Wet Seal expects no sale proceeds to be distributed to stockholders

By Caroline Salls

Pittsburgh, April 7 – The Wet Seal, Inc. said it does not expect to be able to distribute any of the proceeds of its asset sale to stockholders, according to an 8-K filed Tuesday with the Securities and Exchange Commission.

As a result, Wet Seal said it believes the shares of its common stock are worthless.

As previously reported, the company received approval on April 1 from the U.S. Bankruptcy Court for the District of Delaware to sell substantially all of its assets to Versa Capital Management, LLC affiliate Mador Lending, LLC.

The purchase price includes a $7.5 million cash component and a credit bid equal to all of the Wet Seal DIP financing obligations.

Wet Seal, a Foothill Ranch, Calif.-based clothing retailer, filed for bankruptcy on Jan. 15 under Chapter 11 case number 15-10081.

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