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UNITED STATESSECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended August 3, 2019

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period from to

Commission file number 001-16435

Chico's FAS, Inc.(Exact name of registrant as specified in charter)

Florida 59-2389435(State of Incorporation)

(I.R.S. Employer

Identification No.)

11215 Metro Parkway, Fort Myers, Florida 33966(Address of principal executive offices)

239-277-6200(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registeredCommon Stock, Par Value $0.01 Per Share CHS New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during thepreceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for thepast 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of RegulationS-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerginggrowth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2of the Exchange Act. (Check one):

Large accelerated filer ☑ Accelerated filer ☐

Non-accelerated filer ☐ Smaller reporting company ☐

Emerging growth company ☐

#CHS082919Q210-Q_HTM_SCA06A5454F6E528E91A4DC51BB175236

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new orrevised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

At August 19, 2019, the registrant had 117,873,533 shares of Common Stock, $0.01 par value per share, outstanding.

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CHICO'S FAS, INC. AND SUBSIDIARIESQUARTERLY REPORT ON FORM 10-Q

FOR THEFISCAL THIRTEEN AND TWENTY-SIX WEEKS ENDED AUGUST 3, 2019

TABLE OF CONTENTS

PART I – Financial Information Item 1. Financial Statements:

Condensed Consolidated Statements of (Loss) Income for the Thirteen Weeks and Twenty-Six Weeks Ended August 3, 2019(Unaudited) and August 4, 2018 (Unaudited) 3

Condensed Consolidated Statements of Comprehensive (Loss) Income for the Thirteen Weeks and Twenty-Six WeeksEnded August 3, 2019 (Unaudited) and August 4, 2018 (Unaudited) 4

Condensed Consolidated Balance Sheets – August 3, 2019 (Unaudited), February 2, 2019 (Unaudited), and August 4, 2018(Unaudited) 5

Condensed Consolidated Statements of Shareholders’ Equity for the Thirteen Weeks and Twenty-Six Weeks Ended August3, 2019 (Unaudited) and August 4, 2018 (Unaudited) 6

Condensed Consolidated Statements of Cash Flows for the Twenty-Six Weeks Ended August 3, 2019 (Unaudited) andAugust 4, 2018 (Unaudited) 8

Notes to Condensed Consolidated Financial Statements (Unaudited) 9 Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 21 Item 3. Quantitative and Qualitative Disclosures About Market Risk 31 Item 4. Controls and Procedures 31 PART II – Other Information Item 1. Legal Proceedings 32 Item 1A. Risk Factors 32 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 34 Item 6. Exhibits 35 Signatures 36

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#CHS082919Q210-Q_HTM_S7436D9658C3C5EA28089C1338E89CD0C

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#CHS082919Q210-Q_HTM_S63B26735D5A154ECBC6ACDE0BE50FADC

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#CHS082919Q210-Q_HTM_SF942DDCD7C765FD691301254A61E6AEE

Table of Contents

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

CHICO'S FAS, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME

(Unaudited)(Dollars in thousands, except per share amounts)

Thirteen Weeks Ended Twenty-Six Weeks Ended

August 3, 2019 August 4, 2018 August 3, 2019 August 4, 2018

Amount % ofSales Amount

% ofSales Amount

% of Sales Amount

% of Sales

Net Sales $ 508,356 100.0 % $ 544,720 100.0 % $ 1,026,084 100.0 % $ 1,106,535 100.0%Cost of goods sold 339,734 66.8 347,853 63.9 666,631 65.0 682,800 61.7

Gross Margin 168,622 33.2 196,867 36.1 359,453 35.0 423,735 38.3Selling, general andadministrative expenses 170,983 33.7 174,089 31.9 356,391 34.7 360,508 32.6

(Loss) Income fromOperations (2,361) (0.5) 22,778 4.2 3,062 0.3 63,227 5.7

Interest income (expense), net 52 0.0 (310) (0.1) 54 0.0 (555) 0.0(Loss) Income beforeIncome Taxes (2,309) (0.5) 22,468 4.1 3,116 0.3 62,672 5.7

Income tax provision — 0.0 5,700 1.0 3,400 0.3 16,900 1.6Net (Loss) Income $ (2,309) (0.5)% $ 16,768 3.1 % $ (284) 0.0 % $ 45,772 4.1%

Per Share Data: Net (loss) income per commonshare - basic $ (0.02) $ 0.13 $ 0.00 $ 0.36 Net (loss) income per commonand common equivalent share –diluted $ (0.02) $ 0.13 $ 0.00 $ 0.36 Weighted average common sharesoutstanding – basic 114,802 124,730 114,618 125,003 Weighted average common andcommon equivalent sharesoutstanding – diluted 114,802 124,774 114,618 125,054

The accompanying notes are an integral part of these condensed consolidated statements.

