Document

DEF 14A 1 master-proxystatementfor20.htm DEF 14A Document

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549

SCHEDULE 14A


Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934

Filed by the Registrant Filed by a Party other than the Registrant

Check the appropriate box:

Preliminary Proxy Statement

Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

Definitive Proxy Statement

Definitive Additional Materials

Soliciting Material Pursuant to §240.14a-12

TORRID HOLDINGS INC.

(Name of registrant as specified in its charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):


No fee required.
Fee paid previously with preliminary materials.
Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

Dear Fellow Stockholders,

We are pleased to invite you to attend our Annual Meeting of Stockholders of Torrid Holdings Inc. (“Torrid” or the “Company”) to be held in-person at the Company’s headquarters located at 18501 East San Jose Avenue, City of Industry, California 91748 on Thursday, June 8, 2023, at 12:00 p.m. Pacific Time (the “Annual Meeting”). You will be able to submit questions and vote your shares during the meeting.

The accompanying proxy statement provides information about the matters we will ask you to consider at the Annual Meeting, which are:

1.to elect two nominees identified in the accompanying proxy statement to serve as Class II directors until the 2026 Annual Meeting and until their successors are duly elected and qualified;

2.to approve, on an advisory, non-binding basis, the compensation paid to the Company’s named executive officers;

3.to approve, on an advisory, non-binding basis, the frequency of future advisory votes on named executive officer compensation;

4.to ratify the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for the year ending February 3, 2024; and

5.to transact other business as may properly come before the meeting or any adjournment of the meeting.

Our Board of Directors (the “Board”) has set the record date as April 17, 2023. Only stockholders that owned shares of the Company’s common stock at the close of business on that day are entitled to notice of and may vote at this meeting or any adjournment or postponement thereof. A list of stockholders entitled to vote at the meeting will be available for examination by any stockholder for any purpose relevant to the meeting during ordinary business hours for a period of ten days ending on the day before the date of the Annual Meeting at 18501 East San Jose Avenue, City of Industry, California 91748.

Your vote is important. Whether or not you plan to attend the in-person Annual Meeting, we urge you to vote. You may vote by proxy over the Internet, by telephone, or by mail by following the instructions on the proxy card. Voting by proxy will ensure your representation at the Annual Meeting regardless of whether you attend.

Sincerely,

Members of the Board of Directors:

Stefan L. Kaluzny

Lisa M. Harper

Theophlius Killion

Dary Kopelioff

Valeria Rico Nikolov

Michael Shaffer

NOTICE OF 2023 ANNUAL MEETING OF STOCKHOLDERS

The 2023 Annual Meeting of stockholders of Torrid Holdings Inc. will be held in-person at the Company’s headquarters located at 18501 East San Jose Avenue, City of Industry, California 91748 on Thursday, June 8, 2023, at 12:00 p.m. Pacific Time for the following purposes:

1.to elect two nominees identified in the accompanying proxy statement to serve as Class II directors until the 2026 Annual Meeting and until their successors are duly elected and qualified;

2.to approve, on an advisory, non-binding basis, the compensation paid to the Company’s named executive officers;

3.to approve, on an advisory, non-binding basis, the frequency of future advisory votes on named executive officer compensation;

4.to ratify the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for the year ending February 3, 2024; and

5.to transact other business as may properly come before the meeting or any adjournment of the meeting.

Stockholders of record as of the close of business on April 17, 2023, are entitled to vote. A list of stockholders entitled to vote at the meeting will be available for examination by any stockholder for any purpose relevant to the meeting during ordinary business hours for at least ten days prior to June 8, 2023, at 18501 East San Jose Avenue, City of Industry, California 91748.

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON JUNE 8, 2023

The notice of Annual Meeting, the proxy statement and our fiscal year 2022 Annual Report on Form 10-K are available on our website at https://investors.torrid.com. Additionally, in accordance with the SEC rules, you may access our proxy materials at www.proxyvote.com.

The Notice of Internet Availability of proxy materials is first being delivered to the Company’s stockholders of record on or about April 26, 2023.

By Order of the Board of Directors,

BRIDGETT C. ZETERBERG

Chief Human Resources Officer

Chief Legal Officer and

Corporate Secretary

TABLE OF CONTENTS

Page


COMMONLY ASKED QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING			1
BOARD OF DIRECTORS AND CORPORATE GOVERNANCE			5
PROPOSAL 1—ELECTION OF DIRECTORS			7
EXECUTIVE OFFICERS			15
EXECUTIVE AND DIRECTOR COMPENSATION			16
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS			36
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT			39
PROPOSAL 2— APPROVAL OF, ON AN ADVISORY, NON-BINDING BASIS, THE COMPENSATION PAID TO THE COMPANY’S NAMED EXECUTIVE OFFICERS			40
PROPOSAL 3— APPROVAL OF, ON AN ADVISORY, NON-BINDING BASIS, THE FREQUENCY OF FUTURE ADVISORY VOTES ON NAMED EXECUTIVE OFFICER COMPENSATION			41
PROPOSAL 4—RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM			42
REPORT OF THE AUDIT COMMITTEE			44
OTHER MATTERS			45
WHERE TO FIND ADDITIONAL INFORMATION			46
COST OF PROXY SOLICITATION			47
APPENDIX A: DESCRIPTION OF NON-GAAP FINANCIAL MEASURES			A-1

COMMONLY ASKED QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING

Q: Why did I receive these materials?

The Board of the Company is soliciting your proxy to vote at our 2023 Annual Meeting of Stockholders (or at any postponement or adjournment of the meeting). Stockholders who own shares of our common stock as of the record date, April 17, 2023 (the “Record Date”), are entitled to vote at the Annual Meeting. You should review these proxy materials carefully as they give important information about the proposals that will be voted on at the Annual Meeting, as well as other important information about the Company.

Q: Who will be entitled to vote?

Stockholders who own shares of our common stock as of the Record Date are entitled to vote at the Annual Meeting. As of the Record Date, the Company had 103,827,701 shares of common stock outstanding. Holders of shares of common stock are entitled to one vote per share. Cumulative voting is not permitted with respect to the election of directors or any other matter to be considered at the Annual Meeting.

Q: What will I be voting on?

You will be voting on:

1. the election of two Class II directors to serve on the Board until the 2026 Annual Meeting and until their successors are duly elected and qualified;

2. the approval of, on an advisory, non-binding basis, the compensation paid to the Company’s named executive officers;

3. the approval of, on an advisory, non-binding basis, the frequency of future advisory votes on named executive officer compensation;

4. the ratification of the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for the year ending February 3, 2024; and

5. any other business as may properly come before the meeting or any adjournment of the meeting.

Q: How does the Board recommend I vote on these matters?

The Board recommends you vote:

1.FOR the election of Theophlius Killion and Michael Shaffer as Class II directors;

2.FOR the approval of, on an advisory, non-binding basis, the compensation paid to the Company’s named executive officers;

3.FOR the approval of a frequency of ONE YEAR (annual) for future advisory votes on named executive officer compensation;

4.FOR the ratification of the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm for the year ending February 3, 2024.

Q: How do I cast my vote?

Beneficial Stockholders. If you hold your shares through a broker, trustee, or other nominee, you are a beneficial stockholder. In order to vote your shares, please refer to the materials forwarded to you by your broker, bank or other nominee for instructions on how to vote the shares you hold as a beneficial stockholder.

Registered Stockholders. If you hold shares in your own name, you are a registered stockholder and may vote during the in-person Annual Meeting at the Company’s headquarters located at 18501 E. San Jose Ave., City of Industry, CA 91748. You can also vote by proxy before the Annual Meeting in the following ways:

1.via the Internet at www.proxyvote.com;

2.by phone by calling on a touch-tone telephone toll-free 1-800-690-6903; or

3.by signing and returning a proxy card.

Proxies submitted via the Internet or by telephone must be received by 11:59 p.m., Pacific Time, on June 7, 2023. If you hold shares in the Torrid Holdings Inc. 2021 Employee Stock Purchase Plan, you must submit your proxy via the Internet or by telephone by 11:59 p.m., Pacific Time, on June 5, 2023.

Q: Can I access the proxy materials electronically?

Yes. Our proxy materials are available at www.proxyvote.com. Please be advised that you will need your control number, which you should have received in an earlier communication. In addition, instead of receiving future copies of our notice of internet availability and other proxy materials by mail, stockholders of record and most beneficial owners can elect to receive an email that will provide an electronic link to these documents. If you would like to instruct us to send electronic copies of our notice of internet availability and other proxy materials, you should follow the instructions available at www.proxyvote.com. Your election to receive future proxy materials by email will remain in effect until you revoke it.

Q: How may I change or revoke my proxy?

Beneficial Stockholders. Beneficial stockholders should contact their broker, trustee or nominee for instructions on how to change or revoke their proxy.

Registered Stockholders. Registered stockholders may change or revoke a properly executed proxy at any time before its exercise:

1.via the Internet at www.proxyvote.com;

2.by phone by calling on a touch-tone telephone toll-free 1-800-690-6903;

3.by signing and returning a new proxy card bearing a later date; or

4.by voting at the in-person Annual Meeting.

In addition, registered stockholders can revoke a properly executed proxy at any time before it has been exercised by timely delivering to the Secretary at the Company’s principal executive offices a written revocation of the proxy.

Q: How can I attend the in-person Annual Meeting?

The Annual Meeting is being held in-person this year at the Company’s headquarters located at 18501 E. San Jose Ave., City of Industry, CA 91748.

If you are a stockholder of record as of the Record Date, you may attend, vote, and ask questions at the meeting if you are in attendance. Beneficial stockholders are also invited to attend the Annual Meeting. However, such stockholders may not vote their shares at the Annual Meeting unless they request and obtain a valid proxy from your broker, bank or other agent. If you are a beneficial owner and want to vote your shares at the Annual Meeting, you will need to request a legal proxy from your bank, broker or other nominee well in advance of the Annual Meeting.

Q: What are “broker non-votes”?

If your shares are held through a broker and you give the broker instructions, your shares will be voted as you direct. If you do not provide voting instructions, your shares will not be voted on any proposal on which the broker does not have discretionary authority to vote. This is called a “broker non-vote.” In these cases, the broker can register your shares as being present at the Annual Meeting for purposes of determining the presence of a quorum and will be able to use their discretionary voting authority under NYSE rules to vote your shares on the ratification of PricewaterhouseCoopers LLP as our independent registered public accounting firm for the year ending February 3, 2024. However, the broker will not be able to vote on those matters for which specific authorization is required under NYSE rules, such as to vote on the election of directors, the advisory approval of named executive officer compensation or the advisory approval on frequency of future advisory votes on named executive officer compensation without instructions from you, in which case a broker non-vote will occur, and your shares will not be voted on these matters.

Q: What is the voting requirement to approve each of the proposals, and how are the votes counted?

PROPOSAL 1—ELECTION OF DIRECTORS

A plurality of the votes cast by the shares of common stock present in person or represented by proxy at the meeting and entitled to vote thereon is required to elect each nominee named herein. This means that the two nominees receiving the highest number of votes at the Annual Meeting will be elected, even if those votes do not constitute a majority of the votes cast. You may vote for the two nominees, withhold authority to vote your shares for the two nominees or withhold authority to vote your shares with respect to any one of the nominees. Withholding authority to vote your shares with respect to one or more nominees will have no effect on the election of those nominees. Broker non-votes will have no effect on the election of the nominees.

PROPOSAL 2— ADVISORY VOTE ON THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS

This vote is advisory only and non-binding on the Board. The affirmative vote of a majority of the voting power of the shares of common stock present in person or represented by proxy at the meeting and entitled to vote thereon is required to approve the proposal. Votes may be cast “for” or “against” the proposal. Stockholders may also abstain from voting. Abstentions will have the same effect as a vote “against” the proposal. Broker non-votes will not be included in the vote totals and therefore will have no effect on the advisory vote on executive compensation.

PROPOSAL 3— ADVISORY VOTE ON THE FREQUENCY OF FUTURE ADVISORY STOCKHOLDER VOTING ON NAMED EXECUTIVE OFFICER COMPENSATION

This vote is advisory only and non-binding on the Board. Stockholders will have the option of selecting a frequency of every year, every two years or every three years for the advisory vote on executive compensation. The Company will consider the alternative receiving the greatest number of

votes as the frequency the stockholders approve. Abstentions and broker non-votes will have no effect on the vote.

PROPOSAL 4— RATIFICATION OF THE SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The ratification of the selection of our independent registered public accounting firm requires the affirmative vote of a majority of the voting power of the shares of common stock present in person or represented by proxy at the meeting and entitled to vote thereon. Votes may be cast “for” or “against” such ratification. Stockholders may also abstain from voting. Votes “for” and “against” this proposal and abstentions will count in the tabulations of votes cast on this proposal. Abstentions will be counted as votes cast on this proposal and will have the same effect as votes “against” this proposal. If you are a beneficial owner whose shares are held of record by a broker, your broker has discretionary voting authority under NYSE rules to vote your shares on this proposal even if the broker does not receive voting instructions from you. Therefore, no broker non-votes are expected in connection with this proposal.

Q: When will the results of the vote be announced?

The preliminary voting results will be announced at the in-person Annual Meeting. The final voting results will be published in a Current Report on Form 8-K filed with the SEC within four business days of the Annual Meeting.

Q: What is the deadline for submitting a stockholder proposal or director nomination for the 2024 Annual Meeting?

Stockholder proposals pursuant to SEC Rule 14a-8 for inclusion in the Company’s proxy statement and form of proxy for the Company’s annual meeting of stockholders to be held in 2024, must be received by the Company at our principal executive offices at 18501 East San Jose Avenue, City of Industry, California 91748 no later than the close of business on December 28, 2023. Stockholders wishing to make a director nomination or bring a proposal before the 2024 annual meeting (but not include it in the Company’s proxy materials) must provide written notice of such proposal to the Secretary at the Company’s principal executive offices no later than the close of business on March 8, 2024 and not earlier than the close of business on February 9, 2024, assuming the Company does not change the date of the 2024 annual meeting of stockholders by more than 30 days before or after the anniversary of the 2023 Annual Meeting. If so, the Company will release an updated time frame for stockholder proposals. Any stockholder proposal or director nomination must comply with the other provisions of the Company’s Amended and Restated Bylaws (the “Bylaws”) and be submitted in writing to the Secretary at the Company’s principal executive offices. In addition to satisfying the requirements of the Company’s Bylaws, including the notice deadlines set forth therein, to comply with the universal proxy rules, stockholders who intend to solicit proxies in support of director nominees, other than the Company’s nominees, must also comply with the additional requirements of Rule 14a-19 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

Our business and affairs are managed under the direction of the Board, which is composed of six directors. Our amended and restated certificate of incorporation (the “Charter”) provides that the authorized number of directors may be changed only by resolution of the Board. Our Charter also provides that the Board will be divided into three classes of directors, with the classes as nearly equal in number as possible. At each annual meeting of stockholders, a class of directors will be elected for a three-year term to succeed the class whose term is then expiring.

