On January 19, 2023, Lawndale Capital Management, LLC announced that it has been in contact with P&F Industries' management and members of P&F's Board of Directors regarding concerns relating to the Company's executive compensation and capital allocation policies and the Board's composition and corporate governance practices. Lawndale Capital stated that over several years, Lawndale has requested implementation of constructive changes that would further improve corporate governance, better align management and directors with shareowners' interests, and also requested other capital allocation and transparency steps to maximize value for all the Company shareowners. As Lawndale had over many years requested the Company's Board to regularly consider returning capital to the Company shareholders via a sustainable dividend or stock buybacks, Lawndale was pleased with these past capital allocation actions.

Lawndale believes that, so long as the Company's extraordinarily low market valuation continues, the Company's board should re-initiate a 10b5-1 stock buyback plan, capped at attractive price valuation multiples, enabling periodic open market purchases that are not limited by narrow insider trading windows. Additionally, Lawndale Capital stated that especially if the Company Board does not implement a 10b5-1 buyback plan and other measures reasonably calculated to reduce ownership transaction costs, such as engaging in typical investor relations activities (beyond simply its quarterly earnings conference calls), Lawndale believes the Board should return to classifying its renewed and recurring dividend to simply a regular dividend rather than designating current recurring distributions as ‘special' dividends. Lawndale expressed the special designation precludes income-focused investors from being able to invest in the Company, further reducing trading liquidity in its shares, thus raising ownership transaction costs and the Company's cost of capital.