Vince Holding Corp. Announces Receipt of $30.0 Million Rights Offering Commitment Letter
May 19 2017 - 8:30AM
Business Wire
Vince Holding Corp. (NYSE:VNCE), a leading global luxury apparel
and accessories brand (“Vince” or the “Company”), today announced
that on May 18, 2017, the Company received a Rights Offering
Commitment Letter from Sun Capital Partners V, L.P. (“Sun Fund V”)
that provides the Company with an amount equal to $30.0 million of
cash proceeds (the “Contribution Obligation”) in the event that the
Company conducts a rights offering of its common stock to its
stockholders (a “Rights Offering”), subject to certain terms and
conditions.
Brendan Hoffman, Chief Executive Officer, commented, “We are
pleased to have received this Rights Offering Commitment Letter
from Sun Fund V, and appreciate their continued support. The
proceeds from a potential offering would enhance our capital
structure and provide additional cash for operations, enabling us
to continue executing our strategic plan.”
Terms of Rights Offering Commitment Letter
Sun Fund V will receive terms and conditions substantially in
the same form as the investment agreement, dated March 15, 2016, by
and among Sun Cardinal, LLC, SCSF Cardinal, LLC and the Company,
with any modifications thereto as may be mutually agreed between
Sun Fund V and the Company, for providing the Contribution
Obligation. There will be no fee paid to Sun Fund V by the Company
relating to the Contribution Obligation. Sun Fund V’s obligations
are subject to certain terms and conditions, as detailed fully in
the Rights Offering Commitment Letter dated May 18, 2017, including
but not limited to the Company entering into an amendment to its
existing senior secured term loan facility that is acceptable to
Sun Fund V in its sole discretion, and no default or event of
default having occurred under the Company’s senior secured term
loan facility or revolving credit facility, unless promptly cured
or reasonably expected to be promptly cured by the Company.
Sun Fund V’s obligations terminate upon the earliest to occur of
(A) the consummation of the Rights Offering whereby the Company
receives proceeds equal to or exceeding $30.0 million,
(B) 11:59 p.m. New York City time on June 30, 2017 if the
Rights Offering has not commenced by such time (which date to be
extended by 45 days in the event the Company’s registration
statement relating to the Rights Offering is reviewed by the
Securities and Exchange commission (“SEC”)), (C) 11:59 p.m.
New York City time on August 1, 2017 (which date to be extended by
45 days in the event the Company’s registration statement relating
to the Rights Offering is reviewed by the SEC), and (D) the
date Sun Fund V, or its affiliates, fund the Contribution
Obligation.
The Company will provide further details if and when the Rights
Offering commences.
For additional information, including a copy of the Rights
Offering Commitment Letter, please refer to the Company’s Current
Report on Form 8-K filed with the SEC on May 19, 2017.
ABOUT VINCE
Established in 2002, Vince is a global luxury brand best known
for utilizing luxe fabrications and innovative techniques to create
a product assortment that combines urban utility and modern
effortless style. From its edited core collection of ultra-soft
cashmere knits and cotton tees, Vince has evolved into a global
lifestyle brand and destination for both women’s and men’s apparel
and accessories. As of January 28, 2017, Vince products were sold
in prestige distribution worldwide, including approximately 2,300
distribution locations across more than 40 countries. With
corporate headquarters in New York and its design studio in Los
Angeles, the Company operated 40 full-price retail stores, 14
outlet stores and its e-commerce site, vince.com. Please visit
www.vince.com for more information.
This document, and any statements incorporated by reference
herein, contains forward-looking statements under the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements include the statements regarding, among other things,
our current expectations about the Company's future results and
financial condition, revenues, store openings and closings,
margins, expenses and earnings and are indicated by words or
phrases such as "may," "will," "should," "believe," "expect,"
"seek," "anticipate," "intend," "estimate," "plan," "target,"
"project," "forecast," "envision" and other similar phrases.
Although we believe the assumptions and expectations reflected in
these forward-looking statements are reasonable, these assumptions
and expectations may not prove to be correct and we may not achieve
the results or benefits anticipated. These forward-looking
statements are not guarantees of actual results, and our actual
results may differ materially from those suggested in the
forward-looking statements. These forward-looking statements
involve a number of risks and uncertainties, some of which are
beyond our control, including, without limitation: our ability to
maintain adequate cash flow from operations or availability under
our revolving credit facility to meet our liquidity needs
(including our obligations under the Tax Receivable Agreement with
the Pre-IPO Stockholders); our ability to continue as a going
concern; our ability to successfully operate the newly implemented
systems, processes, and functions recently transitioned from
Kellwood Company; our ability to remediate the identified material
weaknesses in our internal control over financial reporting; our
ability to comply with the continued listing standards of the New
York Stock Exchange; our ability to commence and complete a
potential rights offering; our ability to ensure the proper
operation of the distribution facility by a third party logistics
provider recently transitioned from Kellwood; our ability to remain
competitive in the areas of merchandise quality, price, breadth of
selection, and customer service; our ability to anticipate and/or
react to changes in customer demand and attract new customers,
including in connection with making inventory commitments; our
ability to control the level of sales in the off-price channels;
our ability to manage excess inventory in a way that will promote
the long-term health of the brand; changes in consumer confidence
and spending; our ability to maintain projected profit margins;
unusual, unpredictable and/or severe weather conditions; the
execution and management of our retail store growth plans,
including the availability and cost of acceptable real estate
locations for new store openings; the execution and management of
our international expansion, including our ability to promote our
brand and merchandise outside the U.S. and find suitable partners
in certain geographies; our ability to expand our product offerings
into new product categories, including the ability to find suitable
licensing partners; our ability to successfully implement our
marketing initiatives; our ability to protect our trademarks in the
U.S. and internationally; our ability to maintain the security of
electronic and other confidential information; serious disruptions
and catastrophic events; changes in global economies and credit and
financial markets; competition; our ability to attract and retain
key personnel; commodity, raw material and other cost increases;
compliance with domestic and international laws, regulations and
orders; changes in laws and regulations; outcomes of litigation and
proceedings and the availability of insurance, indemnification and
other third-party coverage of any losses suffered in connection
therewith; tax matters; and other factors as set forth from time to
time in our Securities and Exchange Commission filings, including
under the heading "Item 1A—Risk Factors" in our Annual Report on
Form 10-K and our Quarterly Reports on Form 10Q. We intend these
forward-looking statements to speak only as of the time of this
release and do not undertake to update or revise them as more
information becomes available, except as required by law.
This press release is also available on the Vince Holding Corp.
website (http://investors.vince.com/).
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version on businesswire.com: http://www.businesswire.com/news/home/20170519005104/en/
Investor Relations:ICR, Inc.Jean Fontana,
646-277-1200Jean.fontana@icrinc.com
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