The following table sets forth the director class, name, age as of April 17, 2023, and other information for each member of the Board:


Name	Class	Age	Director Since Fiscal Year	Current Term Expires Fiscal Year	Expiration of Term For Which Nominated Fiscal Year

Lisa M. Harper	I	63	2021	2025
Stefan L. Kaluzny	I	56	2021	2025
Theophlius Killion	II	72	2021	2023	2026
Michael Shaffer	II	60	2022	2023	2026
Dary Kopelioff	III	39	2021	2024
Valeria Rico Nikolov	III	59	2021	2024

The Board’s policy is to encourage the selection of directors who will contribute to the Company’s overall corporate goals. The Board believes that in order to effectively guide us to long-term sustainable, dependable performance, the Board should be composed of individuals with sophistication and experience in the many disciplines that impact our business. Additionally, we desire that the Board have specific knowledge related to our industry, such as expertise in consumer apparel and intimates. In evaluating candidates for the director position, the Board and the Nominating and Corporate Governance Committee consider a number of criteria, including, but not limited to: (i) the experience, qualifications and skills of the candidate; (ii) the reputation of the candidate; (iii) any possible conflicts of interest; (iv) whether the candidate will be considered independent under the standards of the NYSE, and the heightened independence standards for audit committees and compensation committees under the securities laws; (v) whether the candidate will have the time and willingness to carry out his or her duties and responsibilities effectively; and (vi) whether the candidate will bring a diversity of viewpoints to the Board.

When filling a vacancy on the Board, the Nominating and Corporate Governance Committee will identify the desired skills and experience of a new director and will nominate individuals who it believes can strengthen the Board’s capabilities and further diversify the collective experience represented by the then-current directors. The Nominating and Corporate Governance Committee may engage third parties to assist in the search and provide recommendations. Also, directors are generally asked to recommend candidates for the position. The same process is used to evaluate all candidates, including candidates recommended by stockholders. While we do not have a formal policy on diversity, when considering the selection of director nominees, the Nominating and Corporate Governance Committee considers individuals with diverse viewpoints, accomplishments, cultural background, professional expertise, and diversity in gender, ethnicity, race, skills and geographic representation, that, when considered as a group, provide a sufficient mix of perspectives to allow the Board to best fulfill its responsibilities to the long-term interests of our stockholders. Currently, of the six directors on the Board, four are racially/ethnically diverse, and one of these four ia a woman. Overall, the Board is comprised of four men and two women.

The Nominating and Corporate Governance Committee has determined that all of our directors possess one or more of the following critical personal qualities and attributes that we believe are essential for the proper functioning of the Board to allow it to fulfill its duties for our stockholders: accountability,

ethical leadership, governance, integrity, risk management, and sound business judgment. The director biographies below include a non-exhaustive list of other key experiences and qualifications that further qualify the individual to serve on the Board. These collective qualities, skills, experiences and attributes are essential to the Board’s ability to exercise its oversight function for the Company and its stockholders, and guide the long-term sustainable, dependable performance of the Company.

Subject to any earlier resignation or removal in accordance with the terms of our Charter, our Bylaws and the Stockholders’ Agreement (as defined and discussed below), our Class II directors will serve until this Annual Meeting, our Class III directors will serve until the annual meeting of stockholders to be held in fiscal year 2024, and our Class I directors will serve until the annual meeting of stockholders to be held in fiscal year 2025. In addition, our Charter provides that as long as Sycamore Partners Management, L.P., Sycamore Partners Torrid, L.L.C. and each of their respective Affiliates (together, the “Principal Stockholders”) beneficially own (directly or indirectly) 50% or more of the voting power of the Company entitled to vote, directors may be removed with or without cause upon the affirmative vote of at least a majority of the voting power of our outstanding shares of stock entitled to vote thereon. However, once the Principal Stockholders cease to beneficially own in the aggregate (directly or indirectly) 50% or more of the voting power of the Company, our directors may be removed only for cause upon the affirmative vote of at least 75% of the voting power of our outstanding shares of stock entitled to vote thereon.

Stockholders’ Agreement

In connection with our initial public offering (“IPO”), we entered into a Stockholders’ Agreement, dated as of July 6, 2021 (the “Stockholders’ Agreement”), with Sycamore Partners Torrid, L.L.C. (together with its indirect beneficial owners, the “Sycamore Stockholder”). The Stockholders’ Agreement provides the Sycamore Stockholder with certain rights with respect to the designation of directors to serve on the Board. As set forth in the Stockholders’ Agreement, for so long as the Sycamore Stockholder beneficially owns at least 50% of our common stock, it will be entitled to designate for nomination a majority of the Board. When the Sycamore Stockholder beneficially owns less than 50% of our common stock but owns at least 10% of our common stock, the Sycamore Stockholder will be entitled to designate for nomination a number of directors in proportion to its ownership of our common stock, rounded up to the nearest whole number. When the Sycamore Stockholder owns less than 10% of our common stock but owns at least 5% of our common stock, the Sycamore Stockholder will be entitled to designate for nomination the greater of (i) a number of directors in proportion to its ownership of our common stock, rounded up to the nearest whole number, and (ii) one director.

Stockholder Recommendations for Director Nominees

The Nominating and Corporate Governance Committee will consider stockholder nominations for membership on the Board. For the fiscal year 2024 Annual Meeting, nominations may be submitted to 18501 East San Jose Avenue, City of Industry, California 91748, Attn: Chief Legal Officer and Secretary, and such nominations will then be forwarded to the chairperson of the Nominating and Corporate Governance Committee. Recommendations must be in writing and we must receive the recommendation no later than the close of business on March 8, 2024 and not earlier than the close of business on February 9, 2024. Recommendations must also comply with certain other procedural requirements as specified in our Bylaws. In addition to satisfying the requirements of our Bylaws, including the notice deadlines set forth therein, to comply with the universal proxy rules, stockholders who intend to solicit proxies in support of director nominees, other than the Company’s nominees, must also comply with the additional requirements of Rule 14a-19 under the Exchange Act.

PROPOSAL 1—ELECTION OF DIRECTORS

Our Board recommends that the nominees below be elected as members of the Board at the Annual Meeting.

Name

Class

Age

Director Since

Current Term Expires Fiscal Year

Expiration of Term For Which Nominated

Fiscal Year

Theophlius Killion

July 2021

2023

2026

Michael Shaffer

May 2022

2023

2026

Each nominee was recommended for re-election by the Nominating and Corporate Governance Committee for consideration by the Board and our stockholders. If, before the Annual Meeting, any nominee becomes unable to serve, or chooses not to serve, the Board may nominate a substitute. If that happens, the persons named as proxies on the proxy card will vote for the substitute. Alternatively, the Board may either let the vacancy stay unfilled until an appropriate candidate is identified or reduce the size of the Board to eliminate the unfilled seat.

THE BOARD RECOMMENDS THAT YOU VOTE “FOR” EACH OF THE DIRECTOR NOMINEES.

Director Nominees to Serve for a Three-Year Term Expiring at the Fiscal Year 2026 Annual Meeting.

Theophlius Killion has served as a member of the Board since June 2021 and currently serves as the Lead Independent Director. Since November 2016, Mr. Killion has been a managing partner of The Sierra Institute, a Dallas-based human resources consortium. Mr. Killion also worked for The Zale Corporation from January 2008 until July 2014, serving as Chief Executive Officer from January 2010 until his retirement in 2014. Prior to Zale, Mr. Killion served in a variety of positions at a number of iconic retailers including TOMMY HILFIGER, Limited Brands (now L Brands), The Home Shopping Network and Macy’s. Mr. Killion holds M. Ed. and B.A. degrees from Tufts University. In addition to his service on the Board, Mr. Killion currently serves as a member of the board of directors of Claire’s Stores, Inc., a privately held global retailer of fashionable jewelry accessories, where he serves as a member of the Audit Committee and Chairman of the Compensation Committee. Mr. Killion previously served as a member of the board of directors of Tailored Brands, Inc., Libbey, Inc., Express, Inc. and The Zale Corporation when he was CEO. Mr. Killion is also a member of the National Association of Corporate Directors.

As a result of these and other professional experiences, we believe Mr. Killion possesses particular knowledge and experience in retail merchandising, finance, human capital management, executive compensation, Diversity, Equity and Inclusion, ESG and board governance practices of other major corporations that strengthen the Board’s collective qualifications, skills and experience.

Michael Shaffer has served as a member of the Board since May 2022. Mr. Shaffer also served for five years on the board of directors with the Build-A-Bear Workshop, where he was Chairman of the Audit Committee. Until his retirement in September 2021, Mr. Shaffer served as the Executive Vice President, Chief Operating Officer, and Chief Financial Officer for PVH Corp. (“PVH”). PVH is one of the world’s largest fashion companies, connecting with consumers in over 40 countries. Their global brands include Calvin Klein and TOMMY HILFIGER. Mr. Shaffer joined PVH in 1990 as a Financial Budget Manager and over the next 30 years worked his way up through the organization, gaining valuable experience and insights into both financial and business operations. He held various roles, including Director of Accounting Operations, Vice President and Controller, Senior Vice President of Operations

and Executive Vice President, Chief Operating Officer and Chief Financial Officer for PVH. In addition, Mr. Shaffer took on the additional responsibility at PVH of guiding the Building Resources for African American Voices (BRAAVE) with PVH and led the efforts as the executive sponsor. Mr. Shaffer completed his bachelor's degree in accounting from George Washington University and earned his CPA designation.

As a result of these and other professional experiences, we believe Mr. Shaffer possesses particular knowledge and experience in finance, ESG, and board governance practices of other major corporations that strengthen the Board’s collective qualifications, skills and experience.

Continuing Directors

Class I Directors (Terms expiring in Fiscal Year 2025)

Lisa M. Harper has served as Torrid’s Chief Executive Officer since May 2022 and as a member of the Board and its predecessor since 2008. From July 2021 until May 2022, Ms. Harper served as Executive Chairperson of Belk, a privately-owned department store chain. Prior to that, Ms. Harper served as Chief Executive Officer of Belk from July 2016 through July 2021. In February 2021, under Ms. Harper’s leadership, Belk successfully completed its financial restructuring, finalizing an expedited pre-packaged, one-day reorganization, and emerged from Chapter 11 bankruptcy. Ms. Harper previously served as CEO of each of Torrid Holding Corp. and its predecessor, Hot Topic, from March 2011 until June 2016. From February 2001 until her retirement in July 2006, Ms. Harper served in various capacities with The Gymboree Corporation, a publicly traded corporation operating a chain of specialty retail stores for children and women. Ms. Harper’s roles at Gymboree included Chairman of the board of directors, from June 2002 to July 2006, Chief Creative Officer, from January 2006 to July 2006, Vice Chairman of the board of directors, from February 2001 to June 2002, and Chief Executive Officer, from February 2001 to January 2006. Ms. Harper has also held merchandising and design positions with several other clothing retailers, including Limited Too, Esprit, GapKids, Mervyn’s and Levi Strauss. Ms. Harper attended the University of North Carolina at Chapel Hill. In addition to her service on the Board, Ms. Harper currently serves as a member of the board of directors of each of Belk and Hot Topic.

As a result of these and other professional experiences, we believe Ms. Harper possesses particular knowledge and experience in multi-channel retail merchandising, finance, strategic planning and leadership of complex organizations, and board practices of other major corporations that strengthen the Board’s collective qualifications, skills and experience.

Stefan L. Kaluzny has served as a member of the Board since 2019. Mr. Kaluzny is co-founder and Managing Director of Sycamore Partners, a New York-based private equity firm. Prior to founding Sycamore Partners, Mr. Kaluzny was a Managing Director of Golden Gate Capital. Mr. Kaluzny was with Golden Gate Capital from its inception in 2000 until January 2011. Prior to Golden Gate Capital, Mr. Kaluzny was co-founder and CEO of Delray Farms, a Hispanic specialty food company. Mr. Kaluzny has also held positions at consulting firms Bain & Company and LEK. Mr. Kaluzny has an M.B.A. from Harvard Business School (Baker Scholar), and a B.A. degree from Yale University. Mr. Kaluzny currently serves as a member of the Board of Trustees of Phillips Academy, a residential boarding school located in Andover, MA, and previously served on the Yale University Investment Committee. In addition to his service on the Board, Mr. Kaluzny currently serves and has served as member of the board of directors of many of Sycamore Partners’ portfolio companies.

As a result of these and other professional experiences, Mr. Kaluzny possesses particular knowledge and experience in retail merchandising, accounting, finance and capital structure, strategic planning and leadership of complex organizations, and board practices of other major corporations that strengthen the Board’s collective qualifications, skills and experience.

Class III Directors (terms expiring in fiscal year 2024)

Dary Kopelioff has served as a member of the Board since 2019. Mr. Kopelioff is a Managing Director of Sycamore Partners, a New York-based private equity firm. Prior to Sycamore Partners,

Mr. Kopelioff was an Associate at Golden Gate Capital and had been with the firm since 2007. Prior to Golden Gate Capital, Mr. Kopelioff was a consultant for McKinsey & Company. Mr. Kopelioff has an M.B.A. from Harvard Business School and a B.S. degree with distinction from Stanford University. In addition to his service on the Board, Mr. Kopelioff currently serves as a member of the board of directors of Hot Topic, LOFT / Ann Taylor, Lane Bryant and Talbots.

As a result of these and other professional experiences, we believe Mr. Kopelioff possesses particular knowledge and experience in retail merchandising, accounting, finance and capital structure, strategic planning, and leadership of complex organizations, and board practices of other major corporations that strengthen the Board’s collective qualifications, skills and experience.

Valeria Rico Nikolov has served as a member of the Board since September 2021. Ms. Nikolov is the founder and Chief Executive Officer of GGA Solutions, an outsourced customer and back-office solutions provider. Prior to GGA Solutions, Ms. Rico Nikolov served as the Chief Executive Officer of Confie Seguros, one of the largest personal lines insurance distributors in the United States, from November 2014 to November 2016. Ms. Rico Nikolov also served as Confie Seguros’ Chief Operating Officer from August 2013 to November 2014 and Chief Strategy Officer from August 2012 to August 2013. Prior to Confie Seguros, Ms. Rico Nikolov served as the Chief Executive Officer and President of Lexicon Marketing from 2004 to 2011. Ms. Rico Nikolov served on the board of directors of Herbalife Nutrition from March 2006 to March 2009. Ms. Rico Nikolov holds a degree in Law from the Complutense University of Madrid, Spain. In addition to her service on the Board, Ms. Rico Nikolov also serves as a member of the board of directors of Phoenix House California, which provides addiction and behavioral health services to individuals and families overcoming substance abuse, and as a member of the board of trustees of the Buckley School.

As a result of these and other professional experiences, we believe Ms. Rico Nikolov possesses particular knowledge and experience in marketing, finance, human capital management, strategic planning and leadership of complex organizations, and board practices of other major corporations that strengthen the Board’s collective qualifications, skills and experience.

Controlled Company; Independence Status

Our Charter provides that the Board shall consist of such number of directors as determined from time to time by resolution adopted by the Board. Subject to the rights granted to the holders of any one or more series of preferred stock then outstanding, from and after the Trigger Event (as defined in the Charter) any additional directorships resulting from an increase in the number of directors may only be filled by the directors then in office, although less than a quorum, or by a sole remaining director (and not by the stockholders). The term of office for each director will be until his or her successor is elected at our annual meeting or his or her death, resignation or removal, whichever is earliest to occur. Stockholders will elect directors each year at our annual meeting.

