Centric Brands (CTRC) 10-Q 16 Aug 16 2016 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2016	Aug. 11, 2016
Document and Entity Information
Entity Registrant Name	Differential Brands Group Inc.
Entity Central Index Key	844,143
Document Type	10-Q
Document Period End Date	Jun. 30, 2016
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		13,082,659
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q2

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Current assets
Cash and cash equivalents	$ 8,368	$ 1,966
Factored accounts receivable, net	12,155	4,917
Accounts receivable, net	1,521	1,836
Royalties receivable	663	547
Inventories, net	26,759	15,353
Prepaid expenses and other current assets	1,976	1,351
Total current assets	51,442	25,970
Property and equipment, net	13,003	13,406
Goodwill	6,524	2,286
Trademarks and other Intangible, net	84,965	39,823
Other assets	477	1,374
Customer relationships, net	26,628
Total assets	156,411	82,859
Current liabilities
Accounts payable and accrued expenses	19,114	13,084
Cash advances from customers	1,724
Current portion of long term debt	875
Current portion of loan payable		1,167
Total current liabilities	21,713	14,251
Long term debt, net of current portion	47,694
Line of credit	12,000	17,013
Convertible notes	12,251
Deferred income taxes, net	9,723
Deferred rent	3,624	3,568
Other liabilities	81
Loan payable, net of current portion		486
Total liabilities	107,086	35,318
Commitments and contingencies
Equity
Preferred members		24,798
Common members		22,743
Common stock, $0.10 par value: 100,000 and 0 shares authorized, 12,379 and 0 shares issued and outstanding at June 30, 2016 and December 31, 2015, respectively	1,239
Additional paid-in capital	56,093
Accumulated deficit	(8,012)
Total equity	49,325	47,541
Total liabilities and equity	156,411	$ 82,859
Convertible preferred stock
Equity
Convertible preferred stock, $0.10 par value: 50 and 0 shares authorized, issued and outstanding at June 30,2016 and December 31, 2015, respectively	$ 5

CONDENSED CONSOLIDATED BALANCE3

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Jun. 30, 2016	Dec. 31, 2015
Common stock, par value (in dollars per share)	$ 0.10
Common stock, shares authorized	100,000,000	0
Common stock, shares issued	12,379,000	0
Common stock, shares outstanding	12,379,000	0
Convertible preferred stock
Convertible preferred stock, par value (in dollars per share)	$ 0.10
Convertible preferred stock, shares authorized	50,000	0
Convertible preferred stock, shares issued	50,000	0
Convertible preferred stock, shares outstanding	50,000	0

UNAUDITED CONDENSED CONSOLIDATE

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Net sales	$ 32,373,000	$ 16,256,000	$ 66,088,000	$ 35,204,000
Cost of goods sold	15,274,000	6,310,000	28,686,000	13,367,000
Gross profit	17,099,000	9,946,000	37,402,000	21,837,000
Operating expenses
Selling, general and administrative	18,718,000	9,259,000	39,147,000	19,551,000
Depreciation and amortization	1,501,000	936,000	2,863,000	1,833,000
Retail stores impairment	0		279,000
Total operating expenses	20,219,000	10,195,000	42,289,000	21,384,000
Operating (loss) income	(3,120,000)	(249,000)	(4,887,000)	453,000
Interest expense, net	1,995,000	134,000	3,336,000	268,000
(Loss) income, before income tax (benefit) provision	(5,115,000)	(383,000)	(8,223,000)	185,000
Income tax (benefit) provision	(1,510,000)	105,000	577,000	116,000
(Loss) income from continuing operations	(3,605,000)	(488,000)	(8,800,000)	69,000
Loss from discontinued operations			(1,286,000)
Net (loss) income	$ (3,605,000)	$ (488,000)	$ (10,086,000)	$ 69,000
(Loss) earnings per common share - basic
(Loss) earnings from continuing operations (in dollars per share)	$ (0.29)	$ (0.06)	$ (0.74)	$ 0.01
Loss from discontinued operations (in dollars per share)			(0.11)
Loss) earnings per common share - basic (in dollars per share)	(0.29)	(0.06)	(0.85)	0.01
(Loss) earnings per common share - diluted
(Loss) earnings from continuing operations (in dollars per share)	(0.29)	(0.06)	(0.74)	0.01
Loss from discontinued operations (in dollars per share)			(0.11)
Loss) earnings per common share - diluted (in dollars per share)	$ (0.29)	$ (0.06)	$ (0.85)	$ 0.01
Weighted average shares outstanding
Basic (in shares)	12,380	8,825	11,852	8,825
Diluted (in shares)	12,380	8,825	11,852	8,825

UNAUDITED CONDENSED CONSOLIDAT5

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
CASH FLOWS FROM OPERATING ACTIVITIES
Net cash (used in) provided by continuing operating activities	$ (13,083)	$ 175
Net cash used in discontinued operations	(1,384)
Net cash (used in) provided by operating activities	(14,467)	175
CASH FLOWS FROM INVESTING ACTIVITIES
Cash paid in reverse acquisition with Robert Graham, net of cash acquired	(6,538)
Refund of security deposit		41
Purchases of property and equipment	(1,125)	(1,319)
Net cash used in investing activities	(7,663)	(1,278)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of Series A convertible preferred stock, net of offering costs	49,881
Proceeds from new term debt	50,000
Repayment of new term loan	(250)
Proceeds from line of credit	12,587	1,558
Repayment of terminated line of credit and loan payable	(23,349)
Payment of deferred financing costs	(1,584)
Redemption of unit holders	(58,218)
Proceeds from customer cash advances	831
Payment of loan payable		(584)
Payment of accrued distribution to members	(1,366)	(331)
Net cash provided by continued financing activities	28,532	643
NET CHANGE IN CASH AND CASH EQUIVALENTS	6,402	(460)
CASH AND CASH EQUIVALENTS, at beginning of period	1,966	792
CASH AND CASH EQUIVALENTS, at end of period	8,368	332
Supplemental disclosures of cash flow information:
Interest paid	1,563	275
Income taxes paid	507	$ 81
Supplemental disclosures of non-cash financing activities:
Reclassification of other assets to offering costs	812
Reclassification of other assets to deferred financing costs	349
Issuance of convertible notes	16,565
Common stock issued in reverse acquisition with Robert Graham	$ 20,000

UNAUDITED CONDENSED CONSOLIDAT6

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - USD ($) shares in Thousands, $ in Thousands	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Preferred member	Common member	Preferred Series A	Total
Balance at Dec. 31, 2014				$ 25,375	$ 23,298		$ 48,673
Balance (in shares) at Dec. 31, 2014				5,100	4,900
Increase (Decrease) in Stockholders' Equity
Distributions				$ (18)	$ 349		331
Net income				35	34		69
Balance at Jun. 30, 2015				$ 25,428	$ 22,983		48,411
Balance (in shares) at Jun. 30, 2015				5,100	4,900
Balance at Dec. 31, 2015				$ 24,798	$ 22,743		$ 47,541
Balance (in shares) at Dec. 31, 2015				5,100	4,900		0
Increase (Decrease) in Stockholders' Equity
Net income							$ (10,086)
Net loss through RG Merger date				$ (1,058)	$ (1,016)		(2,074)
Redemption of Robert Graham unit holders				(29,313)	(28,905)		(58,218)
Contribution of Robert Graham in exchange for common shares	$ 883	$ (13,634)		$ 5,573	$ 7,178
Contribution of Robert Graham in exchange for common shares (in shares)	8,825			(5,100)	(4,900)
Reverse acquisition with Robert Graham	$ 351	19,649					20,000
Reverse acquisition with Robert Graham (in shares)	3,509
Net loss post RG Merger date			$ (8,012)				(8,012)
Issuance of Series A convertible preferred stock, net of offering costs of $931		49,064				$ 5	49,069
Issuance of Series A convertible preferred stock (in shares)						50
Stock-based compensation		516					516
Issuance of restricted common stock	$ 5	498					503
Issuance of restricted common stock (in shares)	45
Balance at Jun. 30, 2016	$ 1,239	$ 56,093	$ (8,012)			$ 5	$ 49,325
Balance (in shares) at Jun. 30, 2016	12,379					50	12,379

UNAUDITED CONDENSED CONSOLIDAT7

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) $ in Thousands	6 Months Ended
	Jun. 30, 2016USD ($)
Preferred Series A
Issuance of convertible preferred stock, offering costs	$ 931

BASIS OF PRESENTATION

BASIS OF PRESENTATION	6 Months Ended
	Jun. 30, 2016
BASIS OF PRESENTATION
BASIS OF PRESENTATION	NOTE 1 — BASIS OF PRESENTATION Our principal business activity involves the design, development and worldwide marketing of apparel products, which include denim jeans, related casual wear and accessories bearing the brand name Hudson®, and the design, development, sales and licensing of apparel products and accessories bearing the brand name Robert Graham®. Our primary current operating subsidiaries are Robert Graham, Hudson Clothing, LLC (“ Hudson ”) and as of July 18, 2016, DFBG Swims, LLC (“ DFBG Swims ”) (see “Note 18 – Subsequent Events”). In addition, we have other non-operating subsidiaries. All significant inter-company transactions have been eliminated in consolidation. On January 28, 2016, we completed the RG Merger. We refer you to the “Explanatory Note” on page 1 for the definitions of the capitalized terms used in this Quarterly Report. As a result of the RG Merger, RG is a wholly-owned subsidiary of the Company and RG’s former members own a majority of our issued and outstanding equity. Additionally, the Company owns the Robert Graham Business, no longer owns the Joe’s Business and has retained ownership of the Hudson Business. The RG Merger has been accounted for as a reverse merger and recapitalization, such that, under the acquisition method, RG has been deemed the accounting acquirer for financial reporting purposes, with the Company, as the legal acquirer, viewed as the accounting acquiree. As a result, the assets, liabilities and operations reflected in the historical condensed consolidated financial statements and elsewhere in this Quarterly Report prior to the RG Merger are those of RG and are recorded at the historical cost basis. For the three and six months ended June 30, 2016, the Company’s condensed consolidated financial statements include: (i) from January 1, 2016 up to the day prior to the closing of the RG Merger on January 28, 2016, the results of operations and cash flows of RG; and (ii) from and after the RG Merger’s closing date on January 28, 2016, the results of continuing operations and cash flows and, as applicable, the assets and liabilities of the combined company, comprising the Company’s Hudson Business and Robert Graham Business; (iii) from and after the RG Merger’s closing date on January 28, 2016, the results of the discontinued operations from the Joe’s® brand retail stores that were not transferred to GBG but that closed as of February 29, 2016. In connection with the RG Merger, we changed our fiscal year end to December 31 and report our results with RG as the accounting acquirer. Certain reclassifications have been made to prior year amounts within the accompanying condensed consolidated balance sheets and unaudited condensed consolidated statements of cash flows to conform to the current period presentation. Our reportable business segments are Wholesale, Consumer Direct and Corporate and other. Because RG has been accounted for as the accounting acquirer as a result of the RG Merger, we have adopted RG’s three subdivisions as our reportable segments for all operations of our combined Company for periods after the RG Merger’s closing date. For periods before the RG Merger’s closing date, our discussion of reportable segments reflects only the operations of RG. We manage, evaluate and aggregate our operating segments for segment reporting purposes primarily on the basis of business activity and operation. Our Wholesale segment is comprised of sales of our products to premium department stores, boutiques, retailers, specialty stores and international customers, and records expenses from sales and customer service departments, trade shows, warehouse distribution, product samples and customer service departments. Our Consumer Direct segment is comprised of sales to consumers through our Robert Graham® brand full-price retail stores and outlet stores and through our online retail sites at www.hudsonjeans.com and www.robertgraham.us . Our Corporate and other segment is comprised of revenue from trademark licensing agreements and expenses from corporate operations, which include the executive, finance, legal, information technology, accounting, human resources, design and production departments and general brand marketing and advertising expenses associated with our brands. Our unaudited condensed consolidated financial statements, which comprise the accounts of our wholly-owned subsidiaries (including Hudson from the date of the completion of the RG Merger), for the quarterly period ended June 30, 2016 and 2015 and the related footnote information have been prepared on a basis consistent with our audited consolidated financial statements as of December 31, 2015 and 2014 and for the three-year period ended December 31, 2015 (filed as Exhibit 99.1 to Amendment No. 1 to our Current Report on Form 8-K/A, filed with the Securities and Exchange Commission (the “ SEC ”) on March 30, 2016). These unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements as of December 31, 2015 and 2014 and for the three-year period ended December 31, 2015 contained in Exhibit 99.1 to Amendment No. 1 to our Current Report on Form 8-K/A, filed with the SEC on March 30, 2016. In the opinion of management, the accompanying unaudited financial statements contain all adjustments (consisting of normal recurring adjustments), which management considers necessary to present fairly our financial position, results of operations and cash flows for the interim periods presented. The results for the quarterly period ended June 30, 2016 are not necessarily indicative of the results anticipated for the entire year ending December 31, 2016. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements. Actual results may differ from those estimates.

ACCOUNTING POLICIES

ACCOUNTING POLICIES	6 Months Ended
	Jun. 30, 2016
Accounting Policies
ACCOUNTING POLICIES	NOTE 2 — ACCOUNTING POLICIES Our accounting policies are described in the December 31, 2015 financial statements of RG filed as Exhibit 99.1 to Amendment No. 1 to our Current Report on Form 8-K/A, filed with the SEC on March 30, 2016. The following accounting policies became effective in the six months ended June 30, 2016: Discontinued Operations In accordance with the Financial Accounting Standards Board (“ FASB ”), Accounting Standards Codification (“ ASC ”), ASC 205-20, Presentation of Financial Statements – Discontinued Operations, the results of operations of a component of an entity or a group or component of an entity that represents a strategic shift that has, or will have, a major effect on the reporting company’s operations that has either been disposed of or is classified as held for sale are required to be reported as discontinued operations in a company’s consolidated financial statements. In order to be considered a discontinued operation, both the operations and cash flows of the discontinued component must have been (or will be) eliminated from the ongoing operations of the company and the company will not have any significant continuing involvement in the operations of the discontinued component after the disposal transaction. The accompanying unaudited condensed consolidated financial statements reflect the results of operations of our Joe's Business as discontinued operations. Stock−Based Compensation We measure the cost of all employee stock-based compensation awards based on the grant date fair value of those awards and record that cost as compensation expense over the period during which the employee is required to perform service in exchange for the award (generally over the vesting period of the award). An entity may elect either an accelerated recognition method or a straight-line recognition method for awards subject to graded vesting based on a service condition, regardless of how the fair value of the award is measured. For all stock-based compensation awards that contain graded vesting based on service conditions, we have elected to apply a straight-line recognition method to account for these awards. Two−Class Earnings Per Share We calculate basic and diluted earnings per common share using the two-class method. Under the two-class method, net earnings are allocated to each class of common stock and participating security as if all of the net earnings for the period had been distributed. Our participating securities consist of convertible preferred shares that contain a nonforfeitable right to receive dividends and therefore are considered to participate in undistributed earnings with common stockholders. Preferred Share Dividend Cumulative dividends on preferred stock are only accrued for when the board of directors declares a dividend. The board of directors has not declared a dividend through June 30, 2016. Concentration of Risk Financial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash, cash equivalents, accounts receivable and factor accounts receivable. We maintain cash and cash equivalents with various financial institutions. The policy is designed to limit exposure to any one institution. We perform periodic evaluations of the relative credit rating of those financial institutions that are considered in our investment strategy. We do not require collateral for trade accounts receivable. However, we sell a portion of our accounts receivable to CIT on a non-recourse basis (see “Note 6 – Factored and Accounts Receivables, Net”). In that instance, we are no longer at risk if the customer fails to pay. For accounts receivable that are not sold to CIT or sold on a recourse basis, we continue to be at risk if these customers fail to pay. We provide an allowance for estimated losses to be incurred in the collection of accounts receivable based upon the aging of outstanding balances and other account monitoring analysis. The net carrying value approximates the fair value for these assets. Such losses have historically been within management’s expectations. Uncollectible accounts are written off once collection efforts are deemed by management to have been exhausted. For the three and six months ended June 30, 2016 and 2015, sales to customers or customer groups representing greater than 10 percent of net sales are as follows: Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 Customer A % % % % Customer B % % % % As of June 30, 2016 and December 31, 2015, these customers represented approximately 67% and 47% , respectively, of our factored accounts receivable in our accompanying condensed consolidated balance sheets.

