The bankruptcy comes more than a year after the company ousted its controversial CEO, Dov Charney, over allegations of misconduct.
American Apparel filed for Chapter 11 bankruptcy on Monday following a rocky period in which its made-in-the-U.S. model faltered and its controversial CEO became embroiled in controversy over his behavior in the workplace.
The embattled retailer said it has already reached agreements with creditors representing 95 percent of its secured debts to execute a restructuring plan that would allow the company to maintain operations.
The deal, which would require a court’s approval, will allow the company to “continue to operate its business without interruption to customers, employees and vendors,” American Apparel said in a statement.