Our board of directors is divided into three classes, with each director serving a three-year term, and one class being elected at each year’s annual meeting of stockholders. Stefan L. Kaluzny and Lisa M. Harper serve as Class I directors with a term expiring at the 2025 annual meeting. Theophlius Killion and Michael Shaffer serve as Class II directors with a term expiring at this Annual Meeting. Dary Kopelioff and Valeria Rico Nikolov serve as Class III directors with a term expiring at the 2024 annual meeting.

Any additional directorships resulting from an increase in the number of directors will be distributed among the three classes so that, as nearly as possible, each class will consist of one-third of the total number of directors. Our board of directors has affirmatively determined that Theophlius Killion, Valeria Rico Nikolov and Michael Shaffer are each an “independent director,” as defined under the rules of the New York Stock Exchange (“NYSE”).

Affiliates of Sycamore Partners Management, L.P. (“Sycamore”) control a majority of the voting power of our outstanding common stock. As a result, we are a “controlled company” under the NYSE

corporate governance standards. As a controlled company, we rely on available NYSE exemptions from the obligation to comply with certain corporate governance requirements, including the requirements:

•that a majority of the Board consist of “independent directors,” as defined under the rules of the NYSE;

•that any corporate governance and nominating committee or compensation committee be composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and

•for an annual performance evaluation of the nominating and governance committees and compensation committee.

Pursuant to the Stockholders’ Agreement with the Sycamore Stockholder (a) when the Sycamore Stockholder beneficially owns at least 50% of our common stock, the Sycamore Stockholder will be entitled to designate for nomination a majority of the directors, (b) when the Sycamore Stockholder beneficially owns less than 50% of our common stock but owns at least 10% of our common stock, the Sycamore Stockholder will be entitled to designate for nomination a number of directors in proportion to its ownership of our common stock, rounded up to the nearest whole number and (c) when the Sycamore Stockholder owns less than 10% of our common stock but owns at least 5% of our common stock, the Sycamore Stockholder will be entitled to designate for nomination the greater of (i) a number of directors in proportion to its ownership of our common stock, rounded up to the nearest whole number, and (ii) one director. See “Certain Relationships and Related Party Transactions—Stockholders’ Agreement.”

Board Meetings and Committees

Our Board has an Audit Committee, a Nominating and Corporate Governance Committee, and a Compensation Committee. The composition, duties and responsibilities of these committees are as set forth below. In the future, the Board may establish other committees, as it deems appropriate, to assist it with its responsibilities.

For the fiscal year 2022, the Board held four meetings. For the fiscal year 2022, the Audit Committee, the Nominating and Corporate Governance Committee and the Compensation Committee each held four meetings. Directors are expected to attend the annual meeting of stockholders and all or substantially all of the Board meetings and meetings of committees on which they serve. In fiscal year 2022, each director, other than Mr. Kaluzny, attended at least 75% of the aggregate of the meetings of the Board during such director’s tenure and the total number of meetings held by any of the committees of the Board on which the director served. All directors then serving on the board attended the 2022 Annual Meeting of Stockholders.

Each of our standing committees has a written charter which is available on our website at https://investors.torrid.com. The information contained on or accessible through our website is not incorporated by reference into this proxy statement or any of our other filings with the SEC or considered to be part of this document.

The table below sets forth the composition of the Board committees as of April 17, 2023:


Board Member	Audit Committee	Compensation Committee	Nominating and Corporate Governance Committee
Lisa M. Harper			X
Stefan L. Kaluzny		X (Chairperson)	X
Theophlius Killion	X	X
Dary Kopelioff		X	X (Chairperson)
Valeria Rico Nikolov	X
Michael Shaffer	X (Chairperson)

Audit Committee

Our Audit Committee consists of Michael Shaffer, Theophlius Killion and Valeria Rico Nikolov, with Michael Shaffer serving as chairperson. Our Board has affirmatively determined that each of Theophlius Killion, Valeria Rico Nikolov and Michael Shaffer meet the definition of “independent director” for purposes of serving on an Audit Committee under Rule 10A-3 and the NYSE rules. In addition, the Board has determined that Michael Shaffer is an “audit committee financial expert,” as such term is defined in Item 407(d)(5) of Regulation S-K. Our Board has adopted a written charter for the Audit Committee, which is available on our website at https://investors.torrid.com. The information contained in or connected to our website is not deemed to be part of this proxy statement.

The Audit Committee is responsible for, among other matters: (1) appointing, compensating, retaining, evaluating, terminating and overseeing our independent registered public accounting firm; (2) discussing with our independent registered public accounting firm their independence from management; (3) reviewing with our independent registered public accounting firm the scope and results of their audit; (4) approving all audit and permissible non-audit services to be performed by our independent registered public accounting firm; (5) overseeing the financial reporting process and discussing with management and our independent registered public accounting firm the interim and annual financial statements that we file with the SEC; (6) reviewing and monitoring our accounting principles, accounting policies, financial and accounting controls and compliance with legal and regulatory requirements, including but not limited to, cybersecurity requirements; (7) establishing procedures for the confidential anonymous submission of concerns regarding questionable accounting, internal controls or auditing matters; and (8) reviewing and approving related person transactions.

Compensation Committee

Our Compensation Committee consists of Stefan L. Kaluzny, Theophlius Killion and Dary Kopelioff, with Stefan L. Kaluzny serving as chairperson. The composition of our Compensation Committee meets the requirements under current rules and regulations of the SEC and NYSE. Our Board has adopted a written charter for the Compensation Committee, which is available on our website at https://investors.torrid.com. The information contained in or connected to our website is not deemed to be part of this proxy statement.

The Compensation Committee is responsible for, among other matters: (1) reviewing officer and executive compensation goals, objectives and plans; (2) reviewing and recommending to the Board, the compensation and benefits of our directors and Chief Executive Officer; (3) reviewing and approving the compensation of all other executive officers; (4) reviewing and approving employment agreements and other similar arrangements between us and our officers and other key executives; and (5) appointing and overseeing any compensation consultants.

Nominating and Corporate Governance Committee

Our Nominating and Corporate Governance Committee consists of Dary Kopelioff, Lisa M. Harper and Stefan L. Kaluzny, with Dary Kopelioff serving as chairperson. The composition of our Nominating and Corporate Governance Committee meets the requirements under current rules and regulations of the SEC and NYSE. Our Board has adopted a written charter for the Nominating and Corporate Governance Committee, which is available on our website at https://investors.torrid.com. The information contained in or connected to our website is not deemed to be part of this proxy statement.

The Nominating and Corporate Governance Committee is responsible for, among other matters: (1) identifying individuals qualified to become members of the Board, consistent with criteria approved by the Board; (2) reviewing stockholder proposals and overseeing engagement with stockholders and proxy advisory firms; (3) reviewing the Board’s leadership structure and recommending changes to the Board as appropriate; (4) reviewing and proposing changes to the Company’s corporate governance policies; and (5) reviewing and proposing changes to the Company’s ESG policies and practices.

Board Leadership Structure

The following section describes the Board leadership structure, the reasons the Board considers this structure to be appropriate at this time, the roles of various positions, and related key governance practices. Our Board believes that the mix of experienced independent directors and directors affiliated with our Principal Stockholders that currently make up the Board and the Board committee composition benefit the Company and its stockholders.

Board Leadership

Mr. Kaluzny currently serves as the chairperson of the Board. Both independent and management directors, including the Chief Executive Officer, are eligible for appointment as the chairperson. If the chairperson is not an independent director, the Board will designate a lead independent director. The lead independent director’s responsibilities include, among others: (i) serving as liaison between the independent directors and the Board Chair and Chief Executive Officer; (ii) calling meetings of the independent directors; (iii) presiding at all meetings of the independent directors; (iv) engaging with major shareholders, as appropriate; and (v) providing feedback from executive sessions of the independent directors to the chairperson of the Board and Chief Executive Officer and other senior management. Mr. Killion currently serves as the Lead Independent Director of the Board.

The Board conducts an annual assessment of its leadership structure to determine that the leadership structure is the most appropriate for the Company, taking into account the recommendations of the Nominating and Corporate Governance Committee.

Independence

Our Board believes it has an effective mix of independent directors and non-independent directors. Our Board includes two representatives from our Principal Stockholders, including Mr. Kaluzny and Mr. Kopelioff, and three independent directors: Theophlius Killion, Valeria Rico Nikolov and Michael Shaffer. In addition, our Chief Executive Officer, Lisa M. Harper, serves on the Board, providing valuable insight as an officer of the Company.

Self-Evaluation

In November 2022, our Nominating and Corporate Governance Committee conducted its first annual performance evaluation to determine whether the Board, its committees, and management are functioning effectively. This evaluation included survey materials as well as individual conversations between each director and the chairperson. The evaluation focused on the Board’s and the committees’ contributions to the Company, with an enhanced focus on areas in which the Board or management believes that the Board could improve.

As part of the annual Board self-evaluation, the Board evaluated whether the current leadership structure continues to be appropriate for the Company and its stockholders. Our Corporate Governance Guidelines provide the flexibility for the Board to modify our leadership structure in the future as appropriate. The Board determined that the Board and Committees were functioning effectively and that the current structure was appropriate.

Insider Trading and Hedging Transactions

Our board has adopted an insider trading policy (“Insider Trading Policy”) to promote compliance with federal, state and foreign securities laws that prohibit certain persons who are aware of material nonpublic information about a company from: (i) trading in securities of that company; or (ii) providing material nonpublic information to other persons who may trade on the basis of that information. Pursuant to our Insider Trading Policy, we also prohibit our employees, directors, and officers from engaging in hedging transactions, including the use of financial instruments such as prepaid variable forwards, equity swaps, collars and exchange funds. Such hedging transactions may permit a director, officer, or employee to continue to own Company securities obtained through employee benefit plans or otherwise, but without the full risks and rewards of ownership. When that occurs, the director, officer or employee may no longer have the same objectives as the Company’s other stockholders. Additionally, directors, officers and other employees are prohibited from holding our securities in a margin account or otherwise pledging our securities as collateral for a loan.

Risk Oversight

Our Board is responsible for overseeing our risk management process. The Board focuses on our general risk management strategy and the most significant risks facing Torrid and ensures that appropriate risk mitigation strategies are implemented by management. The Board is also apprised of particular risk management matters in connection with its general oversight and approval of corporate matters and significant transactions.

The Board has delegated to the Audit Committee oversight of our risk management process. Our other Board committees also consider and address risk as they perform their respective committee responsibilities. All committees report to the full Board as appropriate, including when a matter rises to the level of a material or enterprise level risk. Our management is responsible for day-to-day risk management.

Our internal audit function serves as the primary monitoring and testing function for company-wide policies and procedures and manages the day-to-day oversight of the risk management strategy for the ongoing business of Torrid. This oversight includes identifying, evaluating, and addressing potential risks that may exist at the enterprise, strategic, financial, operational, and compliance and reporting levels.

Code of Ethics

We have adopted a code of business conduct and ethics applicable to our principal executive, financial and accounting officers and all persons performing similar functions. A copy of that code is available on our website at https://investors.torrid.com. We expect that any amendments to the code, or any waivers of its requirements, will be disclosed on our website. The information contained in or connected to our website is not deemed to be part of this proxy statement.

Compensation Committee Interlocks and Insider Participation

None of our directors or executive officers serves, and we anticipate that no member of the Board or executive officers will serve, as a member of the board of directors or compensation committee of any other company that has one or more executive officers serving as a member of the Board.

Communications by Stockholders and Other Interested Parties with the Board

Stockholders and other interested parties may contact an individual director, the Board as a group, or a specified Board committee or group, including the independent directors as a group, by sending regular mail to:

Torrid Holdings Inc.

18501 East San Jose Avenue

City of Industry, California 91748

Attention: Board of Directors

c/o Chief Legal Officer and Secretary

Phone: (626) 667-1002

Each communication should specify which director or directors the communication is addressed to, as well as the general topic of the communication. The Company will receive the communications and process them before forwarding them to the addressee. The Company may also refer communications to other departments within the Company. The Company generally will not forward to the directors a communication that is primarily commercial in nature, relates to an improper or irrelevant topic, or requests general information regarding the Company.

EXECUTIVE OFFICERS

Below is a list of the names, ages, positions, and a brief account of the business experience of the individuals who currently serve as executive officers of the Company as of April 17, 2023:


Name	Age	Position
Lisa M. Harper	63	Chief Executive Officer
Timothy O. Martin	54	Chief Operating Officer and Chief Financial Officer
Elizabeth Muñoz	55	Chief Creative Officer
Bridgett C. Zeterberg	59	Chief Human Resources Officer and Chief Legal Officer

See “Proposal 1—Election of Directors” for a biography of Ms. Harper.

Timothy O. Martin. has served as our Chief Operating Officer and Chief Financial Officer since September 2022. Prior to joining Torrid, from October 2012 to July 2022, Mr. Martin was the Executive Vice President and Chief Financial Officer at Guitar Center, Inc., the world’s largest musical instruments retailer. From December 2009 to July 2012, Mr. Martin was the Chief Financial Officer of Lands’ End, a division of Sears Holdings Corporation and a leading direct merchant of family apparel and accessories and home products. Mr. Martin was previously employed at Coldwater Creek, Inc., a multi-channel specialty retailer of women’s apparel, gifts, jewelry and accessories, serving as Vice President of Finance and Chief Accounting Officer from August 2006 to August 2007 and as Chief Financial Officer from September 2007 to November 2009. Prior to that, Mr. Martin served as Chief Accounting Officer and as Vice President of Finance/Global Commercial Operations for Amgen Inc., a pharmaceutical company, from August 2003 to May 2006. Mr. Martin graduated from the University of Colorado with a Bachelor of Science in Business Administration.

Elizabeth Muñoz has served as our Chief Creative Officer since May 2022. Prior to this, Ms. Muñoz served as Torrid’s Chief Executive Officer from August 2018 to May 2022 and as a member of the Board from June 2021 to May 2022. Ms. Muñoz had served as Torrid’s President and as Torrid’s Senior Vice President of Product from June 2010 through January 2018. Ms. Muñoz served as the President of Lucky Brand from 2007 to January 2010 and Senior Vice President of Design and Merchandising Lucky Brand from 1997 to January 2007. From 1987 to 1997, Ms. Muñoz held various design related positions with Bongo Jeans, including Head of Design and Merchandising. Ms. Muñoz graduated from the Fashion Institute of Design & Merchandising. Additionally, from October 2020 through September 2021, Ms. Muñoz served as a member of the board of directors and the audit committee of Advantage Solutions Inc.

Bridgett C. Zeterberg has served as our Chief Human Resources Officer, Chief Legal Officer, and Corporate Secretary since October 2022. From July 2022 to October 2022, she served as the Company's Chief Legal Officer. Prior to joining the Company, Ms. Zeterberg served as Executive Senior Vice President of Human Resources, General Counsel and Corporate Secretary of Tuesday Morning Corporation until June 2022. At Tuesday Morning Corporation, among her other responsibilities, Ms. Zeterberg guided the company through its voluntary filing for Chapter 11 bankruptcy and subsequent emergence from bankruptcy. Ms. Zeterberg also served as Senior Vice President, General Counsel and Human Resources of Zale Corporation, and as Senior Vice President, General Counsel of Total Wine & More. Ms. Zeterberg served in various roles for hospitality company Accor North America including Vice President, Assistant General Counsel and Vice President of Human Resources for the Motel 6 Division. Prior to serving as corporate counsel, Ms. Zeterberg was in private practice with various law firms. Ms. Zeterberg received her law degree from the University of San Diego and graduated from the University of California San Diego.

