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June 20, 2014
07:07 EDTAPPAmerican Apparel anticipates fight from removed founder, Reuters says
American Apparel's board of directors are preparing for the company's newly dethroned founder Dov Charney to fight his removal as the retailer's chairman, according to Reuters, citing comments from the firm's interim co-chairman Allan Mayer in an interview. American Apparel dismissed Charney citing unspecified misconduct allegations. Reference Link
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October 6, 2015
19:35 EDTAPPAmerican Apparel pushes for restructuring under Standard General, Reuters says
Bankruptcy attorneys for American Apparel stated that the company is "in the early stages of an operating turnaround" under the control of hedge fund Standard General, reports Reuters, citing court proceedings. Reference Link
06:36 EDTAPPAmerican Apparel trading suspended by NYSE, delisting procedures commenced
American Apparel announced that on October 5, the company received a notification letter that the staff of NYSE Regulation, Inc. has determined to suspend trading immediately and commence proceedings to delist the company's common stock from NYSE MKT. The Notice states that the Exchange determined that the company is no longer suitable for listing and will commence delisting proceedings pursuant to Section 1003(c)(iii) of the NYSE MKT Company Guide. As disclosed in the company's press release date October 5, the company and certain of its domestic subsidiaries have voluntarily filed to reorganize under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. The Notice states that in reaching the delisting determination, NYSE Regulation noted the uncertainty as to the timing and outcome of the bankruptcy process, as well as the ultimate effect of this process on the value of the company's common stock. The company does not intend to appeal the delisting determination. Therefore, it is expected that the company's common stock will be delisted from NYSE MKT.
06:27 EDTAPPAmerican Apparel eyed by Authentic Brands, NY Post reports
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October 5, 2015
05:23 EDTAPPAmerican Apparel files for Chapter 11 reorganization
American Apparel announced that it has reached a restructuring support agreement with 95% of its secured lenders to implement a pre-arranged financial restructuring. This reorganization will enable the company to implement a comprehensive transformation strategy to revitalize the business and brand, while keeping its production and operations in the U.S. Throughout the implementation of this process, American Apparel will continue to operate its business without interruption to customers, employees and vendors. The restructuring support agreement, which has been approved by the company's board, will substantially reduce the company's debt and interest payments through the elimination of over $200M of its bonds in exchange for equity interests in the reorganized company, and provide the company with access to financing during and after its restructuring. As part of this agreement, American Apparel, and certain of its domestic subsidiaries have voluntarily filed to reorganize under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. The company expects to complete the restructuring within approximately six months. Under the restructuring support agreement, American Apparel's secured lenders will provide approximately $90M in debtor-in-possession, or DIP, financing. These supporting creditors have committed $70M of new capital to support the reorganization and recapitalization of the business. The company anticipates that such financing will be more than sufficient to fund its ongoing operations and pave the way for a successful reorganization. As a result of the reorganization, American Apparel's debt will be reduced from $300M to no more than $135M, and annual interest expense will decrease by $20M. American Apparel has filed with the Bankruptcy Court and expects to obtain approval for various customary motions for immediate relief to allow the company to make certain necessary payments to employees and suppliers that will permit it to continue operating without interruption during the initial phase of the restructuring. The company will pay all of its suppliers in full under normal terms for goods and services provided on or after the filing date of October 5. American Apparel's international operations are not affected by the reorganization in the U.S. The restructuring plan is subject to satisfaction of certain customary conditions, including approvals by the Bankruptcy Court. If the restructuring transactions contemplated by the restructuring support agreement are consummated, the company's existing common stock will be extinguished and the holders of the common stock will not receive any consideration, consistent with legal priorities.
05:19 EDTAPPAmerican Apparel files for Chapter 11 reorganization
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