Home / Knowledge / News / Apparel/Garments / American Apparel adopts one-year stockholder rights plan
American Apparel adopts one-year stockholder rights plan
28
Jun '14
American Apparel, Inc. announced that a special committee of its Board of Directors has adopted a one-year stockholder rights plan that is designed to strengthen the ability of the Board of Directors to protect the Company's stockholders. 
 
The Company's stockholder rights plan was adopted in response to reports of rapid accumulations of the Company's outstanding common stock. The special committee believes this plan is an important tool to ensure that all American Apparel stockholders are treated fairly. This decision was made in the context of today's SEC filing by Dov Charney in which he expressed an intent to acquire control or influence over the Company. 
 
The Board of Directors previously suspended Mr. Charney as CEO and declared its intent to terminate him for cause based on an ongoing investigation of misconduct. The rights plan is designed to limit the ability of any person or group, including Dov Charney, to seize control of the Company without appropriately compensating all American Apparel stockholders. It is intended to provide the Board of Directors and stockholders with time to make informed judgments. 
 
It does not affect trading by passive investors, as it allows such investors to accumulate as much as 15% of the Company's common stock and has no impact on a takeover proposal for the entire company acceptable to the holders of a majority of the Company's shares. 
 
Initially, the rights will be attached to all shares of common stock and be represented by the certificates representing the common stock. Each right entitles the holder to purchase one ten-thousandth of a share of preferred stock at an exercise price of $2.75, subject to adjustment as provided in the rights plan. Upon the occurrence of certain events, the rights may separate from the common stock. 
 
Until such separation occurs, if at all, outstanding stock certificates (or, in the case of shares reflected on the direct registration system, the notations in the book entry accounts) will represent both shares of the Company's common stock and the rights. The rights distribution is not taxable to stockholders. Stockholders are not required to take any action to receive the rights distribution. The rights will expire at 5:00 P.M. (New York City time) on June 27, 2015, unless such date is extended or the rights are earlier redeemed, exchanged or terminated. 
 
Click here to view more details.
 

American Apparel

Must ReadView All

President Tsai Ing-wen delivering remarks before boarding her plane bound for Central America. Courtesy: Presdient's office

Textiles | On 16th Jan 2017

‘Textiles at centre of Taiwan’s new trade arrangements’

Textiles should be at the heart of Taiwan’s thinking while developing ...

Apparel/Garments | On 16th Jan 2017

Ralph Lauren develops policy on tracking wood based fabrics

In a bid to trace source of wood based fabrics like viscose and rayon ...

Apparel/Garments | On 16th Jan 2017

EC proposes enhanced market access for Sri Lanka

The European Commission (EC) has proposed that a significant part of...

Interviews View All

Anshul Sood
Oceedee

‘Indian footwear market is nascent and largely a trend follower’

Sunil Rathore
Lacoste India

‘New vendor is welcome if he offers cost, quality and timely delivery’

Ajay Ghariwala
Luthra Group

We are ready to adopt or follow every opportunity

Marcel Alberts
Eurofibers

Coating at a fibre level is a practice not usually seen in the...

Urs Stalder
Sanitized AG

Urs Stalder, CEO, Sanitized AG, talks about the increasing use of hygiene...

Mark Paterson
Technical Absorbents Ltd

Mark Paterson, R&D manager of Technical Absorbents Ltd talks about Super...

Mike Hoffman
Gildan Activewear SRL

Gildan Activewear, a manufacturer and marketer of branded clothing and...

Ritu Kumar
Label Ritu Kumar

‘Classics will return’ "There are a lot of people wearing western clothes ...

Tony Ward
Tony Ward

"You have to truly understand what your client wants, know her needs, what ...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH
January 2017

January 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


eNEWS
Insights
Subscribe today and get the latest News update in your mail box.
Advanced Search