UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended January 29, 2022 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-36212 VINCE HOLDING CORP. (Exact name of registrant as specified in its charter) Delaware 75-3264870 (State or other jurisdiction of inc ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended October 30, 2021 Or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 VINCE HOLDING CORP. For the transition period from to Commission File Number: 001-36212 (State or other jurisdiction of incorporation or organization) Delaware 75-3264870 (I.R.S. Employer ...

[FORM 10-Q Filing Information](index=1&type=section&id=FORM%2010-Q) This section provides key details regarding the company's Form 10-Q filing, including its filer status and outstanding common stock [Filing Details](index=1&type=section&id=Filing%20Details) This Quarterly Report on Form 10-Q for Vince Holding Corp. details its status as a **non-accelerated, smaller reporting company** with **11.9 million shares outstanding** - The registrant is a **non-accelerated filer** and a **smaller reporting company**[3](index=3&type=chunk)[4](index=4&type=chunk) - As of August 31, 2021, the registrant had **11,926,443 shares of common stock**, $0.01 par value per share, outstanding[4](index=4&type=chunk) Securities Registered Pursuant to Section 12(b) of the Exchange Act | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | :---------------------------- | :---------------- | :---------------------------------------- | | Common Stock, $0.01 par value | VNCE | New York Stock Exchange | [Table of Contents](index=2&type=section&id=TABLE%20OF%20CONTENTS) [Part I. Financial Information](index=2&type=section&id=Part%20I.%20Financial%20Information) This section presents condensed financial statements, management's discussion and analysis, market risk disclosures, and controls [Part II. Other Information](index=2&type=section&id=Part%20II.%20Other%20Information) This section details legal proceedings, risk factors, equity sales, senior security defaults, mine safety disclosures, and exhibits [Disclosures Regarding Forward-Looking Statements](index=3&type=section&id=DISCLOSURES%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This section outlines the inherent risks and uncertainties associated with forward-looking statements within the report [Forward-Looking Statements and Risks](index=3&type=section&id=Forward-Looking%20Statements%20and%20Risks) This section identifies forward-looking statements and outlines key risks, including COVID-19 impacts, asset impairment, economic conditions, and operational challenges - **Forward-looking statements are identified by words like 'may,' 'will,' 'should,' 'believe,' 'expect,' 'seek,' 'anticipate,' 'intend,' 'estimate,' 'plan,' 'target,' 'project,' 'forecast,' 'envision' and similar phrases**[8](index=8&type=chunk) - **Key risks include the impact of the COVID-19 pandemic on business, results of operations and liquidity; ability to service debt and meet obligations; further impairment of goodwill and intangible assets; general economic conditions; ability to realize benefits of strategic initiatives; ability to maintain wholesale partners; and managing new CEO transition**[8](index=8&type=chunk) - **The company does not undertake to update or revise forward-looking statements unless required by law**[8](index=8&type=chunk) [PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS](index=4&type=section&id=ITEM%201.%20CONDENSED%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) This section provides unaudited condensed consolidated financial statements, including balance sheets, income statements, equity statements, cash flows, and accompanying notes [Unaudited Condensed Consolidated Balance Sheets](index=4&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) This presents the company's financial position, detailing assets, liabilities, and equity at specific points in time Condensed Consolidated Balance Sheets (in thousands) | Assets/Liabilities & Equity | July 31, 2021 | January 30, 2021 | | :-------------------------- | :------------ | :--------------- | | **Assets** | | | | Cash and cash equivalents | $1,524 | $3,777 | | Trade receivables, net | $31,158 | $31,878 | | Inventories, net | $74,336 | $68,226 | | Total current assets | $112,632 | $110,584 | | Total assets | $331,192 | $332,944 | | **Liabilities** | | | | Accounts payable | $50,789 | $40,216 | | Total current liabilities | $94,114 | $82,220 | | Long-term debt | $84,759 | $84,485 | | Total liabilities | $276,289 | $265,537 | | **Stockholders' Equity** | | | | Total stockholders' equity | $54,903 | $66,207 | | Total liabilities and equity| $331,192 | $332,944 | - Total assets decreased slightly from **$332,944 thousand** at January 30, 2021, to **$331,192 thousand** at July 31, 2021[11](index=11&type=chunk) - **Total stockholders' equity decreased from $66,207 thousand to $54,903 thousand**, indicating a reduction in equity over the period[11](index=11&type=chunk) [Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)](index=5&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20%28Loss%29) This section details the company's financial performance, including net