MERGER AND RELATED TRANSACTIONS

MERGER AND RELATED TRANSACTIONS	6 Months Ended
	Jun. 30, 2016
MERGER AND RELATED TRANSACTIONS
MERGER AND RELATED TRANSACTIONS	NOTE 3 — MERGER AND RELATED TRANSACTIONS Effective upon consummation of the RG Merger, we changed our name to “Differential Brands Group Inc.” and effected the Reverse Stock Split. The Reverse Stock Split did not change the par value or the amount of authorized shares of our common stock. In connection with the RG Merger, on January 28, 2016, we completed the issuance and sale of an aggregate of fifty thousand ( 50,000 ) shares of our preferred stock designated as Series A Convertible Preferred Stock (the “ Series A Preferred Stock ”), for an aggregate purchase price of $50 million in cash, as contemplated by the stock purchase agreement, dated as of September 8, 2015 (the “ RG Stock Purchase Agreement ”), by and between us and TCP Denim, LLC. We used the proceeds from the RG Stock Purchase Agreement and the debt financing provided by the credit facilities under the ABL Credit and Term Credit Agreement (see “Note 15 – Debt and Preferred Stock”) to consummate the RG Merger and the transactions contemplated by the RG Merger Agreement. Also in connection with the completion of the RG Merger, on January 28, 2016, we completed the exchange of $38.1 million in the aggregate principal amount of outstanding convertible notes for (i) 1,167,317 shares of common stock (after giving effect to the Reverse Stock Split); (ii) a cash payment of approximately $8.6 million; and (iii) an aggregate principal amount of approximately $16.5 million of modified convertible notes (the “ Modified Convertible Notes ”), as contemplated by the rollover agreement, dated September 8, 2015 (the “ Rollover Agreement ”), between us and the holders of the convertible notes. After the sale of our Joe’s® brand in September 2015, we retained and operated 32 Joe’s® brand retail stores. Pursuant to the terms of a separate agreement, we transferred 18 Joe’s® brand retail stores to the purchaser of the operating assets of our Joe’s® brand on January 28, 2016 for no additional consideration and closed the remaining 14 Joe’s® brand retail stores as of February 29, 2016. The results of operations from the Joe’s® brand have been reported as discontinued operations in the accompanying unaudited condensed consolidated financial statements. In addition, in connection with the consummation of the RG Merger, we entered into (i) the ABL Credit Agreement with Wells Fargo Bank, National Association, as lender, (ii) the Term Credit Agreement with TCW Asset Management Company, and (iii) the A&R Factoring Agreement (as defined below) with CIT. See “Note 15 – Debt and Preferred Stock” for additional information about the ABL Credit Agreement and Term Credit Agreement and “Note 6 – Factored and Accounts Receivables, Net” for additional information about the factoring agreement.

MERGER CONSIDERATION

MERGER CONSIDERATION	6 Months Ended
	Jun. 30, 2016
MERGER CONSIDERATION
MERGER CONSIDERATION	NOTE 4 — MERGER CONSIDERATION We closed the RG Merger on January 28, 2016. The RG Merger has been accounted for under the acquisition method of accounting with RG as the accounting acquirer. Under the acquisition method of accounting, the purchase price and the net assets acquired and liabilities assumed are recorded based on their estimated fair values as of the closing date of the RG Merger. The excess of purchase price over the net assets acquired is recorded as goodwill. The valuations of intangible assets, property and equipment, fair value of leases, income taxes and certain other items are preliminary. Management expects to finalize the purchase price allocations during fiscal 2016. Business acquisitions are accounted for under the acquisition method by assigning the purchase price to tangible and intangible assets acquired and liabilities assumed. Assets acquired and liabilities assumed are recorded at their fair values and the excess of the purchase price over the amounts assigned is recorded as goodwill. Purchased intangible assets with finite lives are amortized over their estimated useful lives. Goodwill and intangible assets with indefinite lives are not amortized but are tested at least annually for impairment or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. The stock price used to determine the preliminary estimated purchase price allocation is based on the closing price of our common stock as of January 28, 2016, which was $5.70 . The equity consideration was based upon the assumption that 3,509,000 shares of common stock were outstanding, which included 2,342,000 shares of common stock outstanding and 1,167,000 total aggregate shares of common stock issued to convertible noteholders upon conversion of the convertible notes into shares of our common stock under the Rollover Agreement. As a result of the Rollover Agreement, immediately after giving effect to the RG Merger and related transactions, the holders of the Modified Convertible Notes owned approximately 14% of the combined company on an as-converted, fully diluted basis. The assets acquired in this acquisition consisted of tangible and intangible assets and liabilities assumed. The differences between the fair value of the consideration paid and the estimated fair value of the assets and liabilities has been preliminarily recorded as goodwill. The significant factors that resulted in recognition of goodwill were: (a) the purchase price was based upon cash flow and return on capital projections assuming integrations of the companies; and (b) the calculation of the fair value of tangible and intangible assets acquired that qualified for recognition. We have determined on a preliminary basis that the useful life of the acquired trade name asset is indefinite, and therefore, no amortization expense will need to be recognized unless the useful life is determined not to be indefinite. The useful life of the acquired customer relationships are finite and will be amortized over their useful lives. However, we intend to test the assets for impairment if events or changes in circumstances indicate that the assets might be impaired. Additionally, a deferred tax liability has been established in the allocation of the purchase price with respect to the identified indefinite long-lived intangible assets acquired. Under the acquisition method of accounting, the total purchase price is allocated to the preliminary assets acquired and liabilities assumed based on their estimated fair values. We may continue to adjust the preliminary estimated purchase price allocation after obtaining more information regarding asset valuations, liabilities assumed, and revision of preliminary estimates. The following is the total preliminary estimated purchase price allocation based on information available as of June 30, 2016 (in thousands, except share and per share data): Assets acquired and liabilities assumed: Cash and cash equivalents $ Factored accounts receivable Accounts receivable Inventories Prepaid expenses and other current assets Property and equipment Other assets Accounts payable and accrued expenses Customer cash advances Line of credit Deferred income tax liability Other liabilities Buy-out payable Intangible assets acquired: Trade name Customer relationships Total Excess purchase price over net assets acquired Total net assets acquired $ Total purchase price: Cash paid to existing holders of convertible notes $ Fair value of Modified Convertible Notes transferred to the existing holders of convertible notes Equity consideration to the Company's stockholders and existing holders of convertible notes (3,508,747 common shares at $5.70) Total Purchase Price $ The preliminary estimated fair value of the Modified Convertible Notes was determined by a third-party valuation specialist. The face value of the Modified Convertible Notes in the amount of $16,473,000 was discounted by $4,673,000 to arrive at the fair value of the Modified Convertible Notes. The discount was calculated based on the present values of the contractual cash flows from the Modified Convertible Notes. In addition, we incurred $3,636,000 of non-recurring expenses related to the RG Merger in the six months ended June 30, 2016. Total revenue and income from continuing operations from Hudson since the date of the RG Merger included in the accompanying unaudited condensed consolidated financial statements is $34,681,000 and $4,406,000 , respectively. The following table presents our unaudited pro forma results (in thousands, except per share data) for the three and six months ended June 30, 2016 and 2015, respectively, as if the RG Merger had occurred on January 1, 2015. These results are not intended to reflect our actual operations had the acquisition occurred on January 1, 2015. Acquisition transaction costs have been excluded from the pro forma net (loss) income. Statutory rates were used to calculate income taxes. Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 Net sales $ $ $ $ Net loss $ $ $ $ Weighted average common shares outstanding Loss per common share - basic and diluted $ $ $ $

ADOPTION OF ACCOUNTING PRINCIPL

ADOPTION OF ACCOUNTING PRINCIPLES	6 Months Ended
	Jun. 30, 2016
ADOPTION OF ACCOUNTING PRINCIPLES
ADOPTION OF ACCOUNTING PRINCIPLES	NOTE 5 — ADOPTION OF ACCOUNTING PRINCIPLES In July 2015, FASB issued Accounting Standards Update, (“ ASU ”) 2015-11, Inventory (Topic 330) - Simplifying the Measurement of Inventory, which will require an entity to measure inventory at the lower of cost or net realizable value. Net realizable value is defined as the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. We adopted this standard in the first quarter of fiscal 2016 and there was no material impact on our condensed consolidated financial statements and related disclosures. In November 2015, the FASB issued ASU No. 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes, which will require entities to present deferred tax assets (“ DTAs ”) and deferred tax liabilities (“ DTLs ”) as noncurrent in a classified balance sheet. ASU 2015-17 simplifies the current guidance, which requires entities to separately present DTAs and DTLs as current and noncurrent in a classified balance sheet. For public entities, the amendments in ASU 2015-17 are effective for financial statements issued for annual periods beginning after December 15, 2016 and interim periods within those annual periods. Early application is permitted as of the beginning of an interim or annual reporting period. ASU 2015-17 is effective for us beginning January 1, 2017. We adopted this standard in the first quarter of fiscal 2016 and there was no material impact on our condensed consolidated financial statements and related disclosures. In April and March 2016, the FASB issued ASU 2016-10, Identifying Performance Obligations and Licensing, and ASU 2016-08, Principal versus Agent Considerations (Reporting Revenue Gross versus Net), respectively. ASU 2016-10 clarifies the implementation guidance on licensing and the identification of performance obligations considerations included in ASU 2014-09. ASU 2016-08 provides amendments to clarify the implementation guidance on principal versus agent considerations included in ASU 2014-09. In August 2015, the FASB issued ASU 2015-14, which defers the effective date of ASU 2014-09. ASU 2014-09 outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The effective date of this pronouncement is for fiscal years beginning after December 15, 2017 with early adoption permitted as of the original effective date. We have not yet adopted this ASU and we are currently evaluating the impact it may have on our condensed consolidated financial statements and related disclosures. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which affects the accounting for leases. The guidance requires lessees to recognize assets and liabilities on the balance sheet for the rights and obligations created by all leases with terms of more than 12 months. The amendment also will require qualitative and quantitative disclosures designed to give financial statement users information on the amount, timing, and uncertainty of cash flows arising from leases. This ASU is effective for fiscal years beginning after December 15, 2018 and interim periods within that reporting period. Early application is permitted. We have not yet adopted this ASU and we are currently evaluating the impact it may have on our condensed consolidated financial statements and related disclosures. In March 2016, the FASB issued ASU 2016-09, Compensation—Stock Compensation (Topic 718): Improvements To Employee Share-Based Payment Accounting, which amends ASC Topic 718, relating to employee share-based payment accounting. This guidance simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. This ASU is effective for fiscal years beginning after December 15, 2016, and interim periods within that reporting period. Early application is permitted. We have not yet adopted this ASU and are currently evaluating the impact it may have on our consolidated financial statements and related disclosures. In April 2015, the FASB issued ASU No. 2015-03, Interest – Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs (“ ASU No. 2015-03 ”), which changes the presentation of debt issuance costs in financial statements. ASU No. 2015-03 requires an entity to present such costs on the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs is reported as interest expense. The standard’s core principle is debt issuance costs related to a note shall be reported in the balance sheet as a direct deduction from the face amount of that note and that amortization of debt issuance costs also shall be reported as interest expense. We adopted this standard in the first quarter of fiscal 2016 and there was no material impact on our condensed consolidated financial statements and related disclosures. In May 2016, the FASB issued ASU No. 2016-12, Revenue from Customers with Contracts (Topic 606) Narrow-Scope Improvements and Practical Expedients. ASU 2016-12 amends certain aspects of ASU No. 2014-09, “Revenue from Customers with Contracts (Topic 606).” The amendments include the following: · Collectibility – ASU 2016-12 clarifies the objective of the entity’s collectibility assessment and contains new guidance on when an entity would recognize as revenue consideration it receives if the entity concludes that collectibility is not probable. · Presentation of sales tax and other similar taxes collected from customers – Entities are permitted to present revenue net of sales taxes collected on behalf of governmental authorities (i.e., to exclude from the transaction price sales taxes that meet certain criteria). · Noncash consideration – An entity’s calculation of the transaction price for contracts containing noncash consideration would include the fair value of the noncash consideration to be received as of the contract inception date. Further, subsequent changes in the fair value of noncash consideration after contract inception would be subject to the variable consideration constraint only if the fair value varies for reasons other than its form. · Contract modifications and completed contracts at transition – The ASU establishes a practical expedient for contract modifications at transition and defines completed contracts as those for which all (or substantially all) revenue was recognized under the applicable revenue guidance before the new revenue standard was initially adopted. · Transition technical correction – Entities that elect to use the full retrospective transition method to adopt the new revenue standard would no longer be required to disclose the effect of the change in accounting principle on the period of adoption (as is currently required by ASC 250-10-50-1(b)(2)); however, entities would still be required to disclose the effects on preadoption periods that were retrospectively adjusted. ASU 2016-12 is effective for annual and interim periods beginning on or after December 15, 2017, and early adoption is permitted as of the original effective date of December 31, 2016. We are currently evaluating the impact the adoption of ASU 2016-02 will have on our consolidated financial statements and related disclosures.

