Deja vu? Failed CCU donor’s $237M gift to FL college could be worthless, officials admit

Less than a week after Florida A&M University announced the largest donation ever received by a historically Black college or university, officials are now acknowledging the gift could be worthless.

Gregory Gerami gave the university’s commencement speech last Saturday before presenting a giant check for more than $237 million. But the excitement surrounding the historic gift was short lived.

Public skepticism was swift as questions were raised about the relatively unknown CEO of a Texas hemp farming company and the historic donation. The Sun News detailed in an article Wednesday several inconsistencies surrounding his reported wealth, including an earlier failed donation to Coastal Carolina University.

Gerami, as an anonymous donor, had pledged $464 million to the South Carolina college in 2020, according to records The Sun News acquired, though the university only publicly announced a $95 million gift. But that relationship was terminated less than four months later with CCU officials citing an unfulfilled early obligation.

FAMU’s relationship with Gerami appears to have soured even more quickly. The university “put a pause” on processing the donation, said Larry Robinson, the school’s president, during an emergency board meeting of the FAMU Foundation Thursday.

While Gerami proudly declared, “The money is in the bank,” after presenting the check, the university disclosed that the donation was actually stocks believed to be valued at more than $237 million. University officials later doubled down on their belief in the value of the gift as criticisms rose, issuing a press release Sunday reassuring everyone that it had “done its due diligence when it comes to this matter.”

They had already received the stocks a month earlier, but a nondisclosure agreement prevented university officials from disclosing additional details, the press release added.

Gerami told The Sun News during a Friday phone interview that he remained confident the donation is worth $237 million. He doesn’t understand the criticism surrounding the donation, nor does he understand what the president meant by pausing the gift since the stock was already transferred.

“Could they send the stock back? They could send the stock back, but that wasn’t my understanding of what was talked about yesterday,” he said, adding that he’s not interested in taking back his donation at this point.

FAMU released a copy of the gift agreement Thursday to media outlets, including The Sun News. The agreement shows the FAMU Foundation received 14 million shares of stock worth at least $239 million with the donor agreeing to donate an additional $61 million over 10 years. The donor is listed as the Isaac Batterson Family 7th Trust, with Gerami serving as a trustee.

The Isaac Batterson Family 7th Trust Gift Agreement by David Weissman on Scribd

Stocks in Gerami’s hemp company. What are they worth?

University officials revealed during Thursday’s meeting that those stocks are in Batterson Farms Corp, the hydroponic hemp farming company Gerami founded in 2021.

Shawnta Friday-Stroud, the FAMU vice president for university advancement and executive director of the foundation, explained to the board that representatives of the bank Gerami was using sent the school financial statements valuing the stocks at $15.85 per share. She did not share the name of the bank, and noted that Gerami no longer uses that bank.

Friday-Stroud also said FAMU didn’t hire anyone itself to conduct a valuation of the stock because a third-party evaluation was already going to be conducted as part of its annual audit, so they decided to wait.

She later acknowledged that, as could be the case with any private stock, there’s a risk the value could be zero, but it could also be worth more than projected.

Gerami told The Sun News Friday he wasn’t sure whether the donation meant the FAMU Foundation currently owns Batterson Farms.

Before it was revealed that the stocks were in Batterson Farms Corp, Gerami explained to The Sun News during a Tuesday phone interview about how he evaluates his business.

“The way we do our valuation of our business is that we look at what contracts we have in front of us,” he said. “... We basically look at (our contracts) and determine our stock price based on what our volume is to project our revenue. We look at projected revenue and revenue coming in, and then we break that down among our shares.”

But information publicly available about Batterson Farms doesn’t suggest a booming company capable of more than doubling a public university’s endowment.

The Sun News previously reported that Gerami never purchased the 114-acre property in Muleshoe, Texas — as was publicized in an April 2023 news report about the company. And none of the addresses on file for Batterson Farms with Texas agencies are farmland, nor are any owned by Gerami, online property records show.

While the company has had a hemp producer’s license since Dec. 2022, a Texas Department of Agriculture spokesman previously told The Sun News that Batterson Farms didn’t have the permit needed to grow or harvest hemp. Gerami told The Sun News they have since received that permit, but the department did not respond to a request for confirmation.

A woman previously listed on the Batterson Farm Corp’s website as co-CEO also recently demanded her name be removed because she never worked for Gerami, The Tallahassee Democrat reported Thursday.

Where did FAMU go wrong?

Numerous foundation board members expressed frustration with the process, including asking why FAMU wouldn’t wait to announce the donation until after their independent valuation was complete.

Friday-Stroud said Gerami requested to speak at the graduation ceremony to make the announcement and, since he had already fulfilled the agreement by transferring the stocks, they honored his request.

In response to questions about why board members didn’t know about the donation until it was publicly announced, Friday-Stroud and President Robinson said the nondisclosure agreement Gerami requested limited knowledge of the gift to just six or seven FAMU officials.

Gerami told The Sun News Friday that his team requested the nondisclosure agreement to prevent upsetting people within departments at FAMU that were not going to be receiving funds as part of the gift. He didn’t recall specifically requesting the board members not be part of the NDA, but said he can’t remember every discussion surrounding the agreement.

Gerami first contacted FAMU last fall, and officials did an “expansive screening” of his background as they moved forward with the agreement, Friday-Stroud said. They discovered much of the information about him that has been spread on social media in recent days, she said, without specifying what information.

Friday-Stroud said no one at the university contacted Coastal Carolina University or Miles College, an HBCU in Alabama that The Sun News also previously reported that Gerami said he was donating to, but did not.

Gerami told The Sun News during a Tuesday phone interview that his team assessed possible donations to about 15 universities and colleges in recent years prior to announcing the Florida A&M gift. The Sun News identified University of Texas at Austin as a school Gerami contacted in 2019 to make a donation. But they cut off communication with him after less than a month, emails show.

Friday-Stroud also shared Thursday that Gerami’s proposed gift was initially less, but he increased it after Spelman College, an HBCU in Atlanta, Georgia, announced earlier this year it had received a $100 million donation, which was reported as the largest gift ever granted to an HBCU.

The Sun News has a pending public records request with FAMU for additional documents related to its relationship with Gerami. The newspaper also has a pending lawsuit with CCU for records related to Gerami’s failed donation there.

FAMU’s Board of Trustees has scheduled a special meeting for 3 p.m. next Wednesday, May 10, to further discuss the donation.