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CHICO'S FAS, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

(Unaudited)(In thousands)


August 3, 2019 August 4, 2018 August 3, 2019 August 4, 2018

Net (loss) income $ (2,309) $ 16,768 $ (284) $ 45,772Other comprehensive income:

Unrealized gains on marketable securities, net of taxes 131 87 194 56Foreign currency translation gains (losses) 103 (20) 21 (88)

Comprehensive (loss) income $ (2,075) $ 16,835 $ (69) $ 45,740


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CHICO'S FAS, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)(In thousands, except per share amounts)

August 3, 2019 February 2, 2019 August 4, 2018ASSETS

Current Assets: Cash and cash equivalents $ 99,634 $ 124,128 $ 177,641Marketable securities, at fair value 63,446 61,987 61,727Inventories 227,736 235,218 224,233Prepaid expenses and other current assets 47,919 63,845 57,301

Total Current Assets 438,735 485,178 520,902Property and Equipment, net 337,049 370,932 393,525Right of Use Assets 697,332 — —Other Assets:

Goodwill 96,774 96,774 96,774Other intangible assets, net 38,930 38,930 38,930Other assets, net 17,468 15,220 13,327

Total Other Assets 153,172 150,924 149,031$ 1,626,288 $ 1,007,034 $ 1,063,458

LIABILITIES AND SHAREHOLDERS’ EQUITY Current Liabilities:

Accounts payable $ 137,142 $ 143,404 $ 139,604Current lease liabilities 158,866 — —Other current and deferred liabilities 108,861 131,820 119,497

Total Current Liabilities 404,869 275,224 259,101Noncurrent Liabilities:

Long-term debt 50,000 57,500 61,250Long-term lease liabilities 611,308 — —Other noncurrent and deferred liabilities 8,860 89,109 97,454Deferred taxes 2,129 5,237 4,640

Total Noncurrent Liabilities 672,297 151,846 163,344Commitments and Contingencies (see Note 11) Shareholders’ Equity:

Preferred stock, $0.01 par value; 2,500 shares authorized; no shares issued andoutstanding — — —Common stock, $0.01 par value; 400,000 shares authorized; 159,297 and 158,246and 158,368 shares issued respectively; and 118,000 and 116,949 and 125,710shares outstanding, respectively 1,180 1,169 1,257Additional paid-in capital 487,789 486,406 476,480Treasury stock, at cost, 41,297 and 41,297 and 32,658 shares, respectively (494,395) (494,395) (444,252)Retained earnings 554,694 587,145 607,643Accumulated other comprehensive loss (146) (361) (115)

Total Shareholders’ Equity 549,122 579,964 641,013

$ 1,626,288 $ 1,007,034 $ 1,063,458


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CHICO'S FAS, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

(Unaudited)(In thousands, except per share amounts)

Thirteen Weeks Ended

Common Stock AdditionalPaid-inCapital

Treasury Stock RetainedEarnings

Accumulated OtherComprehensive Loss

Shares Par Value Shares Amount Total

BALANCE, May 4, 2019 117,968 $ 1,180 $ 485,805 41,297 $ (494,395) $ 567,233 $ (380) $ 559,443

Net loss — — — — — (2,309) — (2,309)Unrealized gains on marketablesecurities, net of taxes — — — — — — 131 131

Foreign currency translation adjustment — — — — — — 103 103

Issuance of common stock 48 — 45 — — — — 45Dividends declared on common stock($0.0875 per share) — — — — — (10,230) — (10,230)Repurchase of common stock and taxwithholdings related to share-basedawards (16) — (55) — — — — (55)

Share-based compensation — — 1,994 — — — — 1,994

BALANCE, August 3, 2019 118,000 $ 1,180 $ 487,789 41,297 $ (494,395) $ 554,694 $ (146) $ 549,122

BALANCE, May 5, 2018 129,216 $ 1,292 $ 471,458 29,114 $ (413,465) $ 601,801 $ (182) $ 660,904