FACTORED AND ACCOUNTS RECEIVABL

FACTORED AND ACCOUNTS RECEIVABLES, NET	6 Months Ended
	Jun. 30, 2016
FACTORED AND ACCOUNTS RECEIVABLES, NET
FACTORED ACCOUNTS AND RECEIVABLES	NOTE 6 — FACTORED AND ACCOUNTS RECEIVABLES, NET A&R Factoring Agreement In January 2016, in connection with the RG Merger, we entered into the amended and restated deferred purchase factoring agreement with CIT, through our subsidiaries, Robert Graham Designs LLC and Hudson (the “ A&R Factoring Agreement ”), which replaced all prior agreements relating to factoring and inventory security. The A&R Factoring Agreement provides that we sell and assign to CIT certain of our accounts receivable, including accounts arising from or related to sales of inventory and the rendition of services. Under the A&R Factoring Agreement, we pay a factoring rate of (i) 0.20 percent for certain major department store accounts, (ii) 0.40 percent for all other accounts for which CIT bears the credit risk, subject to discretionary surcharges and (iii) 0.35 percent for accounts for which we bear the credit risk, but in no event less than $3.50 per invoice. The A&R Factoring Agreement may be terminated by CIT upon 60 days’ written notice or immediately upon the occurrence of an event of default as defined in the agreement. The A&R Factoring Agreement may be terminated by us upon 60 days’ written notice prior to December 31, 2020 or annually with 60 days’ written notice prior to December 31 of each year thereafter. Prior to the RG Merger, we were also party to a deferred purchase factoring arrangement with CIT, which was terminated in connection with the RG Merger. See “Note 15 – Debt and Preferred Stock” below for further discussion of this and other RG debt arrangements prior to the RG Merger. Factored and accounts receivables consist of the following (in thousands): June 30, 2016 December 31, 2015 Non-recourse receivables assigned to factor $ $ Client recourse receivables Total receivables assigned to factor Allowance for customer credits Factor accounts receivable, net $ $ Non-factored accounts receivable $ $ Allowance for customer credits Allowance for doubtful accounts Accounts receivable, net of allowance $ $ Total factored and accounts receivable, net $ $ Of the total amount of receivables sold by us as of June 30, 2016 and December 31, 2015, we hold the risk of payment of $500,000 and $637,000 , respectively, in the event of non-payment by the customers.

INVENTORIES

INVENTORIES	6 Months Ended
	Jun. 30, 2016
INVENTORIES
INVENTORIES	NOTE 7 — INVENTORIES Inventories are valued at the lower of cost or net realizable value with cost determined by the first-in, first-out method. Inventories consisted of the following (in thousands): June 30, 2016 December 31, 2015 Finished goods $ $ Finished goods consigned to others Work in progress — Raw materials Inventories $ $

LONG-LIVED AND INTANGIBLE ASSET

LONG-LIVED AND INTANGIBLE ASSETS AND GOODWILL	6 Months Ended
	Jun. 30, 2016
LONG-LIVED AND INTANGIBLE ASSETS AND GOODWILL
LONG-LIVED AND INTANGIBLE ASSETS AND GOODWILL	NOTE 8 — LONG-LIVED AND INTANGIBLE ASSETS AND GOODWILL Valuation of Long-lived and Intangible Assets and Goodwill We assess the impairment of indefinite-lived intangible assets and goodwill annually. We assess the impairment of finite-lived assets and intangible assets whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors considered important that could trigger an impairment review other than on an annual basis include, among others, the following: · A significant underperformance relative to expected historical or projected future operating results; · A significant change in the manner of the use of the acquired asset or the strategy for the overall business; or · A significant negative industry or economic trend. When we determine that the carrying value of finite-lived assets may not be recoverable based upon the existence of one or more of the aforementioned factors and the carrying value exceeds the estimated undiscounted cash flows expected to be generated by the asset, impairment is measured based on a projected discounted cash flow method using a discount rate determined by management. An asset is considered to be impaired if we determine that the carrying value may not be recoverable based upon our assessment of the asset’s ability to generate positive cash flow in future periods or if significant changes our strategic business objectives and utilization of the assets occurred. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the estimated fair value, which is determined based on discounted future cash flows. The impairment loss calculations require management to apply judgment in estimating future cash flows and the discount rates that reflect the risk inherent in future cash flows. Future expected cash flows for store assets are based on management’s estimates of future cash flows over the remaining lease period or expected life, if shorter. We consider historical trends, expected future business trends and other factors when estimating each store’s future cash flow. We also consider factors such as: the local environment for each store location, including mall traffic and competition; our ability to successfully implement strategic initiatives; and the ability to control variable costs such as cost of sales and payroll, and in some cases, renegotiate lease costs. During the six months ended June 30, 2016, we recorded a store impairment charge of $279,000 related to one of our RG retail stores which was closed prior to the lease end date. We did not record any retail store impairment charges in the three months ended June 30, 2016 . We evaluate goodwill for impairment at least annually or whenever events or changes in circumstances indicate that the carrying value may not be recoverable using a two-step process. Under the first of two steps, we compare the fair value of a reporting unit to its carrying amount, including goodwill, to identify a potential impairment. If the fair value of the reporting unit is less than its carrying value, an indication of goodwill impairment exists for such reporting unit and the enterprise must perform step two of the impairment test to measure the impairment, if any. Under step two, an impairment loss is recognized for any excess of the carrying amount of the reporting unit’s goodwill over the implied fair value of that goodwill. The implied fair value of goodwill is determined by allocating the fair value of the reporting unit in a manner similar to a purchase price allocation: the fair value of the reporting unit is allocated to all assets and liabilities of that unit (including any unrecognized intangible assets) and the residual fair value after this allocation is the implied fair value of the reporting unit goodwill. We review our other indefinite-lived intangible assets for impairment on an annual basis, or when circumstances indicate their carrying value may not be recoverable. We calculate the value of the indefinite-lived intangible assets using a discounted cash flow method, based on the relief from royalty method. Our annual impairment testing date is December 31 of each year. Intangible assets as of June 30, 2016 consisted of the following (in thousands): Amortization Gross Accumulated Net Period Amount Amortization Amount Trade names Indefinite $ $ — $ Customer relationships 13 to 15 Years Total $ $ $ Intangible assets as of December 31, 2015 consisted of the following (in thousands): Amortization Gross Accumulated Net Period Amount Amortization Amount Trade names Indefinite $ $ — $ Customer relationships 15 Years Total $ $ $ Amortization expense related to the intangible assets amounted to approximately $683,000 and $330,000 for the three months ended June 30, 2016 and 2015, respectively, and $1,258,000 and $660,000 for the six months ended June 30, 2016 and 2015, respectively. As of June 30, 2016, the future amortization expense related to the finite-lived intangible assets is as follows (in thousands): 2016 Remainder of the year $ 2017 2018 2019 2020 Thereafter $ Goodwill as of June 30, 2016 and December 31, 2015 consisted of the following (in thousands): June 30, 2016 December 31, 2015 Balance at January 1 $ $ Preliminary goodwill created by the RG Merger — Ending balance $ $

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	6 Months Ended
	Jun. 30, 2016
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS	NOTE 9 — RELATED PARTY TRANSACTIONS Peter Kim We entered into several agreements, including a stock purchase agreement, a convertible note, a registration rights agreement, an employment agreement and a non-competition agreement with Peter Kim, the Chief Executive Officer of our subsidiary, Hudson, in connection with the acquisition of Hudson. Additionally, in connection with the RG Merger, we entered into a Rollover Agreement pursuant to which the convertible notes were exchanged for a combination of cash, stock and Modified Convertible Notes, and a new employment and non-competition agreement with Mr. Kim. Mr. Kim also has rights under the Registration Rights Agreement described below with respect to shares of our common stock issuable upon conversion of his Modified Convertible Notes. Under the new non-competition agreement with us and Hudson, which became effective as of the closing date of the RG Merger, Mr. Kim has agreed not to engage in, compete with or permit his name to be used by or in connection with any premium denim apparel business outside his role with Hudson that is competitive to us, Hudson or our respective subsidiaries for a period of up to three years from January 28, 2016. See “Note 15 – Debt and Preferred Stock.” Registration Rights Agreement On the closing date of the RG Merger, we entered into a registration rights agreement (the “ Registration Rights Agreement ”) with TCP Denim, LLC and certain of its affiliates, who are our major stockholders, the noteholder party to the Rollover Agreement and Michael Buckley, our Chief Executive Officer. Pursuant to the Registration Rights Agreement, and subject to certain limitations described therein, we are required to provide certain demand and piggyback registration rights to the parties to the Registration Rights Agreement. In particular, we are required to prepare and file a registration statement on Form S-1 or S-3 (or any similar form or successor thereto) for the registration under the Securities Act of shares of our common stock (i) issued to the parties to the Registration Rights Agreement in connection with the RG Merger Agreement and the Rollover Agreement and (ii) issuable upon conversion of the Series A Preferred Stock and the Modified Convertible Notes. Prior to the closing date of the RG Merger, we had a substantially similar registration rights agreement with the holders of the original convertible notes, which included Mr. Kim. Employment Agreements with Officers We have entered into employment agreements with Mr. Buckley, Mr. Kim and Hamish Sandhu, our Chief Financial Officer. The agreements have varying initial terms, but all contain automatic one -year renewals, unless terminated by either party, and provide for minimum base salaries adjusted for annual increases, incentive bonuses based upon the attainment of specified goals, and severance payments in the event of termination of employment, as defined in the employment contracts. RG Purchases We purchase orders from Texport Industries PVT Ltd, an entity affiliated with certain of our stockholders. RG purchased from the affiliated entity merchandise for resale amounting to approximately $1,398,000 and $2,080,000 , respectively, representing approximately 9% and 33% , respectively, of costs of goods sold during the three months ended June 30, 2016 and 2015 and $5,210,000 and $5,945,000 , respectiv ely, representing approximately 18% and 44% , respectively, during the six months ended June 30, 2016 and 2015. As of June 30, 2016 and December 31, 2015, approximately $2,248,000 and $ 4,600,000 , respectively, were due to the affiliated entity and were included in accounts payable and accrued expenses on the accompanying condensed consolidated balance sheets. Warehousing and Shipping We utilize warehousing and shipping services from Creative Logistics Services, LLC, an entity affiliated with certain of our stockholders, under an agreement expiring in October 2017. Under the agreement, RG is charged a percentage of monthly net amounts invoiced. Warehousing and shipping services provided by the affiliated entity and charged to us amounted to approximately $337,000 and $325,000 , respectively, during the three months ended June 30, 2016 and 2015 and $753,000 and $764,000 , respectively, during the six months ended June 30, 2016 and 2015. As of June 30, 2016 and December 31, 2015, approximately $294,000 and $ 283,000 , respectively, were due to the affiliated entity and were included in accounts payable and accrued expenses on the accompanying condensed consolidated balance sheets. License Fees We pay licensing fees to Robert Stock, one of our stockholders and a consultant, based on net wholesale sales and royalty income from certain licenses as defined in his employment agreement. We did not make any payments to Mr. Stock in the three months ended June 30, 2016 and 2015. For the six months ended June 30, 2016 and 2015, licensing fees incurred to Mr. Stock were $46,000 and $52,000 , respectively. Payments to Tengram Capital Partners, LP From time to time, we expect to reimburse Tengram Capital Partners, LP, an entity that is one of our stockholders, for certain travel and other related expenses of its employees related to services performed on our behalf and at our request. For the three months ended June 30, 2016, we have recorded expenses of $84,000 . For the six months ended June 30, 2016, we recorded expense of $875,000 , which included (i) $750,000 of reimbursement for legal fees incurred by TCP Denim, LLC, in connection with the purchase of the Series A Preferred Stock and RG Merger; and (ii) $41,000 of pre-RG Merger management fees that were paid by RG that are non-recurring as a result of the RG Merger. For the three months and six months ended June 30, 2015, RG paid $125,000 and $250,000 , respectively, related to annual management fees and expenses that are non-recurring as a result of the RG Merger. SWIMS® Transaction In connection with the acquisition of SWIMS® in July 2016, we entered into certain financing arrangements with Tengram Partners Fund II, L.P., an entity affiliated with the holder of our Series A Preferred Stock, TCP Denim, LLC. See “Note 18 – Subsequent Events.”

EARNINGS PER SHARE

EARNINGS PER SHARE	6 Months Ended
	Jun. 30, 2016
EARNINGS PER SHARE
EARNINGS PER SHARE	NOTE 10 — EARNINGS PER SHARE Earnings per share are computed using weighted average common shares and dilutive common equivalent shares outstanding. Potentially dilutive shares consist of outstanding options, shares issuable upon the assumed conversion of Modified Convertible Notes, Series A Preferred Stock and unvested restricted stock units (“ RSUs ”). A reconciliation of the numerator and denominator of basic earnings per share and diluted earnings per share is as follows: Three months ended Six months ended June 30, 2016 June 30, 2015 June 30, 2016 June 30, 2015 Basic (loss) earnings per share computation: Numerator: (Loss) income from continuing operations $ $ $ $ Loss from discontinued operations - - - Net (loss) income Denominator: Weighted average common shares outstanding (Loss) earnings per common share - basic (Loss) income from continuing operations (Loss) Income from discontinued operations - - - (Loss) earnings per common share - basic $ $ $ $ Diluted (loss) earnings per share computation: Numerator: (Loss) income from continuing operations $ $ $ $ (Loss) Income from discontinued operations - - - Net (loss) income Denominator: Weighted average common shares outstanding Effect of dilutive securities: RSU's, convertible securities and options - - - - Dilutive potential common shares (Loss) earnings per common share - diluted (Loss) income from continuing operations Loss from discontinued operations - - - (Loss) earnings per common share - diluted $ $ $ $ For the three and six months ended June 30, 2016, currently exercisable options, the Modified Convertible Notes, Series A Preferred Stock and unvested RSUs in the aggregate of 6,37 7,781 have been excluded from the calculation of the diluted loss per share as their effect would have been anti-dilutive. For the three and six months ended June 30, 2015, weighted average shares represent the number of shares issued to RG members in connection with the RG Merger. Earnings (Loss) Per Share under Two− Class Method Our Series A Preferred Stock has the non-forfeitable right to participate on an as converted basis at the conversion rate then in effect in any common stock dividends declared and as such, is considered a participating security. The Series A Preferred Stock is included in the computation of basic and diluted loss per share pursuant to the two-class method. Holders of the Series A Preferred Stock do not participate in undistributed net losses because they are not contractually obligated to do so. The computation of diluted earnings per share attributable to common stockholders reflects the potential dilution that could occur if securities or other contracts to issue shares of common stock that are dilutive were exercised or converted into shares of common stock (or resulted in the issuance of shares of common stock) and would then share in our earnings. During the periods in which we record a loss from continuing operations attributable to common stockholders, securities would not be dilutive to net loss per share and conversion into shares of common stock is assumed not to occur. The following table provides a reconciliation of net loss to preferred shareholders and common stockholders for purposes of computing net loss per share for the three and six months ended June 30, 2016 and 2015 (in thousands, except per share amounts): Three months ended Six months ended June 30, 2016 June 30, 2015 June 30, 2016 June 30, 2015 Net (loss) income $ $ $ $ Less: preferred dividends - - Net (loss) income attributable to stockholders Participating securities - Series A Preferred Stock - - - - Net (loss) income attributable to common stockholders $ $ $ $ Denominator: Weighted average common shares outstanding (Loss) earnings per common share - basic and diluted under two-class method $ $ $ $ Shares Reserved for Future Issuance As of June 30, 2016, shares reserved for future issuance include: (i) 444 shares of common stock issuable upon the exercise of stock options granted under the incentive plans; (ii) 700,431 shares of common stock issuable upon the vesting of RSUs; and (iii) 1, 187,498 shares of common stock issuable pursuant to the Modified Convertible Notes.

