Wet Seal Shareholders May See Their Stake Cut

Shareholders of Wet Seal Inc. could see their stake in the company reduced by more than half under a financial plan aimed at staving off bankruptcy, according to a filing with the SEC.

If all notes are converted, warrants fully exercised and all 10 million shares of class A common stock are issued under a new stock incentive plan, the stockholder ownership will be reduced to 32.9% from 76.4%, according to a proxy statement filed by the Foothill Ranch-based retailer.

A special shareholder’s meeting will be held Jan. 10.