Net income — — — — — 16,768 — 16,768Unrealized gains on marketablesecurities, net of taxes — — — — — — 87 87

Foreign currency translation adjustment — — — — — — (20) (20)

Issuance of common stock 65 1 73 — — — — 74Dividends declared on common stock($0.085 per share) — — — — — (10,926) — (10,926)Repurchase of common stock and taxwithholdings related to share-basedawards (3,571) (36) (234) 3,544 (30,787) — — (31,057)


BALANCE, August 4, 2018 125,710 $ 1,257 $ 476,480 32,658 $ (444,252) $ 607,643 $ (115) $ 641,013


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Twenty-Six Weeks Ended

Common Stock AdditionalPaid-inCapital

Treasury Stock RetainedEarnings

Accumulated OtherComprehensive Loss

Shares Par Value Shares Amount Total

BALANCE, February 2, 2019 116,949 $ 1,169 $ 486,406 41,297 $ (494,395) $ 587,145 $ (361) $ 579,964Cumulative effect of adoption of ASU2016-02 (see Note 1) — — — — — (1,287) — (1,287)BALANCE, February 2, 2019, asadjusted 116,949 1,169 486,406 41,297 (494,395) 585,858 (361) 578,677

Net loss — — — — — (284) — (284)Unrealized gains on marketablesecurities, net of taxes — — — — — — 194 194

Foreign currency translation adjustment — — — — — — 21 21

Issuance of common stock 1,490 15 377 — — — — 392Dividends declared on common stock($0.2625 per share) — — — — — (30,880) — (30,880)Repurchase of common stock & taxwithholdings related to share-basedawards (439) (4) (2,480) — — — — (2,484)


BALANCE, August 3, 2019 118,000 $ 1,180 $ 487,789 41,297 $ (494,395) $ 554,694 $ (146) $ 549,122

BALANCE, February 3, 2018 127,471 $ 1,275 $ 468,806 29,114 $ (413,465) $ 599,810 $ (44) $ 656,382Cumulative effect of adoption of ASU2018-02, ASU 2016-16 and ASU 2014-09 (5,015) (39) (5,054)BALANCE, February 3, 2018, asadjusted 127,471 1,275 468,806 29,114 (413,465) 594,795 (83) 651,328

Net income — — — — — 45,772 — 45,772Unrealized gains on marketablesecurities, net of taxes — — — — — — 56 56

Foreign currency translation adjustment — — — — — — (88) (88)

Issuance of common stock 2,115 21 658 — — — — 679Dividends declared on common stock($0.255 per share) — — — — — (32,924) — (32,924)Repurchase of common stock & taxwithholdings related to share-basedawards (3,876) (39) (3,222) 3,544 (30,787) — — (34,048)


BALANCE, August 4, 2018 125,710 $ 1,257 $ 476,480 32,658 $ (444,252) $ 607,643 $ (115) $ 641,013


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CHICO'S FAS, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)(In thousands)


August 3, 2019 August 4, 2018Cash Flows from Operating Activities: Net (loss) income $ (284) $ 45,772Adjustments to reconcile net (loss) income to net cash provided by operating activities:

Depreciation and amortization 46,826 45,870Non-cash lease expense 106,961 —Loss on disposal and impairment of property and equipment, net 196 1,778Deferred tax benefit (2,639) (2,600)Share-based compensation expense 3,486 10,238Deferred rent and lease credits — (10,101)Changes in assets and liabilities:

Inventories 7,482 8,669Prepaid expenses and other assets (4,432) 5,864Accounts payable (16,509) 10,440Accrued and other liabilities (5,884) (16,329)Lease liability (114,186) —

Net cash provided by operating activities 21,017 99,601Cash Flows from Investing Activities:

Purchases of marketable securities (25,615) (17,315)Proceeds from sale of marketable securities 24,384 15,718Purchases of property and equipment (14,076) (19,844)

Net cash used in investing activities (15,307) (21,441)Cash Flows from Financing Activities:

Proceeds from borrowings — 61,250Payments on borrowings (7,500) (68,750)Proceeds from issuance of common stock 392 679Dividends paid (20,633) (22,012)Repurchase of common stock — (28,443)Payments of tax withholdings related to share-based awards (2,484) (3,226)

Net cash used in financing activities (30,225) (60,502)Effects of exchange rate changes on cash and cash equivalents 21 (88)Net (decrease) increase in cash and cash equivalents (24,494) 17,570

