Member Info for okfornow

I presume they still have contract with musical.ly which has been bought by tic toc. This is a huge business especially in China and other fast growing territories. If so there must be good revenues coming in from here alone. Would welcome conformation or correction.

Well qualified CFO appointed, a disciplined management of revenue and costs should prove vital and bring good profits going forward. Would like to see news on contract wins from the last few months.

I have been asked to post the previous communication from phronimos and urge shareholders to contact them so we can bring about change.I am not a forum chat member for advfn could someone who is let polo shareholders know about this latest info by either posting letter or directing them to this forum.Many thanks and looking forward to an improvement in corporate governance here.

The release, publication or distribution of this document in jurisdictions other than the United Kingdom may be restricted under the laws of those jurisdictions and therefore persons into whose possession this document comes should inform themselves about and observe any such restrictions. Failure to comply with any such restrictions may constitute a violation of the securities laws of any such jurisdiction.

Phronimos is not affiliated with Polo. However, as at the date of this document, clients of Phronimos hold a long position in shares of Polo. We acquired interests in the securities of the Company based on the belief that such securities, when purchased, were undervalued and represented an attractive investment opportunity. Depending upon overall market conditions, other investment opportunities available to Phronimos, and the availability of securities of the Company at prices that would make the purchase or sale of such securities desirable, Phronimos may seek to increase or decrease its clients’ long position in the Company.

3. Engage in a thoughtful dialogue regarding potential financing to help unlock value for shareholders. Subsequent to the publication of Phronimos’ letter to the Board of Directors on February 14th, we have heard from other Polo shareholders supportive of our proposals, and, consequently, the concerned shareholder group has grown significantly. Furthermore, we have also heard from other investors willing to provide non-dilutive financing to help unlock value for Polo shareholders.

4. Provide shareholders with the time frame deemed necessary by the Board to evaluate any shareholder value unlocking proposals currently being contemplated.

We strongly urge the Board to respond to our requests and concerns without further delays.

Sincerely,

Sam John, CFA

Managing Member of Phronimos Capital, LLC

Investor Contact: Sam John (sjohn@phronimoscap.com/+1 (424) 781-7871/www.phronimoscap.com)



SOURCE: Phronimos Capital, LLC





Important Information

This document sets out the views of Phronimos Capital, LLC (“Phronimos”).

This document does not constitute a financial promotion of any kind by Phronimos or any affiliate, and the receipt of this document in no way renders you a client of Phronimos or any affiliate. The information contained in this document should not be construed as investment or tax advice, nor should it be construed as an invitation to purchase or sell any of your shares in Polo Resources Limited (“Polo” or the “Company”) (LON: POL). If you are in any doubt as to the action you should take, you should seek advice from an appropriately qualified independent financial or other adviser.

The information contained in this document (which may include price or other data) is for illustrative purposes only and may not be comprehensive or up to date. In preparing this document, Phronimos has relied upon and assumed, without independent verification, the accuracy, reliability and completeness of all information available from public sources. No responsibility is accepted and no representations, undertakings or warranties are made or given, in either case expressly or impliedly, by Phronimos or any affiliate as to the reliability, accuracy, timeliness, completeness or fitness for a particular purpose of information contained in this document or as to the reasonableness of any assumptions on which any of the same is based. Additionally, neither Phronimos nor any affiliate accepts any direct or consequential liability for any errors in or reliance upon the contents of this document. Neither Phronimos nor any affiliate will be responsible for updating any information contained within this document and opinions and information contained herein are subject to change without notice. Certain figures included in this document have been subject to rounding adjustments.

and excellent long-term sustainable value creation. Companies should avoid paying their executive directors more than is necessary to remunerate and motivate them. … No board should allow any executive director to be, or to consider himself or herself to be, irreplaceable: amongst other governance challenges that will inevitably arise, this may lead to demands for excessive remuneration.”

Furthermore, we note that in 2018, the Company issued share based payments granting Chairman Tang the option to purchase 20,000,000 shares at a greater than 70% discount to NAV. We believe the valuation methodology chosen by the Company significantly understates the fair value of the grant. The choice of a particular valuation method to determine fair value is not “fair and reasonable” if it does not take into account information material to the value of the corporation. With regards to investment companies (like Polo) in particular, the Net Asset Value per share is of paramount importance in determining “fair value.” Had the NAV per share been used to determine the fair value of the share based payment, we calculate the value of the grant to be ~USD 2.9 million (or ~USD 1 million annually considering that the options vest in equal instalments over a three year period.) Summing up the 2018 consulting fees and the share based payments using NAV as the fair value in pricing the options, total annual compensation for Chairman Tang was approximately USD 2 million (or GBP 1.5 million.) Even if we were to exclude Chairman Tang’s ~USD 400,000 salary from Polo’s investee company, GCM Resources, his total annual compensation of approximately USD 1.6 million (or GBP 1.2 million) is significantly above the median average total remuneration of GBP 248,000 for CEOs of companies trading on the AIM (as cited in BDO’s AIM Directors Remuneration Report 2018). As we stated in our previous letter, we do not begrudge management teams being adequately compensated when they have helped to create shareholder value. However, Chairman Tang’s significantly above market compensation (approximately 5-6 times the median) stands in stark contrast to the historical returns of Polo’s shareholders, who have witnessed c.80% decline in the share price and received no dividends or return of capital since his appointment in May 2013.

