SCHEDULE: Horton Capital Takes 5.1% Stake in Myomo, Pushes for Board Declassification

Horton Capital Partners has acquired a 5.1% stake in Myomo, Inc. and submitted a shareholder proposal to declassify the company's Board of Directors for annual elections.

Summary

• Horton Capital Partners Fund, LP, along with its affiliates and Joseph M. Manko, Jr., collectively acquired 1,960,212 shares of Myomo, Inc. common stock.
• This represents approximately 5.1% of Myomo's outstanding shares, based on 38,435,524 shares outstanding as of November 3, 2025.
• The aggregate purchase price for these shares was approximately $3,311,165, including brokerage commissions.
• Horton Capital believes Myomo's shares were undervalued and represent an attractive investment opportunity.
• The Reporting Persons intend to engage in discussions with Myomo's management and board regarding business, capital structure, corporate governance, board composition, and strategic direction.
• Horton Capital has submitted a shareholder proposal for Myomo's 2026 Annual Meeting of Stockholders, requesting the Board to take steps to eliminate its classified structure, ensuring all directors are elected annually.
• Horton Capital may increase or decrease its position, engage in short selling, hedging, or other transactions depending on market conditions and Myomo's performance.

Sentiment

Score: 7

Explanation: The sentiment is moderately positive from the perspective of the activist investor, who sees Myomo as an undervalued investment opportunity and is taking proactive steps to enhance shareholder value through governance improvements. While it implies dissatisfaction with current governance, the overall action is aimed at positive change.

Positives

• Horton Capital Partners believes Myomo's shares were undervalued at the time of purchase, indicating potential upside.
• The activist engagement could lead to improved corporate governance and potentially enhanced shareholder value through board declassification and strategic discussions.

Negatives

• The filing implies dissatisfaction with Myomo's current corporate governance structure, specifically the classified board, which Horton Capital views as reducing accountability.
• The activist stance could lead to potential friction between the investor and current management/board.

Risks

• Potential for ongoing activist investor engagement, which could divert management's attention or lead to strategic disagreements.
• Uncertainty regarding the outcome of the shareholder proposal to declassify the board and its potential impact on company stability or strategic execution.
• The Reporting Persons may increase or decrease their position, including selling shares or engaging in short selling, which could impact share price volatility.

Future Outlook

Horton Capital Partners intends to continuously review its investment in Myomo, potentially increasing or decreasing its position. They expect to engage in ongoing discussions with Myomo's management and board regarding strategic direction, corporate governance, and capital structure, and may pursue other plans to enhance shareholder value, including potentially seeking a board seat. The shareholder proposal for board declassification is a key future action.

Management Comments

• The Reporting Persons purchased the Shares based on the Reporting Persons' belief that the Shares, when purchased, were undervalued and represented an attractive investment opportunity.
• The Reporting Persons and their representatives have, from time to time, engaged in, and expect to continue to engage in, discussions with members of management of the Issuer and the board of directors of the Issuer... regarding a variety of matters relating to the Issuer, which may include, among other things, the Issuer's business, management, capital structure and allocation, corporate governance, Board composition and strategic direction, and may take other steps seeking to bring about changes to increase shareholder value.
• A classified, or staggered, Board structure reduces accountability by allowing directors to stand for election only once every several years.
• Annual director elections enhance Board accountability and provide shareholders with a regular mechanism to evaluate the performance, oversight quality, and responsiveness of the Board.

Industry Context

This filing reflects a broader trend in corporate governance where activist investors increasingly push for board declassification to enhance accountability and shareholder rights. Many institutional investors and proxy advisory firms advocate for annual director elections as a best practice, moving away from staggered boards prevalent in the past. The proposal aligns with a general market shift towards more transparent and responsive governance structures.

Comparison to Industry Standards

• The proposal to declassify the board aligns with widely recognized corporate governance best practices supported by leading institutional investors like Institutional Shareholder Services (ISS) and Glass Lewis.
• Academic research, including studies in the Journal of Financial Economics, suggests that classified boards are associated with reduced firm value and board responsiveness, implying Myomo's current structure may be below optimal industry standards.
• A majority of U.S. public companies, particularly across the Russell 3000, have transitioned to annual director elections over the past decade, indicating Myomo's classified board is increasingly an outlier compared to modern governance norms.

Corporate Governance

Stakeholder Impact

• Shareholders: Potential for increased shareholder value if governance improvements are implemented; enhanced accountability of the board; potential for increased volatility due to activist engagement.
• Board of Directors: Increased scrutiny and pressure to respond to shareholder demands; potential for changes in board composition and election cycles.
• Management: Potential for increased engagement with activist investor; focus on strategic and governance changes.

Next Steps

• Horton Capital Partners will continue to review its investment in Myomo.
• Ongoing discussions are expected between Horton Capital and Myomo's management and board regarding business, capital structure, governance, and strategic direction.
• The shareholder proposal to declassify the Board of Directors will be included in Myomo's 2026 proxy statement.
• The proposal will be considered and voted upon at Myomo's 2026 Annual Meeting of Stockholders.
• Horton Capital may increase or decrease its position in Myomo shares, including through open market purchases, private transactions, sales, short selling, or hedging.
• Horton Capital may seek a position on Myomo's Board of Directors.

Key Dates

Recommendation

Horton Capital Partners' 5.1% stake and proposal to declassify Myomo's board signal an intent to drive shareholder value through improved governance. While the belief in undervaluation is positive, the outcome of the activist campaign and its impact on Myomo's strategic direction and financial performance remain uncertain. A 'hold' recommendation allows investors to observe the progression of these initiatives and management's response before making further investment decisions, balancing potential upside with inherent risks of activist engagement.

Keywords

Myomo Inc., Horton Capital Partners, Schedule 13D, Activist Investor, Shareholder Proposal, Board Declassification, Corporate Governance, Undervalued Stock, Investment Opportunity, MYO