Core Viewpoint - Marlton Partners L.P. is advocating for significant changes in the governance of 180 Degree Capital Corp. due to the company's underperformance and persistent discount to net asset value (NAV) since Kevin Rendino took over as Chair and CEO in 2017 [1][2][3] Performance Metrics - Since 2017, 180 Degree Capital's net asset value has decreased by 37.3%, while its benchmarks, including the Russell Microcap, Russell Microcap Value, and Russell 2000 Indices, have increased by 59.2%, 70.5%, and 82.1% respectively [1][2] - As of November 2024, the fund's discount to NAV was at -26%, which translates to over $12.5 million in potential value for shareholders if eliminated [1][2] Shareholder Engagement - Marlton Partners first engaged with 180 Degree Capital in October 2023, proposing a Discount Management Program to address the NAV discount, but received an evasive response from the company [1][2] - A request for a meeting with the Lead Independent Director was ignored, highlighting a lack of engagement from the board [2][11] Governance Issues - The current board has not demonstrated accountability, with no independent director purchasing stock in over six years, except for a minor purchase by one director [2][11] - Marlton Partners is nominating three new director candidates to replace long-serving directors who have overseen the company's decline [12][13] Proposed Solutions - Marlton recommends implementing a formal proposal to provide shareholders an exit at NAV, which could include distributing publicly traded securities as a dividend in-kind [8][9] - The firm emphasizes the need for a binding commitment from management to return capital to shareholders at NAV [10][14]

Core Insights - 180 Degree Capital Corp. reported an average discount of approximately 21% between its estimated daily net asset value (NAV) per share and its daily closing stock price for November 2024, and 20% year-to-date through the end of November 2024, with a specific discount of 26% noted on November 29, 2024 [1][2] Discount Management Program - The Board of Directors has established two measurement periods from January 1, 2024, to December 31, 2024, and from January 1, 2025, to June 30, 2025, to evaluate the average discount between NAV and stock price [2] - If the average daily discount exceeds 12% during these periods, the Board will consider options such as expanding the stock buyback program up to $5 million, cash distributions, or other strategic alternatives [2] Performance Highlights - In November 2024, the NAV increased by approximately 26%, driven by the successful sale of Brightcove, Inc. for about $233 million, translating to $4.45 per share, compared to a cost basis of $2.55 per share [3] - The company actively managed its portfolio, increasing positions on weakness and monetizing its stake in Quantum Corporation, which saw a price surge from $2.96 to $21.77 per share [3] - The management and Board hold a 12.7% ownership position, indicating alignment of interests in driving stock price increases and shareholder value [3] Historical Performance - Since its inception in 2017 through November 30, 2024, the gross total return on public portfolio holdings was approximately +212%, significantly outperforming the Russell Microcap Index, which had a total return of +79% [3] - The decline in NAV of approximately 31% over the same period was primarily due to decreases in the legacy private portfolio, while public market performance has been the main source of value creation [3] Company Overview - 180 Degree Capital Corp. is a publicly traded closed-end fund focused on investing in undervalued small publicly traded companies, aiming for significant turnarounds through constructive activism [4]