Polo Resources Limited

Craigmuir Chambers, P O Box 71

Road Town, VG1110

British Virgin Islands



To the Board of Directors:

We are disappointed with Polo’s response to the proposals put forth in our letter dated January 28th, 2019. We write to you again so that the Board and the Company’s shareholders fully understand our viewpoint and the reasons for our concern. We firmly believe the underlying value in Polo is significantly higher than the current share price and that the stubborn adherence to the Board's current investment policy is detrimental to the interests of shareholders as a whole. The market’s lack of faith in the stated investment policy is evidenced by the greater than 70% discount of Polo’s share price to its Net Asset Value (“NAV”) per share. The persistently large discount of Polo’s share price to net asset value precludes shareholders from realizing anything remotely close to its fair value through open-market transactions. The status-quo, which has resulted in significant realized and unrealized losses for past and present shareholders of Polo, is unacceptable. Consequently, we request that the Board:

1. Provide fellow concerned shareholder Nicholas Greenwood with the register of members within five business days. As you are aware, Section 100 of the BVI Business Companies Act grants shareholders a statutory right to inspect and make copies of the register of members. The Company has denied Mr. Greenwood’s request to exercise his statutory right, citing “data privacy” concerns. The right to inspect shareholder lists for the purpose of communicating with shareholders with regards to a proper purpose, being in this case the exercise of shareholder rights in the form of gathering support for a potential requisition of a shareholder meeting, is enshrined in company law. We urge the Board to respect this right.

2. Provide an explanation and/or the remuneration committee minutes regarding the appropriateness of Chairman Michael Tang’s total compensation (including the 2018 share option grant of 20 million shares at a greater than 70% discount to NAV.) We note that Chairman Tang’s consulting fees of ~USD 1 million per year from Polo Resources and its investee company GCM Resources is many multiples above the norm. According to BDO’s AIM Directors Remuneration Report 2018, the median average total salary for CEOs of AIM constituents was approximately GBP 150,000. The QCA Remuneration Committee Guide for Small and Mid-Size Quoted Companies states:

“Companies should communicate their decisions and supporting rationale clearly to shareholders and other stakeholders, most importantly through the report of the remuneration committee chairman. A company will face severe criticism if it rewards failure. Just as important is to ensure that mediocre performance is not rewarded as if it were good performance. It is fair that executives are offered the opportunity for higher levels of remuneration if they prod

Phronimos Urges Polo to Respond to Shareholder Requests and Concerns

March 13, 2019—Subsequent to the publication of Phronimos Capital's (“Phronimos”) letter to the Board of Directors of Polo Resources (“Polo” or the “Company”), on February 13th, we have heard from numerous other Polo shareholders supportive of our cause and, consequently, the concerned shareholder group has grown significantly. We believe there will be broad shareholder support for a substantial cash distribution or share buyback if the proposal to return capital were put to a vote at a requisitioned meeting of the shareholders of Polo. Fellow Polo shareholders supportive of a significant share buyback or distribution are encouraged to contact us at sjohn@phronimoscap.com.

Phronimos transmitted a follow-up letter to the Polo Board of Directors today. The full text of the letter can be found below or at: www.phronimoscap.com/news

Quite a solid set of results with a positive outlook for the future ,share price could make progress from here.GLA

I think 7dig has had a fairly turbulent last 6 months. I for one would be happy no share movement until some meaningful positive news is released. This year the company needs to be frugal in spending cash and become successful in generating profits.

Every reason to see good results, I think share price is well underpinned at the moment and any progress made should improve market cap. Would like to see dividend given within a couple of years.

Share price rising nicely over last couple of weeks. Results hopefully will show steady progress. Await news with interest and some optimism. GLA.

Quite frustrating company but share price well supported by assets. Over next couple of years Prism could generate large profits. GCM always a maybe but could come good. Hib pet continues to grow and make good profits. Things should improve but a lot more time needed. Not for day traders!

I see the news as neutral. He could of left for better paying job. May have decided to move just before things got better for 7digital. Maybe the replacement may be the right person at the right time. Let's relax and wait for posting of more news in the coming weeks GLA.

Been a good day with big gains holding. Looking forward there are plenty of reasons to see good income growth here with some quality contract wins. Management can reboot focus rather than concentrating on a dominate single customer whose business strategy obviously changed. I think before long MMS may regret their contract termination as streaming is now the main way people get their music.

Looks like i called news about right.I was always a bit concerned about the juke contract.The best revenue streams will probably come from the USA and china regions.Would like to see some progress with some large retail chains.Some contracts news to show lost revenue should see return to 3-4p.

Looking forward to trading update within next couple of weeks. I imagine share price is weak on no news. Expect improved revenue and cost reductions will come thru on this year's figures. Time for 7digital to rise and shine.

Seems like progress being made in the background. 7dig have signed deal with a big music publisher in USA called rumble fish. Big changes taking place in music industry as the music modernisation act becomes law. Seems like 7dig are keeping in the Premier league in this fast moving and growth industry. The future is looking a look more bright in my opinion.

Cost savings and consolidation to one platform delivered on time is a big win. It has been known that cash flow for this quarter would be tight, but it seems pretty likely HMRC will be paid on time. The owners of Juke may wish to improve their side of the contract. It is important 7digital make a good bargain or ultimately take the termination fee. Although unsettling it will focus minds to obtain a more numerous and diverse set of customers going forward.

Contract with juke looks like it may change, this may not have such a large impact on profit. If and there is a chance that the contract is terminated 7dig maybe able to cherry pick and keep most profitable part of the business. SC stated previously that he saw more growth in the USA which seems the case. The money owed to HMRC will hopefully be resolved very soon as confirmed in the update.