INCOME TAXES

INCOME TAXES	6 Months Ended
	Jun. 30, 2015
INCOME TAXES
INCOME TAXES	NOTE 11 — INCOME TAXES We utilize the liability method of accounting for income taxes in accordance with FASB Accounting Standards Codification (“ ASC ”) 740. Under the liability method, deferred taxes are determined based on the temporary differences between the financial statements and tax bases of assets and liabilities using enacted tax rates. Until the RG Merger on January 28, 2016, the Company was treated as a partnership for tax purposes. Pursuant to this status, taxable income or loss of the Company is included in the income tax returns of its owners. Consequently, no federal income tax provision is recorded through the RG Merger date. However, under state laws, certain taxes are imposed upon limited liability companies and are provided for through the RG Merger date. A valuation allowance is required if, based on the weight of available evidence, it is more likely than not that all or a portion of a deferred tax asset will not be realized. Quarterly, management reassesses the need for a valuation allowance. Realization of deferred income tax assets is dependent upon taxable income in prior carryback years, estimates of future taxable income, tax planning strategies and reversals of existing taxable temporary differences. In determining the need for a valuation allowance, we reviewed all available evidence pursuant to the requirements of FASB ASC 740. Pursuant to ASC 740, we excluded the deferred income tax liabilities associated with identified indefinite long lived intangible assets as a source of income. For the second quarter of fiscal 2016, based upon our assessment of all available evidence, we have concluded that it is more likely than not that the net deferred tax assets will not be realized. We considered all available evidence, both positive and negative, in our assessment of the valuation allowance needed as of the RG Merger date on January 28, 2016 and as of June 30, 2016. In calculating the amount of deferred tax assets subject to a valuation allowance, we have excluded the deferred tax liabilities associated with our trademarks from that amount. These intangible assets have an indefinite life and therefore, we cannot expect that the associated deferred tax liabilities will reverse over the same periods as our other net deferred tax assets. Certain limitations may be placed on net operating loss carryforwards as a result of a “change in control” as defined in Section 382 of the Internal Revenue Code. In the event a “change in control” occurs, it will have the effect of limiting the annual usage of the carryforwards in future years. Additional changes in control in future periods could result in further limitations of our ability to offset taxable income. Management believes that certain changes in control have occurred during the six months ended June 30, 2016 which may have resulted in significant limitations on our net operating loss carryforwards. As all of net operating carryforwards subject to these limitations have been reduced by a valuation allowance, there was no material impact on our condensed consolidated financial statements and related disclosures as a result of any limitation. We apply the FASB guidance on accounting for uncertainty in income taxes. The guidance clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with other authoritative GAAP and prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The guidance also addresses derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. At June 30, 2016 and December 31, 2015, we had $0.6 million of certain unrecognized tax benefits, included as a component of long-term liabilities held for disposition from discontinued operations of wholesale business. We expect to reverse these unrecognized tax benefits during fiscal year 2016. Interest and penalties related to uncertain tax positions, if any, are recorded in income tax expense. Tax years that remain open for assessment for federal and state tax purposes include the years ended December 31, 2012 through December 31, 2015.

EQUITY

EQUITY	6 Months Ended
	Jun. 30, 2016
EQUITY
EQUITY	NOTE 12 —EQUITY Stock Incentive Plans On June 3, 2004, Differential adopted the 2004 Stock Incentive Plan (the “2004 Incentive Plan” ) and in October 2011, Differential adopted an Amended and Restated 2004 Stock Incentive Plan (the “Restated Plan” ) to update the 2004 Incentive Plan with respect to certain provisions and changes in the tax code since its original adoption. Under the Restated Plan, the number of shares authorized for issuance is 227,500 shares of common stock after giving effect to the Reverse Stock Split. After the adoption of the Restated Plan in October 2011, we no longer grant awards pursuant to the 2004 Incentive Plan. Under the Restated Plan, grants may be made to employees, officers, directors and consultants under a variety of awards based upon underlying equity, including, but not limited to, stock options, restricted common stock, restricted stock units or performance shares. The Restated Plan limits the number of shares that can be awarded to any employee in one year to 41,667 . The exercise price for incentive options may not be less than the fair market value of our common stock on the date of grant and the exercise period may not exceed ten years. Vesting periods, terms and types of awards are determined by the board of directors and/or our compensation committee. The Restated Plan includes a provision for the acceleration of vesting of all awards upon a change of control as well as a provision that allows forfeited or unexercised awards that have expired to be available again for future issuance. Since fiscal 2008, we have issued both restricted common stock and RSUs to our officers, directors and employees pursuant to our various plans. The RSUs represent the right to receive one share of common stock for each unit on the vesting date provided that the employee continues to be employed by us. On the vesting date of the RSUs, we expect to issue the shares of common stock to each participant upon vesting and expect to withhold an equivalent number of shares at fair market value on the vesting date to fulfill tax withholding obligations. Any RSUs withheld or forfeited will be shares available for issuance in accordance with the terms of the Restated Plan. The shares of common stock issued upon exercise of a previously granted stock option or a grant of RSUs are considered new issuances from shares reserved for issuance under our various incentive plans. We require that the option holders provide a written notice of exercise in accordance with the applicable incentive plan and option agreement thereunder to the plan administrator and that full payment for the shares be made prior to issuance. All issuances are made under the terms and conditions set forth in the applicable plan. As of June 30, 2016, shares reserved for future issuance under our 2004 Incentive Plan and our Restated Plan include: (i) 444 shares of common stock issuable upon the exercise of stock options granted under our incentive plans; and (ii) 700,431 shares of common stock issuable upon the vesting of RSUs. As of June 30, 2016, no shares remained available for grant under the Restated Plan. We expect to adopt a new or restated stock incentive plan at our next annual meeting of stockholders. Exercise prices for all options outstanding as of June 30, 2016 were as follows (in actual amounts): Options Outstanding and Exercisable Exercise Price Number of Shares Weighted-Average Remaining Contractual Life (Years) $ 11.40 8.5 8.5 The following table summarizes stock option activity by incentive plan for the six months ended June 30, 2016 (in actual amounts): Total Number of Shares 2004 Incentive Plan Restated Plan Outstanding at January 1, 2016 — — — Legacy Joe's stock options assumed Granted — — — Exercised — — — Forfeited / Expired — Outstanding and exercisable at June 30, 2016 — The following table summarizes stock option activity for all incentive plans for the six months ended June 30, 2016 (in actual amounts): Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Outstanding at January 1, 2016 — $ — — Legacy Joe's stock options assumed — Granted — — — — Exercised — — — — Expired — — — — Forfeited — — Outstanding and exercisable at June 30, 2016 $ $ — The following table summarizes RSU activity for the six months ended June 30, 2016 (in actual amounts): Restricted Stock Units Number Of Units Weighted Average Grant Date Fair Value Outstanding at December 31, 2015 — $ — Granted Vested — — Issued Cancelled — — Forfeited — — Outstanding at June 30, 2016 $ During the three months ended June 30, 2016, we granted 100,000 shares of RSUs and did not issue any shares of common stock to holders of RSUs. During the six months ended June 30, 2016, we granted 745,938 shares of RSUs and issued 45,507 shares of common stock to holders of RSUs that vested during the period. Stock-Based Compensation Cost For all stock compensation awards that contain graded vesting with time-based service conditions, we have elected to apply a straight-line recognition method to account for all of these awards. There was a total of $312,000 of stock-based compensation expense recognized during the three months ended June 30, 2016 and $1,019,000 during the six months ended June 30, 2016. There were no stock options , RSUs or stock-based compensation awards granted or outstanding during fiscal year 2015, although in connection with the RG Merger, we assumed certain stock options granted by Joe’s which were outstanding during fiscal year 2015. As of June 30, 2016, there was $3,336,000 of total unrecognized compensation cost related to nonvested stock-based compensation arrangements. That unrecognized compensation cost is expected to be recognized over a weighted-average period of 2. 5 years.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	6 Months Ended
	Jun. 30, 2016
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES	NOTE 13 — COMMITMENTS AND CONTINGENCIES Operating Leases We lease retail store locations and our corporate offices and warehouse under operating lease agreements expiring on various dates through 2026. Some of these leases require us to make periodic payments for property taxes, utilities and common area operating expenses. Certain retail store leases provide for rents based upon the minimum annual rental amount and a percentage of annual sales volume, generally ranging from 6 percent to 8 percent, when specific sales volumes are exceeded. Some leases include lease incentives, rent abatements and fixed rent escalations, which are amortized and recorded over the initial lease term on a straight-line basis. As of June 30, 2016, the future minimum rental payments under non-cancelable operating leases with lease terms in excess of one year were as follows (in thousands): 2016 Remainder of the year $ 2017 2018 2019 2020 Thereafter $ Modified Convertible Notes and Credit Agreements See “Note 15 – Debt and Preferred Stock” below for a further discussion on the commitments related to the RG Merger, which included the issuance of the Modified Convertible Notes and the providing of the ABL Credit Agreement and Term Credit Agreement. Advertising Agreements In 2014, RG entered into certain agreements with an unrelated third party for advertising and sponsorship during 2015 and 2016. The 2016 portion has subsequently been cancelled. The amount charged to expense for these commitments was approximately $0 and $425,000 for the three months ended June 30, 2016 and 2015, respectively, and $750,000 and $700,000 for the six months ended June 30, 2016 and 2015, respectively. Letter of Credit We maintained an irrevocable standby letter of credit for approximately $130,000 representing the deposit on RG’s New York City retail store. In April 2016, the letter of credit was terminated. Litigation We are a party to legal proceedings and claims in the ordinary course of business, including proceedings to protect our intellectual property rights. As part of our monitoring program for our intellectual property rights, from time to time, we file lawsuits in the United States and abroad for acts of trademark counterfeiting, trademark infringement, trademark dilution, patent infringement or breach of other state or foreign laws. These actions often result in seizure of counterfeit merchandise and negotiated settlements with defendants. Defendants sometimes raise the invalidity or unenforceability of our proprietary rights as affirmative defenses or counterclaims. In the opinion of management, based upon advice of legal counsel, the likelihood is remote that the impact of any pending proceedings and claims, either individually or in the aggregate, would have a material adverse effect on our consolidated financial condition, results of operations or cash flows. However, because the ultimate outcome of legal proceedings and claims involves judgments, estimates and inherent uncertainties, actual outcomes of these proceedings and claims may materially differ from our current estimates. It is possible that resolution of one or more of the proceedings currently pending or threatened could result in losses material to our consolidated results of operations, liquidity or financial condition. On a quarterly basis, we review our legal proceedings and claims and determine if an unfavorable outcome to us is considered “remote,” “reasonably possible” or “probable” as defined by U.S. GAAP. Where we determine an unfavorable outcome is probable and is reasonably estimable, we accrue for potential litigation losses. The liability we may ultimately incur with respect to such litigation matters, in the event of a negative outcome, may be in excess of amounts we accrue, if at all. Where we determine an unfavorable outcome is not probable or reasonably estimable, we do not accrue for any potential litigation loss.

SEGMENT INFORMATION

SEGMENT INFORMATION	6 Months Ended
	Jun. 30, 2016
SEGMENT INFORMATION
SEGMENT INFORMATION	NOTE 14 — SEGMENT INFORMATION See “Note 1 – Basis of Presentation” for more information about our reportable segments. The following table contains summarized financial information concerning our reportable segments: Three months ended Six months ended June 30, 2016 June 30, 2015 June 30, 2016 June 30, 2015 Net sales: Wholesale $ $ $ $ Consumer Direct Corporate and other $ $ $ $ Gross profit: Wholesale $ $ $ $ Consumer Direct Corporate and other $ $ $ $ Operating (loss) income: Wholesale $ $ $ $ Consumer Direct Corporate and other $ $ $ $ Capital expenditures: Wholesale $ $ Consumer Direct Corporate and other $ $ June 30, 2016 December 31, 2015 Total assets: Wholesale $ $ Consumer Direct Corporate and other $ $