Financial Data and Key Metrics Changes - The company has experienced a significant decline in stock price, with shares dropping from $14 to $7 due to a sluggish consumer environment for most restaurant brands [26] - The management highlighted that the bear market for small-cap stocks has lasted longer than expected, leading to lower valuations [5][6] Business Line Data and Key Metrics Changes - Potbelly reported strong earnings, beating all metrics and providing a positive outlook for 2025, including a projected 10% growth in store count and positive same-store sales growth [25] - Synchronoss reported solid Q3 2024 results with increased revenue and EBITDA guidance, although the stock declined due to delays in tax refunds and contract renewals [27][28] Market Data and Key Metrics Changes - The Russell Microcap Index has outperformed the S&P 500 since the Fed's rate cut and the resolution of election uncertainties, indicating a potential reversal in the small-cap market [6] Company Strategy and Development Direction - The company is focused on positioning itself as a partner for small-cap public companies needing creative capital solutions, particularly in light of upcoming debt maturities and acquisition financing [11] - Management emphasized the importance of aligning interests with shareholders, noting that they collectively own 13% of the company [18][19] Management Comments on Operating Environment and Future Outlook - Management acknowledged the challenges faced in the past three years but remains optimistic about the potential for small-cap stocks, citing historically low valuations [6][10] - The company is actively evaluating strategic options to enhance its asset base and capabilities for future growth [23] Other Important Information - The company has successfully transitioned its balance sheet to cash and publicly traded securities, allowing it to focus on value creation without the risk of insolvency [14] - The management has significantly reduced operating expenses, cutting them from $6.5 million to approximately $3 million annually [15][17] Q&A Session Summary - Management expressed willingness to engage with shareholders regarding the quarter and year, emphasizing open communication [44]

1 Value Creation Through Constructive Activism Q3 2024 Shareholder Update Call November 15, 2024 Safe Harbor Statement This presentation may contain statements of a forward-looking nature relating to future events. Statements contained in this presentation that are forward-looking statements are intended to be made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to the inherent uncertainties in predicting future res ...

MONTCLAIR, N.J., Sept. 03, 2024 (GLOBE NEWSWIRE) -- 180 Degree Capital Corp. ("180 Degree Capital") (NASDAQ: TURN), noted today that the average discount between its estimated daily net asset value per share ("NAV") and its daily closing stock price during August 2024 and year-to-date through the end of August 2024, were approximately 21% and 19%, respectively.1 This discount was approximately 25% on August 30, 2024, the last day of trading in the month. As previously disclosed in a press release on Novembe ...

180 Degree Capital Corp (NASDAQ:TURN) Q2 2024 Earnings Conference Call August 20, 2024 9:00 AM ET Company Participants Daniel Wolfe - President, Chief Financial Officer and Chief Compliance Officer Kevin Rendino - Chairman and Chief Executive Officer Daniel Wolfe [Starts Abruptly] our second quarter 2024 financial Results Update Call. This is Daniel Wolfe, President and Portfolio Manager of 180 Degree Capital. Kevin Rendino, our Chief Executive Officer -- Portfolio Manager, and I would like to welcome you t ...

C O N F I D E N T I A L 1 Value Creation Through Constructive Activism Q2 2024 Stockholder Update Call August 20, 2024 C O N F I D E N T I A L Safe Harbor Statement This presentation may contain statements of a forward-looking nature relating to future events. Statements contained in this presentation that are forward-looking statements are intended to be made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to the i ...

Forward-Looking Statements 180 Degree Capital Corp. is a publicly traded registered closed-end fund focused on investing in and providing value-added assistance through constructive activism to what we believe are substantially undervalued small, publicly traded companies that have potential for significant turnarounds. Our goal is that the result of our constructive activism leads to a reversal in direction for the share price of these investee companies, i.e., a 180- degree turn. Detailed information abou ...

180 Degree Capital Corp. is a publicly traded registered closed-end fund focused on investing in and providing value-added assistance through constructive activism to what we believe are substantially undervalued small, publicly traded companies that have potential for significant turnarounds. Our goal is that the result of our constructive activism leads to a reversal in direction for the share price of these investee companies, i.e., a 180- degree turn. Detailed information about 180 and its holdings can ...

As previously disclosed in a press release on November 13, 2023, 180 Degree Capital's Board of Directors has set two measurement periods of 1) January 1, 2024 to December 31, 2024, and 2) January 1, 2025 to June 30, 2025, in which it will evaluate the average discount between TURN's estimated daily NAV and its closing stock price pursuant to a Discount Management Program. Should TURN's common stock trade at an average daily discount to NAV of more than 12% during either of these measurement periods, 180 Deg ...