Cash and Cash Equivalents, Beginning of period 124,128 160,071

Cash and Cash Equivalents, End of period $ 99,634 $ 177,641

Supplemental Disclosures of Cash Flow Information: Cash paid for interest $ 1,149 $ 2,063Cash (received) paid for income taxes, net $ (1,449) $ 22,327


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CHICO'S FAS, INC. AND SUBSIDIARIESNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except share and per share amounts and where otherwise indicated)(Unaudited)

1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accompanying unaudited condensed consolidated financial statements of Chico's FAS, Inc. and its wholly-owned subsidiaries (collectively, the"Company") have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and notes required by accountingprinciples generally accepted in the U.S. for complete financial statements. In the opinion of management, such interim financial statements reflect all normal,recurring adjustments considered necessary to present fairly the condensed consolidated financial position, the results of operations and cash flows for the interimperiods presented. All significant intercompany balances and transactions have been eliminated in consolidation. For further information, refer to the consolidatedfinancial statements and notes thereto for the fiscal year ended February 2, 2019, included in the Company's Annual Report on Form 10-K for the fiscal year endedFebruary 2, 2019 filed with the Securities and Exchange Commission ("SEC") on March 19, 2019 ("2018 Annual Report on Form 10-K").

As used in this report, all references to "we," "us," "our" and "the Company," refer to Chico's FAS, Inc. and all of its wholly-owned subsidiaries.

Our fiscal years end on the Saturday closest to January 31 and are designated by the calendar year in which the fiscal year commences. Operating resultsfor the thirteen and twenty-six weeks ended August 3, 2019 are not necessarily indicative of the results that may be expected for the entire year.

Adoption of New Accounting Pronouncements

Effective February 3, 2019, the Company adopted the Financial Accounting Standards Board ("FASB") Accounting Standards Update ("ASU") 2016-02, Leases, which requires the recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases under previous guidance. TheCompany also adopted the package of practical expedients issued in subsequent ASUs related to ASU 2016-02. The original guidance required application on amodified retrospective basis with the earliest period presented. In August 2018, the FASB issued ASU 2018-11, Targeted Improvements, to Accounting StandardCodification ("ASC") 842, Leases ("ASC 842"), which included a provision to apply ASC 842 at the adoption date and recognize a cumulative effect adjustment tothe opening balance of retained earnings in the period of adoption. The Company has elected to use the initial application date as the effective date of ASC 842.Consequently, the comparative periods are presented in accordance with ASC 840, Leases, and are not restated in accordance with ASC 842. As a result of theadoption of ASC 842, on February 3, 2019, we recorded operating lease right-of-use ("ROU") assets of $764.1 million and lease liabilities of $845.7 million. OnFebruary 3, 2019, the Company recorded a cumulative effect adjustment of $1.3 million as a decrease to opening retained earnings upon adoption of ASC 842. Theadoption of ASC 842 had an immaterial impact on our unaudited condensed consolidated results of operations and statement of cash flows for the thirteen andtwenty-six weeks ended August 3, 2019. Additional information and disclosures required by this new standard are contained in Note 4, Leases.

Leases

Beginning on February 3, 2019, the Company accounts for leases pursuant ASC 842 as established by ASU 2016-02. We determine if an arrangement is alease at inception. Operating leases are included in ROU assets, current lease liabilities and long-term lease liabilities in our unaudited consolidated balance sheet.The Company does not have finance leases in the periods presented.

ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arisingfrom the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of fixed lease payments over the leaseterm. The operating lease ROU asset represents the net present value of fixed payments required under the lease, discounted at the Company's incrementalborrowing rate, offset by impairments and lease incentives such as tenant improvements and deferred rent balances.

Our leases do not provide an implicit rate. Accordingly, we use the Company's incremental borrowing rate at commencement date in determining thepresent value of lease payments over the lease term. Furthermore, we elected to apply a portfolio approach, using the same discount rate applied to a portfolio ofleases for similar asset types with a similar lease term.

Our lease terms may include options to extend or terminate the lease. When it is reasonably certain that we will exercise an option to extend or terminate alease, the Company will adjust its ROU asset and lease liability. For leases with no impairment of the ROU asset, lease expense is recognized on a straight-linebasis over the lease term. For stores with impairment of the ROU asset, lease expense consists of straight-line amortization of the ROU asset and the implicitinterest expense on the lease liability.