DEBT AND PREFERRED STOCK

DEBT AND PREFERRED STOCK	6 Months Ended
	Jun. 30, 2016
Debt And Preferred Stock Disclosures
DEBT AND PREFERRED STOCK	NOTE 15 — DEBT AND PREFERRED STOCK The five-year payment schedule of our term debt and line of credit (both of which are classified as long-term debt) and our Modified Convertible Notes is as follows (in thousands): Payments due by period (in thousands) Deferred Original Remainder of Financing Issue Carrying 2016 2017 2018 2019 2020 Thereafter Total Costs, net Discount, net Value Long-term debt $ 250 $ 1,250 $ 2,500 $ 3,750 $ 5,000 $ 37,000 $ 49,750 $ $ — $ 48,569 Line of credit — — — — 12,587 — 12,587 — 12,000 Convertible notes — — — — — 16,565 16,565 — 4,314 12,251 Total $ $ $ $ $ $ $ $ $ $ JPM Credit Facility and Capex Loan of RG On December 23, 2013, our subsidiary RG entered into a $30 million revolving credit facility with JP Morgan Chase Bank (the “ JPM Loan Agreement ”), which was later amended such that $3.5 million of the revolving credit facility was reclassified to the Capex Loan , a term loan . Interest on the amounts borrowed pursuant to the JPM Loan Agreement was charged based on RG’s average balance and, at our management’s election, at the bank’s prevailing prime rate plus 0.75% or at LIBOR plus 2.25% , which was 2.6% at December 31, 2015. As a result of the Capex Loan, the maximum amount available under the JPM Loan Agreement’s revolving credit facility was reduced to $26.5 million. The remaining revolving credit facility under the JPM Loan Agreement provided for borrowings based on an amount not to exceed the sum of (i) 85% of eligible accounts receivable, (ii) 90% of eligible credit card receivables, (iii) 70% of eligible wholesale inventory, (iv) 75% of eligible retail inventory and (v) the trademark component, as defined in the JPM Loan Agreement, minus outstanding principal amount of Capex Loan, and minus reserves. In January 2016, RG used the aggregate cash consideration received in the RG Merger to repay all of RG’s outstanding loans and indebtedness under the JPM Loan Agreement, including the Capex Loan. RG’s Former Factoring Agreement with CIT In December 2013, our subsidiary RG entered into a deferred purchase factoring arrangement and loan agreement with CIT. Under the agreement, RG assigned trade accounts receivable to a commercial factor with recourse, while retaining ownership of the assigned accounts receivable until the occurrence of a specified triggering event. RG paid fees ranging from 0.20% to 0.50% of the gross amount of the accounts receivable assigned, with an annual floor amount of $100,000 . In January 2016, in connection with the RG Merger, we terminated our deferred purchase factoring arrangement and loan agreement and entered into our A&R Factoring Agreement. See “Note 6 – Factored and Accounts Receivables, Net.” ABL Credit Agreement and Term Credit Agreement On January 28, 2016, in connection with consummation of the RG Merger, we and certain of our subsidiaries entered into (i) the ABL Credit Agreement; (ii) the Term Credit Agreement; and (iii) the A&R Factoring Agreement. See “Note 6 – Factored and Accounts Receivables, Net” for a discussion of the A&R Factoring Agreement. The ABL Credit Agreement provides for a senior secured asset-based revolving credit facility (the “ Revolving Facility ”) with commitments in an aggregate principal amount of $40 million. The Term Credit Agreement provides for a senior secured term loan credit facility (the “ Term Facility ”) in an aggregate principal amount of $50 million. The Term Facility matures on January 28, 2021. The Revolving Facility matures on October 30, 2020. The amount available to be drawn under the Revolving Facility will be based on the borrowing base values attributed to eligible accounts receivable and eligible inventory. Certain of our subsidiaries are co-borrowers under the ABL Credit Agreement and the Term Credit Agreement. The obligations under the ABL Credit Agreement and the Term Credit Agreement are guaranteed by all of our domestic subsidiaries and are secured by substantially all of our assets, including the assets of our domestic subsidiaries. There are no scheduled payments under the Revolving Facility. The Term Facility is subject to quarterly payments of principal as follows: (i) 0.25% for each of the first four fiscal quarters; (ii) 0.625% for each of the four fiscal quarters thereafter; (iii) 1.25% for each of the next following four fiscal quarters; (iv) 1.875% for each of the next following four fiscal quarters; and (v) 2.50% for each fiscal quarter thereafter, with the balance payable at maturity. The Term Facility includes mandatory prepayments customary for credit facilities of its nature, including, subject to certain exceptions: (i) 100% of the net cash proceeds from issuances of debt that is not permitted and certain equity issuances; (ii) 100% of the net cash proceeds from certain non-ordinary course asset sales, subject to customary exceptions and reinvestment rights; (iii) 100% of certain insurance proceeds and condemnation recoveries, subject to customary exceptions and reinvestment rights; (iv) 100% of the net cash proceeds from certain extraordinary receipts; and (v) a variable percentage of excess cash flow, ranging from 50% to 0% depending on our senior leverage ratio. Outstanding loans under the Term Facility may be prepaid at any time at our option subject to customary “breakage” costs with respect to LIBOR loans. Subject to certain exceptions, prepayments of loans under the Term Facility are subject to a prepayment premium of (i) 2.00% during the first year after the closing date and (ii) 1.00% during the second year after the closing date. The Revolving Facility is required to be prepaid to the extent extensions of credit thereunder exceed the applicable borrowing base. Outstanding loans under the Revolving Facility may be prepaid at any time at our option without premium or penalty, other than customary "breakage" costs with respect to LIBOR loans. The ABL Credit Agreement provides that, subject to customary conditions, we, and certain of our subsidiaries that are borrowers, may seek to obtain incremental commitments under the Revolving Facility in an aggregate amount not to exceed $10 million. The Term Credit Agreement provides that, subject to customary conditions, we, and certain of our subsidiaries that are borrowers, may seek to obtain incremental term loans under the Term Facility in an aggregate amount not to exceed $50 million. We do not currently have any commitments for such incremental loans under either facility. Borrowings under the ABL Credit Agreement and Term Credit Agreement bear interest at a rate equal to either, at our option, an adjusted base rate or the LIBOR (subject to a 0.50% floor for borrowings under the Term Facility), in each case plus an applicable margin. The applicable margins for borrowing under the Term Facility (which varies based on our senior leverage ratio) range from 8.00% to 6.00% for base rate loans and 9.00% to 7.00% for LIBOR loans. The applicable margin for borrowings under the Revolving Facility is 0.50% for base rate loans and 1.75% for LIBOR loans. An unused commitment fee equal to 0.25% per annum of the average daily amount by which the total commitments under the Revolving Facility exceeds the outstanding usage under the Revolving Facility will be payable monthly in arrears. The ABL Credit Agreement and Term Credit Agreement contain customary representations and warranties, events of default and covenants, including, among other things and subject to certain exceptions, covenants that restrict the ability of us and our subsidiaries, to incur additional indebtedness, create or permit liens on assets, engage in mergers or consolidations, dispose of assets, make prepayments of certain indebtedness, pay certain dividends and other restricted payments, make investments, and engage in transactions with affiliates. The Term Credit Agreement requires us to comply with financial maintenance covenants to be tested quarterly (beginning with the second fiscal quarter ending after the RG Merger’s closing date), consisting of a maximum senior leverage ratio, a maximum net senior rent adjusted leverage ratio and a minimum fixed charge coverage ratio. The ABL Credit Agreement requires us to comply with a minimum fixed charge coverage ratio to be tested monthly if excess availability under the Revolving Facility is less than 10% of the lesser of the commitments under the Revolving Facility and the borrowing base or during specified events of defaults. If an event of default under a credit agreement occurs and continues, the commitments may be terminated and the principal amount outstanding, together with all accrued and unpaid interest and other amounts owed may be declared immediately due and payable. In connection with entering into the ABL Credit Agreement and the Term Credit Agreement, we incurred deferred financing costs totaling $1,930,000 , of which $346,000 was accrued for as of December 31, 2015. As of June 30, 2016, we were in compliance with the financial and non-financial covenants in our ABL Credit Agreement and our Term Credit Agreement. RG Stock Purchase Agreement In connection with the RG Merger, we entered into the RG Stock Purchase Agreement with TCP Denim, LLC pursuant to which we issued and sold to TCP Denim, LLC an aggregate of 50,000 shares of the Series A Preferred Stock, for an aggregate purchase price of $50 million in cash. The proceeds from the sale of Series A Preferred Stock were used to consummate the RG Merger. Under the form of certificate of designation for the Series A Preferred Stock, each share of Series A Preferred Stock entitles the holder thereof to receive cumulative cash dividends, payable quarterly, at an annual rate of 10% , plus accumulated and accrued dividends thereon through such date. As of June 30, 2016, the cumulative dividends totaled $1,268,000 . Additionally, if our board of directors declares or pays a dividend on the common stock, then each holder of the Series A Preferred Stock will be entitled to receive a cash dividend on an as-converted basis. Each holder of the Series A Preferred Stock is entitled to vote on an as-converted basis and together with the holders of common stock as a single class, subject to certain limitations. For so long as a to-be-determined percentage of the shares of the Series A Preferred Stock remains outstanding, the holders of the Series A Preferred Stock, exclusively and as a separate class, will be entitled to elect six members of the board of directors, each of whom may only be removed without cause by the affirmative vote of the holders of a majority of the shares of Series A Preferred Stock. The holders of the Series A Preferred Stock have separate class voting rights with respects to certain matters affecting their rights. Upon any liquidation event, holders of the Series A Preferred Stock are entitled to receive the greater of the liquidation preference on the date of determination and the amount that would be payable to the holders of the Series A Preferred Stock had such holders converted their shares of Series A Preferred Stock into shares of common stock immediately prior to such liquidation event. Each share of the Series A Preferred Stock is convertible, at the option of the holder thereof, at any time and without the payment of additional consideration by the holder, at an initial conversion price of $11.16 (after taking into account the Reverse Stock Split). Hudson Convertible Notes On September 8, 2015, the Company entered into the Rollover Agreement with the holders of convertible notes originally issued in connection with the acquisition of the Hudson Business, pursuant to which, on January 28, 2016, the holders of the notes contributed the notes to the Company in exchange for the following: · 1,167,317 shares of common stock; · a cash payment of approximately $8.6 million, before expenses; and · an aggregate principal amount of approximately $16.5 million of Modified Convertible Notes. The Modified Convertible Notes are structurally and contractually subordinated to our senior debt and will mature on July 28, 2021. The Modified Convertible Notes accrue interest quarterly on the outstanding principal amount at a rate of 6.5% per annum (to be increased to 7% as of October 1, 2016 with respect to the Modified Convertible Notes issued to Fireman Capital CPF Hudson Co-Invest LP (“ Fireman ”) ), which is payable 50% in cash and 50% in additional paid-in-kind notes; provided, however, that the Company may, in its sole discretion, elect to pay 100% of such interest in cash. Beginning on January 28, 2016, the Modified Convertible Notes are convertible by each of the holders into shares of our common stock, cash, or a combination of cash and common stock, at our election. If we elect to issue only shares of common stock upon conversion of the Modified Convertible Notes, each of the Modified Convertible Notes would be convertible, in whole but not in part, into a number of shares equal to the conversion amount divided by the market price. The conversion amount is (a) the product of (i) the market price, multiplied by (ii) the quotient of (A) the principal amount, divided by (B) the conversion price, minus (b) the aggregate optional prepayment amounts paid to the holder. The market price is the average of the closing prices for our common stock over the 20 trading day period immediately preceding the notice of conversion. If we elect to pay cash with respect to a conversion of the Modified Convertible Notes, the amount of cash to be paid per share will be equal to the conversion amount. We will have the right to prepay all or any portion of the principal amount of the Modified Convertible Notes at any time so long as we make a pro rata prepayment on all of the Modified Convertible Notes. The following table (in thousands) is a summary of the recorded value of the Modified Convertible Notes as of June 30, 2016. The value of the convertible note reflects the present value of the contractual cash flows from the Modified Convertible Notes and resulted in an original issue discount of $4,673,000 that was recorded on January 28, 2016, the issuance date. Balance June 30, 2016 Modified Convertible Notes - Face value $ Less: Original issue discount Modified Convertible Notes recorded value on issue date PIK interest paid January 29, 2016 - June 30, 2016 Accumulated accretion of debt discounts Modified Convertible Notes value $ The following table (in thousands) is a summary of our total interest expense as follows: Three months ended Six months ended June 30, 2016 June 30, 2015 June 30, 2016 June 30, 2015 Contractual coupon interest $ $ $ $ Amortization of discount and deferred financing costs — — Total interest expense $ $ $ $

FAIR VALUE MEASUREMENT OF FINAN

FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS	6 Months Ended
	Jun. 30, 2016
Fair Value Measurement of Financial Instruments
FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS	NOTE 16 — FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS The financial instruments recorded in the accompanying condensed consolidated balance sheets include cash and cash equivalents, factored accounts receivable, trade receivables (including credit card receivables), royalty receivables, accounts payable, revolving credit facilities, senior secured notes and term loans discussed elsewhere in this Quarterly Report. Due to their short-term maturity, the carrying values of cash, trade accounts receivables, and accounts payable approximate their fair market values. In addition, the carrying amounts of the ABL Credit Agreement and Term Credit Agreement approximate their fair value because of the variable market interest rate charged to us. Fair value is defined as the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. Accounting guidance also establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of us. Unobservable inputs are inputs that reflect our assumptions about the factors market participants would use in valuing the asset or liability. The guidance establishes three levels of inputs that may be used to measure fair value: Level 1—Quoted prices in active markets for identical assets or liabilities. Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurements. We review the fair value hierarchy classification on a quarterly basis. Changes in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy. The following table presents our fair value hierarchy for liabilities measured at fair value on a recurring basis as of June 30, 2016 and December 31, 2015 (in thousands): Carrying Value Fair Value Financial Instrument Level June 30, 2016 December 31, 2015 June 30, 2016 December 31, 2015 Convertible notes $ $ — $ $ — Loan payable — — $ $ $ $

DISCONTINUED OPERATIONS

DISCONTINUED OPERATIONS	6 Months Ended
	Jun. 30, 2016
Discontinued Operations
DISCONTINUED OPERATIONS	NOTE 17 — DISCONTINUED OPERATIONS On February 29, 2016, we completed the closure of 14 of our Joe’s® brand retail stores. In accordance with ASC 205-20, Presentation of Financial Statements – Discontinued Operations, the results of operations of our former Joe’s Business are reported as discontinued operations in the accompanying unaudited condensed consolidated statements of operations for the three and six months ended June 30, 2016 because those operations were disposed of as of March 31, 2016. Due to the timing of the RG Merger, there were no discontinued operations prior to the three months ended March 31, 2015 or six months ended June 30, 2015. The operations and cash flows of the 14 Joe’s® brand retail stores that were part of the Joe’s Business have been eliminated from the ongoing operations of the Company since the Company does not have any continuing involvement in the operations of such retail stores that were closed after the disposal transaction. There were no assets and liabilities from the discontinued operations at June 30, 2016. The operating results of discontinued operations for the three and six months ended June 30, 2016 are as follows (in thousands): Three months ended June 30, Six months ended June 30, 2016 2016 Net sales from discontinued operations $ — $ Loss from discontinued operations before income tax — Income tax provision — — Loss from discontinued operations $ — $

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	6 Months Ended
	Jun. 30, 2016
Subsequent Events
SUBSEQUENT EVENTS	NOTE 18 — SUBSEQUENT EVENTS On July 18, 2016, we completed the acquisition of all of the outstanding share capital of Norwegian private limited company ( aksjeselskap ) SWIMS AS (“ SWIMS ”). SWIMS® is a Scandinavian lifestyle brand known for its range of fashion-forward, water-resistant footwear and sportswear. We purchased SWIMS for aggregate consideration of (i) approximately $12.3 million in cash, (ii) 702,943 shares of our common stock and (iii) warrants to purchase an aggregate of 150,000 shares of our common stock with an exercise price of $5.47 per share (the “ SWIMS Seller Warrants ”). The acquisition was completed pursuant to the Purchase Agreement, dated as of July 18, 2016 (the “ SWIMS Purchase Agreement ”), between us, our wholly-owned subsidiary DFBG Swims, the shareholders of SWIMS named therein (the “ SWIMS Sellers ”), Øystein Alexander Eskeland and Atle Søvik, acting jointly as the representatives of the SWIMS Sellers, and, for certain limited purposes, TCP Denim, LLC, TCP RG, LLC and TCP RG II, LLC. Pursuant to the SWIMS Purchase Agreement, DFBG Swims deposited approximately $325,000 of the cash consideration into an escrow account for certain indemnification obligations of the SWIMS Sellers. The SWIMS Purchase Agreement contains customary representations, warranties and covenants of the SWIMS Sellers and us, along with customary post-closing indemnification rights of DFBG Swims. To finance the acquisition, we issued the following to our major stockholder Tengram Capital Partners Fund II, L.P. (“ Tengram II ”): (i) a warrant for the purchase of 500,000 shares of our common stock at an exercise price of $3.00 per share (the “ Tengram Warrant ”); and (ii) a convertible promissory note with principal of $13.0 million (the “ SWIMS Convertible Note ”). The SWIMS Convertible Note accrues interest at a rate of 3.75% per annum, compounding on the first day of each month starting August 1, 2016, and will convert, at Tengram II’s option or on the maturity date of January 18, 2017 if not already repaid in cash on or prior to that date, into up to 4,500,000 newly issued shares of our Class A-1 Preferred Stock at a conversion price of $3.00 per share. Additionally, the Class A-1 Preferred Stock will itself be convertible into shares of our common stock at an initial price of $3.00 per share (subject to adjustment), will be entitled to dividends at a rate of 10% per annum payable quarterly in arrears, will be senior to the common stock upon liquidation and will have voting rights on an as-converted basis alongside our common stock. To permit the acquisition, on July 18, 2016, we also entered into (i) a Consent and Amendment No. 1 to our ABL Credit Agreement and accompanying security agreement with Wells Fargo Bank, National Association, as lender, and (ii) a Consent and Amendment No. 1 to our Term Credit Agreement and accompanying security agreement with TCW Asset Management Company, as agent for the lenders and the lenders party thereto. Unless otherwise noted, the effect of the acquisition of SWIMS, the payment of the various forms of consideration therefor, and the issuance of the Tengram Warrant and SWIMS Convertible Note on our financial condition and results of operations are not reflected in these unaudited condensed consolidated financial statements or elsewhere in the notes to those financial statements, as the transactions occurred after June 30, 2016, the period covered by this Quarterly Report.

