TLRD Tailored Brands Inc

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 11-K

(Mark One)

x              ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Year Ended December 31, 2019

OR

o                 TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                           to                          

Commission File No. 1-16097

A.                   Full title of the plan and address of the plan, if different from that of the issuer named below:

TAILORED BRANDS
401(k) SAVINGS PLAN

B.                    Name of issuer of the securities held pursuant to the plan and the address of its principal executive offices:

TAILORED BRANDS, INC.

6380 Rogerdale Road
Houston, Texas 77072

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information, including its form and content, is presented in conformity with the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. In our opinion, the supplementary information is fairly stated, in all material respects, in relation to the financial statements as a whole.

/s/ McConnell & Jones LLP

We have served as the Plan’s auditor since 2012.

Houston, Texas

June 29, 2020

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The accompanying notes are an integral part of these financial statements.

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The accompanying notes are an integral part of these financial statements.

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TAILORED BRANDS 401(K) SAVINGS PLAN

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TAILORED BRANDS 401(K) SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

AS OF AND FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (continued)

Investments — Employee contributions are deposited into a trust account, which is invested by the Trustee in various investment options as directed by each participant. The investment options available for 2019 and 2018 included Tailored Brands, Inc. (“TLRD”) common stock, mutual funds, and a guaranteed portfolio fund maintained by the Trustee. The Plan administrator has limited the percentage of participant’s accounts that may be invested in the Company’s common stock to 20% of their total account value.  For 2019 and 2018, employee deferral into the Company’s common stock is, also, limited to 20% per pay period. Plan participants, at their sole discretion, may transfer amounts among the various investment options in accordance with the terms of the Plan.

Vesting — Participants are always 100% vested in their salary deferral contribution accounts, rollover contribution accounts, prior matching contribution accounts, and qualified non-elective employer contribution accounts. Eligible employees who enter the plan after January 1, 2017, are subject to a vesting schedule of 100% after two years of service for any employer contributions made to the Plan. Eligible employees who entered the plan prior to January 1, 2017, are immediately 100% vested for any employer contributions made to the Plan.

Distributions to Participants — Upon termination of service, a participant may elect to receive a lump-sum payment equal to the value of his or her account. The Plan also permits distributions to active participants if certain conditions are met.

Participant Loans — Plan loans are available to all active Plan participants on a nondiscriminatory basis. Amounts may not exceed the lesser of $50,000 (reduced by the highest outstanding loan balance during the prior 12 months) or one-half of the current value of a participant’s vested account balance. All loans are fully secured by the balance in the participant’s account.

Forfeited Accounts — The Plan allows the forfeitures of nonvested Company-matching contributions from terminated participant accounts to be used to offset future Company-matching contributions, to pay certain administrative expenses, and to make account restorations.

For the years ended December 31, 2019 and 2018, forfeited nonvested amounts totaled $63,983 and $20,958, respectively. There were no forfeitures used to reduce employer-matching contributions in 2019 as such forfeitures were generally not eligible to reduce employer-matching contributions. Forfeitures of $2,406 were used to reduce employer-matching contributions in 2018.

2.                      SUMMARY OF ACCOUNTING POLICIES

Basis of Accounting — The accompanying financial statements have been prepared on the accrual basis in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

Use of Estimates — The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and changes therein, and disclosure of contingent assets and liabilities. Actual results could differ from those estimates.

Risk and Uncertainties — The Plan utilizes various investments, including common stock, mutual funds, common collective investments and, in 2019 and 2018, a fully benefit-responsive investment contract. Investment securities, in general, are exposed to various risks, such as interest rate, credit, and

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TAILORED BRANDS 401(K) SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

AS OF AND FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (continued)

overall market volatility risk. Due to the level of risk associated with certain investment securities, it is reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect participants’ account balances and the amounts reported in the financial statements.

Investment Valuation and Income Recognition — The Plan’s investments are stated at fair value. Fair value of a financial instrument is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Shares of mutual funds are valued at quoted market prices, which represent the net asset value (“NAV”) of shares held by the Plan at year-end.  Tailored Brands’ stock is valued at the closing price of the common stock reported on the New York Stock Exchange on the last business day of the Plan year. In 2018, the Key Guaranteed Portfolio Fund (the “Portfolio Fund”) is stated at fair value using NAV as a practical expedient. The Portfolio Fund is a Common Trust Fund offered and managed by the Trustee. The fund strategies seek current income while maintaining stability of invested principal. The Portfolio Fund  invests in synthetic guaranteed investment contracts, U.S. Treasury and agency securities, and cash and cash equivalents, including money market instruments. The trust will also maintain a cash reserve to augment its liquidity. The level of the cash reserve is predicated on expected future liquidity needs. Participants may ordinarily direct the withdrawal or transfer of all or a portion of their investment in the Portfolio Fund at a constant NAV of $1 per unit.