sales, gross profit, and net income or loss Condensed Consolidated Statements of Operations (in thousands, except per share data) | Metric | Three Months Ended July 31, 2021 | Three Months Ended August 1, 2020 | Six Months Ended July 31, 2021 | Six Months Ended August 1, 2020 | | :-------------------------- | :------------------------------- | :-------------------------------- | :----------------------------- | :------------------------------ | | Net sales | $78,673 | $37,022 | $136,206 | $76,040 | | Gross profit | $35,378 | $13,340 | $60,861 | $29,340 | | Income (loss) from operations | $2,635 | $(14,008) | $(4,466) | $(63,426) | | Net loss | $(590) | $(15,062) | $(12,212) | $(63,240) | | Basic loss per share | $(0.05) | $(1.28) | $(1.03) | $(5.39) | | Diluted loss per share | $(0.05) | $(1.28) | $(1.03) | $(5.39) | - **Net sales for the three months ended July 31, 2021, increased by 112.5% to $78,673 thousand from $37,022 thousand in the prior year, and for the six months, increased by 79.1% to $136,206 thousand from $76,040 thousand**[12](index=12&type=chunk) - **The company reported a reduced net loss of $(590) thousand for the three months ended July 31, 2021, compared to $(15,062) thousand in the prior year, and a reduced net loss of $(12,212) thousand for the six months, compared to $(63,240) thousand in the prior year**[12](index=12&type=chunk) [Unaudited Condensed Consolidated Statements of Stockholders' Equity](index=6&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity) This section outlines changes in the company's equity, reflecting net income, share-based compensation, and other adjustments Changes in Stockholders' Equity (in thousands) | Item | Six Months Ended July 31, 2021 | | :------------------------------------ | :----------------------------- | | Balance as of January 30, 2021 | $66,207 | | Net loss | $(12,212) | | Foreign currency translation adjustment | $9 | | Share-based compensation expense | $889 | | Restricted stock unit vestings | $1 | | Tax withholdings related to vesting | $(62) | | ESPP common stock issuance | $72 | | Balance as of July 31, 2021 | $54,903 | - **Total stockholders' equity decreased from $66,207 thousand at January 30, 2021, to $54,903 thousand**, primarily due to a **net loss of $12,212 thousand**[15](index=15&type=chunk) - **Share-based compensation expense contributed $889 thousand to equity** during the six months ended July 31, 2021[15](index=15&type=chunk) [Unaudited Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section presents the company's cash inflows and outflows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows (in thousands) | Activity | Six Months Ended July 31, 2021 | Six Months Ended August 1, 2020 | | :---------------------------- | :----------------------------- | :------------------------------ | | Net cash used in operating activities | $(290) | $(21,252) | | Net cash used in investing activities | $(1,919) | $(1,597) | | Net cash (used

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended May 1, 2021 Or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 001-36212 VINCE HOLDING CORP. (Exact name of registrant as specified in its charter) Delaware 75-3264870 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Iden ...

Part I [Business](index=4&type=section&id=Item%201.%20Business) Vince Holding Corp. operates three brands (Vince, Rebecca Taylor, Parker) through wholesale and direct-to-consumer channels, significantly impacted by the COVID-19 pandemic in fiscal 2020, leading to revenue decline and impairment charges - The company operates three main brands: **Vince, Rebecca Taylor, and Parker**, with the latter two acquired on November 3, 2019[16](index=16&type=chunk) - **Nordstrom Inc.** accounted for **21% of net sales in fiscal 2020** and **22% in fiscal 2019**, highlighting significant wholesale partner dependency[17](index=17&type=chunk) - Significant non-cash impairment charges in fiscal 2020 included **$13.0 million for property, equipment, and ROU assets** and **$13.8 million for goodwill and intangible assets**, driven by the COVID-19 pandemic[21](index=21&type=chunk)[22](index=22&type=chunk) - The company implemented various liquidity management actions in response to the pandemic, such as **furloughs, salary reductions, and credit facility amendments**[29](index=29&type=chunk) [Our Brands and Segments](index=5&type=section&id=our_brands_and_segments) The company operates three reportable segments: Vince Wholesale, Vince Direct-to-consumer, and Rebecca Taylor and Parker - The company operates three reportable segments: **Vince Wholesale, Vince Direct-to-consumer, and Rebecca Taylor and Parker**[35](index=35&type=chunk) Net Sales by Segment (Fiscal 2020 vs. 2019) | Segment | 2020 Net Sales ($ thousands) | % of Total | 2019 Net Sales ($ thousands) | % of Total | | :--- | :--- | :--- | :--- | :--- | | Vince Wholesale | $105,737 | 48.1% | $166,805 | 44.4% | | Vince Direct-to-consumer | $86,326 | 39.3% | $133,412 | 35.6% | | Rebecca Taylor and Parker | $27,807 | 12.6% | $74,970 | 20.0% | | **Total Net Sales** | **$219,870** | **100.0%** | **$375,187** | **100.0%** | - As of January 30, 2021, the company operated **62 Vince stores** and **9 Rebecca Taylor