EXECUTIVE AND DIRECTOR COMPENSATION

Compensation Overview

We are currently considered a “smaller reporting company,” as defined in Rule 12b-2 of the Exchange Act, for purposes of the SEC’s executive compensation disclosure rules. In accordance with such rules, we are required to provide a Summary Compensation Table, an Outstanding Equity Awards at Fiscal Year End Table and a Director Compensation Table, as well as limited narrative disclosures.

This section provides information about the material elements of compensation that are paid to, awarded to, or earned by, our “named executive officers,” who consist of anyone who served as our principal executive officer (“PEO”) during fiscal year 2022 and our two other most highly compensated executive officers who were serving at the end of fiscal year 2022 other than our PEO. For fiscal year 2022, our named executive officers, were:

•Lisa M. Harper, Chief Executive Officer;(1)

•Elizabeth Muñoz, Chief Creative Officer, and Former Chief Executive Officer;(2)

•Timothy O. Martin, Chief Operating Officer, and Chief Financial Officer;(3) and

•Bridgett C. Zeterberg, Chief Human Resources Officer, Chief Legal Officer, and Corporate Secretary.(4)


(1)			On May 3, 2022, the Company announced that Ms. Harper was appointed as the Chief Executive Officer of the Company, effective as of such date. Ms. Harper has served as a member of the Company’s Board and its predecessor since 2008. Following such appointment, she has continued to serve as a member of the Board as an employee director and a member of the Nominating and Corporate Governance Committee, and she no longer receives any cash compensation in respect of her service on the Board.
(2)			On May 3, 2022, the Company announced that Ms. Muñoz voluntarily transitioned to the role of the Company’s Chief Creative Officer, effective as of such date. Ms. Muñoz previously served as the Company’s Chief Executive Officer. In connection with such transition, Ms. Muñoz also stepped down from her role as a member of the Company’s Board, also effective as of such date.
(3)			On August 3, 2022, the Company announced that Mr. Martin was appointed as the Chief Operating Officer and Chief Financial Officer of the Company, effective as of September 12, 2022.
(4)			On July 5, 2022, Ms. Zeterberg joined the Company as its Senior Vice President, Chief Legal Officer, and on October 4, 2022, Ms. Zeterberg was appointed as the Company’s Chief Human Resources Officer, Chief Legal Officer, and Corporate Secretary, effective as of such date.

Compensation Philosophy and Objectives

The objectives of our executive compensation program are to:

•Attract, motivate and retain talented and experienced executives in our industry;

•Reward executives whose knowledge, skills and performance are critical to our success;

•Align the interests of our executive officers with our stockholders by motivating executive officers to increase stockholder value;

•Foster a shared commitment among executives by aligning individual goals with the goals of the executive management team and our company, while also recognizing individual contributions to the success of our Company; and

•Compensate our executives in a manner that is fair but also ensures alignment between pay and performance to meet our long-range performance objectives.

To achieve these objectives, the Compensation Committee established the current executive compensation program, with the intention of aligning our executives’ overall compensation to key strategic financial and operational goals.

Upon the consummation of the IPO in fiscal year 2021, the Compensation Committee of the Board was appointed and, in consultation with our independent outside compensation consultant Exequity LLP (“Exequity”), our Compensation Committee informally benchmarked our executive compensation against a peer group of companies. This informal benchmarking analysis was reaffirmed at our Compensation Committee meetings in the first and fourth quarters of fiscal year 2022. In the future, we anticipate that our Compensation Committee may make adjustments to our executive compensation program as a result of this informal benchmarking process, in addition to the factors traditionally reviewed, including Company and individual performance.

Compensation Committee Procedures

The Compensation Committee is responsible for discharging the Board’s obligations relating to the compensation of our named executive officers and members of the Board. The Compensation Committee is generally responsible for overseeing and evaluating the Company’s compensation strategy, benefits policies, and compensation plans, policies and practices applicable to our Chief Executive Officer and our other named executive officers. The Compensation Committee operates pursuant to a written charter, which is available at the Company’s website, https://investors.torrid.com. The Compensation Committee charter is reviewed annually by the Board and updated as appropriate.

The Compensation Committee meets outside the presence of all of our executive officers, including our named executive officers, to consider appropriate compensation for our Chief Executive Officer. For all of our other named executive officers, the Compensation Committee will meet outside the presence of all executive officers except our Chief Executive Officer. Our Chief Executive Officer reviews annually each of the other named executive officers’ performance with the Compensation Committee and recommends appropriate base salary, cash performance awards and grants of long-term equity incentive awards for all other executive officers. Based upon the recommendations of our Chief Executive Officer, and in consideration of the objectives and the principles described herein, the Compensation Committee approves the annual compensation packages of our executive officers, other than our Chief Executive Officer. The Compensation Committee also annually analyzes our Chief Executive Officer’s performance and determines the Chief Executive Officer’s base salary, cash performance-based annual awards and grants of long-term equity incentive awards based on its assessment of the Chief Executive Officer’s performance.

Compensation Committee Independent Consultant

In order to ensure that we continue to remunerate our executives appropriately, the Compensation Committee relies on advice and data provided by Exequity, our independent outside compensation consultant, which generally reviews policies, programs, and levels with respect to executive compensation and outside independent director compensation. Specifically, Exequity provides comparative market data on compensation practices and programs based on an analysis of peer company practices and guidance on industry best practices. The Compensation Committee retains the right to modify or terminate its relationship with Exequity or select other outside advisors to assist the Compensation Committee in carrying out its responsibilities.

Risk Assessment

The Compensation Committee has reviewed the Company’s compensation programs and policies and has determined that any risks arising from its compensation programs and policies are not reasonably likely to have a material adverse effect on the Company. The Company’s compensation programs and policies mitigate risk by providing executive pay that is predominantly incentive-based through cash incentive awards that are subject to forfeiture if threshold performance goals are not achieved and the use

of stock options which only provide value to recipients if the stock price increases. The combination of performance measures for annual bonuses and the equity compensation program, as well as the multiyear vesting schedule for equity awards, encourage employees to maintain both a short- and a long-term view with respect to Company performance.

Elements of Compensation

Our current executive compensation program consists of the following components:

•base salary;

•annual cash incentive awards linked to our overall financial performance;

•annual grants of long-term equity-based compensation, such as time-based restricted stock units (“RSUs”), performance-based restricted stock units (“PSUs”), and/or nonqualified stock options;

•other executive benefits and perquisites; and

•employment agreements and offer letters with our named executive officers, which contain specified termination benefits.

We combine these elements in order to formulate compensation packages that provide competitive pay, reward the achievement of financial, operational and strategic objectives and align the interests of our executive officers with those of our stockholders.

Pay Mix

We utilize the particular elements of compensation described above because we believe they align with our goal of paying for performance. Specifically, we believe these particular elements provide a well-proportioned mix of pay, which balances retention through fixed compensation and at-risk performance-based compensation through short- and long-term incentives. By following this approach, we strive to provide executive compensation security, while motivating executives to focus on Company performance translating into long-term value creation for stockholders. The mix of metrics used for our annual performance bonus and our long-term incentive program likewise provides an appropriate balance between short-term financial performance and long-term financial and stock performance.

Base Salary

Base salary represents the fixed portion of compensation for our named executive officers and is an important element of compensation intended to attract and retain highly talented individuals. The base salary established for each of our executive officers is intended to reflect each individual’s responsibilities, experience, prior performance and other discretionary factors deemed relevant by our Chief Executive Officer and the Compensation Committee.

Base salary increases are generally based on annual market movement and individual performance. Base salary may be reviewed at promotion or based on a change in responsibility. The Compensation Committee receives input from the Board regarding our Chief Executive Officer’s performance, and the Compensation Committee receives input from the Chief Executive Officer on the other named executive officers’ performance.

Base salaries are reviewed during the first quarter of the fiscal year by our Chief Executive Officer and the Compensation Committee and may be adjusted from time to time based on the results of this review. In the first quarter of fiscal year 2022, the Compensation Committee, in consultation with Exequity, reviewed our named executive officers’ base salaries to determine if any adjustments were warranted. The Compensation Committee subsequently determined that no changes were necessary.

Annual Bonus

Our named executive officers are eligible to participate in our annual cash incentive plan (the “Annual Incentive Plan”) which provides an opportunity to earn an annual cash incentive award based on the attainment of certain pre-determined Adjusted EBITDA(1) goals, as adjusted for certain events and expenses. Payments made to participants in our Annual Incentive Plan, including our named executive officers, are made in the first quarter of the fiscal year following the conclusion of the fiscal year performance period. The Adjusted EBITDA(1) goals are established by the Compensation Committee prior to, or shortly after, the start of the applicable fiscal year in conjunction with approval of our fiscal year budget and range from a minimum (or threshold) level to a maximum level, with a target level in between.

Under the Annual Incentive Plan, for fiscal year 2022, each named executive officer had a targeted incentive award potential expressed as a percentage of his or her annual base salary as set forth in the table below, with a threshold incentive award potential equal to 40% of such named executive officer’s target incentive award and a maximum incentive award potential equal to 200% of such named executive officer’s target annual incentive. If threshold performance goals are not met, the named executive officer is not entitled to receive an annual bonus under the Annual Incentive Plan. Notwithstanding such targets, the Board has the discretion to increase or reduce the size of any award if it believes the interests of our stockholders would be better served by doing so.

The following chart describes the target bonus percentages for each of our named executive officers for fiscal year 2022.



Name	Target Bonus %
Lisa M. Harper		150%
Elizabeth Muñoz		125%
Timothy O. Martin		80%
Bridgett C. Zeterberg		65%

For purposes of the Annual Incentive Plan, we established a target Adjusted EBITDA(1) goal of approximately $277 million for fiscal year 2022. After adjustment for certain events and expenses in accordance with the terms of the Annual Incentive Plan, our Adjusted EBITDA(1) for fiscal year 2022 resulted in no annual incentive award payouts being made to any of our named executive officers under the Annual Incentive Plan in respect of fiscal year 2022 (except for Mr. Martin).

Pursuant to his employment agreement, Mr. Martin received a guaranteed annual incentive award in respect of fiscal year 2022 equal to target, prorated for Mr. Martin’s partial year of service. Please see the section below entitled “Executive Compensation — Narrative to Fiscal Year 2022 Summary Compensation Table” for further information on Mr. Martin’s employment agreement.

Long-Term Equity-Based Compensation

Effective as of the consummation of the IPO, the Board adopted the Torrid Holdings Inc. 2021 Long-Term Incentive Plan (the “LTIP”) for our employees, consultants and directors, including our named executive officers. The LTIP provides for the grant of stock options, stock appreciation rights, restricted stock, restricted stock units, stock awards, dividend equivalents, other stock-based awards, cash awards and substitute awards intended to align the interests of our executives with those of our stockholders.

Our Chief Executive Officer and the Compensation Committee believe that equity-based compensation is an important component of our executive compensation program, and that providing a significant portion of our executive officers’ total compensation package in equity-based compensation

(1) Adjusted EBITDA is a non-GAAP financial measure. See Appendix A of this proxy statement for additional information on non-GAAP financial measures.

aligns the incentives of our executives with the interests of our stockholders and with our long-term corporate success. Additionally, our Chief Executive Officer and the Compensation Committee believe that equity-based compensation awards enable us to attract, motivate, retain and adequately compensate executive talent. To that end, we have awarded certain of our executives equity-based compensation in the form of restricted stock awards (“RSAs”), RSUs, PSUs and/or nonqualified stock options. Our Chief Executive Officer and the Compensation Committee believe equity awards provide executives with a significant long-term interest in our success by rewarding the creation of stockholder value over time. Our Compensation Committee, in consultation with our Chief Executive Officer, and subject to approval by the Board, as deemed necessary by the Compensation Committee, determines the size, terms and conditions of equity grants to our executive officers in accordance with the terms of the LTIP and will approve them on an individual basis.

For fiscal year 2022, the equity awards granted to Ms. Harper, Mr. Martin, and Ms. Zeterberg were made in connection with each of their appointments as executive officers of the Company in fiscal year 2022. In addition, Ms. Zeterberg received an additional grant of equity awards upon her appointment to the office of Chief Human Resources Officer on October 4, 2022.

For further information regarding the equity awards that were granted to our named executive officers under the LTIP in fiscal year 2022, please see the section below entitled “Executive Compensation — Narrative to Fiscal Year 2022 Summary Compensation Table” and the “Outstanding Equity Awards at the end of Fiscal Year 2022” table below.

Other Executive Benefits and Perquisites

We provide the following benefits to our executive officers on the same basis as other eligible employees (except for the supplemental health care insurance plan noted below, which is only offered to our executive officers):

•health insurance and supplemental health care insurance plans;

•flexible time off (vacation or sick days) and a personal holiday;

•life insurance and supplemental life insurance;

•short-term and long-term disability;

•a 401(k) plan, with employer contributions of 50% of the first 4% of participants’ eligible contributions; and

•a nonqualified deferred compensation plan, with employer contributions of 50% of the first 4% of participants’ eligible contributions.

We believe these benefits are generally consistent with those offered by other companies and specifically with those companies with which we compete for talent.

Agreements with Named Executive Officers

We believe that a strong, experienced management team is essential to the best interests of the Company and our stockholders. We have entered into employment agreements and/or offer letters with each of our named executive officers. In addition, we have entered into a proprietary information and inventions agreement with each of our named executive officers that provides for a covenant not to solicit employees during employment and for a period of two years following termination of employment for any reason, a covenant not to compete with the Company during employment, perpetual non-disclosure of confidential information covenant, and an assignment of intellectual property covenant. For a description of the terms of the employment agreements and/or offer letters with certain of our named executive officers, please see the section below entitled “Executive Compensation — Narrative to Fiscal Year 2022 Summary Compensation Table.” For a more complete description of our obligations under the

employment agreements and/or offer letters in the event of a termination of employment or change in control, please see the section below entitled “Executive Compensation — Potential Payments Upon Termination or Change in Control.”

Clawback Policy

The Compensation Committee is reviewing the final rule issued by the SEC implementing the provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act relating to recoupment of incentive-based compensation and will adopt a compliant clawback policy when the NYSE adopts listing standards in accordance with the final rules.

Section 280G of the Internal Revenue Code

In approving compensation arrangements for our named executive officers, the Board and Compensation Committee considers all elements of the cost to us of providing such compensation, including the potential impact of Section 280G of the Code. However, the Board may, in its judgment, authorize compensation arrangements that could give rise to loss of deductibility of Section 280G of the Code and the imposition of excise taxes under Section 4999 of the Code when it believes that such arrangements are appropriate to attract and retain executive talent. However, we do not provide for excise tax gross-ups to our executive officers and do not expect to do so in the future.

Section 162(m) Compliance

Section 162(m) of the Internal Revenue Code limits us to a deduction for federal income tax purposes of no more than $1 million of compensation paid to certain executive officers in a taxable year. The Compensation Committee will consider the impact of Section 162(m) when making compensation decisions.

