Cove Street votes no on legacy directors of Motorcar Parts of America

Cove Street Capital, on behalf of its clients and related entities, issued a public letter to the shareholders of Motorcar Parts of America, announcing it has voted NO with respect to all “legacy” nominations to the Board of Directors. The company said, “CEO Selwyn Joffe has had a value-destructive run, effectively overseeing the company as a non-profit for the benefit of customers and employees for the last 10 years, an epic failure as a public company. Cove Street has engaged with management and the Board since February 2024 in an effort to constructively work toward long overdue material change at the Board level to assist in a rigorous overview of uneconomic company behavior. While we were successful in convincing the company to start the process of Board refreshment by nominating two new Board members this year, the path toward this outcome needs to be aired. Proper management and governance of a public company, in our opinion, is crucial to reaching appropriate outcomes for shareholders. We would suggest the unveiling of how the process was conducted is relevant for investors to consider in making their own decisions with respect to this company and its leadership. We have voted NO with respect to the following Directors: Selwyn Joffe; David Bryan; Joseph Ferguson; Philip Gay; Jeffrey Mirvis; Patricia Warfield; Barbara Whittaker. We are supporting the nominations of Doug Trussler, Anil Shrivastava and F. Jack Leibau, Jr. Our research suggests the stock is woefully undervalued, which we attribute primarily to the considerable governance risks imposed by this long-time underperforming Board.”