stores**[27](index=27&type=chunk)[31](index=31&type=chunk) - New product creation for the **Parker brand was paused in fiscal 2020** to reallocate resources to Vince and Rebecca Taylor and conserve liquidity[33](index=33&type=chunk) [Sourcing, Manufacturing, and Distribution](index=7&type=section&id=sourcing_manufacturing_and_distribution) The company relies on over 50 third-party manufacturers, primarily in China, and operates through seven third-party distribution centers globally - The company contracts with **over 50 manufacturers across nine countries**, without owning any manufacturing facilities[50](index=50&type=chunk) - In fiscal 2020, **88% of products were produced in China**[50](index=50&type=chunk) - Operations utilize **seven third-party distribution centers** located across the U.S., Hong Kong, Canada, the United Kingdom, and Belgium[52](index=52&type=chunk) [Human Capital](index=8&type=section&id=human_capital) As of January 30, 2021, the company employed 497 individuals, with nearly half working in its retail stores - As of January 30, 2021, the company employed **497 individuals**, with **230 in retail stores**[58](index=58&type=chunk) [Risk Factors](index=9&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks from the COVID-19 pandemic, dependence on key wholesale partners, potential goodwill impairment, supply chain reliance on foreign manufacturing, IT control weaknesses, and its "controlled company" status [Risks Related to Business and Industry](index=9&type=section&id=risks_related_to_our_business_and_industry) Key business risks include the ongoing impact of COVID-19, high dependence on a few wholesale partners, potential further goodwill impairment, and an un-remediated material weakness in internal controls - The **COVID-19 pandemic continues to adversely affect business, financial condition, and operations** through store closures, reduced demand, and supply chain disruptions[64](index=64&type=chunk)[65](index=65&type=chunk) - A **significant portion of revenue depends on a few large wholesale partners**, with the largest accounting for **21% of total revenue in fiscal 2020**, posing a substantial revenue risk if lost[86](index=86&type=chunk) - **Goodwill and indefinite-lived intangible assets face further impairment risk**, following **$13.8 million in impairment charges in fiscal 2020** due to COVID-19[75](index=75&type=chunk) - A **material weakness in internal control over financial reporting**, first identified in fiscal 2016, remains un-remediated[94](index=94&type=chunk) [Risks Related to Supply Chain](index=18&type=section&id=risks_related_to_our_supply_chain) Supply chain risks include reliance on third-party logistics, extensive foreign sourcing (especially China), and concentration with a few key manufacturers - Reliance on **third-party logistics providers for distribution facilities**, especially in California, poses operational disruption risks[113](index=113&type=chunk) - **Extensive foreign sourcing, with 88% of products from China in fiscal 2020**, exposes the company to political instability, trade restrictions, tariffs, and supply chain disruptions[116](index=116&type=chunk)[117](index=117&type=chunk) - **Concentration risk exists with independent manufacturers**, as the **top five accounted for approximately 59% of finished products in fiscal 2020**[121](index=121&type=chunk) [Risks Related to Structure and Ownership](index=20&type=section&id=risks_related_to_our_structure_and_ownership) Structural risks include being a "controlled company" by Sun Capital, which holds significant influence, and obligations under a Tax Receivable Agreement - The company is a **"controlled company"**, with **Sun Capital Partners, Inc. affiliates owning approximately 72% of common stock**, granting them significant influence[130](index=130&type=chunk) - A **Tax Receivable Agreement obligates the company to pay Pre-IPO Stockholders 85% of certain tax benefits**, with an estimated potential payment of **approximately $32.6 million plus accrued interest**, contingent on future taxable income[124](index=124&type=chunk) [Properties](index=22&type=section&id=Item%202.%20Properties) The company leases all corporate and retail properties, operating 71 stores (62 Vince, 9 Rebecca Taylor) totaling 174,439 gross square feet as of January 30, 2021 - All corporate offices and showrooms in **New York, Los Angeles, and Paris are leased**[135](index=135&type=chunk) Company-Operated Retail Store Count as of Jan 30, 2021 | Brand | Type | Count | | :--- | :--- | :--- | | Vince | Full-Price | 47 | | Vince | Outlet | 15 | | **Vince Total** | | **62** | | Rebecca Taylor | Full-Price | 6 | | Rebecca Taylor | Outlet | 3 | | **Rebecca Taylor Total** | | **9** | | **Grand Total** | | **71** | [Legal Proceedings](index=24&type=section&id=Item%203.