Section 409A Considerations

Another section of the Code, Section 409A, affects how deferred compensation opportunities are offered to our employees because Section 409A requires, among other things, that “nonqualified deferred compensation” be structured in a manner that limits employees’ abilities to accelerate or further defer certain kinds of deferred compensation. We intend to operate our existing compensation arrangements that are covered by Section 409A in accordance with the applicable rules thereunder, and we will continue to review and amend our compensation arrangements where necessary to comply with Section 409A.

Fiscal Year 2022 Summary Compensation Table

The following table summarizes the total compensation paid to or earned by each of our named executive officers in fiscal years 2022 and 2021.


Name and principal position	Year	Salary ($)(1)	Bonus ($)(2)	Stock Awards ($)(3)	Option Awards ($)(4)	Non-Equity Incentive Plan Compensation ($)(5)	Change in Pension Value and Nonqualified Deferred Compensation Earnings ($)	All Other Compensation ($)(6)	Total ($)
Lisa M. Harper(7)	2022	707,688	—	999,000	—	—	—	36,008	1,742,696
Chief Executive Officer	2021	—	—	—	—	—	—	—	—
Elizabeth Muñoz(8)	2022	900,000	—	—	—	—	—	18,514	918,514
Chief Creative Officer and Former Chief Executive Officer	2021	900,019	—	8,426,241	—	30,357,730	252,587	20,681	39,956,898
Timothy O. Martin(9)	2022	276,923	244,396	2,000,000	1,000,000	—	—	4,007	3,525,326
Chief Operating Officer and Chief Financial Officer	2021	—	—	—	—	—	—	—	—
Bridgett C. Zeterberg(10)	2022	242,692	—	350,000	350,000	—	—	3,280	945,972
Chief Human Resources Officer, Chief Legal Officer, and Corporate Secretary	2021	—	—	—	—	—	—	—	—


(1)			Amounts in this column reflect the base salary earned by each of our named executive officers in the applicable fiscal year.
(2)			The amount in this column represents a guaranteed annual cash incentive bonus earned by Mr. Martin in respect of fiscal year 2022 equal to target, prorated for his partial year of service, payable pursuant to his employment agreement.
(3)			Amounts in this column represent the aggregate grant date fair value of awards of stock granted to certain of our named executive officers in the applicable fiscal year, as computed in accordance with FASB ASC Topic 718.
(4)			Amounts in this column represent the aggregate grant date fair value of awards of options granted to certain of our named executive officers in the applicable fiscal year, as computed in accordance with FASB ASC Topic 718.
(5)			The amount in this column represents (i) an annual cash incentive bonus equal to $2,250,000 earned by Ms. Muñoz in respect of fiscal year 2021, and (ii) $28,107,370, which is the amount of the accounting expense incurred in fiscal year 2021 with respect to Ms. Muñoz’s vested incentive units, which were settled in fully-vested shares of the Company in connection with the IPO.
(6)			Amounts in this column consist of, for fiscal year 2022, the following:


Name	Supplemental Healthcare Insurance Plan Premiums ($)	Supplemental Disability Income Insurance Premiums ($)	Matching Contributions to 401k Plan ($)	Matching Contributions Pursuant to Nonqualified Deferred Compensation Plan ($)	Miscellaneous ($)(a)	Total ($)
Lisa M. Harper	7,925	2,528	-	-	25,556	36,008
Elizabeth Muñoz	13,715	4,107	-	692	-	18,514
Timothy O. Martin	2,290	948	769	-	-	4,007
Bridgett C. Zeterberg	2,395	885	-	-	-	3,280

(a) This amount represents the prorated portion of Ms. Harper’s annual cash retainer, which was paid to Ms. Harper in respect of her service on the Board during fiscal year 2022 prior to being appointed as Chief Executive Officer of the Company on May 3, 2022.


(7)			On May 3, 2022, the Company announced that Ms. Harper was appointed as the Chief Executive Officer of the Company, effective as of such date. Ms. Harper is a named executive officer for the first time in fiscal year 2022.
(8)			On May 3, 2022, the Company announced that Ms. Muñoz voluntarily transitioned to the role of the Company’s Chief Creative Officer, effective as of such date.
(9)			On August 3, 2022, the Company announced that Mr. Martin was appointed as the Chief Operating Officer and Chief Financial Officer of the Company, effective as of September 12, 2022. Mr. Martin is a named executive officer for the first time in fiscal year 2022.
(10)			On July 5, 2022, Ms. Zeterberg joined the Company as its Senior Vice President, Chief Legal Officer, and on October 4, 2022, Ms. Zeterberg was appointed as the Company’s Chief Human Resources Officer, Chief Legal Officer and Corporate Secretary, effective as of such date. Ms. Zeterberg is a named executive officer for the first time in fiscal year 2022.

Narrative to the Fiscal Year 2022 Summary Compensation Table

Lisa M. Harper Employment Agreement

On May 3, 2022, we entered into an employment agreement with Ms. Harper that sets forth the terms of her employment as the Company’s Chief Executive Officer. Ms. Harper’s employment agreement does not provide for a fixed term of employment. Pursuant to her employment agreement, Ms. Harper will receive the following: (i) an initial annual base salary of $1,000,000, less required deductions and withholdings, (ii) an annual bonus with a target opportunity equal to 150% of base salary less required deductions and withholdings, (iii) an initial equity award under the LTIP, as further described in the “Outstanding Equity Awards at the end of Fiscal Year 2022” table below, and (iv) reimbursement of reasonable business expenses incurred in conducting her duties as the Company’s Chief Executive Officer as well as of certain relocation expenses.

Ms. Harper’s employment agreement provides for the following restrictive covenants: (i) during the term of her employment and any period thereafter in which Ms. Harper is receiving severance benefits pursuant to her employment agreement (as further described in the section below captioned “Potential Payments upon Termination or a Change in Control”), an agreement not to engage in competition, directly or indirectly, with the Company or its affiliates, (ii) for a period of two years following the termination of her employment, an agreement not to solicit or encourage employees of the Company to leave its employ, or to hire such employees, (iii) during the term of her employment, an agreement not to acquire, assume or participate in any position, investment or interest known by Ms. Harper to be adverse or antagonistic to the Company or in any entity that is in competition with the business of the Company or any of its affiliates, (iv) during the term of her employment and at all times thereafter, an agreement not to disparage the Company, its affiliates or their respective employees, officers, directors or equity holders, (v) during the term of her employment and at all times thereafter, an agreement to preserve as confidential and not to disclose or use (other than on behalf of the Company) confidential information relating to the Company or its business and affairs, and (vi) an agreement to assign to the Company all trade secrets,

inventions, developments and ideas protectable under relevant intellectual property laws and other proprietary rights.

Ms. Harper’s employment agreement also provides for certain severance payments and benefits in the event of specified termination events, as described below in the section captioned “Potential Payments upon Termination or a Change in Control.”

Elizabeth Muñoz Employment Agreement and Amendment

On December 13, 2019, we entered into an employment agreement with Elizabeth Muñoz that set forth the terms of her employment as the Company’s Chief Executive Officer. On May 3, 2022, Ms. Muñoz voluntarily transitioned from her role as the Chief Executive Officer of the Company to the role of the Company’s Chief Creative Officer. In connection with such transition, we entered into an amendment to her employment agreement, effective as of May 3, 2022, as further described below.

Ms. Muñoz’s employment agreement provides for base salary, eligibility to receive an annual bonus, eligibility to receive long-term incentive compensation and participation in the Company’s standard benefit plans. Ms. Muñoz’s employment agreement has no fixed term.

The terms of Ms. Muñoz’s employment agreement provide for a covenant not to compete with us or to solicit our employees and customers during employment and for a period of twelve months following her termination of employment for any reason, a perpetual non-disclosure of confidential information covenant, and a perpetual mutual non-disparagement covenant.

Ms. Muñoz’s employment agreement also contemplated that she was entitled to receive an equity award in connection with the consummation of the IPO, with such equity award further described in the “Outstanding Equity Awards at the end of Fiscal Year 2022” table below. Following the IPO, Ms. Muñoz is eligible to receive an annual incentive equity award grant in a form and at a time determined by our Compensation Committee on terms no less favorable to our other members of the senior management team, and subject to vesting and other terms of the LTIP.

Ms. Muñoz’s employment agreement also provides for certain severance payments and benefits in the event of specified termination events, as described below in the section captioned “Potential Payments upon Termination or a Change in Control”.

The May 3, 2022 amendment to Ms. Muñoz’s employment agreement provides that she will be employed by the Company as its Chief Creative Officer, will report directly to the Company’s Chief Executive Officer, and would resign as a member of the Board. Further, Ms. Muñoz waived any right to claim “good reason” (as defined in her employment agreement) related to the changes in her title, duties, responsibilities and offices as provided for in the amendment. The amendment further provided that Ms. Muñoz’s compensation and benefits would remain the same in her new role as Chief Creative Officer of the Company.

Timothy O. Martin Employment Agreement

On August 1, 2022, we entered into an employment agreement with Mr. Martin that sets forth the terms of his employment as the Company’s Chief Operating Officer and Chief Financial Officer. Mr. Martin’s employment agreement does not provide for a fixed term of employment. Pursuant to his employment agreement, Mr. Martin is eligible to receive the following: (i) an initial annual base salary of $800,000, less required deductions and withholdings, (ii) an annual bonus with a target opportunity equal to 80% of base salary, less required deductions and withholdings, with Mr. Martin’s annual bonus for fiscal year 2022 to be paid based on target achievement and prorated for his service during the 2022 fiscal year, and (iii) an initial equity award under the LTIP, as further described in the “Outstanding Equity Awards at the end of Fiscal Year 2022” table below.

Mr. Martin’s employment agreement provides for the following restrictive covenants: (i) non-competition during the term of Mr. Martin’s employment and any period thereafter in which Mr. Martin is receiving severance benefits pursuant to his employment agreement, (ii) non-solicitation of employees for

two years following termination of employment, (iii) during the term of Mr. Martin’s employment, an agreement not to acquire, assume or participate in any position, investment or interest known by Mr. Martin to be adverse or antagonistic to the Company or in any entity that is in competition with the business of the Company or any of its affiliates, (iv) mutual perpetual non-disparagement, (v) perpetual non-disclosure of confidential information, and (vi) assignment of intellectual property.

Mr. Martin’s employment agreement also provides for certain severance payments and benefits in the event of specified termination events, as described below in the section captioned “Potential Payments upon Termination or a Change in Control.”

Bridgett C. Zeterberg Offer Letter

On May 30, 2022, we entered into an offer letter with Bridgett C. Zeterberg that sets forth the terms of her employment as the Company’s Senior Vice President, Chief Legal Officer. Ms. Zeterberg’s offer letter does not provide for a fixed term of employment. Ms. Zeterberg’s offer letter provides for an annual base salary, eligibility to receive an annual bonus, eligibility to receive long-term incentive compensation under the LTIP, and participation in the Company’s standard benefit plans.

Ms. Zeterberg’s offer letter provides for the following restrictive covenants: (i) non-competition during the term of Ms. Zeterberg’s employment, (ii) non-solicitation of employees during employment and for a period of two years following her termination of employment for any reason, (iii) non-disparagement, and (iv) perpetual non-disclosure of confidential information.

Ms. Zeterberg’s offer letter also provides for certain severance payments and benefits in the event of specified termination events, as described below in the section captioned “Potential Payments upon Termination or a Change in Control.”

Long-Term Equity-Based Compensation

In connection with the consummation of the IPO, the unvested portion of any previously granted awards of incentive units made to our executives was converted into RSAs under the LTIP. Such RSAs generally vest in substantially equal quarterly installments, subject to continued employment through each such vesting date.

In addition, upon the consummation of the IPO, we granted our executives equity awards under the LTIP in the form of RSAs, RSUs and/or nonqualified stock options. Such grants generally vest in substantially equal installments on each of the first four anniversaries of the applicable vesting commencement date, subject to continued employment through each such vesting date.

In fiscal year 2022, we granted our named executive officers equity awards under the LTIP in the form of RSUs, nonqualified stock options, and/or PSUs. The mix of equity awards granted to our named executive officers in fiscal year 2022 was as follows: (i) for Ms. Harper, 100% in the form of PSUs; (ii) for Mr. Martin, one-third in the form of nonqualified stock options, one-third in the form of RSUs and one-third in the form of PSUs; and (iii) for Ms. Zeterberg, 50% in the form of nonqualified stock options and 50% in the form of RSUs.

The 2022 nonqualified stock option and RSU awards generally vest in substantially equal installments on each of the first four anniversaries of the applicable vesting commencement date, subject to continued employment through each such vesting date. The 2022 PSUs generally (i) time-vest in substantially equal installments on each of the first three anniversaries of the applicable grant date, subject to continued employment through each such vesting date, and (ii) performance-vest based upon the achievement of the Company’s common stock of specified volume-weighted average trading price targets (each, a “VWAP Target”) during the three-year performance period starting on the applicable grant date.

Our named executive officers’ outstanding equity awards are further described in the “Outstanding Equity Awards at the end of Fiscal Year 2022” table below.

Outstanding Equity Awards at the end of Fiscal Year 2022

The following table sets forth certain information with respect to outstanding equity awards of our named executive officers as of January 28, 2023, with respect to the named executive officer.


		Option Awards				Stock Awards
Name	Grant Date	Number of securities underlying unexercised options exercisable (#)	Number of securities underlying unexercised options unexercisable (#)(1)	Option exercise price ($)	Option expiration date	Number of shares or units of stock that have not vested (#)(1)	Market value of shares or units of stock that have not vested ($)(2)	Equity incentive plan awards: number of unearned shares, units or other rights that have not vested (#)(1)	Equity incentive plan awards: market value of unearned shares, units or other rights that have not vested ($)(2)
Lisa M. Harper	5/3/22	—	—	—	—	—	—	300,000(3)	1,113,000
Elizabeth Muñoz	7/6/21	—	—	—	—	80,221(4)	297,620	—	—
	7/6/21	—	—	—	—	23,810(5)	88,335	—	—
Timothy O. Martin	9/12/22	—	254,453(6)	6.64	9/12/32	—	—	—	—
	9/12/22	—	—	—	—	150,603(7)	558,737	—	—
	9/12/22	—	—	—	—	—	—	181,489(8)	673,324
Bridgett C. Zeterberg	7/6/22	—	67,568(6)	4.45	7/6/32	—	—	—	—
	7/6/22	—	—	—	—	39,326(7)	145,899	—	—
	10/4/22	—	63.869(6)	4.60	2/18/32	—	—	—	—
	10/4/22	—	—	—	—	38,044(7)	141,143	—	—


(1)			The treatment of these awards upon certain termination and change in control events is described in the “Potential Payments Upon Termination or a Change in Control” section below.
(2)			The values in these columns are calculated based on $3.71, the closing price of our common stock on January 28, 2023.
(3)			Represents an award of PSUs granted to Ms. Harper under the LTIP. Such PSUs (i) time-vest in substantially equal installments on each of the first three anniversaries of the applicable grant date, subject to continued service through each such vesting date, and (ii) performance-vest based upon the achievement of the Company’s common stock of specified VWAP Targets during the three-year performance period starting on the grant date as follows: (a) 25% upon achievement of a $15 VWAP Target, (b) 50% upon achievement of a $20 VWAP Target, (c) 75% upon achievement of a $25 VWAP Target, and (d) 100% upon achievement of a $30 VWAP Target. As of January 28, 2023, all of Ms. Harper’s PSUs remained unvested, as the foregoing VWAP Targets have not yet been achieved.
(4)			Represents RSAs granted to Ms. Muñoz under the LTIP in connection with the consummation of the IPO. Such RSAs vest quarterly in nine substantially equal installments between August 29, 2021 and August 29, 2023, subject to continued employment through each such vesting date.
(5)			Represents an award of RSUs granted to Ms. Muñoz under the LTIP in connection with the consummation of the IPO. Such RSUs vest as follows: (i) 50% vested on the grant date, and (ii) the remaining 50% vest in substantially equal installments on the first three anniversaries of the grant date, subject to continued employment through each such vesting date.
(6)			Represents awards of nonqualified stock options granted to each of Mr. Martin and Ms. Zeterberg under the LTIP. Such option awards each vest in substantially equal installments on the first four anniversaries of the applicable vesting commencement date, subject to continued employment through each such vesting date.
(7)			Represents awards of RSUs granted to each of Mr. Martin and Ms. Zeterberg under the LTIP. Such RSU awards each vest in substantially equal installments on the first four anniversaries of the applicable vesting commencement date, subject to continued employment through each such vesting date.
(8)			Represents awards of PSUs granted to Mr. Martin under the LTIP. Such PSUs (i) time-vest in substantially equal installments on each of the first three anniversaries of the applicable grant date, subject to continued service through each such vesting date, and (ii) performance-vest based upon the achievement of the Company’s common stock of a specified VWAP Target during the three-year performance period starting on the grant date as follows: 100% upon achievement of a $10 VWAP Target. As of January 28, 2023, all of Mr. Martin’s PSUs remained unvested, as the foregoing VWAP Target has not yet been achieved.

