the number is in the US.
It used to be 81 million globally, and now it's over 100 million wallets. The addressable market for being able to transact in Bitcoin, in my opinion, is gonna grow. I can be wrong, but I don't think I'm wrong here. Will, your thoughts on BitNile becoming its own standalone platform.
I think it's the only logical conclusion for the company. Again, people that are going to invest in the future BitNile, the marketplace, that's what they want. They don't want to invest in a holding company structure. Candidly, the opportunity is so large it warrants its own separate company. It's not gonna be a short-term race. This thing is gonna be a marathon. It's going to take years, I think, before we really see the benefits of the marketplace. Again, you know, what was Amazon's growth cycle over the last 20 years? I think that's the same opportunity we have here.
Right. Excuse me. You wanna say what?
Sorry.
What about it? Okay. That has a time cut off?
Uh-huh.
Never heard of that before. All right. I'm gonna get back to Ken, and I'll get to Ken in a second. Here's what we intend to do. We intend to create a marketplace to be a super app, widely considered to be a mobile application, multiple services, including payment functionality, transfer of payment, driven by Bitcoin, blockchain. BitNile believes the marketplace will lower transaction fees, reduce complexity, and add security and brand name global e-commerce platform. I'll explain to you what's so big about this, and that is, if you look at the spam problem and the bot problem, when you use a Satoshi to verify that someone's real and that everyone on the network is real, this has not been done this way, to any scale, right?
That's the hardest part, is that people think Bitcoin is anonymous. It's really not. It's really open, and people can see what's happening. They know what's happening on the network. This super app, we hope to build something out that doesn't have spam, that doesn't have bots, and that is independent, and it's only people doing business that are verified. We plan an advanced buyer and seller functionality, third-party integration services, enhanced security through comprehensive buyer and seller program. Marketplace intends to be flexible, functional with a broad e-commerce solution. It's really we hope to become a one-stop shop. What I mean by that is that.
I wish if Douglas were on this call, he could talk about, and we will in the future, especially when we bring Douglas out for roadshows and events that we're gonna be doing for BitNile. He would talk about the functionality of other sites using our overlapping software. Today, when people say they accept Bitcoin, they just say, "Oh yeah, we accept Bitcoin." But they don't make it functional. They don't make it functional like you have to have Bitcoin. The great thing about what we're setting up is you can have Bitcoin in your own wallet, but you don't have to have Bitcoin when you show up. You can have up to, I think it's around 40 other cryptocurrencies and 22 other fiat currencies.
What I'd be looking for in the future is partnership announcements, things we're doing around retail, things we're doing around software, what features we're gonna add. I'd look up, if I were a BitNile shareholder, to understand what a super app is and what we're trying to build here. This is the reason why we're separating it. There are just big opportunities here. BitNile has developed into its own real biz, a big, big opportunity. People ask me a lot of questions about why isn't mining staying with BitNile. The real reason is that miners are really data center focused, and the management team at BitNile wants to run the platform. They don't wanna have to worry about mining.
You don't need to worry about it as a shareholder 'cause you're still gonna get the dividend of Ault Alliance, and that has the mining in it. Those people who say you're not gonna get the miner, you're incorrect. You're still gonna get the miner. All these assets are being dividended out. That's the intention, to dividend out to the shareholders. I'm gonna get to some questions, let me answer some questions. I know that there's a few analysts on the line, and we had a couple sent in from. These were from Barry. Okay, let me read this here. Please update the rationale for splitting BitNile. The original idea to place the crypto assets, which investors viewed as risky, into one public vehicle other than more traditional assets in another public company.
Well, I think I kind of just addressed that, and that is what we've learned about mining is it's incredibly volatile and incredibly risky, and we've learned that owning a data center or having long-term contracts to secure those data centers is really what matters in mining. It's clear that our relationship with Bitmain has paid off. I mean, we've obviously recently increased our acquisition of more miners, and I would expect in the future for us to, at the mining division, as we build out capacity, to even buy more miners. I think we're focused more than ever to be in mining. I just think that we think that the BitNile marketplace is just too big of an opportunity.
I really believe with all my heart that the BitNile marketplace has an opportunity to be something big, and we need to separate that. We don't want the BitNile marketplace distracted from anything other than the transactional platform that we hope to be a super app. What is the timeline expected for the 4 dividends? Have you done the SEC filing? I just saw the TurnOnGreen filing. What about the other steps, such as regulatory approvals and shareholder votes? Will, it's my thought that because we're distributing the assets to the shareholders, we have come to the tentative conclusion, although we are still subject to final approval, that we do not need a shareholder vote to separate the company.
That's my understanding.
Yeah. Those people asking about whether we need a shareholder vote, when you take a piece of pie, and you say, "I don't want four slices, but I want eight," you don't need a vote to cut the same pie into eight pieces, as long as you're giving everyone their equal shares. I can assure you what we're trying to do here is treat all shareholders fairly. What we wanna do is we wanna make those distributions, and we wanna do that knowing that BitNile will have its own desired capital base down the road. It has its own things it's gonna be doing. We wanna get these assets out to those shareholders as soon as possible.