%20Legal%20Proceedings) A stockholder lawsuit from 2018, alleging misleading statements about an ERP system transition, was dismissed in September 2020, but the plaintiff's appeal is pending - A **stockholder lawsuit from 2018** concerning ERP system transition statements was dismissed in September 2020, with a **plaintiff's appeal currently pending**[140](index=140&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=24&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on the NYSE under "VNCE", has never paid cash dividends, and does not anticipate doing so due to growth plans and debt covenants - The company's common stock trades on the **NYSE under the symbol 'VNCE'**[144](index=144&type=chunk) - The company has **never paid cash dividends** and does not plan to in the foreseeable future, restricted by debt covenants[146](index=146&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Fiscal 2020 saw a **41.4% net sales decrease to $219.9 million** and a **$65.6 million net loss** due to COVID-19, leading to lower gross margin, significant impairment charges, and liquidity management actions [Results of Operations](index=27&type=section&id=results_of_operations) Fiscal 2020 saw net sales decline by **41.4%** to **$219.9 million**, gross profit decrease by **50.3%**, and a net loss of **$65.6 million**, driven by pandemic impacts and impairment charges Fiscal 2020 vs. Fiscal 2019 Financial Performance (in thousands) | Metric | Fiscal 2020 | Fiscal 2019 | Change (%) | | :--- | :--- | :--- | :--- | | Net Sales | $219,870 | $375,187 | (41.4)% | | Gross Profit | $88,597 | $178,430 | (50.3)% | | Gross Margin | 40.3% | 47.6% | -7.3 p.p. | | Loss from Operations | ($61,080) | ($20,390) | 199.6% | | Net (Loss) Income | ($65,649) | $30,396 | N/M | | Diluted (Loss) EPS | ($5.58) | $2.55 | N/M | - The **gross margin rate decreased** primarily due to **increased promotional activity (-550 bps)**, **inventory reserve adjustments (-160 bps)**, and **deleverage of supply chain costs (-150 bps)**[170](index=170&type=chunk)[176](index=176&type=chunk) - Significant impairment charges in fiscal 2020 included **$13.8 million for goodwill and intangible assets** and **$13.0 million for long-lived assets**[171](index=171&type=chunk)[172](index=172&type=chunk) [Performance by Segment](index=28&type=section&id=performance_by_segment) All segments experienced significant sales declines in fiscal 2020, with Rebecca Taylor and Parker seeing the largest drop, while Vince Direct-to-consumer's e-commerce grew Segment Performance (Fiscal 2020, in thousands) | Segment | Net Sales | Change vs. 2019 (%) | Income (Loss) from Operations | | :--- | :--- | :--- | :--- | | Vince Wholesale | $105,737 | (36.6)% | $30,059 | | Vince Direct-to-consumer | $86,326 | (35.3)% | ($20,734) | | Rebecca Taylor and Parker | $27,807 | (62.9)% | ($16,112) | - **Vince Wholesale sales declined** due to delayed/canceled orders from wholesale partner store closures and lower off-price shipments[179](index=179&type=chunk) - **Vince Direct-to-consumer sales decline** from store closures was partially mitigated by **over 25% e-commerce growth**[181](index=181&type=chunk) [Liquidity and Capital Resources](index=30&type=section&id=liquidity_and_capital_resources) Net cash used in operating activities was **$25.1 million** in fiscal 2020, with the company securing a new **$20 million subordinated term loan** and amending credit facilities to enhance liquidity Cash Flow Summary (Fiscal 2020 vs. 2019, in thousands) | Cash Flow Activity | Fiscal 2020 | Fiscal 2019 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | ($25,071) | $16,819 | | Net cash used in investing activities | ($3,497) | ($4,523) | | Net cash provided by (used in) financing activities | $31,787 | ($11,991) | - In December 2020, the company secured a **new $20 million subordinated term loan** (Third Lien Credit Facility) from a Sun Capital affiliate to enhance liquidity[191](index=191&type=chunk) - Multiple amendments were made to the **2018 Term Loan and Revolving Credit Facilities in 2020** to provide liquidity and adjust financial covenants due to the pandemic[187](index=187&type=chunk)[188](index=188&type=chunk) - As of January 30, 2021, **$24.75 million was outstanding under the 2018 Term Loan Facility** and **$40.4 million under the 2018 Revolving Credit Facility**[208](index=208&type=chunk)[223](index=223&type=chunk) [Critical Accounting Policies](index=38&type=section&id=critical_accounting_policies) Key accounting estimates involve revenue recognition reserves, inventory valuation, goodwill and intangible asset fair value, and the Tax Receivable Agreement liability - Key estimates include **revenue recognition reserves for allowances**, **inventory valuation for obsolescence**, and **fair value assessments for goodwill and intangible assets**[239](index=239&type=chunk)[243](index=243&type=chunk)[246](index=246&type=chunk) - A **Q1 2020 triggering event (COVID-19)** resulted in a **$9.5 million goodwill impairment for Vince Wholesale** and a **$4.4 million impairment for Vince and Rebecca Taylor tradenames**[250](index=250&type=chunk)[251](index=251&type=chunk)[252](index=252&type=chunk) - The **Tax Receivable Agreement obligation was reduced to $0** as of January 30, 2021, after a **$2.3 million downward adjustment in fiscal 2020** due to revised income projections[267](index=267&type=chunk) - A **full valuation allowance was maintained on all definite-lived deferred tax assets** as of January 30, 2021, due to uncertainty of recognition[269](index=269&type=chunk) [Controls and Procedures](index=43&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls were ineffective as of January 30, 2021, due to an un-remediated material weakness in IT general controls, specifically user access and segregation of duties - The **CEO and CFO concluded disclosure controls and procedures were not effective** as of January 30, 2021[276](index=276&type=chunk) - A **material weakness in internal control over financial reporting**, identified in fiscal 2016, persists due to **inadequate IT general controls**, specifically user access and segregation of duties[94](index=94&type=chunk)[282](index=282&type=chunk) - A **remediation plan is underway**, involving system access modifications and user access recertifications, but the material weakness remains un-remediated until all controls are effectively implemented and tested[285](index=285&type=chunk)[286](index=286&type=chunk) [Part III](index=45&type=section&id=PART%20III) Items 10 through 14, covering governance and compensation, are incorporated by reference from the definitive proxy statement for the 2021 annual meeting Part IV [Exhibits, Financial Statement Schedules](index=45&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section provides an index to the financial statements, schedules, and all exhibits filed with the Form 10-K, including governance documents and material contracts - This section provides the **index to Audited Consolidated Financial Statements** and a **comprehensive list of all exhibits** filed with the Form 10-K[297](index=297&type=chunk) Financial Statements and Supplementary Data [Report of Independent Registered Public Accounting Firm](index=52&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) PricewaterhouseCoopers LLP issued an unqualified opinion on the consolidated financial statements, highlighting critical audit matters related to impairment assessments for the Vince tradename, Vince Wholesale goodwill, and Right-of-Use assets - **PricewaterhouseCoopers LLP issued an unqualified opinion** on the consolidated financial statements[312](index=312&type=chunk) - Critical Audit Matters identified include **impairment assessments for the Vince Tradename**, **Vince Wholesale Reporting Unit goodwill**, and **Retail Store Asset Groups' Right-of-Use assets**[317](index=317&type=chunk)[318](index=318&type=chunk)[322](index=322&type=chunk)[325](index=325&type=chunk) [Consolidated Financial Statements](index=55&type=section&id=Consolidated%20Financial%20Statements) Fiscal 2020 consolidated financial statements show a significant decline, with total assets decreasing to **$332.9 million**, stockholders' equity to **$66.2 million**, a **$65.6 million net loss**, and **$25.1 million cash used in operations** Consolidated Balance Sheet Data (in thousands) | Account | Jan 30, 2021 | Feb 1, 2020 | | :--- | :--- | :--- | | Total Current Assets | $110,584 | $114,244 | | Total Assets | $332,944 | $362,302 | | Total Current Liabilities | $82,220 | $90,277 | | Total Liabilities | $266,737 | $231,522 | | Total Stockholders' Equity | $66,207 | $130,780 | Consolidated Statement of Operations Data (in thousands) | Account | Fiscal 2020 | Fiscal 2019 | | :--- | :--- | :--- | | Net Sales | $219,870 | $375,187 | | Gross Profit | $88,597 | $178,430 | | Loss from Operations | ($61,080) | ($20,390) | | Net (Loss) Income | ($65,649) | $30,396 | | Diluted (Loss) EPS | ($5.58) | $2.55 | [Notes to Consolidated Financial Statements](index=59&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail accounting policies and financial results, including COVID-19's impact, impairment charges, the Rebecca Taylor and Parker acquisition, debt modifications, and the Tax Receivable Agreement liability reduction to zero - **Note 2:** The **acquisition of Rebecca Taylor and Parker** was accounted for as a transaction between commonly controlled entities, requiring retrospective financial statement combination[407](index=407&type=chunk) - **Note 3:** Fiscal 2020 saw a **$9.5 million goodwill impairment for Vince Wholesale** and a **$4.4 million impairment for Vince and Rebecca Taylor tradenames** due to COVID-19[410](index=410&type=chunk)[412](index=412&type=chunk)[414](index=414&type=chunk) - **Note 5:** The company **amended its 2018 Term Loan and Revolving Credit facilities multiple times in 2020** and secured a **new $20 million Third Lien Credit Facility** with a Sun Capital affiliate for liquidity and flexibility[431](index=431&type=chunk)[435](index=435&type=chunk)[453](index=453&type=chunk) - **Note 14:** The **Tax Receivable Agreement liability was reduced to $0** as of January 30, 2021, resulting in a **$2.3 million gain in fiscal 2020** due to revised income projections[521](index=521&type=chunk)[522](index=522&type=chunk)

Vince Holding Corp. (NYSE:VNCE) Q4 2020 Earnings Conference Call April 29, 2021 4:30 PM ET Company Participants Amy Levy - Vice President, Investor Relations Jack Schwefel - Chief Executive Officer David Stefko - Chief Financial Officer Conference Call Participants Dana Telsey - Telsey Advisory Group Operator Ladies and gentlemen, thank you for standing by, and welcome to Vince Q4 2020 Earnings Conference Call. [Operator Instructions] Thank you. I would now turn the conference over to Amy Levy. You may begi ...

