NEW YORK -- American Apparel (APP) is adopting a one-year shareholder rights plan a day after its ousted CEO and founder, Dov Charney, made a bid to increase his control of the clothing chain.
The Los Angeles-based retailer said early Saturday that the move, made by a special committee of its board of directors, is designed to limit the ability of any person or group, including Charney, "to seize control of the company without appropriately compensating all American Apparel stockholders."
According to a regulatory filing Friday, Charney entered into a loan agreement with investment firm Standard General LP to increase his stake. The board voted to oust Charney as CEO and president about two weeks ago for "alleged misconduct." He currently holds a 27.2 percent stake in American Apparel, according to the filing.