I do not believe, and of course, I could be wrong, but so far, tentatively, legal has said that they do not believe we need a shareholder vote because we're treating all the shareholders the same. Everyone, if you own a share of BitNile, you're getting your pro rata share of what that distribution will be. Keep in mind, people have been asking me about the increase in the share authorization.
I think one of the things that Will and I are sensitive about, and Ken, is we wanna be able to say that if BitNile has an objective to raise more capital, and I'm not suggesting right now what they're doing, but if BitNile wants to raise more capital, it can always go to its shareholders and say, "Hey, do you wanna be in a rights offering?" I know we don't wanna use an ATM going forward. I know we reserve the right to do that, but it's not our intention to use an ATM going forward when those new shares are authorized. And there's no assurance that they will be authorized, by the way. Shareholders have to vote on it. I would say to you that we wanna use that strategically in conjunction with the distribution of these other assets.
It says here, for Gresham specifically, at one point, a secondary offer was mentioned. Is there still a case? I'm not aware of what Gresham plans to do yet when it uplists to the Nasdaq. I know they intend to list on the Nasdaq. I know they have plans to list on the Nasdaq. Will, can you make a commentary about the long-term plans you think of Gresham? I know that's kind of in flux right now.
Like you just said, it's up to the management of Gresham, of GWW. Our intent is to dividend out our 6.9 million shares of common stock to the shareholders and let J.R. and Tim run the company.
One of the questions from Barry is: Do you plan on having investor relations strategy? I think that it's probably gonna be important given that for some reason it's very confusing for everyone what we own. As the companies separate, they're gonna have to have their own investor relations strategy, their own reach out to shareholders, and making sure that people understand what they've gotten in those special dividends. In addition, the four companies comprising the split. Okay, so the question here is: How do you value Alzamend, The Singing Machine, AdTech Pharma, and the other potential companies we own inside the Ault Alliance portfolio and the lender? That's part of the problem. I don't think the market does value that.
I mean, if you just look at the liquidation value of the company, I don't think it values it at all. That's why you continue to see me, when I'm legally allowed to, buy what I can buy, what I can afford. Will, I guess we'll ask.
Some of the larger-
I'm sorry. Todd, I think the distinction is people are asking how we value the companies. To be clear, what you see on our audited financial statements, and I don't care if it's the audited financial statements of BitNile Holdings as a consolidated entity, if it's TurnOnGreen's consolidated or TurnOnGreen's audited financial statements that were filed in both the Super 8-K and the S-1 that we just filed, or if it's Giga-tronics' audited financial statements. We record things at book value. I mean, that's the only thing that you can do as a company. You don't go through and mark up your investments.
We don't look at these, a lot of these things on a day-to-day basis and say, "How do we value this?" Because candidly, it's not relevant from a company reporting its consolidated results. Now, obviously, in our investments, we have to go ahead and value them, but there you look towards market conditions. And again, that's broken for small cap companies. Ken, go ahead. I'm sorry. I didn't mean to cut you off.
Oh, yeah. No, I was gonna say the Alzamend is easy because it's we don't consolidate it, but we have a large position, and we're very transparent on what our position is. They're traded on Nasdaq. I think they trade 1 million shares a day. So it's very easy to know what the value of our holdings is in Alzamend.
Except you're subject to the inefficiencies in the market.
Yeah. Yeah.
They are there for small-cap companies.
Right. How do you value it? That one's easy.
Yeah.
You look up ALZN on.
You take out any subjective.
Yeah.
You make it really objective to the extent that you can.
The same thing for Singing Machine Company. It's traded on the Nasdaq. So that one's not difficult to value. Now, AdTech and AVLP, some of these things are privately held, and it is a little bit harder for investors to get their arms around that. But big components are publicly traded.
Yeah.
That's helpful.
Some of the questions I got, I think I answered them. The ATM, we do not plan on using it at this time for future financings when it comes to the new authorized capital. What we have in place has been around for a long time. I don't know why people keep asking me about the ATM. It makes no sense to me why when we publish something, we file it, why people keep asking about what's out there. It is what it is. We report it quarterly. That is what it is. In terms of the authorized new capital, those 750 million shares, that is just something we're putting in place for BitNile's future use and what it's doing with Ault Alliance.
That is separate from Gresham and TurnOnGreen, and that still has to be voted on, and we have no plans to file an ATM for those shares. If something changes, we'll let you know, but it won't make strategic sense. We've already raised a lot of money. All the future financing is strategic to the network, strategic to the breakup, and really strategic to the marketplace. I'm not gonna get specific but. Did you wanna say something, Will? Okay. I'm sorry. I thought.
No.