The Portfolio Fund impose certain restrictions on investments made under the Plan and the Portfolio Fund itself may be subject to circumstances that impact its ability to transact  at a constant  NAV of $1 per unit.  Plan management believes that events causing these investments to transact at less than $1 per unit are unlikely to occur.

Purchases and sales of securities are recorded on a trade-date basis. The net appreciation (depreciation) in fair value of investment securities consists of the net change in unrealized appreciation (depreciation) in fair value and realized gains (losses) upon the sale of investments. The net change in unrealized appreciation (depreciation) and realized gains (losses) upon sale are determined using the fair values as of the beginning of the year or the purchase price if acquired since that date. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date.

Notes Receivable from Participants — Notes receivable from participants are measured at their unpaid principal balance plus any accrued but unpaid interest. Delinquent participant loans are recorded as distributions based on the terms of the Plan document.  No allowance for credit losses has been recorded as of December 31, 2019 or 2018.

Administrative Expenses — For 2019 and 2018, all administrative fees charged by the trustee are paid by the participants and are presented as administrative expenses in the statement of changes in net assets available for benefits.

Payment of Benefits — Benefits are recorded when distribution checks or wires are issued from the trust used to fund the Plan (the “Trust”).

Recent Accounting Pronouncements Adopted — In July 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update  (“ASU”) 2018-09, Codification Improvements, which, among other things, amends an illustrative example of a fair value hierarchy disclosure to

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NOTES TO FINANCIAL STATEMENTS

AS OF AND FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (continued)

indicate that a certain type of investment should not always be considered to be eligible to use the net asset value per share practical expedient. The ASU also further clarifies that an entity should evaluate whether a readily determinable fair value exists or whether its investments qualify for the net asset value per share practical expedient in accordance with Accounting Standards Codification 820, Fair Value Measurement.  Adoption of the amended guidance, which is to be applied retrospectively, affects the fair value disclosures, but does not change the fair value measurement of the investments.  The Plan adopted ASU 2018-09 for the year ended December 31, 2019.  In connection with the adoption, there was no impact on the net assets available for benefits or the changes in the net assets available for benefits.

3.                      FULLY BENEFIT-RESPONSIVE INVESTMENT CONTRACT

During the 2018 Plan year, the Plan entered into a group annuity contract with Great-West Life and Annuity Insurance Company, a related entity of the Trustee.  The contract is a traditional investment contract. This contract meets the fully benefit-responsive investment contract criteria and therefore is reported at contract value. Contract value is the relevant measure for the fully benefit investment contracts because this is the amount received by the participant if they were to initiate permitted transactions under the terms of the Plan. Contract value represents contributions made under each contract, plus earnings, less participant withdrawals, and administrative expenses. As a traditional investment contract, the Plan owns only the contract itself.

The traditional investment contract held by the Plan is a guaranteed investment contract. The contract issuer is contractually obligated to repay the principal and interest at a specified interest rate that is guaranteed to the Plan. The crediting rate is based on a formula established by the contract issuer but may not be less than zero percent. The credit rating is reviewed on a quarterly basis for resetting. The contract does not have a maturity date.

The Plan’s ability to receive amounts due in accordance with the fully benefit-responsive investment contract is dependent upon the third-party issuer’s ability to meet its financial obligations. The issuer’s ability to meet its contractual obligations may be affected by future economic and regulatory developments.

Certain events might limit the ability of the Plan to transact at contract value with the contract issuer. These events may be different under each contract.  Examples of such events include, but are not limited to the Plan’s failure to qualify under Section 401(a) of the Internal Revenue Code (“IRC”) or the failure of the trust to be tax-exempt under section 501(a) of the IRC; premature termination of the contract; Plan terminations or merger; changes to the Plan’s prohibition or competing investment options; and bankruptcy of the Plan Sponsor or other events of the Sponsor, such as divestitures, that significantly affect the Plan’s normal operations.

No events are probable of occurring that might limit the ability of the Plan to transact at contract value with the contract issuer and that also would limit the ability of the Plan to transact at contract value with the participants.

4.                      FAIR VALUE MEASUREMENTS

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The authoritative guidance

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NOTES TO FINANCIAL STATEMENTS

AS OF AND FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (continued)

for fair value measurements establishes a three-tier fair value hierarchy, categorizing the inputs used to measure fair value. The hierarchy can be described as follows: Level 1, which refers to securities valued using quoted prices from active markets for identical assets; Level 2, which refers to securities not traded on an active market but for which observable market inputs are readily available; and Level 3, which refers to securities valued based on significant unobservable inputs. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

The following tables set forth by level within the fair value hierarchy a summary of the Plan’s investments measured at fair value on a recurring basis at December 31, 2019 and 2018.

