Star Equity Fund, LP (“Star Equity Fund”, “we”, “our”), a shareholder of Servotronics, Inc. (NYSE American: SVT) (“Servotronics” or “the Company”) that seeks to unlock shareholder value and improve corporate governance at its portfolio companies, urges Servotronics shareholders to vote WITHHOLD on the re-election of incumbent board members Ed Cosgrove and Lucion Gygax at the Company’s 2022 Annual Meeting of Shareholders, which will be held virtually on June 10, 2022 at 9:00 a.m., ET.
Although our campaign at Servotronics led to the Company implementing several positive changes for shareholders, we are disappointed that Ed Cosgrove and Lucion Gygax remain on the 2022 ballot. In our view, both directors either enabled or at best failed to see malfeasance occurring at Servotronics. Under their watch, the Company’s previous CEO abused his authority and perpetuated a culture of harassment at the expense of employees and shareholders (as alleged in the lawsuit filed by a former employee on June 7, 2021), with an internal investigation finding that he committed willful malfeasance in violation of his employment agreement with the Company. In addition, both directors had overseen and continued to support the Company’s unprofitable Consumer Products Group without having taken meaningful action to maximize shareholder value. We believe their continued directorship represents an impediment to further positive change and is harmful to shareholders’ interests, and we strongly recommend shareholders vote WITHHOLD on the re-election of both directors.
While we are pleased with the initial results of our campaign, we also believe there is more to be done. It is our intention to continue to monitor the Company’s progress; as we previously disclosed, we remain ready to act again in the future on behalf of shareholders, if further progress on improving shareholder value and shareholder rights is not made. Today’s recommendation is reflective of our continued commitment to maximizing shareholder value at Servotronics.