Financial Data and Key Metrics Changes - Total company net sales for Q3 2020 decreased 34% to $69 million compared to $104.5 million in Q3 2019, showing significant improvement from a 59.9% decline in Q2 2020 [28] - Gross profit for Q3 was $31.7 million or 45.9% of net sales, down from $51 million or 48.8% in the same period last year, primarily due to increased promotional activity [31] - Net income for Q3 was $5 million or $0.42 per diluted share, compared to $6 million or $0.50 per diluted share in Q3 2019 [36] Business Line Data and Key Metrics Changes - Vince brand's consolidated net sales decreased 28.7% to $61.6 million compared to $86.4 million in the same prior year period [28] - Direct-to-consumer segment sales for Vince decreased 35.4% to $22.8 million in Q3 [28] - Rebecca Taylor and Parker combined net sales decreased 58.9% to $7.5 million compared to the same period last year [30] Market Data and Key Metrics Changes - International sales in Q3 were considerably less negative than in the U.S., indicating a stronger recovery in international markets [17] - The online business at wholesale partners remained strong, although in-store traffic continued to be challenged [12] Company Strategy and Development Direction - The company is focused on enhancing liquidity to support brand strategies, resulting in $42.3 million in excess availability under the revolving credit facility [8][37] - The strategy includes expanding the Vince brand's size offerings and enhancing the Rebecca Taylor brand through a cohesive collection and digital marketing efforts [11][22] - The company is strategically evaluating attractive real estate opportunities for new store openings, including short-term leases [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate challenges posed by COVID-19 and emphasized the importance of health and safety for customers and team members [9] - The company believes it is well-positioned to advance growth strategies as it emerges from the crisis in the latter half of 2021 [9][42] - Management noted that the brand remains a top performer in the contemporary luxury segment and is gaining market share [6][42] Other Important Information - The company took proactive steps to enhance liquidity, including entering into a $20 million Third Lien Credit Facility [37] - Net inventory at the end of Q3 was $88.6 million, up from $71.6 million at the end of Q3 2019, with a focus on working through seasonal inventory [40][41] Q&A Session Summary Question: Can you discuss the performance of specific categories in DTC and wholesale? - Management noted strong performance in sweaters and tops, with consumer response to promotions and new products being positive [46][47] Question: What is the breakdown of expense reductions? - The largest reduction came from payroll, with furloughs and a reduction in force contributing to the decrease [48][49] Question: How does the new credit facility affect interest expenses? - The new facility will increase interest expenses but will be paid in kind, allowing for a decline in cash interest costs [52] Question: What is the expected future split between DTC and wholesale? - Management did not provide a specific percentage but indicated strong performance in wholesale and ongoing investments in e-commerce [53][54]

PART I. FINANCIAL INFORMATION [Condensed Consolidated Financial Statements](index=4&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements) Presents unaudited condensed consolidated financial statements, reflecting COVID-19's impact on revenues, net losses, and asset impairments [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Balance sheet as of October 31, 2020, shows decreased total assets and stockholders' equity, driven by operating losses and impairments Condensed Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item | October 31, 2020 | February 1, 2020 | | :--- | :--- | :--- | | **Total current assets** | $126,525 | $114,244 | | **Total assets** | $354,454 | $362,302 | | **Total current liabilities** | $85,877 | $90,277 | | **Long-term debt** | $92,823 | $48,680 | | **Total liabilities** | $281,308 | $231,522 | | **Total stockholders' equity** | $73,146 | $130,780 | [Condensed Consolidated Statements of Operations and Comprehensive Earnings (Loss)](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Earnings%20%28Loss%29) Net sales declined significantly due to COVID-19, with substantial impairment charges leading to a significant net loss Statement of Operations Highlights (in thousands, except per share data) | Metric | Three Months Ended Oct 31, 2020 | Three Months Ended Nov 2, 2019 | Nine Months Ended Oct 31, 2020 | Nine Months Ended Nov 2, 2019 | | :--- | :--- | :--- | :--- | :--- | | **Net sales** | $69,022 | $104,539 | $145,062 | $270,779 | | **Gross profit** | $31,654 | $50,997 | $60,994 | $132,243 | | **Income (loss) from operations** | $6,264 | $7,550 | $(57,162) | $(17,089) | | **Net earnings (loss)** | $4,963 | $6,001 | $(58,277) | $(21,288) | | **Diluted EPS** | $0.42 | $0.50 | $(4.96) | $(1.83) | - For the nine months ended October 31, 2020, the company recorded significant impairment