Potential Payments upon Termination or a Change in Control

Lisa M. Harper Employment Agreement

Upon a termination of Ms. Harper’s employment by the Company without “cause” or a resignation by Ms. Harper for “good reason” (each as defined in her employment agreement), subject to Ms. Harper’s execution and non-revocation of a release of claims, Ms. Harper is entitled to receive the following severance benefits: (i) payment of an amount equal to 200% of base salary in effect at the time of termination, less required deductions and withholdings, payable in equal installments in accordance with the Company’s regular payroll practices over the 12-month period following such date of termination, and (ii) if Ms. Harper is eligible for and timely elects continued coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 or analogous provisions of state law (collectively, “COBRA”) for herself and/or her eligible dependents under the Company’s group health insurance plans following the termination of her employment, the Company will pay the COBRA premiums necessary to continue the health insurance coverage in effect for Ms. Harper and/or her eligible dependents as of such date of termination until the earliest of (x) 36 months following such termination date, (y) the expiration of Ms. Harper’s eligibility for continuation coverage under COBRA, and (z) the date Ms. Harper becomes eligible for substantially equal group health insurance coverage in connection with new employment.

Elizabeth Muñoz Employment Agreement

Upon a termination of Ms. Muñoz’s employment by the Company without “cause” or a resignation by Ms. Muñoz for “good reason” (each as defined in her employment agreement), subject to Ms. Muñoz’s execution and non-revocation of a release of claims, Ms. Muñoz is entitled to receive the following severance benefits: (i) payment of an amount equal to twelve months of her then-current base salary, payable in accordance with our normal payroll procedures during the twelve-month period following termination of employment, (ii) a pro-rata portion of her annual target bonus through the date of her termination of employment based on actual Company performance, payable when annual bonuses are paid to other senior executives of the Company, and (iii) if Ms. Muñoz is eligible for and timely elects continued coverage under COBRA for herself and/or her eligible dependents under the Company’s group health insurance plans following the termination of her employment, the Company will pay the employer portion of the COBRA premiums necessary to continue the health insurance coverage in effect for Ms. Muñoz and/or her eligible dependents as of such date of termination until the earliest of (x) 12 months following such termination date, (y) the expiration of Ms. Muñoz’s eligibility for continuation coverage under COBRA, and (z) the date Ms. Muñoz becomes eligible for substantially equal group health insurance coverage in connection with new employment.

In the event Ms. Muñoz’s employment is terminated due to death or disability, she (or her estate) is entitled to severance equal to a pro-rata portion of her annual target bonus through the date of her termination of employment.

In addition, Ms. Muñoz’s employment agreement provides that, if Ms. Muñoz’s employment is terminated by the Company for any reason other than for “cause” or by Ms. Muñoz for “good reason”, in each case, during the two-year period immediately following a Change of Control (as defined in Ms. Muñoz’s August 29, 2018 incentive unit grant agreement) that occurs following an IPO, subject to her execution and non-revocation of a release of claims, all of her unvested equity-based awards will vest in full on the 60th day following her termination of employment.

The May 3, 2022 amendment to Ms. Muñoz’s employment agreement provides that she waived any right to claim “good reason” (as defined in her employment agreement) related to the changes in her title, duties, responsibilities, and offices as provided for in the amendment.

Timothy O. Martin Employment Agreement

Upon a termination of Mr. Martin’s employment by the Company without “cause” or a resignation by Mr. Martin for “good reason” (each as defined in his employment agreement), subject to his execution and non-revocation of a release of claims and continued compliance with restrictive covenants, Mr.

Martin will receive the following severance benefits: (i) payment of an amount equal to 100% of base salary in effect at the time of termination, less required deductions and withholdings, payable in equal installments in accordance with the Company’s regular payroll practices over the 12-month period following such date of termination, and (ii) subject to Mr. Martin’s timely election for continued coverage under COBRA, the Company will pay the COBRA premiums necessary to continue the health insurance coverage in effect for Mr. Martin and/or his eligible dependents as of such date of termination until the earliest of (x) 12 months following such termination date, (y) the expiration of Mr. Martin’s eligibility for continuation coverage under COBRA, and (z) the date Mr. Martin becomes eligible for substantially equal group health insurance coverage in connection with new employment.

Bridgett C. Zeterberg’s Offer Letter

Upon a termination of Ms. Zeterberg’s employment by the Company without “cause” (as defined in her offer letter), subject to her execution and non-revocation of a release of claims, Ms. Zeterberg will receive the following severance benefits: (i) payment of an amount equal to 100% of base salary in effect at the time of termination, less required deductions and withholdings, payable in equal installments in accordance with the Company’s regular payroll practices over the 12-month period following such date of termination, and (ii) if Ms. Zeterberg is eligible for and timely elects continued coverage under COBRA for herself and/or her eligible dependents under the Company’s group health insurance plans following the termination of her employment, the Company will pay the COBRA premiums necessary to continue the health insurance coverage in effect for Ms. Zeterberg and/or her eligible dependents as of such date of termination until the earliest of (x) 12 months following such termination date and (y) the expiration of Ms. Zeterberg’s eligibility for continuation coverage under COBRA.

Cause and Good Reason Definitions

For purposes of Ms. Zeterberg’s offer letter and Ms. Harper’s and Mr. Martin’s employment agreements, “cause” generally means the following events, as determined by the Board, in its sole discretion: (i) willful misconduct, including, but not limited to, dishonesty which materially and adversely reflects upon the executive’s ability to perform his or her duties for the Company, (ii) conviction of, or the entry of a pleading of guilty or nolo contendere by the executive to, any crime involving moral turpitude or any felony, (iii) fraud, embezzlement or theft against the Company, (iv) material breach of any material provision of any employment contract, assignment of inventions, confidentiality and/or nondisclosure agreement between the executive and the Company (or, for Ms. Harper and Mr. Martin, any material written policy or code of conduct of the Company), or (v) willful and habitual failure to attend to his or her duties, after written notice to the executive and no less than a 90 day period (or 10 days for Mr. Martin) to cure such failure provided such failure to perform is subject to cure with the passage of time (or, for Ms. Zeterberg, her failure to attend to her duties as assigned by the Chief Executive Officer of the Company).

For purposes of Ms. Muñoz’s employment agreement, “cause” generally means the following: (i) conviction of a felony (or entry of a plea of guilty or nolo contendre with respect to a felony), (ii) fraudulent conduct, (iii) willful refusal to materially perform her duties (except during periods when she is unable to perform such duties as a result of her illness (either physical or mental) or other incapacity or excused absence or vacation) consistent with her position and title as reasonably directed by the Board, (iv) willful misconduct which has a material adverse effect on us or our reputation or our subsidiaries, or (v) a material breach by Ms. Muñoz of her obligations as set forth in the employment agreement.

For purposes of Ms. Harper’s and Mr. Martin’s employment agreements, “good reason” generally means the occurrence of any of the following events without the executive’s consent: (i) a material reduction in the executive’s duties, authority, or responsibilities relative to his or her duties, authority, or responsibilities in effect immediately prior to such reduction, including, without limitation, removal of the executive as Chief Executive Officer or Chief Operating Officer and Chief Financial Officer of the Company, as applicable (but not including Ms. Harper’s failure to be elected to the Board following nomination), (ii) a material reduction of the executive’s base salary as initially set forth in his or her employment agreement or as the same may be increased from time to time, (iii) any material breach of his or her employment agreement by the Company, or (iv) for Mr. Martin, the Company requires Mr. Martin to relocate his principal work location to a location in excess of 50 miles from the Company’s Corporate

Office Headquarters located in the City of Industry, California (for the avoidance of doubt, the Company’s requirement that Mr. Martin cease working remotely shall not constitute “good reason” under his employment agreement).

For purposes of Ms. Muñoz’s employment agreement, “good reason” generally means Ms. Muñoz resigns from her employment with the Company as a result of one or more of the following events: (i) any material adverse change in her authority, responsibilities or duties such that Ms. Muñoz no longer has the title of, or serve or function as, our Chief Executive Officer (except due to illness (either physical or mental) or other incapacity or excused absence or vacation), (ii) a material breach by us of Ms. Muñoz’s employment agreement (including, without limitation, any reduction in her base salary or annual incentive opportunity), or (iii) relocation of Ms. Muñoz’s principal business location to an area outside of the Los Angeles, California metropolitan area.

Equity Award Agreements

Each of the award agreements entered into by our NEOs provide that, upon the termination of the applicable NEO’s employment or service with the Company for any reason, all unvested RSAs, nonqualified stock options, RSUs or PSUs, as applicable, will be immediately forfeited.

In addition, each of Ms. Harper’s and Mr. Martin’s PSU award agreements provide that, upon the consummation of a “change in control” (as defined in the LTIP), the PSUs will be deemed to have 100% time-vested, subject to the applicable executive’s continued employment or service through the date such change in control is consummated.

Notwithstanding the foregoing, each award agreement provides that the Compensation Committee may, in its sole discretion, provide for the accelerated vesting of any unvested RSAs, nonqualified stock options, RSUs or PSUs, as applicable, at any time and for any reason.

Director Compensation

The Board has adopted a compensation program for our independent, non-employee directors, or the “Independent Director Compensation Program.” The Independent Director Compensation Program became effective as of June 30, 2021. Pursuant to the Independent Director Compensation Program, each non-employee member of the Board who is independent will receive the following cash compensation for Board services, as applicable:

•$100,000 per year for service as a Board member; and

•$15,000 per year for service as a chairperson for each committee, including Audit, Compensation, and Nominating and Corporate Governance Committee.

In addition, pursuant to the Independent Director Compensation Program, our independent, non-employee directors will generally receive an annual grant of RSUs under the LTIP, with a grant date fair value equal to $125,000, each of which vests on the one-year anniversary of the grant date, subject to the director’s continued service on the Board through such vesting date.

Any of our directors who are appointed and employed by Sycamore (i.e., Stefan L. Kaluzny and Dary Kopelioff) do not receive any compensation from us for their Board services. Any of our non-employees who are not independent receive the cash compensation provided for in the Independent Director Compensation Program, but do not receive any of the equity-based compensation provided for in the Independent Director Compensation Program.

Our independent, non-employee directors and any of their respective affiliates are reimbursed for any out-of-pocket expenses incurred in connection with the performance of their duties as our directors.

The table below provides compensation amounts for our non-employee directors for fiscal year 2022. Due to her role as Chief Executive Officer of the Company, Ms. Harper’s compensation is shown in the “Summary Compensation Table” above. Following Ms. Harper’s appointment as Chief Executive Officer on May 3, 2022, she no longer receives any compensation in respect of her service on the Board.


Name	Fees Earned or Paid in Cash ($)		Stock Awards(1) ($)		Total ($)
Theo Killion		104,090		125,000		229,090
Valeria Rico Nikolov		100,000		125,000		225,000
Michael Shaffer(2)		86,250		125,000		187,646


(1)			Amounts in this column represent the aggregate grant date fair value of stock awards granted to certain of our non-employee directors during fiscal year 2022, computed in accordance with FASB ASC Topic 718. As of January 28, 2023, our non-employee directors held outstanding RSUs in the following amounts: Mr. Killion - 21,477; Ms. Nikolov - 21,477; and Mr. Shaffer - 18,882.
(2)			Mr. Shaffer was appointed as a director on the Board effective May 3, 2022.

Pay versus Performance

Pay versus Performance Table

The following table sets forth certain information with respect to the Company’s financial performance and the compensation paid to our named executive officers (“NEOs’) for the fiscal years ended on January 28, 2023, and January 29, 2022, in accordance with the SEC disclosure requirements for a smaller reporting company as set forth in Item 402(v)(8) of Regulation S-K.


Year	Summary Compensation Table Total for PEO 1(1)		Compensation Actually Paid to PEO 1(1)(2)		Summary Compensation Table Total for PEO 2(1)		Compensation Actually Paid to PEO 2(1)(2)		Average Summary Compensation Table Total for Non-PEO NEOs(3)		Average Compensation Actually Paid to Non-PEO NEOs(3)(4)		Value of Initial Fixed $100 Investment Based On: Total Shareholder Return(5)		Net Income(6) (in thousands)
2022	$	1,742,696	$	908,696	$	918,514	$	54,136	$	2,235,649	$	1,352,670	$	15.36	$	50,209
2021	—		—		$	39,956,898	$	34,212,632	$	12,286,073	$	10,198,297	$	36.52	$	(29,944)

(1)The names of the PEOs reflected in these columns are as follows: (i) PEO 1 is Lisa M. Harper, and (ii) PEO 2 is Elizabeth Munoz. Ms. Harper was appointed Chief Executive Officer of the Company in May 2022, replacing Ms. Munoz, who was the Chief Executive Officer of the Company in fiscal year 2021 and for part of fiscal year 2022.

(2)Amounts reported in these columns represent the compensation actually paid to our PEOs for each applicable fiscal year. In calculating the compensation actually paid amounts reflected in these columns, the fair value or change in fair value, as applicable, of the equity award adjustments included in such calculations was computed in accordance with FASB ASC Topic 718. The valuation assumptions used to calculate such fair values did not materially differ from those disclosed at the time of grant.

