New York -- J. C. Penney disclosed in a Securities and Exchange Commission filing on Friday that it entered into a Registration Rights Agreement with Bill Ackman’s Pershing Square and its affiliates that gives him an out to completely walk away from the company. Under the deal, Ackman can make up to four requests to Penney to register the sale of his restricted common stock.
"It is paving the way for (Pershing Square) to sell the stock if they choose to do so," Imperial Capital analyst Mary Ross Gilbert said in a Reuters report.
Ackman, whose firm owns about 18% of Penney, resigned from the board earlier this week. His resignation came on the heels of a heated public battle with the board, which saw him call not only for a quick replacement for interim CEO Myron Ullman but also for a new chairman. The billionaire investor has not said publicly what he plans to do with his shares.
Penney is set to release its second quarter results on Aug. 20.