charges totaling **$26,900 thousand** (**$13,800 thousand** for goodwill and intangibles, and **$13,000 thousand** for long-lived assets), contributing heavily to the net loss[12](index=12&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity) Stockholders' equity decreased from $130,800 thousand at the beginning of the fiscal year to $73,100 thousand as of October 31, 2020, primarily due to the period's net loss - Total stockholders' equity fell by approximately **44%** from **$130,780 thousand** on February 1, 2020, to **$73,146 thousand** on October 31, 2020, mainly due to the accumulated deficit increasing from the period's net loss[16](index=16&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Significant cash outflow from operations due to net loss and inventory increase, offset by increased financing activities Cash Flow Summary (in thousands) | Cash Flow Activity | Nine Months Ended Oct 31, 2020 | Nine Months Ended Nov 2, 2019 | | :--- | :--- | :--- | | **Net cash (used in) provided by operating activities** | $(38,135) | $2,189 | | **Net cash used in investing activities** | $(2,560) | $(3,563) | | **Net cash provided by financing activities** | $40,851 | $1,983 | [Notes to Unaudited Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Notes detail accounting policies, COVID-19 impact, impairment charges, debt, segment performance, related party transactions, and subsequent events - The company operates three brands: Vince, Rebecca Taylor, and Parker. The acquisition of Rebecca Taylor and Parker in November 2019 was a transaction between commonly controlled entities, requiring retrospective combination of financial statements[27](index=27&type=chunk)[28](index=28&type=chunk) - Due to COVID-19's impact, the company recorded non-cash impairment charges of **$13,800 thousand** for goodwill and intangible assets and **$13,000 thousand** for property, equipment, and right-of-use assets during the nine months ended October 31, 2020[36](index=36&type=chunk)[37](index=37&type=chunk)[52](index=52&type=chunk) - Subsequent to the quarter end, on December 11, 2020, the company entered into a new **$20,000 thousand** subordinated term loan (Third Lien Credit Facility) with an affiliate of its majority stockholder, Sun Capital, to enhance liquidity[85](index=85&type=chunk)[112](index=112&type=chunk)[126](index=126&type=chunk) - The obligation under the Tax Receivable Agreement with Pre-IPO Stockholders was adjusted down by **$2,320 thousand** to an estimated total of **$0** as of October 31, 2020, due to revised projections of future pre-tax income[120](index=120&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses COVID-19's negative impact on sales and operations, detailing segment performance and liquidity measures taken [Results of Operations](index=30&type=section&id=Results%20of%20Operations) Net sales fell significantly in Q3 and YTD 2020, with gross margin contraction and substantial impairment charges leading to operating loss Q3 2020 vs Q3 2019 Performance (in thousands) | Metric | Q3 2020 | Q3 2019 | % Change | | :--- | :--- | :--- | :--- | | **Net Sales** | $69,022 | $104,539 | -34.0% | | **Gross Profit** | $31,654 | $50,997 | -37.9% | | **Gross Margin** | 45.9% | 48.8% | -290 bps | | **SG&A Expenses** | $25,390 | $43,447 | -41.6% | | **Income from Operations** | $6,264 | $7,550 | -17.0% | Nine Months 2020 vs 2019 Performance (in thousands) | Metric | YTD 2020 | YTD 2019 | % Change | | :--- | :--- | :--- | :--- | | **Net Sales** | $145,062 | $270,779 | -46.4% | | **Gross Profit** | $60,994 | $132,243 | -53.9% | | **Gross Margin** | 42.0% | 48.8% | -680 bps | | **Loss from Operations** | $(57,162) | $(17,089) | -234.5% | - The decrease in SG&A expenses was driven by cost-saving measures in response to COVID-19, including reduced compensation and benefits (**$7,700 thousand** in Q3), lower rent and occupancy costs (**$4,200 thousand** in Q3), and decreased marketing and travel expenses[149](index=149&type=chunk)[155](index=155&type=chunk) [Performance by Segment](index=32&type=section&id=Performance%20by%20Segment) All segments experienced significant sales declines in Q3 and YTD 2020 due to COVID-19, despite e-commerce growth in one segment Net Sales by Segment - Q3 (in thousands) | Segment | Q3 2020 | Q3 2019 | % Change | | :--- | :--- | :--- | :--- | | **Vince Wholesale** | $38,746 | $51,102 | -24.2% | | **Vince Direct-to-consumer** | $22,822 | $35,302 | -35.4% | | **Rebecca Taylor and Parker** | $7,454 | $18,135 | -58.9% | Net Sales by Segment - Nine Months (in thousands) | Segment | YTD 2020 | YTD 2019 | % Change | | :--- | :--- | :--- | :--- | | **Vince Wholesale** | $66,598 | $121,850 | -45.3% | | **Vince Direct-to-consumer** | $55,958 | $91,027 | -38.5% | | **Rebecca Taylor and Parker** | $22,506 | $57,902 | -61.1% | - Despite reduced traffic in retail locations, the Vince Direct-to-consumer segment saw **mid-teens growth** in e-commerce sales in Q3 and **over 30% growth** for the nine-month period[159](index=159&type=chunk)[172](index=172&type=chunk) [Liquidity and Capital Resources](index=36&type=section&id=Liquidity%20and%20Capital%20Resources) COVID-19 