SCHEDULE: Frequency Electronics Files Schedule 13D Amendment

Edenbrook Capital and affiliated funds report a significant reduction in their stake in Frequency Electronics, Inc. following a public offering.

Summary

• Edenbrook Capital, LLC, Edenbrook Long Only Value Fund, LP, and Jonathan Brolin have filed an amendment to their Schedule 13D, reporting changes in their beneficial ownership of Frequency Electronics, Inc. (the "Issuer").
• The filing details an offering where Edenbrook Value Fund, LP and Edenbrook Long Only Value Fund, LP sold a combined 652,174 shares of Common Stock to an underwriter at $57.50 per share. This offering closed on July 30, 2026.
• Following the offering, Edenbrook Capital, LLC beneficially owns 1,221,636 shares (11.15% of class), Edenbrook Long Only Value Fund, LP beneficially owns 1,047,958 shares (9.56% of class), and Jonathan Brolin beneficially owns 1,242,941 shares (11.33% of class), which includes 21,305 restricted stock units (RSUs).
• The net investment cost for the directly owned Common Stock by Edenbrook funds was approximately $11,226,336.
• Edenbrook and Mr. Brolin remain supportive of the Issuer and its management, believing the company is well-positioned for future growth.

Sentiment

Score: 5

Explanation: StockSavvy.ai views this as a neutral filing. While it details a significant sale of shares, the reporting persons express continued support and optimism for the company's future growth prospects.

Positives

• Edenbrook and Mr. Brolin express continued support for Frequency Electronics, Inc. and its management team.
• Management believes the Issuer is uniquely positioned to capitalize on significant profitable growth opportunities.
• The offering was completed at a gross price of $57.50 per share.

Negatives

• Edenbrook Value Fund, LP and Edenbrook Long Only Value Fund, LP have sold a substantial number of shares (652,174 shares) in the offering.
• The reporting persons have reduced their aggregate beneficial ownership through the sale.

Risks

• The lock-up agreement restricts the disposal of shares for 60 days after the final prospectus date, subject to customary exceptions.
• The filing does not explicitly detail future risks but refers to the Issuer's most recent earnings press release and conference call for growth opportunities.

Future Outlook

Edenbrook and Mr. Brolin believe the Issuer is uniquely positioned to take advantage of significant profitable growth opportunities in the years ahead, as detailed in the Issuer's most recent earnings press release and conference call.

Management Comments

• Edenbrook and Mr. Brolin are supportive of the Issuer and the management team.
• We believe the Issuer is uniquely positioned to take advantage of significant profitable growth opportunities in the years ahead.

Industry Context

StockSavvy.ai notes that this filing reflects a common strategy for investment funds to realize gains after a period of investment, especially when they believe the company is poised for growth. The sale of shares via an underwriter suggests a structured exit for a portion of their holdings.

Stakeholder Impact

• Shareholders: The sale of shares by significant holders may influence market perception and potentially impact share price in the short term. However, the continued support from Edenbrook and Brolin may mitigate negative sentiment.
• Management: The continued support from Edenbrook and Mr. Brolin is a positive signal for the management team.
• Creditors: No direct impact indicated.

Next Steps

• Edenbrook and Mr. Brolin will be subject to a 60-day lock-up period following the final prospectus for the offering, restricting further disposal of shares.
• Continued monitoring of Frequency Electronics, Inc.'s performance and growth opportunities.

Key Dates

Recommendation

The filing indicates a partial exit by significant shareholders, which can be a negative signal. However, the continued support and positive outlook expressed by these same shareholders suggest they still believe in the company's long-term prospects. Therefore, a 'hold' recommendation is appropriate pending further performance data.

Keywords

Frequency Electronics, Schedule 13D, Edenbrook Capital, Stock Offering, Beneficial Ownership, Underwriting Agreement, Lock-Up Agreement, Restricted Stock Units