The table below includes each of the adjustments made to the Summary Compensation Table total compensation in order to calculate the compensation actually paid to our PEOs for each applicable fiscal year, computed in accordance with Item 402(v) of Regulation S-K:


	PEO 1: Ms. Harper			PEO 2: Ms. Munoz
	2022		2021	2022		2021
Summary Compensation Table - Total Compensation	$	1,742,969	N/A	$	918,514	$	39,956,898
- Deduct the amounts reported in the Summary Compensation Table as equity award amounts which are based on grant date fair values.	$	999,000	N/A	$	—	$	8,426,241
+ Add the year-end fair value of any equity awards granted in the covered fiscal year that are outstanding and unvested as of the end of the covered fiscal year.	$	165,000	N/A	$	—	$	1,965,899
+ Add the amount of change in fair value as of the end of the covered fiscal year (from the end of the prior fiscal year) of any awards granted in prior years that are outstanding and unvested as of the end of the covered fiscal year.	$	—	N/A	$	(531,598)	$	—
+ Add the fair value as of the vesting date for awards that are granted and vest in the same covered fiscal year.	$	—	N/A	$	—	$	716,076
+ Add the amount of change in fair value from the end of the prior fiscal year to the vesting date for awards granted in prior years that vest in the covered fiscal year.	$	—	N/A	$	(332,780)	$	—
- Deduct the amount of fair value at the end of the prior fiscal year for awards granted in prior years that forfeited during the covered fiscal year.	$	—	N/A	$	—	$	—
+ Add the dollar value of any dividends, dividend equivalents, or other earnings paid on stock or option awards in the covered fiscal year prior to the vesting date that are not otherwise reflected in the fair value of such award or included in any other component of total compensation for the covered fiscal year.	$	—	N/A	$	—	$	—
Compensation actually paid	$	908,969	N/A	$	54,136	$	34,212,632

(3)The names of each of the non-PEO NEOs reflected in these columns for each applicable fiscal year are as follows: (i) for fiscal year 2022, Timothy O. Martin and Bridgett C. Zeterberg, and (ii) for fiscal year 2021, George Wehlitz, Michael Salmon, Anne Stephenson and Kelly McGuire Diehl.

(4)Amounts reported in this column represent the average compensation actually paid to our non-PEO NEOs for each applicable fiscal year. In calculating the compensation actually paid amounts reflected in this column, the fair value or change in fair value, as applicable, of the equity award adjustments included in such calculations was computed in accordance with FASB ASC Topic 718. The valuation assumptions used to calculate such fair values did not materially differ from those disclosed at the time of grant.

The table below includes each of the adjustments made to the Summary Compensation Table total compensation in order to calculate the average compensation actually paid to our non-PEO NEOs for each applicable fiscal year, computed in accordance with Item 402(v) of Regulation S-K:


	Non-PEO NEOs Average
	2022		2021
Summary Compensation Table - Total Compensation	$	2,235,649	$	12,286,073
- Deduct the amounts reported in the Summary Compensation Table as equity award amounts which are based on grant date fair values.	$	1,850,000	$	3,512,866
+ Add the year-end fair value of any equity awards granted in the covered fiscal year that are outstanding and unvested as of the end of the covered fiscal year.	$	967,021	$	925,484
+ Add the amount of change in fair value as of the end of the covered fiscal year (from the end of the prior fiscal year) of any awards granted in prior years that are outstanding and unvested as of the end of the covered fiscal year.	$	—	$	—
+ Add the fair value as of the vesting date for awards that are granted and vest in the same covered fiscal year.	$	—	$	499,607
+ Add the amount of change in fair value from the end of the prior fiscal year to the vesting date for awards granted in prior years that vest in the covered fiscal year.	$	—	$	—
- Deduct the amount of fair value at the end of the prior fiscal year for awards granted in prior years that forfeited during the covered fiscal year.	$	—	$	—
+ Add the dollar value of any dividends, dividend equivalents, or other earnings paid on stock or option awards in the covered fiscal year prior to the vesting date that are not otherwise reflected in the fair value of such award or included in any other component of total compensation for the covered fiscal year.	$	—	$	—
Compensation actually paid	$	1,352,670	$	10,198,298

(5)The Company’s total shareholder return (“TSR”) reflected in this column for each applicable fiscal year is calculated based on a fixed investment of $100 at the applicable measurement point on the same cumulative basis as is used in Item 201(e) of Regulation S-K.

(6)Represents the amount of net income reflected in the audited financial statements included in the Company’s fiscal year 2022 Annual Report on Form 10-K for each applicable fiscal year.

Pay versus Performance Comparative Disclosure

In accordance with Item 402(v)(5) of Regulation S-K, the Company is providing the following comparative graphical disclosure, which describes the relationships between certain information presented in the Pay Versus Performance Table set forth above.

Company TSR and Compensation Actually Paid (“CAP”)

Company Net Income and Compensation Actually Paid (“CAP”)

Limitations of Liability and Indemnification Matters

We have adopted provisions in our Charter that limit the liability of our directors for monetary damages for breach of their fiduciary duties, except for liability that cannot be eliminated under the Delaware General Corporation Law. Delaware law provides that directors of a corporation will not be personally liable for monetary damages for breach of their fiduciary duties as directors, except liability for any of the following:

•any breach of their duty of loyalty to the corporation or its stockholders;

•acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law;

•unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the Delaware General Corporation Law; or

•any transaction from which the director derived an improper personal benefit.

This limitation of liability does not apply to liabilities arising under the federal securities laws and does not affect the availability of equitable remedies such as injunctive relief or rescission.

Our Bylaws also provide that we shall indemnify our directors and officers and may indemnify our other officers and employees and other agents to the fullest extent permitted by law. We believe that indemnification under our Bylaws covers at least negligence and gross negligence on the part of indemnified parties. Our Bylaws also permit us to secure insurance on behalf of any officer, director,

employee, or other agent for any liability arising out of his or her actions in this capacity, regardless of whether our Bylaws would permit indemnification.

We have entered into separate indemnification agreements with our directors and executive officers, in addition to indemnification provided for in our charter documents. These agreements, among other things, provide for indemnification of our directors and executive officers for expenses, judgments, fines and settlement amounts incurred by this person in any action or proceeding arising out of this person’s services as a director or executive officer, as applicable, or at our request. We believe that these provisions and agreements are necessary to attract and retain qualified persons as directors and executive officers.

CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

Related Person Transactions Policy

We have adopted a written policy with respect to related party transactions. Under our related person transaction policy, a “Related Person Transaction” is any transaction, arrangement, or relationship between us or any of our subsidiaries and a Related Person. A “Related Person” is any of our executive officers, directors or director nominees, any stockholder beneficially owning in excess of 5% of our stock or securities exchangeable for our stock, any immediate family member of any of the foregoing persons, and any firm, corporation or other entity in which any of the foregoing persons is an executive officer, a partner or principal or in a similar position or in which such person has a 10% or greater beneficial ownership interest in such entity.

Pursuant to our Related Person Transaction policy, any Related Person Transaction must generally be approved by our Audit Committee. In approving any Related Person Transaction, our Audit Committee shall review all relevant information available to it about the Related Person Transaction. The Audit Committee may approve the Related Person Transaction only if the Audit Committee determines in good faith that, under all of the circumstances, the transaction is in the best interests of the Company and its stockholders.

Certain Related Persons Transactions

Described below are transactions with Related Persons in which the amounts involved exceeded $120,000 since the beginning of our last fiscal year or may be expected to exceed such amount in the foreseeable future. Other than as described in this section and the Executive and Director Compensation Discussion section above, there were no transactions with Related Persons in the last fiscal year, and no transactions are currently proposed, that would require disclosure under Item 404 of Regulation S-K.

Services Agreements with Hot Topic

Hot Topic Inc. ("Hot Topic") is an entity indirectly controlled by affiliates of Sycamore. From June 2, 2017 until its termination on March 21, 2019, we had a services agreement ("Third Party Services Agreement") with Hot Topic, pursuant to which Hot Topic provided us (or caused applicable third parties to provide) certain services, including information technology, distribution and logistics management, real estate leasing and construction management and other services as may have been specified. On March 21, 2019, we entered into an amended and restated services agreement ("Amended and Restated Services Agreement") with Hot Topic under which Hot Topic provides us (or causes applicable third parties to provide) substantially similar services to those provided under the Third Party Services Agreement. The term of the Amended and Restated Services Agreement is three years, unless we or Hot Topic extend the agreement, or we terminate the agreement (or certain services under the agreement). We may terminate the various services upon written notice. Rates and costs related to the services provided under the Amended and Restated Services Agreement may change with approval from both parties. Each month, we are committed to pay Hot Topic for these services and reimburse Hot Topic for certain costs it incurs in the course of providing these services. We record payments made to Hot Topic under these service agreements in the applicable expense category in either cost of goods sold, or selling, general and administrative expenses. On August 1, 2019, we entered into a services agreement ("Reverse Services Agreement") with Hot Topic, under which Torrid provided Hot Topic with certain information technology services. The term of the Reverse Services Agreement was three years, unless we or Hot Topic extended the agreement, or Hot Topic terminated the agreement. Torrid provided Hot Topic with the specified information technology services at no cost for the first three years of the Reverse Services Agreement, however Hot Topic bore certain capital and operating expenses that it incurred. Costs incurred in connection with providing the specified information technology services to Hot Topic were expensed as incurred in our consolidated statements of operations and comprehensive income (loss). During fiscal year 2022, we incurred costs of $1.6 million in connection with providing these information technology services to Hot Topic. In connection with the Reverse Services Agreement, we entered into an amendment to the Amended and Restated Services Agreement ("Amendment to Amended and Restated

Services Agreement") with Hot Topic on August 1, 2019, pursuant to which sections pertaining to Hot Topic’s provision of information technology services to Torrid were removed.

During fiscal year 2022, Hot Topic charged us $2.4 million, all of which was recorded as a component of selling, general and administrative expenses. As of January 28, 2023, we owed $0.2 million to Hot Topic for these services.

On July 31, 2022, we entered into a first amendment to the Reverse Services Agreement ("Amended Reverse Services Agreement") with Hot Topic, under which Torrid provided Hot Topic with certain information technology services for a fixed fee. The term of the Amended Reverse Services Agreement was five months while both parties negotiated a longer-term amendment to the Reverse Services Agreement with modified terms and conditions. On September 30, 2022, we entered into a second amendment to the Reverse Services Agreement ("Second Amended Reverse Services Agreement") with Hot Topic, under which Torrid provided Hot Topic with certain information technology services for a fixed fee. The term of the Second Amended Reverse Services Agreement was two months while both parties negotiated a longer-term amendment to the Reverse Services Agreement with modified terms and conditions. Effective December 1, 2022, we entered into a third amendment to the Reverse Services Agreement ("Third Amended Reverse Services Agreement") with Hot Topic, under which Torrid provides Hot Topic with certain information technology services for a fixed fee. The term of the Third Amended Reverse Services Agreement ends on May 4, 2024, unless we and Hot Topic mutually agree to extend the agreement, or we or Hot Topic terminate the agreement (or certain services under the agreement), upon written notice. During fiscal year 2022, we charged Hot Topic $1.0 million for these services and as of January 28, 2023, Hot Topic owed us $0.1 million for these services.

Hot Topic incurs certain direct expenses on our behalf, such as payments to our non-merchandise vendors and each month, we pay Hot Topic for these pass-through expenses. As of January 28, 2023, the net amount we owed Hot Topic for these expenses was $1.1 million, which is included in due to related parties in our consolidated balance sheets.

Transactions with MGF Sourcing US, LLC

MGF Sourcing US, LLC, an entity indirectly controlled by affiliates of Sycamore, is one of our suppliers. During fiscal year 2022, cost of goods sold included $70.0 million related to the sale of merchandise purchased from this supplier. Purchases from this supplier accounted for approximately 15% of total net purchases in fiscal year 2022. As of January 28, 2023, the net amount we owed MGF Sourcing US, LLC for these purchases was $11.6 million. This liability is included in due to related parties in our consolidated balance sheets.

Transactions with HU Merchandising, LLC

HU Merchandising, LLC, a subsidiary of Hot Topic, is one of our suppliers. During fiscal year 2022, cost of goods sold included $0.5 million related to the sale of merchandise purchased from this supplier.

Consulting Services Agreement

On May 4, 2022 the Company announced that Tanner MacDiarmid, a Partner at MERU LLC, specializing in interim management for clients, had been appointed as Interim Chief Financial Officer of the Company pursuant to which the Company paid MERU LLC a consulting fee of $1,022,124.64. The agreement was effective from May 3, 2022, and Mr. MacDiarmid appointment ended upon September 12, 2022, when Mr. Martin was appointed as the Chief Operating Officer and Chief Financial Officer.

Stockholders’ Agreement

We entered into the Stockholders’ Agreement with the Sycamore Stockholder on July 6, 2021 that provides them with certain rights with respect to the designation of directors to serve on the Board. See “Board of Directors and Corporate Governance—Stockholders’ Agreement.”

Registration Rights Agreement

We entered into a registration rights agreement pursuant to which we granted certain registration rights to certain funds managed by Sycamore and its affiliates and certain of their transferees, including the right, under certain circumstances and subject to certain restrictions, to require us to register for resale under the Securities Act of 1933, as amended (the “Securities Act”), our common stock held by them. In addition, we will commit to file as promptly as possible after receiving a request from Sycamore, a shelf registration statement registering secondary sales of our common stock held by Sycamore. Sycamore also will have the right to exercise certain piggyback registration rights in respect of common stock held by them in connection with registered offerings requested by other registration rights holders or initiated by us.

Sponsor Advisory Services Agreement

On May 1, 2015, we entered into an advisory services agreement with Sycamore, pursuant to which Sycamore agreed to provide strategic planning and other related services to us. We are obligated to reimburse Sycamore for its expenses incurred in connection with providing such advisory services to us. From time to time, we also reimburse Sycamore for certain management expenses it pays on our behalf. During fiscal year 2022, the reimbursements we made to Sycamore for such expenses were not material.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth information as of April 17, 2023 regarding the beneficial ownership of our common stock by:

•each person or group known to us who beneficially owns more than 5% of our common stock;

•each of our directors and director nominees;

•each of our named executive officers; and

•all of our directors and executive officers as a group.

Beneficial ownership for the purposes of the following table is determined in accordance with the rules and regulations of the SEC. Applicable percentages are based on 103,827,701 shares of common stock outstanding as of April 17, 2023. Common stock subject to restricted stock units or stock options that are currently exercisable or exercisable within 60 days of April 17, 2023 are deemed to be outstanding and beneficially owned by the person holding the restricted stock units or stock options. These shares, however, are not deemed outstanding for the purposes of computing the percentage ownership of any other person except the percentage ownership of executive officers and directors as a group.

Except as disclosed in the footnotes to this table and subject to applicable community property laws, we believe that each stockholder identified in the table possesses sole voting and investment power over all shares of common stock shown as beneficially owned by the stockholder. Unless otherwise indicated in the table or footnotes below, the address for each beneficial owner is c/o Torrid Holdings Inc., 18501 East San Jose Avenue, City of Industry, California 91748.


	Shares Beneficially Owned
Name of Beneficial Owner	Common Stock	Awards Vesting Within 60 Days	Total	Percentage Ownership
Directors and Named Executive Officers
Lisa M. Harper	5,620,420	—	5,620,420	5.41%
Stefan L. Kaluzny	—	—	—	*
Theophlius Killion	15,952	21,477	37,429	*
Dary Kopelioff	—	—	—	*
Timothy O. Martin	—	—	—	*
Elizabeth Muñoz(1)	2,123,282	—	2,123,282	2.04%
Valeria Rico Nikolov	5,952	21,477	27,429	*
Michael Shaffer	—	18,882	18,882	*
Bridgett C. Zeterberg	—	—	—	*
All directors and executive officers, as a group (10 persons)	9,529,259	61,836	9,591,095	9.23%
Sycamore Partners Management LP	82,351,986	—	82,351,986	79.32%

* Represents beneficial ownership of less than one percent (1%) of our outstanding common stock.