ACCOUNTING POLICIES (Policies)

ACCOUNTING POLICIES (Policies)	6 Months Ended
	Jun. 30, 2016
Accounting Policies
Discontinued Operations	Discontinued Operations In accordance with the Financial Accounting Standards Board (“ FASB ”), Accounting Standards Codification (“ ASC ”), ASC 205-20, Presentation of Financial Statements – Discontinued Operations, the results of operations of a component of an entity or a group or component of an entity that represents a strategic shift that has, or will have, a major effect on the reporting company’s operations that has either been disposed of or is classified as held for sale are required to be reported as discontinued operations in a company’s consolidated financial statements. In order to be considered a discontinued operation, both the operations and cash flows of the discontinued component must have been (or will be) eliminated from the ongoing operations of the company and the company will not have any significant continuing involvement in the operations of the discontinued component after the disposal transaction. The accompanying unaudited condensed consolidated financial statements reflect the results of operations of our Joe's Business as discontinued operations.
Stock-Based Compensation	Stock−Based Compensation We measure the cost of all employee stock-based compensation awards based on the grant date fair value of those awards and record that cost as compensation expense over the period during which the employee is required to perform service in exchange for the award (generally over the vesting period of the award). An entity may elect either an accelerated recognition method or a straight-line recognition method for awards subject to graded vesting based on a service condition, regardless of how the fair value of the award is measured. For all stock-based compensation awards that contain graded vesting based on service conditions, we have elected to apply a straight-line recognition method to account for these awards.
Two-Class Earnings Per Share	Two−Class Earnings Per Share We calculate basic and diluted earnings per common share using the two-class method. Under the two-class method, net earnings are allocated to each class of common stock and participating security as if all of the net earnings for the period had been distributed. Our participating securities consist of convertible preferred shares that contain a nonforfeitable right to receive dividends and therefore are considered to participate in undistributed earnings with common stockholders.
Preferred Share Dividend	Preferred Share Dividend Cumulative dividends on preferred stock are only accrued for when the board of directors declares a dividend. The board of directors has not declared a dividend through June 30, 2016.
Concentration of Risk	Concentration of Risk Financial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash, cash equivalents, accounts receivable and factor accounts receivable. We maintain cash and cash equivalents with various financial institutions. The policy is designed to limit exposure to any one institution. We perform periodic evaluations of the relative credit rating of those financial institutions that are considered in our investment strategy. We do not require collateral for trade accounts receivable. However, we sell a portion of our accounts receivable to CIT on a non-recourse basis (see “Note 6 – Factored and Accounts Receivables, Net”). In that instance, we are no longer at risk if the customer fails to pay. For accounts receivable that are not sold to CIT or sold on a recourse basis, we continue to be at risk if these customers fail to pay. We provide an allowance for estimated losses to be incurred in the collection of accounts receivable based upon the aging of outstanding balances and other account monitoring analysis. The net carrying value approximates the fair value for these assets. Such losses have historically been within management’s expectations. Uncollectible accounts are written off once collection efforts are deemed by management to have been exhausted. For the three and six months ended June 30, 2016 and 2015, sales to customers or customer groups representing greater than 10 percent of net sales are as follows: Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 Customer A % % % % Customer B % % % %

ACCOUNTING POLICIES (Tables)

ACCOUNTING POLICIES (Tables)	6 Months Ended
	Jun. 30, 2016
Accounting Policies
Schedule of sales to customers or customer groups representing greater than 10 percent of net sales	Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 Customer A % % % % Customer B % % % %

MERGER CONSIDERATION (Tables)

MERGER CONSIDERATION (Tables)	6 Months Ended
	Jun. 30, 2016
MERGER CONSIDERATION
Schedule of total consideration allocated to the assets based on their estimated fair values as of the date of the completion of the acquisition	The following is the total preliminary estimated purchase price allocation based on information available as of June 30, 2016 (in thousands, except share and per share data): Assets acquired and liabilities assumed: Cash and cash equivalents $ Factored accounts receivable Accounts receivable Inventories Prepaid expenses and other current assets Property and equipment Other assets Accounts payable and accrued expenses Customer cash advances Line of credit Deferred income tax liability Other liabilities Buy-out payable Intangible assets acquired: Trade name Customer relationships Total Excess purchase price over net assets acquired Total net assets acquired $ Total purchase price: Cash paid to existing holders of convertible notes $ Fair value of Modified Convertible Notes transferred to the existing holders of convertible notes Equity consideration to the Company's stockholders and existing holders of convertible notes (3,508,747 common shares at $5.70) Total Purchase Price $
Schedule of unaudited pro forma results	Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 Net sales $ $ $ $ Net loss $ $ $ $ Weighted average common shares outstanding Loss per common share - basic and diluted $ $ $ $

FACTORED AND ACCOUNTS RECEIVA29

FACTORED AND ACCOUNTS RECEIVABLES, NET (Tables)	6 Months Ended
	Jun. 30, 2016
FACTORED AND ACCOUNTS RECEIVABLES, NET
Schedule of factored accounts and receivables	Factored and accounts receivables consist of the following (in thousands): June 30, 2016 December 31, 2015 Non-recourse receivables assigned to factor $ $ Client recourse receivables Total receivables assigned to factor Allowance for customer credits Factor accounts receivable, net $ $ Non-factored accounts receivable $ $ Allowance for customer credits Allowance for doubtful accounts Accounts receivable, net of allowance $ $ Total factored and accounts receivable, net $ $

INVENTORIES (Tables)

INVENTORIES (Tables)	6 Months Ended
	Jun. 30, 2016
INVENTORIES
Schedule of inventories	Inventories are valued at the lower of cost or net realizable value with cost determined by the first-in, first-out method. Inventories consisted of the following (in thousands): June 30, 2016 December 31, 2015 Finished goods $ $ Finished goods consigned to others Work in progress — Raw materials Inventories $ $

LONG-LIVED AND INTANGIBLE ASS31

LONG-LIVED AND INTANGIBLE ASSETS AND GOODWILL (Tables)	6 Months Ended
	Jun. 30, 2016
LONG-LIVED AND INTANGIBLE ASSETS AND GOODWILL
Schedule of intangible assets	Intangible assets as of June 30, 2016 consisted of the following (in thousands): Amortization Gross Accumulated Net Period Amount Amortization Amount Trade names Indefinite $ $ — $ Customer relationships 13 to 15 Years Total $ $ $ Intangible assets as of December 31, 2015 consisted of the following (in thousands): Amortization Gross Accumulated Net Period Amount Amortization Amount Trade names Indefinite $ $ — $ Customer relationships 15 Years Total $ $ $
Schedule of estimated amortization expense	As of June 30, 2016, the future amortization expense related to the finite-lived intangible assets is as follows (in thousands): 2016 Remainder of the year $ 2017 2018 2019 2020 Thereafter $
Schedule of goodwill	June 30, 2016 December 31, 2015 Balance at January 1 $ $ Preliminary goodwill created by the RG Merger — Ending balance $ $

EARNINGS PER SHARE (Tables)

EARNINGS PER SHARE (Tables)	6 Months Ended
	Jun. 30, 2016
EARNINGS PER SHARE
Schedule of reconciliation of numerator and denominator of basic and diluted earnings per share	Three months ended Six months ended June 30, 2016 June 30, 2015 June 30, 2016 June 30, 2015 Basic (loss) earnings per share computation: Numerator: (Loss) income from continuing operations $ $ $ $ Loss from discontinued operations - - - Net (loss) income Denominator: Weighted average common shares outstanding (Loss) earnings per common share - basic (Loss) income from continuing operations (Loss) Income from discontinued operations - - - (Loss) earnings per common share - basic $ $ $ $ Diluted (loss) earnings per share computation: Numerator: (Loss) income from continuing operations $ $ $ $ (Loss) Income from discontinued operations - - - Net (loss) income Denominator: Weighted average common shares outstanding Effect of dilutive securities: RSU's, convertible securities and options - - - - Dilutive potential common shares (Loss) earnings per common share - diluted (Loss) income from continuing operations Loss from discontinued operations - - - (Loss) earnings per common share - diluted $ $ $ $
Schedule of reconciliation of basic and diluted earnings per share, two class method	Three months ended Six months ended June 30, 2016 June 30, 2015 June 30, 2016 June 30, 2015 Net (loss) income $ $ $ $ Less: preferred dividends - - Net (loss) income attributable to stockholders Participating securities - Series A Preferred Stock - - - - Net (loss) income attributable to common stockholders $ $ $ $ Denominator: Weighted average common shares outstanding (Loss) earnings per common share - basic and diluted under two-class method $ $ $ $

EQUITY (Tables)

EQUITY (Tables)	6 Months Ended
	Jun. 30, 2016
EQUITY
Schedule of exercise prices for options outstanding and exercisable	Exercise prices for all options outstanding as of June 30, 2016 were as follows (in actual amounts): Options Outstanding and Exercisable Exercise Price Number of Shares Weighted-Average Remaining Contractual Life (Years) $ 11.40 8.5 8.5
Summary of stock option activity by plan	The following table summarizes stock option activity by incentive plan for the six months ended June 30, 2016 (in actual amounts): Total Number of Shares 2004 Incentive Plan Restated Plan Outstanding at January 1, 2016 — — — Legacy Joe's stock options assumed Granted — — — Exercised — — — Forfeited / Expired — Outstanding and exercisable at June 30, 2016 —
Schedule of stock option activity in the aggregate	The following table summarizes stock option activity for all incentive plans for the six months ended June 30, 2016 (in actual amounts): Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Outstanding at January 1, 2016 — $ — — Legacy Joe's stock options assumed — Granted — — — — Exercised — — — — Expired — — — — Forfeited — — Outstanding and exercisable at June 30, 2016 $ $ —
Summary of the status of restricted common stock and RSUs and changes	The following table summarizes RSU activity for the six months ended June 30, 2016 (in actual amounts): Restricted Stock Units Number Of Units Weighted Average Grant Date Fair Value Outstanding at December 31, 2015 — $ — Granted Vested — — Issued Cancelled — — Forfeited — — Outstanding at June 30, 2016 $

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Tables)	6 Months Ended
	Jun. 30, 2016
COMMITMENTS AND CONTINGENCIES
Schedule of future minimum rental payments under non-cancelable retail operating leases with lease terms in excess of one year	As of June 30, 2016, the future minimum rental payments under non-cancelable operating leases with lease terms in excess of one year were as follows (in thousands): 2016 Remainder of the year $ 2017 2018 2019 2020 Thereafter $

SEGMENT INFORMATION (Tables)

SEGMENT INFORMATION (Tables)	6 Months Ended
	Jun. 30, 2016
SEGMENT INFORMATION
Summary of financial information concerning reportable segments	Three months ended Six months ended June 30, 2016 June 30, 2015 June 30, 2016 June 30, 2015 Net sales: Wholesale $ $ $ $ Consumer Direct Corporate and other $ $ $ $ Gross profit: Wholesale $ $ $ $ Consumer Direct Corporate and other $ $ $ $ Operating (loss) income: Wholesale $ $ $ $ Consumer Direct Corporate and other $ $ $ $ Capital expenditures: Wholesale $ $ Consumer Direct Corporate and other $ $ June 30, 2016 December 31, 2015 Total assets: Wholesale $ $ Consumer Direct Corporate and other $ $

DEBT AND PREFERRED STOCK (Table

DEBT AND PREFERRED STOCK (Tables)	6 Months Ended
	Jun. 30, 2016
Debt And Preferred Stock Disclosures
Schedule of five year payment of term debt and line of credit and modified convertible notes	The five-year payment schedule of our term debt and line of credit (both of which are classified as long-term debt) and our Modified Convertible Notes is as follows (in thousands): Payments due by period (in thousands) Deferred Original Remainder of Financing Issue Carrying 2016 2017 2018 2019 2020 Thereafter Total Costs, net Discount, net Value Long-term debt $ 250 $ 1,250 $ 2,500 $ 3,750 $ 5,000 $ 37,000 $ 49,750 $ $ — $ 48,569 Line of credit — — — — 12,587 — 12,587 — 12,000 Convertible notes — — — — — 16,565 16,565 — 4,314 12,251 Total $ $ $ $ $ $ $ $ $ $
Schedule of summary of recorded value of the modified convertible note	The following table (in thousands) is a summary of the recorded value of the Modified Convertible Notes as of June 30, 2016. The value of the convertible note reflects the present value of the contractual cash flows from the Modified Convertible Notes and resulted in an original issue discount of $4,673,000 that was recorded on January 28, 2016, the issuance date. Balance June 30, 2016 Modified Convertible Notes - Face value $ Less: Original issue discount Modified Convertible Notes recorded value on issue date PIK interest paid January 29, 2016 - June 30, 2016 Accumulated accretion of debt discounts Modified Convertible Notes value $
Schedule of interest expense	The following table (in thousands) is a summary of our total interest expense as follows: Three months ended Six months ended June 30, 2016 June 30, 2015 June 30, 2016 June 30, 2015 Contractual coupon interest $ $ $ $ Amortization of discount and deferred financing costs — — Total interest expense $ $ $ $

FAIR VALUE MEASUREMENT OF FIN37

FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS (Tables)	6 Months Ended
	Jun. 30, 2016
Fair Value Measurement of Financial Instruments
Schedule of fair value hierarchy for liabilities measured at fair value on a recurring basis	Carrying Value Fair Value Financial Instrument Level June 30, 2016 December 31, 2015 June 30, 2016 December 31, 2015 Convertible notes $ $ — $ $ — Loan payable — — $ $ $ $

DISCONTINUED OPERATIONS (Tables

DISCONTINUED OPERATIONS (Tables)	6 Months Ended
	Jun. 30, 2016
Discontinued Operations
Schedule of the operating results of discontinued operations	Three months ended June 30, Six months ended June 30, 2016 2016 Net sales from discontinued operations $ — $ Loss from discontinued operations before income tax — Income tax provision — — Loss from discontinued operations $ — $

