Laptop case and accessories maker Targus has canceled its contract with universal charger manufacturer iGo, adding to iGo’s troubles with shareholder dissent and a plunging stock price.

Targus will likely continue a commercial relationship with iGo and iGo believes the termination of the contractual relationship will have only a modestly negative impact on cash flow. However, in light of an 85 percent decline in the company’s stock price over the past 18 months, the company says it is evaluating all options to boost shares.

“The board believes that there is value in the company that is not currently being fully realized in the public markets,” said iGo CEO Mike Heil in a statement. “Therefore, the board has determined that it would be in the best interests of the stockholders to initiate a review of strategic alternatives that may be available to the company to better unlock that value.”

The company plans to move forward with is product roadmap, including a netbook charger and environmentally-friendly products expected to be available in the second half of the year. “We believe that executing on these growth strategies will put us in the strongest possible position from which to evaluate all strategic alternatives,” Heil said.

The company does not plan to disclose developments or provide progress updates on specific initiatives without board approval. “There can be no assurance that our review of strategic alternatives will result in any specific type of strategic transaction,” the company said in a statement.

The announcement comes after a disagreement between former executives – now shareholders – and company management.

The former directors and founder of iGo called for the CEO and board chairman to resign earlier this month. Citing a dearth of new clients and declining revenue projections, founder and former Chairman Charles Mollo and former director Jeffrey Harris questioned the company’s management and long-term plans for growth. The company announced it would cut 20 percent of its workforce at the end of February, a plan Mollo and Harris say hurts the company’s ability to innovate.

“Your latest strategy to reduce expenses even more through further personnel and program cutbacks will undoubtedly further adversely impact the development and release of new products and any future growth prospects for the company,” stated Mollo and Harris in a letter to the company. “And all to save $1.4 million over the next 12 months, or a mere $1 million net of restructuring costs.” Mollo and Harris also questioned executive compensation, citing a bonus comprised of 70 percent of Heil’s base salary and 1 million shares of stock.

Still, iGo swung to a profit in 2008 and the company’s board of directors is standing by the CEO.  iGo made $451,000 in 2008, compared to a loss of $12.56 million the year earlier. “Going forward, Mr. Heil and Michael J. Larson, the chairman of our board, each has our full support, and we believe that we have the right strategy in place to enhance shareholder value,” the board stated in a letter of response. “Our product development efforts have produced a number of new products that we believe can generate substantial revenue in the future.”

IGo’s shares rose slightly in early morning trading.