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Table of ContentsCHICO'S FAS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED(In thousands, except share and per share amounts and where otherwise indicated)

(Unaudited)

We have lease agreements with lease and non-lease components. We have made a policy election to treat both lease and non-lease components as a singlecomponent and account for the full consideration as a single lease component. This policy election is applied to all asset classes for which the Company is a lessee.

We lease retail stores and a limited amount of office space under operating leases. The majority of our lease agreements provide for tenant improvementallowances, rent escalation clauses and/or contingent rent provisions. Tenant improvement allowances, fixed rent escalation clauses and impairments are includedin the ROU asset computation.

Certain leases provide for contingent rents based on defined criteria, such as gross sales in excess of a specified level. We record a contingent rent liabilityin accrued liabilities on the consolidated balance sheets and the corresponding rent expense when the criteria has been achieved or is probable.

Additionally, we have a nominal number of leases that meet the standard's definition of a "short-term lease" (a lease that, at the commencement date, has alease term of twelve months or less and does not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise). We have madea policy election to recognize these leases as incurred and have not recognized a ROU asset or corresponding lease liability for them. The Company's short-termleases are not material.

2. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirementsfor Fair Value Measurement, which modifies the disclosure requirements on fair value measurements. ASU 2018-13 is effective for fiscal years, and interimperiods within those years, beginning after December 15, 2019. The amendments related to the range and weighted average of significant unobservable inputs usedto develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively. All other amendmentsshould be applied retrospectively. An entity is permitted to early adopt any removed or modified disclosures upon issuance of ASU 2018-13 and delay adoption ofthe additional disclosures until their effective date. We do not anticipate adoption to have a material impact on the Company's unaudited condensed consolidatedfinancial statements.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments — Credit Losses (Topic 326), Measurement of Credit Losses on FinancialInstruments. The update and additional changes, modifications, clarifications, or interpretations related to this guidance thereafter, changes the methodology formeasuring credit losses on financial instruments and the timing of when such losses are recorded. The guidance is to be applied using the modified-retrospectiveapproach. The standard is effective for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019,including interim periods within those fiscal years. We are currently evaluating the impact the adoption will have on our unaudited consolidated financialstatements.

3. REVENUE RECOGNITION

Disaggregated Revenue

The following table disaggregates our operating segment revenue by brand, which we believe provides a meaningful depiction of the nature of ourrevenue. Amounts shown include licensing and wholesale income, which is not a significant component of total revenue, and is aggregated within the respectivebrands in the table below.


August 3, 2019 August 4, 2018 August 3, 2019 August 4, 2018Chico's $ 268,924 52.9% $ 286,808 52.7% $ 545,626 53.2% $ 587,744 53.1%WHBM 139,809 27.5 168,938 31.0 300,754 29.3 351,586 31.8Soma (1) 99,623 19.6 88,974 16.3 179,704 17.5 167,205 15.1

Total Net Sales $ 508,356 100.0% $ 544,720 100.0% $ 1,026,084 100.0% $ 1,106,535 100.0%

(1) Includes TellTaleTM net sales, which is not a significant component of Soma revenue.

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(Unaudited)

Accounting Policies

The Company recognizes revenue pursuant ASC 606 as established by ASU 2014-09 ("ASC 606"). Retail sales by our stores are recorded at the point ofsale and are net of estimated customer returns, sales discounts under rewards programs and Company issued coupons, promotional discounts and employeediscounts. Sales from our websites and catalogs are recognized at the time of shipment. Amounts related to shipping and handling costs billed to customers arerecorded in net sales and the related shipping and handling costs are recorded in cost of goods sold in the accompanying unaudited condensed consolidatedstatements of (loss) income. Amounts paid by customers to cover shipping and handling costs are immaterial. Our policy towards taxes assessed by a governmentauthority directly imposed on revenue producing transactions between a seller and a customer is, and has been, to exclude all such taxes from revenue. Licensingand wholesale income, which is not a significant component of total revenue, is recognized based upon delivery of products, except when the customer has acontractual right of return.

We sell gift cards in stores, on our e-commerce website and through third parties. Our gift cards do not have expiration dates. We account for gift cards byrecognizing a liability at the time the gift card is sold. The liability is relieved and revenue is recognized, net of third party sales commissions, for gift cards uponredemption. In addition, we recognize revenue for the amount of gift cards expected to go unredeemed (commonly referred to as gift card breakage) under theredemption recognition method. This method records gift card breakage as revenue on a proportional basis over the redemption period based on our historical giftcard breakage rate. We determine the gift card breakage rate based on our historical redemption patterns. We recognize revenue on the remaining unredeemed giftcards based on determining that the likelihood of the gift card being redeemed is remote and that there is no legal obligation to remit the unredeemed gift cards torelevant jurisdictions.