Assets measured at fair value as of December 31, 2019:

Assets measured at fair value as of December 31, 2018:

The valuation methods as described in Note 2 may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, although the Plan believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.

For the years ended December 31, 2019 and 2018, respectively, there were no transfers in or out of Level 1.

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TAILORED BRANDS 401(K) SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

AS OF AND FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (continued)

5.                      PLAN TERMINATION

Although it has not expressed an intent to do so, the Company has the right under the Plan to terminate the Plan subject to the provisions of ERISA. In the event of Plan termination, participants will be 100% vested in their accounts.

6.                      FEDERAL INCOME TAX STATUS

Effective December 1, 2016, the Plan utilizes a Non-Standardized Plan Document and Adoption Agreement provided through Great-West Trust Company LLC.  The advisory letter was issued by the Internal Revenue Service (“IRS”) to this Non-Standardized Plan on March 31, 2014 and the Company may rely on this advisory letter. The Plan’s administrator believes the Plan continues to maintain its tax-exempt status.  Therefore, no provision for income taxes has been included in the Plan’s financial statements.

GAAP requires the Plan administrator to evaluate tax positions taken by the Plan and recognize a tax liability (or asset) if the Plan has taken an uncertain position that more likely than not would not be sustained upon examination by the IRS. The respective Plan administrator has analyzed the tax positions taken by the Plan, and has concluded that as of December 31, 2019 and 2018, respectively, there are no uncertain positions taken or expected to be taken that would require recognition of a liability (or asset) or disclosure in the financial statements.  The Plan is subject to routine audits by the IRS.

7.                      EXCESS CONTRIBUTIONS REFUNDABLE

The Company has completed discrimination testing for the year ended December 31, 2019. For the Plan year ended December 31, 2019, $483,342 was required to be refunded to satisfy the 2019 Plan year non-discrimination test.  A distribution of $563,476 (including realized gains in the amount of $80,134) was paid on March 13, 2020. For the Plan year ended December 31, 2018, $33,014 was required to be refunded to satisfy the 2018 Plan year non-discrimination test.  A distribution of $33,014 (including realized gain in the amount of $458) was paid on March 19, 2019.

8.                      EXEMPT PARTY-IN-INTEREST TRANSACTIONS

Certain Plan investments, including the Portfolio Fund and Stable Value Fund are shares of a common collective investment fund managed by the Trustee. Transactions with the Trustee and the Company, as well as participant loans, qualify as exempt party-in-interest transactions. At December 31, 2019 and December 31, 2018, the fair value of the Tailored Brands stock held by the Plan was $2,971,255 and $7,373,134, respectively.

9.                      SUBSEQUENT EVENTS

In preparing the accompanying financial statements, Plan management has reviewed and evaluated all known events that have occurred after December 31, 2019, and through June 29, 2020, which is the date these financial statements were issued, for inclusion in these financial statements and related notes. There were no subsequent events that would affect the financial statements or require additional disclosure except for as noted below.

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TAILORED BRANDS 401(K) SAVINGS PLAN

NOTES TO FINANCIAL STATEMENTS

AS OF AND FOR THE YEARS ENDED DECEMBER 31, 2019 AND 2018 (continued)

In March 2020, the World Health Organization declared the outbreak of COVID-19 as a pandemic. The rapidly developing pandemic has generated significant uncertainty in the global economy and volatility in financial markets. The COVID-19 pandemic has affected and may continue to affect Plan assets. Due to the ongoing economic uncertainty and volatility caused by COVID-19, the resulting financial impact to the Plan cannot be reasonably estimated.

Following this declaration, the U.S. Federal government passed the “Coronavirus Aid, Relief, and Economic Security (CARES) Act” on March 27, 2020. The CARES Act allows eligible plan participants to request penalty-free distributions of up to $100,000 before December 31, 2020 for qualifying reasons associated with the COVID-19 pandemic, permits increasing the limit for plan loans, permits suspension of loan payments due for up to one year, and permits individuals to stop receiving 2020 required minimum distributions. The Plan has implemented these changes.

Effective July 2, 2020, future investments in TLRD common stock under the Plan will be suspended.  If no new elections are made by the participant to update his or her election of investment in TLRD common stock, such future contributions will be redirected to the participant’s age appropriate Vanguard Institutional Target Retirement Fund.

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SUPPLEMENTAL SCHEDULE

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TAILORED BRANDS 401(k) SAVINGS PLAN

Employer Identification Number: 47-4894752

Plan Number:  001

*                 Party-in-interest

(1)         Loans generally consist of five-year installment notes with interest rates originating at prime + 1%, resulting in interest rates ranging from 3.25% to 10.5% and maturing through November 2034.

(2)         Cost information has been omitted because all investments are participant-directed.

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