BASIS OF PRESENTATION (Details)

BASIS OF PRESENTATION (Details)	6 Months Ended
	Jun. 30, 2016segment
BASIS OF PRESENTATION
Number of reportable business segments	3

ACCOUNTING POLICIES - (Details)

ACCOUNTING POLICIES - (Details) - Customers and customer group	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015	Dec. 31, 2015
Sales | Customer A
Concentration of Credit Risk
Concentration risk (as a percent)	21.00%	9.00%	20.00%	11.00%
Sales | Customer B
Concentration of Credit Risk
Concentration risk (as a percent)	11.00%	4.00%	12.00%	5.00%
Factored Accounts Receivable | Customer A and B
Concentration of Credit Risk
Concentration risk (as a percent)			67.00%		47.00%

MERGER AND RELATED TRANSACTIO41

MERGER AND RELATED TRANSACTIONS (Details) $ in Thousands	Feb. 29, 2016store	Jan. 28, 2016USD ($)storeshares	Sep. 30, 2015store	Jun. 30, 2016USD ($)
Business Acquisition [Line Items]
Aggregate amount				$ 49,881
Principal amount of outstanding convertible notes exchanged		$ 38,100
Cash payment		8,630
Aggregate principal amount of modified convertible notes		$ 40,430
Number of Joe's brand stores retained and operated | store			32
Number of Joe's brand stores transferred | store		18
Number of Joe's brand retail stores closed | store	14
Modified Convertible Notes | Conversion of Convertible Notes into Common Stock
Business Acquisition [Line Items]
Shares issued (in shares) | shares		1,167,317
Cash payment		$ 8,600
Aggregate principal amount of modified convertible notes		$ 16,500
TCP Denim, LLC | Preferred Series A
Business Acquisition [Line Items]
Shares issued (in shares) | shares		50,000
Aggregate amount		$ 50,000

MERGER CONSIDERATION (Details)

MERGER CONSIDERATION (Details) - USD ($)	Jan. 28, 2016	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2016	Jun. 30, 2015	Dec. 31, 2015	Dec. 31, 2014
Merger between RG and Hudson
Closing share price (in dollars per share)	$ 5.70
Common stock outstanding assumed	3,509,000
Common stock, shares outstanding	2,342,000	12,379,000		12,379,000	12,379,000		0
Total aggregates shares issued to convertible noteholders upon conversion	1,167,000
Principal amount of outstanding convertible notes exchanged	$ 38,100,000
Common stock, par value (in dollars per share)		$ 0.10		$ 0.10	$ 0.10
Modified convertible notes principal amount	$ 16,473,000
Modified convertible notes ownership right (as a percent)	14.00%
Amortization expense	$ 0
Aggregate original issue discount	4,673,000
Revenue		$ 32,373,000	$ 16,256,000		$ 66,088,000	$ 35,204,000
Income from continuing operations		(3,605,000)	(488,000)		(8,800,000)	69,000
Assets acquired and liabilities assumed:
Cash and cash equivalents	2,092,000
Factored accounts receivable	6,719,000
Accounts receivable	336,000
Inventories	11,378,000
Prepaid expenses and other current assets	754,000
Property and equipment	356,000
Other assets	352,000
Accounts payable and accrued expenses	(15,417,000)
Customer cash advances	(893,000)
Line of credit	(4,683,000)
Deferred income tax liability	(9,453,000)
Other liabilities	(81,000)
Buy-out payable	(1,668,000)
Total	36,192,000
Excess purchase price over net assets acquired	4,238,000	6,524,000		$ 6,524,000	6,524,000		$ 2,286,000	$ 2,286,000
Total net assets acquired	40,430,000
Total Purchase Price
Cash paid to existing holders of convertible notes	8,630,000
Fair value of Modified Convertible Notes transferred to the existing holders of convertible notes	11,800,000
Equity consideration to the Company's Common stockholders and existing holders of convertible notes (3,508,747 shares at $5.70)	20,000,000
Total purchase price	$ 40,430,000
Equity consideration to the shareholder's (in shares)	3,508,747
Share Price	$ 5.70
Non-recurring expense related to merger					3,636,000
Unaudited pro forma results
Net sales		32,373,000	32,663,000		69,714,000	71,531,000
Net loss		$ (1,325,000)	$ (2,451,000)		$ (2,282,000)	$ (4,090,000)
Weighted average common shares outstanding (in shares)		12,380,000	12,380,000		12,380,000	12,380,000
(Loss) earnings per common share - basic and diluted (in dollars per share)		$ (0.11)	$ (0.20)		$ (0.18)	$ (0.33)
Hudson
Merger between RG and Hudson
Revenue				34,681,000
Income from continuing operations				$ 4,406,000
Trade names
Assets acquired and liabilities assumed:
Intangible assets acquired	$ 32,300,000
Customer relationships
Assets acquired and liabilities assumed:
Intangible assets acquired	$ 14,100,000

FACTORED AND ACCOUNTS RECEIVA43

FACTORED AND ACCOUNTS RECEIVABLES, NET (Details) - USD ($)	1 Months Ended
	Jan. 31, 2016	Jun. 30, 2016	Dec. 31, 2015
Accounts receivable, inventory advances and due from factor
Non-recourse receivables assigned to factor		$ 16,439,000	$ 5,456,000
Client recourse receivables		500,000	637,000
Total receivables assigned to factor		16,939,000	6,093,000
Allowance for customer credits		(4,784,000)	(1,176,000)
Factor accounts receivable, net		12,155,000	4,917,000
Non-factored accounts receivable		2,756,000	2,392,000
Allowance for customer credits		(1,126,000)	(484,000)
Allowance for doubtful accounts		(109,000)	(72,000)
Accounts receivable, net of allowances		1,521,000	1,836,000
Total factored and accounts receivable		13,676,000	6,753,000
Risk of payment in the event of non-payment by the customers		$ 500,000	$ 637,000
A&R Factoring Agreement
Accounts receivable, inventory advances and due from factor
Accounts receivable factoring agreement factoring ratio of accounts for which factor of certain major department stores bore credit risk	0.20%
Factoring rate of accounts for which the factor bore the credit risk, over a specified amount of invoices factored (as a percent)	0.40%
Factoring rate of accounts for which the entity bore the credit risk (as a percent)	0.35%
Minimum factoring charge per invoice	$ 3.50
Required notice period for termination of the agreement by factor	60 days
Required written notice period for termination of the agreement prior to December 31, 2020	60 days

INVENTORIES (Details)

INVENTORIES (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
INVENTORIES
Finished goods	$ 25,170	$ 14,979
Finished goods consigned to others	1,299	69
Work in progress	19
Raw materials	271	305
Inventories	$ 26,759	$ 15,353

LONG-LIVED AND INTANGIBLE ASS45

LONG-LIVED AND INTANGIBLE ASSETS AND GOODWILL - Intangibles (Details)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2016USD ($)item	Jun. 30, 2015USD ($)	Jun. 30, 2016USD ($)item	Jun. 30, 2015USD ($)	Dec. 31, 2015USD ($)
Intangible assets
Store impairment charges	$ 0		$ 279,000
Gross Amount	92,237,000		92,237,000		$ 45,837,000
Definite, Accumulated Amortization	7,272,000		7,272,000		6,014,000
Definite, Net Amount	26,628,000		26,628,000
Net Amount	84,965,000		84,965,000		39,823,000
Amortization expense related to the intangible assets	683,000	$ 330,000	1,258,000	$ 660,000
Estimated amortization expense
2016 Remainder of the year	1,365,000		1,365,000
2,017	2,730,000		2,730,000
2,018	2,730,000		2,730,000
2,019	2,730,000		2,730,000
2,020	2,730,000		2,730,000
Thereafter	14,343,000		14,343,000
Total	$ 26,628,000		$ 26,628,000
R G Parent, LLC
Intangible assets
Number of full price retail stores on which impairment charge was recorded | item	1		1
Trade names.
Intangible assets
Indefinite, Net Amount	$ 58,337,000		$ 58,337,000		$ 26,037,000
Customer relationships
Intangible assets
Amortization period					15 years
Definite, Gross Amount	33,900,000		33,900,000		$ 19,800,000
Definite, Accumulated Amortization	7,272,000		7,272,000		6,014,000
Definite, Net Amount	26,628,000		26,628,000		13,786,000
Estimated amortization expense
Total	$ 26,628,000		$ 26,628,000		$ 13,786,000
Minimum | Customer relationships
Intangible assets
Amortization period			13 years
Maximum | Customer relationships
Intangible assets
Amortization period			15 years

LONG-LIVED AND INTANGIBLE ASS46

LONG-LIVED AND INTANGIBLE ASSETS AND GOODWILL - Goodwill (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2016USD ($)
Goodwill
Goodwill, Beginning Balance	$ 2,286
Preliminary goodwill created by the RG Merger	4,238
Goodwill, Ending Balance	$ 6,524

RELATED PARTY TRANSACTIONS (Det

RELATED PARTY TRANSACTIONS (Details) - USD ($)	Jan. 28, 2016	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015	Dec. 31, 2015
Related party transactions
Period for automatic renewal of the term of the employment				1 year
Texport Industries PVT Ltd | RG
Related party transactions
Purchase of merchandise		$ 1,398,000	$ 2,080,000	$ 5,210,000	$ 5,945,000
Texport Industries PVT Ltd | RG | Accounts payable and accrued expenses
Related party transactions
Due to the affiliated entity		$ 2,248,000		$ 2,248,000		$ 4,600,000
Texport Industries PVT Ltd | RG | Supplier Concentration Risk | Cost of goods sold
Related party transactions
Concentration percentage		9.00%	33.00%	18.00%	44.00%
Creative Logistics Services, LLC
Warehousing and shipping
Warehousing and shipping expenses		$ 337,000	$ 325,000	$ 753,000	$ 764,000
Creative Logistics Services, LLC | Accounts payable and accrued expenses
Related party transactions
Due to the affiliated entity		294,000		294,000		$ 283,000
Robert Stock
License fees
License fees		0	$ 0
License fees incurred				46,000	$ 52,000
Tengram Capital Partners, LP
Related party transactions
Total related party expenses		84,000		875,000
Related party expenses, Legal fee component				750,000
Acquisition related costs				41,000
Tengram Capital Partners, LP | RG
Related party transactions
Annual management fees and expenses paid		$ 125,000		$ 250,000
Peter Kim
Related party transactions
Term of non-compete agreement	3 years

EARNINGS PER SHARE (Details)

EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Numerator:
(Loss) income from continuing operations	$ (3,605)	$ (488)	$ (8,800)	$ 69
Loss from discontinued operations			(1,286)
Net (loss) income	$ (3,605)	$ (488)	$ (10,086)	$ 69
Denominator:
Weighted average common shares outstanding (in shares)	12,380,000	8,825,000	11,852,000	8,825,000
(Loss) earnings per common share - basic
(Loss) earnings from continuing operations (in dollars per share)	$ (0.29)	$ (0.06)	$ (0.74)	$ 0.01
Loss from discontinued operations (in dollars per share)			(0.11)
(Loss) earnings per common share - basic (in dollars per share)	$ (0.29)	$ (0.06)	$ (0.85)	$ 0.01
Numerator:
(Loss) income from continuing operations	$ (3,605)	$ (488)	$ (8,800)	$ 69
Loss from discontinued operations			(1,286)
Net (loss) income	$ (3,605)	$ (488)	$ (10,086)	$ 69
Denominator:
Weighted average common shares outstanding (in shares)	12,380,000	8,825,000	11,852,000	8,825,000
Dilutive potential common shares (in shares)	12,380,000	8,825,000	11,852,000	8,825,000
(Loss) earnings per common share - dilutive
(Loss) earnings from continuing operations (in dollars per share)	$ (0.29)	$ (0.06)	$ (0.74)	$ 0.01
Loss from discontinued operations (in dollars per share)			(0.11)
(Loss) earnings per common share - dilutive (in dollars per share)	$ (0.29)	$ (0.06)	$ (0.85)	$ 0.01
Anti-dilutive securities excluded from computation of earnings per share (in shares)			6,377,781

EARNINGS PER SHARE - Two Class

EARNINGS PER SHARE - Two Class Method (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015	Mar. 31, 2016
EARNINGS PER SHARE
Net (loss) income	$ (3,605)	$ (488)	$ (10,086)	$ 69
Less: Preferred dividends	863		1,268
Net loss attributable to stockholders	(4,468)	(488)	(11,354)	69
Net (loss) income attributable to common stockholders	$ (4,468)	$ (488)	$ (11,354)	$ 69
Denominator:
Weighted average common shares outstanding (in shares)	12,380,000	8,825,000	11,852,000	8,825,000
(Loss) earnings per common sare - basic and diluted under two class method (in dollars per share)	$ (0.36)	$ (0.06)	$ (0.96)	$ 0.01
Shares Reserved For Future Issuance
Stock options granted under the incentive plans reserved for future issuance (in shares)	444		444
Shares of common stock issuable upon the vesting of RSUs	700,431		700,431		700,431
Shares of common stock issuable pursuant to the modified convertible notes	1,187,498		1,187,498		1

INCOME TAXES (Details)

INCOME TAXES (Details) - USD ($)	Jan. 28, 2016	Jun. 30, 2016	Dec. 31, 2015
INCOME TAXES
Federal income tax provision	$ 0
Unrecognized tax benefits		$ 600,000	$ 600,000

EQUITY - Incentive Plan (Detail

EQUITY - Incentive Plan (Details) - shares	1 Months Ended	6 Months Ended	12 Months Ended
	Oct. 31, 2011	Jun. 30, 2016	Dec. 31, 2015	Mar. 31, 2016
Stock Incentive Plans
Granted (in shares)			0
Shares Reserved For Future Issuance
Stock options granted under the incentive plans reserved for future issuance (in shares)		444
Shares of common stock issuable upon the vesting of RSUs		700,431		700,431
Restated Plan
Stock Incentive Plans
Number of shares of common stock authorized for issuance	227,500
Maximum number of shares that can be awarded to any employee in one year	41,667
Exercise period	10 years
Shares Reserved For Future Issuance
Number of shares available for issuance		0
Restated Plan | RSUs
Stock Incentive Plans
Right to receive a specified number of shares of common stock for each unit on vesting date		1
2004 Stock Incentive Plan
Stock Incentive Plans
Granted (in shares)		0