Soma offers a points-based loyalty program in which customers earn points based on purchases. Attaining specified loyalty point levels results in theissuance of reward coupons to discount future purchases. As program members accumulate points, we accrue the estimated future liability, adjusted for expectedredemption rates and expirations. The liability is relieved and revenue is recognized for loyalty point reward coupons upon redemption. In addition, we recognizerevenue on unredeemed points when it can be determined that the likelihood of the point being redeemed is remote and there is no legal obligation to remit thepoint value. We determine the loyalty point breakage rate based on historical and redemption patterns.

As part of the normal sales cycle, we receive customer merchandise returns related to store, website and catalog sales. To account for the financial impactof potential customer merchandise returns, we estimate future returns on previously sold merchandise. Reductions in sales and gross margin are recorded forestimated merchandise returns based on return history, current sales levels and projected future return levels.

The Company's accounting policies and treatment over revenue recognition are consistent with the provisions of ASC 606 and represent a faithfuldepiction of the transfer of promised goods or services to customers in an amount that reflects the consideration the Company expects to be entitled to in exchangefor those goods or services.

Contract Liability

Contract liabilities on the unaudited condensed consolidated balance sheet were comprised of obligations associated with our gift card and customerloyalty programs. As of August 3, 2019 and February 2, 2019, contract liabilities primarily consisted of gift cards of $30.6 million and $42.6 million, respectively.For the thirteen and twenty-six weeks ended August 3, 2019, the Company recognized $7.6 million and $19.5 million, respectively, of revenue that was previouslyincluded in the gift card contract liability as of February 2, 2019. The contract liability for our loyalty program was not material as of August 3, 2019 or February 2,2019.

Performance Obligation

For the thirteen and twenty-six weeks ended August 3, 2019, revenue recognized from performance obligations related to prior periods was not material.Revenue recognized in future periods related to performance obligations is not expected to be material.

4. LEASES

We lease retail stores, a limited amount of office space and certain equipment under operating leases expiring in various years through the fiscal yearending 2029. All of our leases have been classified as operating leases and are recognized and measured as such.

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(Unaudited)

Certain operating leases provide for renewal options that at a pre-determined period and rental value. Furthermore, certain leases provide that we maycancel the lease if our retail sales at that location fall below an established level. Within the first few years of the initial lease term, a majority of our store operatingleases contain cancellation clauses that allow the leases to be terminated at our discretion, if certain minimum sales levels are not met. In the normal course ofbusiness, operating leases are typically renewed or replaced by other leases.

Escalation of operating lease payments of certain leases depend on an existing index or rate, such as the consumer price index or the market interest rate.These are considered variable lease payments and are included in lease payments when the escalation is known.

Operating lease expense was as follows:


August 3, 2019

Operating lease cost (1) $ 62,341 $ 127,243

(1) Includes approximately $5.0 million and $13.0 million in variable lease costs for the thirteen and twenty-six weeks ended August 3, 2019, respectively.

Supplemental balance sheet information related to operating leases was as follows:

August 3, 2019

Right of Use Assets $ 697,332

Current lease liabilities $ 158,866Long-term lease liabilities 611,308

Total operating lease liabilities $ 770,174

Weighted Average Remaining Lease Term (years) 5.0

Weighted Average Discount Rate (1) 5.7%

(1) The incremental borrowing rate used by the Company is based on the rate at which the Company could borrow funds using its credit rating for a collateralizedloan of similar term to the lease. The weighted average discount rate represents a weighted average of the incremental borrowing rate for each lease weightedbased on the remaining fixed lease obligations.

