On October 1, 2021, the Company’s board of directors approved a spin-off of the MTron/PTI subsidiary. The Company had previously announced its exploration of this potential spin-off transaction and will now proceed with the spin-off, which will be submitted to a shareholder vote for approval. Substantially all the cash and investments will remain in LGL. Our electronic components segment consists entirely of the operations of MTron/PTI. See Note M - Segment Information.

The IRNT S-1 registration statement became effective with the SEC on September 30, 2021 and as a result certain IRNT shares and the warrants held became tradeable in the market. On October 1, 2021, the Company sold 220,000 IRNT common shares received as a result of its investment in a private placement in the SPAC public equity (“PIPE”). Furthermore, on October 1, 2021, the Company pursued its alternative to exercise its 2,065,000 IRNT private warrants on a cashless basis and received 1,271,406 IRNT common shares upon such exercise, in two tranches on October 4 and 5. As of October 31, 2021, the Company had sold 1,405,315 shares of our IRNT common stock in a variety of transactions resulting in approximately $16.9 million of gross pre-tax proceeds. The Company held 138,620 shares of unrestricted IRNT common stock and 1,250,000 IRNT common shares that are restricted from sale for at least six months from the date of the IronNet Business Combination. These restricted shares are subject to the applicable shareholder lock-up agreements. The Company has executed and may continue to execute derivatives transactions as part of its plan to minimize the economic risk of IRNT share price volatility to its IRNT holdings. The Company’s deferred tax assets related to net operating loss and tax credit carryforwards of approximately $2.5 million can be utilized to reduce our taxes payable on our gains realized on IRNT share sales.

	Warrants			Shares			Cash
Sponsor investment							$6.1 million
Sponsor distribution on September 14, 2021		2,065,000			1,572,529
Shares donated on September 28, 2021					(50,000	)
Cashless exercise of warrants on October 1, 2021		(2,065,000	)		1,271,406
Shares sold as of October 31, 2021					(1,405,315	)	$16.9 million
Remaining shares-October 31, 2021		—			1,388,620
Restricted shares held					1,250,000
Non-restricted held					138,620