LAPORTE, Ind., May 14, 2010 (GLOBE NEWSWIRE) -- Longtime P&F Industries, Inc. ("P&F" or "the Company") (Nasdaq:PFIN) shareholder Timothy Stabosz, the Company's largest unaffiliated individual stockholder, with ownership dating back to 1996, today summarized the results of his fruitless 7 1/2 month long quest to persuade the P&F Board to make necessary changes to a dysfunctional governance structure, replace "legacy directors" hopelessly tethered to the CEO, appoint new bonafide independent directors with substantial share ownership positions, confront an outrageous CEO pay regime vastly disproportionate to long run Company profitability or peer group norms, and otherwise compel P&F to be run for the benefit of all of its stockholders, instead of operating, as Stabosz believes, primarily as a personal income vehicle for an entrenched CEO.
"Try as I might," Stabosz remarked, "I could not break through the wall of defense and denial erected by an impervious board. I was particularly disappointed, although not surprised, when rather than consider my suggestions, the CEO plaintively asked me why I didn't just sell my stock and go away (like others, apparently). Well, I'm not going away. Rather, I plan on continuing to draw attention to the issues at P&F that need to be addressed."
More detail on Stabosz's findings of the last 7 1/2 months, his reasons for withholding the three incumbent Board candidates, views on the lack of independence of candidates Robert Dubofsky and Alan Goldberg, and seven specific demands for change Stabosz made to the Board, can be found in Stabosz's amended Schedule 13D filing, available at the following three web links:
http://www.sec.gov/Archives/edgar/data/75340/000116289310000004/pfin13d9.txt
http://www.sec.gov/Archives/edgar/data/75340/000116289310000004/horowitz2.txt
http://www.sec.gov/Archives/edgar/data/75340/000116289310000004/pfincomp.txt
Stabosz continued, "It has been 14 years since Richard Horowitz took over as Chairman and CEO of P&F. During that time period (1996-2009), the Company has suffered an anemic internal compound annual growth in shareholders' equity of a mere 2.7%, evidencing poor long term returns. (The company does not pay dividends.) Despite this fact, over the same time period, according to the Company's own filings, the Board has bestowed upon Mr. Horowitz $18.7 million in aggregate gross pay. Adding together the gross pay of the top two officers (CEO and CFO), their total compensation for those 14 years is a staggering $24.8 million. This total is TRIPLE the $8 million aggregate increase in shareholders' equity the Company achieved over the same 1996-2009 time period. In this shareholder's eyes, such an amount of compensation is not only abhorrent, it is also indicative of a Board that is not doing its job, and has abdicated its sworn responsibility of protecting the interests of its non-management shareholders.
"Indeed, at P&F, I believe the issues and problems all trace back to this...essentially nonexistent oversight of the CEO, and governance procedures that defy any resemblance to normative standards or 'best practices.' These governance and bylaw weaknesses are reported on in detail in my amended Schedule 13D filing, and I will continue to report on them, to both the P&F shareholder base, and those in the professional 'corporate governance space,' as long as the P&F Board fails to start addressing them. It's my belief that by telling the truth, the shareholders of P&F will realize their best chance of eventually delivering our company from the yoke of a Chairman and CEO who, in my opinion, has evidenced utter contempt for his outside shareholder base," Stabosz stated.
Recapping and reflecting on his exhaustive efforts over the last 7 ½ months, Stabosz opined, "I have come to the regrettable conclusion that the only way that necessary change will happen at P&F is not so much through the addition of one token bonafide independent director (which the board purports to be pursuing), but through a more wholesale 'purging' of the P&F boardroom. That is what is needed at this time, and that is why I, as a 6.3% shareholder, and the largest individual shareholder other than Mr. Horowitz himself, INTEND TO WITHHOLD MY VOTE FROM ALL THREE INCUMBENT DIRECTOR NOMINEES: RICHARD HOROWITZ, ALAN GOLDBERG, AND ROBERT DUBOFSKY," Stabosz concluded.