significantly impacted liquidity, leading to cash usage from operations, credit facility amendments, and new subordinated debt - Net cash used in operating activities was **$38,100 thousand** for the nine months ended Oct 31, 2020, compared to net cash provided by operating activities of **$2,200 thousand** in the prior-year period[185](index=185&type=chunk)[186](index=186&type=chunk) - On June 8, 2020, the company amended its 2018 Revolving Credit Facility and 2018 Term Loan Facility to, among other things, temporarily increase borrowing availability and suspend certain financial covenants[177](index=177&type=chunk) - On December 11, 2020, the company entered into a new **$20,000 thousand** Third Lien Credit Facility with SK Financial, an affiliate of Sun Capital, and executed the Fifth Amendments to its existing credit facilities to extend covenant relief and revise terms[178](index=178&type=chunk)[179](index=179&type=chunk)[180](index=180&type=chunk) [Quantitative and Qualitative Disclosure About Market Risk](index=43&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosure%20About%20Market%20Risk) As a "smaller reporting company," the company is not required to provide this information - As a "smaller reporting company," the company is exempt from the requirement to provide quantitative and qualitative disclosures about market risk[219](index=219&type=chunk) [Controls and Procedures](index=43&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls and procedures were ineffective due to material weaknesses in IT general controls, with remediation efforts ongoing - The CEO and CFO concluded that disclosure controls and procedures were not effective as of October 31, 2020[222](index=222&type=chunk) - The ineffectiveness is due to material weaknesses in internal control over financial reporting concerning IT program change management and user access controls, which could impact segregation of duties[224](index=224&type=chunk) - During the quarter, the company completed the transition of the Acquired Businesses' ERP system to its existing system, which constituted a material change in internal control over financial reporting[231](index=231&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=41&type=section&id=Item%201.%20Legal%20Proceedings) Stockholder lawsuit alleging misleading statements was dismissed, but plaintiff filed appeals which are currently pending - A stockholder lawsuit alleging misleading statements about an ERP system transition was dismissed in its entirety on September 9, 2020[97](index=97&type=chunk)[233](index=233&type=chunk) - The plaintiff filed notices of appeal on October 6, 2020, and the appeals are currently pending[97](index=97&type=chunk)[233](index=233&type=chunk) [Risk Factors](index=42&type=section&id=Item%201A.%20Risk%20Factors) COVID-19 pandemic adversely affects business, financial condition, and operations, posing risks to stores, demand, inventory, and liquidity - The primary risk factor discussed is the ongoing and uncertain negative impact of the COVID-19 pandemic on all aspects of the business[237](index=237&type=chunk) - Specific risks cited include temporary store closures, reduced consumer demand for luxury goods, excess inventory, supply chain disruptions, and the ability to access capital and maintain compliance with credit facilities[237](index=237&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=43&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales of equity securities or use of proceeds to report for the period - None[239](index=239&type=chunk) [Defaults Upon Senior Securities](index=43&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) No defaults upon senior securities to report for the period - None[240](index=240&type=chunk) [Mine Safety Disclosures](index=43&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[241](index=241&type=chunk) [Other Information](index=43&type=section&id=Item%205.%20Other%20Information) No other information to report for the period - None[242](index=242&type=chunk) [Exhibits](index=43&type=section&id=Item%206.%20Exhibits) Lists exhibits filed with Form 10-Q, including CEO certifications and financial statements in XBRL format - Exhibits filed include CEO certifications (31.1, 32.1) and financial statements in XBRL format (101.1)[243](index=243&type=chunk)

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended August 1, 2020 Or Commission File Number: 001-36212 VINCE HOLDING CORP. (Exact name of registrant as specified in its charter) Delaware 75-3264870 (State or other jurisdiction of incorporation or organization) (I.R.S. ...

Vince Holding Corp. (NYSE:VNCE) Q1 2020 Earnings Conference Call June 16, 2020 4:30 PM ET Company Representatives Brendan Hoffman - Chief Executive Officer David Stefko - Chief Financial Officer Amy Levy - Vice President, Investor Relations Conference Call Participants Dana Telsey - Telsey Advisory Group Operator Ladies and gentlemen, thank you for standing by and welcome to Vince Q1 2020, Preliminary Results Conference Call. At this time all participants are in a listen-only mode. After the speaker present ...