(1) Includes 53,482 time-vested RSAs, all of which have voting power.

PROPOSAL 2— APPROVAL OF, ON AN ADVISORY, NON-BINDING BASIS, THE COMPENSATION PAID TO THE COMPANY’S NAMED EXECUTIVE OFFICERS

In accordance with Section 14A of the Exchange Act and the related SEC rules promulgated thereunder, we are asking our stockholders to cast a non-binding advisory vote to approve the compensation of our named executive officers. This proposal, commonly known as a “say-on-pay” proposal, gives our stockholders the opportunity to express their views on the compensation of our named executive officers.

As described in the “Executive Compensation—Compensation Discussion & Analysis” section of this Proxy Statement, the primary objectives of our executive compensation program are to: (i) attract, motivate and retain talented and experienced executives in our industry; (ii) reward executives whose knowledge, skills and performance are critical to our success; (iii) align the interests of our executive officers with our stockholders by motivating executive officers to increase stockholder value; (iv) foster a shared commitment among executives by aligning individual goals with the goals of the executive management team and our company, while also recognizing individual contributions to the success of our Company; and (v) compensate our executives in a manner that is fair but also ensures alignment between pay and performance to meet our long-range performance objectives. We urge our stockholders to review the “Executive Compensation” section of this Proxy Statement, including the compensation tables and related narrative discussion included therein for more information.

The Compensation Committee and the Board believe that our executive compensation aligns well with our philosophy and with corporate performance. Executive compensation is an important matter for our stockholders. We routinely review our compensation practices and engage in ongoing dialogue with our stockholders to ensure our practices are aligned with stakeholder interests and reflect best practices.

As an advisory vote, the outcome of the vote on this proposal is not binding upon us. However, the Board and Compensation Committee value the opinions expressed by stockholders in their vote on this Proposal, and will consider the outcome of the vote when making future compensation decisions for our named executive officers.

THE BOARD RECOMMENDS THAT YOU VOTE “FOR” APPROVING, ON AN ADVISORY, NON-BINDING BASIS, THE COMPENSATION PAID TO THE COMPANY’S NAMED EXECUTIVE OFFICERS.

PROPOSAL 3— APPROVAL OF, ON AN ADVISORY, NON-BINDING BASIS, THE FREQUENCY OF FUTURE ADVISORY VOTES ON NAMED EXECUTIVE OFFICER COMPENSATION

In accordance with Section 14A of the Exchange Act and the related SEC rules promulgated thereunder, we are providing our stockholders with the opportunity to indicate how frequently we should seek an advisory vote on the compensation of our named executive officers in the future. Under this proposal, commonly known as a “say-on-frequency” proposal, you may express your view on whether we should hold an advisory “say-on-pay” vote every one, two or three years, or you may abstain from voting on this proposal.

After considering the benefits and consequences of each alternative, the Board recommends that the advisory vote on the compensation of our named executive officers be held annually. In formulating its recommendation, the Board considered that compensation decisions are made annually and that an annual advisory say-on-pay vote will allow stockholders to provide more frequent and direct input on our compensation philosophy, policies and practices.

While the Board believes that its recommendation is appropriate at this time, we are not asking stockholders to approve or disapprove that recommendation, but are instead asking stockholders to indicate their preference, on an advisory basis, as to whether future non-binding stockholder advisory votes on the compensation of our named executive officers should be held every one, two or three years.

Our Board and Compensation Committee value the opinions of our stockholders in this matter and will take into account the outcome of this vote when making future decisions regarding the frequency of holding future advisory say-on-pay votes. However, because this is an advisory vote that is not binding on the Board or the Company, the Board may decide that it is in the best interests of our stockholders that we hold an advisory say-on-pay vote more or less frequently than the option preferred by our stockholders.

THE BOARD RECOMMENDS THAT YOU VOTE FOR “ONE YEAR” AS THE FREQUENCY OF FUTURE STOCKHOLDER ADVISORY VOTES ON NAMED EXECUTIVE OFFICER COMPENSATION.

PROPOSAL 4—RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Audit Committee has appointed PricewaterhouseCoopers LLP (“PwC”) as our independent registered public accounting firm for the year ending February 3, 2024. Services provided to the Company and its subsidiaries by PwC for the year ended January 28, 2023 are described below and under “Report of the Audit Committee.”

The Audit Committee approved all services provided by PwC. Representatives of PwC are expected to be present at the Annual Meeting. They will have the opportunity to make a statement if they desire to do so, and we expect that they will be available to respond to questions.

Ratification of the appointment of PwC requires affirmative votes from the holders of a majority of the shares present in person or represented by proxy at the Annual Meeting and entitled to vote. If the Company’s stockholders do not ratify the appointment of PwC, the Audit Committee will reconsider the appointment and may affirm the appointment or retain another independent registered public accounting firm. Even if the appointment is ratified, the Audit Committee may in the future replace PwC as our independent registered public accounting firm if it is determined that it is in the Company’s best interests to do so.

THE AUDIT COMMITTEE AND THE BOARD RECOMMENDS THAT YOU VOTE “FOR” THE RATIFICATION OF THE APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE YEAR ENDING FEBRUARY 3, 2024.

Principal Accountant Fees and Services

The following table summarizes the aggregate fees for professional audit services and other services rendered by PwC for fiscal years 2022 and 2021:


	2022		2021
Audit Fees(1)	$	2,076,869	$	2,361,000
Audit-Related Fees(2)	—		56,000
Tax Fees(3)	61,000		77,000
All Other Fees(4)	2,900		1,000
Total	$	2,142,769	$	2,495,000

(1)“Audit fees” include fees for audit services primarily related to the audit of our annual consolidated financial statements; the review of our quarterly consolidated financial statements; comfort letters, consents and assistance with and review of documents filed with the SEC, including our registration statements on Form S-1 related to our IPO in July 2021; and other accounting and financial reporting consultation and research work billed as audit fees or necessary to comply with the standards of the Public Company Accounting Oversight Board (“PCAOB”).

(2)“Audit-related fees” include fees for assurance and related services that are reasonably related to the performance of the audit or review of our financial statements.

(3)“Tax fees” include fees for tax compliance and advice. Tax advice fees encompass a variety of permissible tax services, including technical tax advice related to federal and state income tax matters, assistance with sales tax and assistance with tax audits.

(4)“Other fees” include fees for services other than the services reported in audit fees, audit-related fees, and tax fees. In both years, included subscriptions and licenses to accounting and tax resources and other permissible services that do not fall within the other listed categories.

In considering the nature of the services provided by PwC, our independent registered public accounting firm, the Audit Committee determined that such services are compatible with the rules and regulations concerning auditor independence promulgated by the SEC as well as the PCAOB. PwC presented the matters required to be discussed by Auditing Standard No. 1301, Communications with Audit Committees, as adopted by the PCAOB and currently in effect. The Committee received these written disclosures and the letters from PwC required by the applicable requirements of the PCAOB regarding communications concerning independence – including Rule 3524, Audit Committee Pre-approval of Certain Tax Services, and Rule 3526, Communication with Audit Committees Concerning Independence – and discussed with PwC its independence from our company and management.

The Audit Committee has adopted a policy that requires advance approval of all audit services as well as non-audit services to the extent required by the Exchange Act and the Sarbanes-Oxley Act of 2002, as amended. Unless the specific service has been previously pre-approved with respect to that year, the Audit Committee must approve the permitted service before the independent registered public accounting firm is engaged to perform it. Each year, the Audit Committee will pre-approve audit services, audit-related services and tax services to be used by the Company.

REPORT OF THE AUDIT COMMITTEE

The Audit Committee of the Board of Directors is currently comprised of three independent directors and operates under a written charter originally adopted by the Board of Directors in June 2021, which charter is reviewed on an annual basis and amended as necessary by the Board of Directors upon recommendation by the Audit Committee.

The current members of the Audit Committee are Michael Shaffer, Theophlius Killion and Valeria Rico Nikolov. Mr. Shaffer serves as the chairperson of the Audit Committee. Each of Mr. Shaffer, Mr. Killion and Ms. Rico Nikolov is an "independent director" as currently defined in Section 303A.02 of the NYSE Listed Company Manual and Rule 10A-3 of the Exchange Act. The Board of Directors has also determined that Mr. Shaffer is an "audit committee financial expert" as described in applicable rules and regulations of the SEC.

The Audit Committee appoints an accounting firm as our independent registered public accounting firm. The independent registered public accounting firm is responsible for performing an independent audit of our financial statements in accordance with generally accepted auditing standards and issuing a report thereon. Management is responsible for our internal controls and the financial reporting process. The audit committee is responsible for monitoring and overseeing these processes.

The Audit Committee held four meetings during fiscal year 2022. The meetings were designed to provide information to the Audit Committee necessary for it to conduct its oversight function of the external financial reporting activities and audit process of our company, and to facilitate and encourage communication between the Audit Committee, management and our independent registered public accounting firm, PwC. Management represented to the audit committee that our financial statements were prepared in accordance with generally accepted accounting principles. The Audit Committee reviewed and discussed the audited financial statements for fiscal year 2022 with management and the independent registered public accounting firm. The Audit Committee also instructed the independent registered public accounting firm that the Audit Committee expects to be advised if there are any subjects that require special attention.

The Audit Committee has discussed with the independent registered public accounting firm the matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board (“PCAOB”), and the SEC.

The Audit Committee has also received the written disclosures and the letter from the independent registered public accounting firm, PwC, required by applicable requirements of the PCAOB regarding the independent registered public accounting firm's communications with the audit committee concerning independence, and has discussed with PwC that firm's independence.

Based on its review of the audited financial statements and the various discussions noted above, the audit committee recommended to the board of directors that the audited financial statements be included in our Annual Report on Form 10-K for the fiscal year ended January 28, 2023, for filing with the SEC.

The audit committee of the board of directors of Torrid Holdings Inc.:

Michael Shaffer (chairperson)

Theophlius Killion
Valeria Rico Nikolov

The material in this report is not "soliciting material," is not deemed "filed" with the SEC, and is not to be incorporated by reference into any filing made by Torrid Holdings Inc. under the Securities Act or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.

OTHER MATTERS

We are not aware of any matters other than those discussed in the foregoing materials contemplated for action at the Annual Meeting. The persons named in the proxy card will vote in accordance with the recommendation of the Board on any other matters incidental to the conduct of, or otherwise properly brought before, the Annual Meeting. The proxy card contains discretionary authority for them to do so.

Notice of Internet Availability of Proxy Statement and Annual Report. As permitted by Securities and Exchange Commission (“SEC”) rules, we are making this proxy statement and our Annual Report on Form 10-K available to our stockholders electronically via the Internet. The notice of internet availability contains instructions on how to access this proxy statement and our Annual Report on Form 10-K and vote online. If you received a notice by mail, you will not receive a printed copy of the proxy materials in the mail. Instead, the notice instructs you on how to access and review all of the important information contained in the proxy statement and Annual Report on Form 10-K. The notice also instructs you on how you may submit your proxy over the Internet or by telephone. If you received a notice by mail and would like to receive a printed copy of our proxy materials, you should follow the instructions for requesting such materials contained on the notice.

Householding. We have adopted a procedure approved by the SEC called “householding.” Under the householding procedure, certain stockholders, whether they own registered shares or shares in street name, who have the same address and who receive either notices or paper copies of the proxy materials in the mail will receive only one copy of our proxy materials, or a single notice, for all stockholders at that address, unless one or more of the stockholders at that address has previously notified us that they want to receive separate copies. If you received a single set of proxy materials as a result of householding, and one or more stockholders at your address would like to have separate copies of these materials with respect to the Annual Meeting or in the future, or if you would like to request that only a single set of proxy materials be sent to the household, contact Broadridge Financial Solutions, Inc. at 1-866-540-7095 or in writing at Broadridge, Householding Department, 51 Mercedes Way, Edgewood, New York 11717. A number of brokerage firms have instituted householding. They will have their own procedures for stockholders who wish to receive individual copies of the proxy materials.

WHERE TO FIND ADDITIONAL INFORMATION

We are subject to the informational requirements of the Exchange Act and in accordance therewith, we file annual, quarterly and current reports and other information with the SEC. Such information may be accessed electronically by means of the SEC’s home page on the Internet at www.sec.gov. We are an electronic filer, and the SEC maintains an Internet site at www.sec.gov that contains the reports and other information we file electronically. These filings are also available on our website at https://investors.torrid.com. Please note that our website address is provided as an inactive textual reference only. We make available free of charge, through our website, our annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and all amendments to those reports as soon as reasonably practicable after such material is electronically filed with or furnished to the SEC. The information provided on or accessible through our website is not part of this proxy statement.

COST OF PROXY SOLICITATION

The Company is paying the expenses of this solicitation. The Company will also make arrangements with brokerage houses and other custodians, nominees and fiduciaries to forward proxy materials to beneficial owners of stock held as of the Record Date by such persons, and the Company will reimburse such persons for their reasonable out-of-pocket expenses in forwarding such proxy materials. In addition to solicitation by mail, directors, officers and other employees of the Company may solicit proxies in person or by telephone, facsimile, email or other similar means.

APPENDIX A:
DESCRIPTION OF NON-GAAP FINANCIAL MEASURES

This proxy statement includes information on Adjusted EBITDA, which is a non-GAAP financial measure (“non-GAAP”). In addition to results determined in accordance with accounting principles generally accepted in the United States of America (“GAAP”), management utilizes certain non-GAAP performance measures such as Adjusted EBITDA. We believe that these non-GAAP operating measures, when reviewed collectively with our GAAP financial information, provide useful supplemental information to investors in assessing our operating performance.

Adjusted EBITDA is a supplemental measure of our operating performance that is neither required by, nor presented in accordance with, GAAP and our calculations thereof may not be comparable to similarly titled measures reported by other companies. Adjusted EBITDA represents GAAP net income (loss) plus interest expense less interest income, net of other expense (income), plus provision for less (benefit from) income taxes, depreciation, and amortization (“EBITDA”), and share-based compensation, non-cash deductions and charges, and other expenses.

We believe Adjusted EBITDA facilitates operating performance comparisons from period to period by isolating the effects of certain items that vary from period to period without any correlation to ongoing operating performance. We also use Adjusted EBITDA as one of the primary methods for planning and forecasting the overall expected performance of our business and for evaluating on a quarterly and annual basis, actual results against such expectations. Further, we recognize Adjusted EBITDA as a commonly used measure in determining business value and, as such, use it internally to report and analyze our results and as a benchmark to determine certain non-equity incentive payments made to executives.

Adjusted EBITDA has limitations as an analytical tool. This measure is not a measurement of our financial performance under GAAP and should not be considered in isolation or as an alternative to or substitute for net income (loss), income (loss) from operations, earnings (loss) per share or any other performance measures determined in accordance with GAAP or as an alternative to cash flows from operating activities as a measure of our liquidity. Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items.

A-1

SEC Form DEF 14A filed by Torrid Holdings Inc.