I thought I heard you say so. We only have a few more minutes here, so I gotta speed it up a little bit. Obviously that's for the future growth of the marketplace. Let's see here. We talked about the shared accounts determined. Yes, if you have an IRA, you should get the distribution of the warrants and the shares in your IRA. Let's see here. Anything. Nasdaq listings for Giga-tronics before distribution. I don't know their plans on how quickly they'll uplist. We really are gonna let the companies become independent. There's always chances in the future, down the road, you know, after Giga-tronics, TurnOnGreen and Ault are distributed, that if you're a shareholder of Ault, that there may be other opportunities in terms of rights offerings, distributions. That's one of the models of a holding company.
Although what I would say is that the stuff inside Ault from a cash flow perspective, the lender, the mining, the data centers, the real estate, that's more of a traditional vehicle in terms of measuring it on cash flow. What's our EBITDA? You'll see that because when you see the marketplace, we believe the marketplace's measurement's gonna be based on the number of people that are members of the marketplace, the number of vendors that are added to it, and the software performance and the usage, right? We think it'll be valued more as a traditional platform. We think TOG and its power electronics business, TurnOnGreen, will be, TurnOnGreen's power electronics business, and then they'll be valued more like a traditional EV business. Then Gresham, there's a whole myriad of public companies.
I know that J.R.'s in all kinds of businesses like looking at drone and opportunities in defense, what he's doing in that legacy business they have and all the connections they have with all those bigger defense companies. That's a whole roll-up in itself. I think Will and I and Ken have just come to the conclusion that you gotta let these companies go and do what they wanna do, and you can't really build a marketplace with all these other things in it, and you can't really build a holding company when you have these other businesses that wanna grow, and they're more hypergrowth, and they're not part of the cash flow. I just think it makes logical sense for this to happen now.
As Will said earlier, we definitely realize that, you know, we realize that small caps have been beaten up. I mean, you look at the valuations of other miners, and we're sorta stuck in that algorithm. These things have been decimated. Ken, sorry, you first, buddy. Do you have any parting comments for everybody about our plans going forward? I know you've been building a really excellent team with the hires you've been making around the financial side of the business. Do you have any thoughts on going forward, what people should think about before we hang up?
No, Todd, I think we've covered it. Hopefully, people will pay attention to the filings. We're glad that we've hit some key milestones on getting a couple of our subsidiaries public and getting these shares, at least filing to get the shares registered for TurnOnGreen.
Will, do you have any parting comments before we part company?
No, I think it's pretty well been covered. You've gone into great detail on all of the four entities that we plan on ultimately becoming.
I have some parting comments, and I would say to you guys, listen, I've been at this a long time. What doesn't kill you makes you stronger. I'm not dead yet. We're not dead yet. The fact that the price is down doesn't deter us from what our plans are. Our plans are to distribute TurnOnGreen, Gresham Worldwide, and Ault Alliance and build the marketplace. We've been at this a very long time, Will and I and Ken, the team, Henry, James, everybody on the team. We have a really excellent crew we put together over a long time. I think there's somewhere, including the hotel, somewhere like 400 employees. I don't know the exact number, but we're very proud of what's happening, and we're gonna set some of those guys free.
I would encourage you as a shareholder to look at the press releases now going forward in the independent silos where they exist and ask yourself, "What does that mean for that business?" We're gonna try to make that clear because there's gonna be marketplace announcements. There's gonna be Ault Alliance announcements. There's gonna be announcements for TurnOnGreen and Gresham until they're separated, right? This process is gonna take some time. I'd pay extra close attention because if you're selling your shares down here, of course, that's your own decision, but I'd point out to you that there's $65 million in equity just in real estate. Now, granted, all that could go, you know, rates are going higher. You never know what can happen. I mean, the stock market could go to zero.
As I said earlier on my show the other day, you only die one time, right? If you're predicting the end of the world, you're only gonna be right once. We're not predicting the end of the world. We think Bitcoin's here to stay. We think the marketplace and the partners we're developing in IndyCar, NASCAR, other places like UFC, all the places that we're involved with that all do business to business, we're pretty excited about them and what's happening with the marketplace. We're really excited about lending and private equity and, of course, now there's a ton of opportunities again. We've raised so much money over the years, there's gonna be a capital allocation decision.
I think Will and I and Henry and Ken and the team are gonna be very deliberate in terms of where the capital goes and how this affects those four companies. Look for things coming out of Ault Alliance. Remember, we have a big investment. Well, I think it's a big opportunity in EV with Unique UES. We have a big opportunity with Alzamend, with AdTech Pharma. Alzamend has a treatment in human beings in phase IIa. If the vaccine, they filed the IND. I mean, we're doing real stuff here, and I would encourage you to pay attention to this if you're a shareholder. If you're not, I understand. Thank you for being with us.
Special thanks to Ken, David, Marcus, the entire team, Brett and Nick, Gary, everyone helping us, Roland, Henry, who's put up with me, our general counsel, James, who probably puts up with me more than Henry now. Everybody, thank you for being here. Thanks for being a shareholder. Pay attention to those press releases. We're gonna try to silo those. Pay attention to what each company's doing if you're a shareholder. Take care, and have a good holiday, everyone. Take care, everyone.