LAPORTE, Ind., Feb. 17, 2009 (GLOBE NEWSWIRE) -- Longtime General Employment Enterprises (AMEX:JOB) shareholder Timothy Stabosz, a 5.5% owner and the company's 2nd largest outside shareholder, today announced his intent to withhold support from Chairman and CEO Herbert "Corky" Imhoff, Jr. at the Oakbrook Terrace, Illinois-based company's Feb. 23rd annual meeting. Stabosz also declared the company in a "grave moral crisis," and appealed to the board of directors to take immediate action to protect the company's valuable franchise, and begin rebuilding the company's credibility and image as a bona-fide public entity, whose main purpose is to maximize value for its ENTIRE shareholder base...instead of existing primarily as an unseemly "personal income vehicle" for the Chairman and CEO.
Stabosz began, "Under 8 years of Corky Imhoff's leadership, the company's financial results have been, frankly, a disaster. Over this lengthy time period, Mr. Imhoff has caused the company to suffer an aggregate net loss; yet, unconscionably, he has taken out almost $4 million in total compensation. Meanwhile, revenues have declined 70% from their 2000 peak, the stock price has plummeted from $15 to 25 cents, and a venerable franchise, with a great name, and a 100 year history, has withered. Considering Mr. Imhoff's atrocious record as CEO, it is improper and irreconcilable with fulfilling his role as chairman to 'hide behind' his $525,000 a year employment agreement, when he has shown, quite clearly after 8 years, that he does NOT have the proper skillsets to successfully run General Employment.
"As a major shareholder, I have diligently and discretely sought to persuade Corky Imhoff for years that his annual salary package needs to be drastically cut, and that maintaining it (recent temporary salary cuts notwithstanding) represents a prima facie conflict of interest. Unfortunately, my pleas have only been met with denial, evasion...and entrenchment.
"'Corky's Conflict' is a direct result of the CEO's insatiable appetite for 'high living,' and his apparent unwillingness, or inability, to find another employer that is willing to fund such a lifestyle. This prevents him from doing, as chairman of the board, what any RESPONSIBLE chairman would do, and that is cutting his own pay and/or replacing himself as CEO. Instead, Mr. Imhoff avoids and denies the conflict, and convinces himself that continuing to take out $525,000 a year is his birthright, for no other reason than the surname he possesses. Meanwhile, the board of directors stands idly by, twiddling their thumbs, and accepting this morally and ethically debased arrangement, worried about the 'letter' of the CEO's employment agreement, when what they should really be focusing on is how their own self-respect is compromised, in permitting Mr. Imhoff to serve as their chairman, when he is, daily and ongoingly, openly betraying his fiduciary duty, in terms of looking out for the ENTIRE COMPANY'S best interest.
"The irony of this situation is that, despite Corky Imhoff's revered father, Herb, dedicating his entire life to BUILDING the company, Imhoff Jr. can only be described, honestly and truthfully, as a parasite upon it. Reflecting a breathtaking level of narcissism and self-absorption, Corky Imhoff has functionally deemed to 'kill the goose that lays the golden eggs.' In so doing, he has destroyed his credibility, and the faith and trust of his shareholder base. He has shown no personal accountability, responsibility, or shame, despite his own failure of leadership, and the fact that he has caused the company to shrivel to a size in which it is quite evident to anyone with a pulse (board of directors excepted) that the corporate overhead is literally EATING AWAY AT THE COMPANY FROM WITHIN.
"Until a new CEO is found, the board needs to demand that Mr. Imhoff cut his salary to $125,000 a year, to make the salary commensurate with the reduced size of the company...or he should be IMMEDIATELY asked to step down from the board of directors. If Imhoff is unwilling to do either, the independent directors MUST act unilaterally to secure the assets and franchise of the company, and 'protect' them from Mr. Imhoff's presumptive self-dealing. It is absolutely imperative that the board of directors, without further delay, confront and RESOLVE 'Corky's Conflict' by compelling obeisance to certain fundamental principals, legal and moral, of fiduciary representation.
"The fact that one of the persons most interested in defending the corporate integrity of General Employment has to come from without is a sober reminder of the great darkness that currently envelops the company. Make no mistake about it: There's a sham or pretense going on at General Employment. Mr. Imhoff's willingness to subjugate the proper management of a public company, to the personal financial needs of the CEO, is morally wrong. It is time for a once great company to be released from the shackles imposed on it by its CEO, and for the board to FORCE Mr. Imhoff to extricate himself from the moral and fiduciary morass he has dragged himself, his board, and his oppressed shareholders into," Stabosz concluded.