EQUITY - Plan Activity (Details

EQUITY - Plan Activity (Details) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2016	Dec. 31, 2015	Jun. 30, 2016
Options Outstanding and Exercisable
Exercise Price (in dollars per share)	$ 11.40		$ 11.40
Number of shares			444
Weighted-Average Remaining Contractual Life (Years)	8 years 6 months
Stock option activity
Outstanding at the beginning of the period (in shares)	0
Granted (in shares)		0
Expired (in shares)	(2,500)
Forfeited (in shares)	(2,500)
Outstanding at the end of the period (in shares)	444	0
Weighted average exercise price
Forfeited (in dollars per share)	$ 30.60
Outstanding at the end of the period (in dollars per share)	$ 11.40
Weighted average remaining contractual Life
Outstanding and exercisable at the end of the period	8 years 6 months
Unrecognized compensation cost
Unrecognized compensation cost related to nonvested share-based compensation arrangements			$ 3,336,000
Weighted-average period for recognition of unrecognized compensation cost	2 years 6 months
2004 Stock Incentive Plan
Stock option activity
Granted (in shares)	0
Expired (in shares)	(2,500)
Restated Plan
Stock option activity
Outstanding at the end of the period (in shares)	444
Legacy Joe
Stock option activity
Stock options assumed (in shares)	2,944
Weighted average exercise price
Stock options assumed (in dollars per share)	$ 27.70
Weighted average remaining contractual Life
Term of stock options assumed (in years)	1 year 4 months 24 days
Legacy Joe | 2004 Stock Incentive Plan
Stock option activity
Stock options assumed (in shares)	2,500
Legacy Joe | Restated Plan
Stock option activity
Stock options assumed (in shares)	444
11.40
Options Outstanding and Exercisable
Exercise Price (in dollars per share)	$ 11.40		$ 11.40
Number of shares			444
Weighted-Average Remaining Contractual Life (Years)	8 years 6 months
Weighted average exercise price
Outstanding at the end of the period (in dollars per share)	$ 11.40

EQUITY - Restricted Stock Units

EQUITY - Restricted Stock Units (Details) - USD ($)	3 Months Ended	6 Months Ended	12 Months Ended
	Jun. 30, 2016	Jun. 30, 2016	Dec. 31, 2015
Weighted-Average Grant-Date Fair Value
Stock based compensation expense recognized	$ 312,000	$ 1,019,000
Granted (in shares)			0
Outstanding at the end of the period (in shares)	444	444	0
Unrecognized compensation cost
Unrecognized compensation cost related to nonvested share-based compensation arrangements	$ 3,336,000	$ 3,336,000
Weighted-average period for recognition of unrecognized compensation cost		2 years 6 months
RSUs
Restricted Stock Units
Granted (in shares)	100,000		0
2004 Stock Incentive Plan
Weighted-Average Grant-Date Fair Value
Granted (in shares)		0
2004 Stock Incentive Plan | RSUs
Restricted Stock Units
Granted (in shares)		745,938
Issued (in shares)		(45,507)
Outstanding at the end of the period (in shares)	700,431	700,431
Weighted-Average Grant-Date Fair Value
Granted (in dollars per share)		$ 5.84
Issued (in dollars per share)		11.16
Outstanding at the end of the period (in dollars per share)	$ 5.49	$ 5.49
Restated Plan
Weighted-Average Grant-Date Fair Value
Outstanding at the end of the period (in shares)	444	444

COMMITMENTS AND CONTINGENCIES54

COMMITMENTS AND CONTINGENCIES (Details)	6 Months Ended
	Jun. 30, 2016
Minimum
Contingent Consideration Payments, Buy-Out Agreement and Earnout Subordination Agreement
Percentage of annual sales volume	6.00%
Maximum
Contingent Consideration Payments, Buy-Out Agreement and Earnout Subordination Agreement
Percentage of annual sales volume	8.00%

COMMITMENTS AND CONTINGENCIES -

COMMITMENTS AND CONTINGENCIES - Agreements (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Future Lease Obligations
2016 Remainder of the year	$ 3,372,000		$ 3,372,000
2,017	7,149,000		7,149,000
2,018	6,727,000		6,727,000
2,019	6,434,000		6,434,000
2,020	6,520,000		6,520,000
Thereafter	25,600,000		25,600,000
Future minimum rental payments	55,802,000		55,802,000
Advertising agreements
Advertising Expense	0	$ 425,000	750,000	$ 700,000
Standby letter of credit
Letters of Credit
Contingent liability for letters of credit	$ 130,000		$ 130,000

SEGMENT INFORMATION (Details)

SEGMENT INFORMATION (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015	Dec. 31, 2015
Segment information
Net sales	$ 32,373	$ 16,256	$ 66,088	$ 35,204
Gross profit	17,099	9,946	37,402	21,837
Operating (loss) income	(3,120)	(249)	(4,887)	453
Capital expenditures			1,125	1,319
Total assets	156,411	82,859	156,411	82,859	$ 82,859
Wholesale
Segment information
Net sales	22,755	8,483	48,332	20,299
Gross profit	9,665	3,869	23,696	10,132
Operating (loss) income	5,108	3,455	14,753	8,285
Capital expenditures			272	100
Total assets	55,764	39,007	55,764	39,007
Consumer Direct
Segment information
Net sales	9,097	7,245	16,736	13,763
Gross profit	6,913	5,549	12,686	10,563
Operating (loss) income	501	913	(1,024)	1,150
Capital expenditures			762	1,140
Total assets	11,461	11,303	11,461	11,303
Corporate and Other
Segment information
Net sales	521	528	1,020	1,142
Gross profit	521	528	1,020	1,142
Operating (loss) income	(8,729)	(4,617)	(18,616)	(8,982)
Capital expenditures			91	79
Total assets	$ 89,186	$ 32,549	$ 89,186	$ 32,549

DEBT AND PREFERRED STOCK (Detai

DEBT AND PREFERRED STOCK (Details)	Jan. 28, 2016USD ($)itemshares	Sep. 08, 2015$ / shares	Dec. 31, 2013USD ($)	Jun. 30, 2016USD ($)	Jun. 30, 2015USD ($)	Jun. 30, 2016USD ($)	Jun. 30, 2015USD ($)	Dec. 31, 2015USD ($)	Oct. 01, 2016	Dec. 23, 2015USD ($)
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Remainder of 2016				$ 250,000		$ 250,000
2,017				1,250,000		1,250,000
2,018				2,500,000		2,500,000
2,019				3,750,000		3,750,000
2,020				17,587,000		17,587,000
Thereafter				53,565,000		53,565,000
Total				78,902,000		78,902,000
Deferred Financing Costs, net				1,768,000		1,768,000
Original Issue Discount, net				4,314,000		4,314,000
Carrying Value				72,820,000		72,820,000
Cash payment	$ 8,630,000
Aggregate principal amount of modified convertible notes	40,430,000
Aggregate amount						49,881,000
Aggregate original issue discount	$ 4,673,000
Recorded value of the convertible note
Less: Original issue discount				(4,314,000)		(4,314,000)
Total				78,902,000		78,902,000
Components of interest expense
Contractual coupon interest				1,603,000	$ 134,000	2,723,000	$ 268,000
Amortization of discount and deferred financing				392,000		613,000
Total interest expense				1,995,000	$ 134,000	3,336,000	$ 268,000
Preferred Series A
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Conversion price (in dollars per share) | $ / shares		$ 11.16
Preferred Series A | TCP Denim, LLC
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Shares issued (in shares) | shares	50,000
Aggregate amount	$ 50,000,000
Dividend rate (as a percent)		10.00%
Accrued dividend				1,268,000		1,268,000
Term Loan Credit Agreement
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Remainder of 2016				250,000		250,000
2,017				1,250,000		1,250,000
2,018				2,500,000		2,500,000
2,019				3,750,000		3,750,000
2,020				5,000,000		5,000,000
Thereafter				37,000,000		37,000,000
Total				49,750,000		49,750,000
Deferred Financing Costs, net				1,181,000		1,181,000
Carrying Value				48,569,000		48,569,000
Recorded value of the convertible note
Total				49,750,000		49,750,000
Line of credit
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
2,020				12,587,000		12,587,000
Total				12,587,000		12,587,000
Deferred Financing Costs, net				587,000		587,000
Carrying Value				12,000,000		12,000,000
Recorded value of the convertible note
Total				12,587,000		12,587,000
Convertible notes
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Thereafter				16,565,000		16,565,000
Total				16,565,000		16,565,000
Original Issue Discount, net				4,314,000		4,314,000
Carrying Value				12,251,000		12,251,000
Recorded value of the convertible note
Less: Original issue discount				(4,314,000)		(4,314,000)
Total				16,565,000		16,565,000
JPM Loan Agreement | RG
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Aggregate principal amount				26,500,000		$ 26,500,000				$ 30,000,000
Effective interest rate (as a percent)								2.60%
JPM Loan Agreement | RG | LIBOR rate loans
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Margin on variable rate basis (as a percent)								2.25%
JPM Loan Agreement | RG | Prime Rate
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Margin on variable rate basis (as a percent)								0.75%
Capex loan | RG
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Aggregate principal amount										$ 3,500,000
Revolving Facility
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Aggregate principal amount	$ 40,000,000
Commitment fee (as a percent)	0.25%
Revolving Facility | Maximum
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Aggregate principal amount	$ 10,000,000
Revolving Facility | Base Rate
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Margin on variable rate basis (as a percent)	0.50%
Revolving Facility | LIBOR rate loans
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Margin on variable rate basis (as a percent)	1.75%
Revolving Facility | RG | Maximum
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Borrowing capacity limit based on percentage of eligible accounts receivable						85.00%
Borrowing capacity limit based on percentage of eligible credit card receivables						90.00%
Borrowing capacity limit based on percentage of eligible wholesale inventory						70.00%
Borrowing capacity limit based on percentage of eligible retail inventory						75.00%
Credit Facilities
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Aggregate principal amount	$ 50,000,000
Minimum borrowing capacity (as a percent)	10.00%
Deferred financing costs								$ 1,930,000
Deferred financing costs, accrued								$ 346,000
Term Facility
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Aggregate principal amount	$ 50,000,000
Required quarterly repayments of principal for the first four fiscal quarters (as a percent)	0.25%
Required quarterly repayments of principal for the second four fiscal quarters (as a percent)	0.625%
Required quarterly repayments of principal for the third four fiscal quarters (as a percent)	1.25%
Required quarterly repayments of principal for the fourth four fiscal quarters (as a percent)	1.875%
Required quarterly repayments of principal thereafter (as a percent)	2.50%
Prepayment exception amounts (as a percent)	100.00%
Prepayment premium during first year (as a percent)	2.00%
Prepayment premium during second year (as a percent)	1.00%
Interest rate floor (as a percent)	0.50%
Term Facility | Minimum
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Prepayment exception amounts (as a percent)	0.00%
Term Facility | Maximum
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Prepayment exception amounts (as a percent)	50.00%
Term Facility | Base Rate | Minimum
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Margin on variable rate basis (as a percent)	6.00%
Term Facility | Base Rate | Maximum
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Margin on variable rate basis (as a percent)	8.00%
Term Facility | LIBOR rate loans | Minimum
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Margin on variable rate basis (as a percent)	7.00%
Term Facility | LIBOR rate loans | Maximum
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Margin on variable rate basis (as a percent)	9.00%
Modified Convertible Notes
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Total				11,800,000		$ 11,800,000
Original Issue Discount, net				4,673,000		4,673,000
Amount of interest payable in cash (as a percent)	50.00%
Amount of interest payable in kind (as a percent)	50.00%
Amount of interest payable in cash, discretionary (as a percent)	100.00%
Recorded value of the convertible note
Modified Convertible Notes - Face value				16,473,000		16,473,000
Less: Original issue discount				(4,673,000)		(4,673,000)
Total				11,800,000		11,800,000
PIK interest paid January 29, 2016 - June 30, 2016						92,000
Accumulated accretion of debt discounts						359,000
Modified Convertible Notes value				$ 12,251,000		$ 12,251,000
Modified Convertible Notes | Conversion of Convertible Notes into Common Stock
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Shares issued (in shares) | shares	1,167,317
Cash payment	$ 8,600,000
Aggregate principal amount of modified convertible notes	$ 16,500,000
Annual rate on outstanding principal amount (as a percent)	6.50%								7.00%
Trading days immediately preceding the notice of conversion used for calculation of average of the closing prices for the common stock | item	20
A&R Factoring Agreement | RG
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Minimum annual amount, or floor, of annual factoring fees			$ 100,000
A&R Factoring Agreement | RG | Minimum
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Factoring rate of gross amount of accounts receivable assigned			0.20%
A&R Factoring Agreement | RG | Maximum
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Factoring rate of gross amount of accounts receivable assigned			0.50%
Private placement | Preferred Series A | TCP Denim, LLC
Five year payment schedule of debt for the promissory notes, long term debt and convertible notes
Shares issued (in shares) | shares	50,000
Aggregate amount	$ 50,000,000

FAIR VALUE DISCLOSURES (Details

FAIR VALUE DISCLOSURES (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Fair value disclosures
Convertible notes	$ 12,251
Recurring | Level 3 | Carrying Value
Fair value disclosures
Convertible notes	12,251
Loan payable		$ 1,653
Recurring | Level 3 | Fair Value
Fair value disclosures
Convertible notes	$ 10,960
Loan payable		1,653
Fair value of liabilities		$ 1,653

DISCONTINUED OPERATIONS (Detail

DISCONTINUED OPERATIONS (Details) $ in Thousands	Feb. 29, 2016store	Jun. 30, 2016USD ($)
Operating results of discontinued operations
Number of stores closed | store	14
Loss from discontinued operations		$ (1,286)
Joe's brand retail stores | Discontinued Operations, Disposed of by Means Other than Sale, Closure
Operating results of discontinued operations
Net Sales from discontinued operations		1,208
Loss from discontinued operations before income tax		(1,286)
Loss from discontinued operations		$ (1,286)

SUBSEQUENT EVENTS (Details)

SUBSEQUENT EVENTS (Details) - USD ($)	Jul. 18, 2016	Jan. 28, 2016
Subsequent Events
Cash payment		$ 8,630,000
Subsequent event | Tengram Capital Partners, LP | Convertible Notes Due January 2017
Subsequent Events
Convertible notes face value	$ 13,000,000
Interest rate (as a percent)	3.75%
Subsequent event | Tengram Capital Partners, LP | Convertible Notes Due January 2017 | Preferred Series A
Subsequent Events
Conversion price (in dollars per share)	$ 3
Preferred stock, conversion price (in dollars per share)	$ 3
Dividend rate (as a percent)	10.00%
Subsequent event | Tengram Capital Partners, LP | Maximum | Convertible Notes Due January 2017 | Preferred Series A
Subsequent Events
Number of shares issuable upon conversion of the debt	4,500,000
Warrants | Subsequent event | Tengram Capital Partners, LP
Subsequent Events
Warrants issued (in shares)	500,000
Exercise price (in dollars per share)	$ 3
SWIMS | Subsequent event
Subsequent Events
Cash payment	$ 12,300,000
SWIMS | Common Stock | Subsequent event
Subsequent Events
Number of shares of common stock issued	702,943
SWIMS | Warrants | Subsequent event
Subsequent Events
Warrants issued (in shares)	150,000
Exercise price (in dollars per share)	$ 5.47
DFBG Swims | SWIMS | Subsequent event
Subsequent Events
Escrow deposit	$ 325,000