Supplemental cash flow information related to operating leases was as follows:


August 3, 2019

Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows $ 114,186

Right of use assets obtained in exchange for lease obligations, non-cash 15,465

12




(Unaudited)

Maturities of operating lease liabilities were as follows:

Fiscal Year Ending:February 1, 2020 $ 91,580January 30, 2021 208,932January 29, 2022 183,783January 28, 2023 146,250February 4, 2024 98,811Thereafter 160,531

Total future minimum lease payments $ 889,887Less imputed interest (119,713)

Total $ 770,174

5. RETAIL FLEET OPTIMIZATION PLAN

In the fourth quarter of fiscal 2018, the Company announced a retail fleet optimization plan to rebalance the mix between our physical store presence andour digital network with the closure of at least 250 stores in the United States in fiscal years 2019-2021. Under this plan, we expect to close approximately 100Chico's, 90 WHBM and 60 Soma locations in fiscal years 2019-2021, with the majority of the closings occurring in fiscal years 2020 and 2021. This initiative ispart of the Company's efforts to better capitalize on its omnichannel platform, reduce costs and improve profitability and return on invested capital. For the thirteenand twenty-six weeks ended August 3, 2019, the Company recorded $3.0 million and $7.9 million, respectively, in pre-tax accelerated depreciation of property andequipment within cost of goods sold associated with this retail fleet optimization plan. Accelerated depreciation on property and equipment reflects the impact of achange in the useful life of store assets for store closures added as a result of the Company's retail fleet optimization plan.

6. SHARE-BASED COMPENSATION

For the twenty-six weeks ended August 3, 2019 and August 4, 2018, share-based compensation expense was $3.5 million and $10.2 million, respectively.As of August 3, 2019, approximately 5.4 million shares remain available for future grants of equity awards under our Amended and Restated 2012 Omnibus Stockand Incentive Plan, which was amended and restated effective June 22, 2017.

Restricted Stock Awards

Restricted stock awards vest in equal annual installments over a three-year period from the date of grant.

Restricted stock award activity for the twenty-six weeks ended August 3, 2019 was as follows:

Number of Shares

Weighted Average

Grant Date Fair Value

Unvested, beginning of period 2,715,466 $ 10.92Granted 2,759,505 4.50Vested (1,201,362) 11.39Forfeited (1,231,952) 6.96

Unvested, end of period 3,041,657 6.51

13




(Unaudited)

Performance-based Restricted Stock Units

For the twenty-six weeks ended August 3, 2019, we granted performance-based restricted stock units ("PSUs"), contingent upon the achievement ofCompany-specific performance goals during the three fiscal years 2019 - 2021. Any units earned as a result of the achievement of this goal will vest 100% threeyears from the date of grant and will be settled in shares of our common stock.

Performance-based restricted stock unit activity for the twenty-six weeks ended August 3, 2019 was as follows:

Number ofUnits/ Shares

Weighted Average

Grant Date Fair Value

Unvested, beginning of period 1,067,338 $ 11.40Granted 1,170,650 4.23Vested (244,628) 13.19Forfeited (1,097,951) 7.42

Unvested, end of period 895,409 6.42

Stock Option Awards

For the twenty-six weeks ended August 3, 2019 and August 4, 2018, we did not grant any stock options.

Stock option activity for the twenty-six weeks ended August 3, 2019 was as follows:

Number of

Options

Weighted Average

Exercise PriceOutstanding, beginning of period 214,277 $ 13.54

Granted — —Exercised — —Forfeited or expired — —

Outstanding and exercisable, end of period 214,277 13.54

7. INCOME TAXES

The provision for income taxes is based on a current estimate of the annual effective tax rate and is adjusted as necessary for quarterly events. Oureffective income tax rate may fluctuate from quarter to quarter as a result of a variety of factors, including changes in our assessment of certain tax contingencies,valuation allowances, changes in tax law, outcomes of administrative audits, the impact of discrete items and the mix of earnings.

For the thirteen weeks ended August 3, 2019 and August 4, 2018, the Company's effective tax rate was 0.0% and 25.4%, respectively. The 0.0% effectivetax rate was primarily the result of an income tax benefit on the second quarter operating loss, offset by a true-up from the first quarter provision due to an increasein the forecasted annual effective tax rate.

For the twenty-six weeks ended August 3, 2019 and August 4, 2018, the Company's effective tax rate was 109.1% and 27.0%, respectively. The effectivetax rates of 109.1% and 27.0% was primarily the result of the additional tax expense related to employee share-based awards against lower pre-tax income.

8. EARNINGS PER SHARE

In accordance with relevant accounting guidance, unvested share-based payment awards that include non-forfeitable rights to dividends, whether paid orunpaid, are considered participating securities. As a result, such awards are required to be included in the calculation of earnings per common share pursuant to the"two-class" method. For the Company, participating securities are comprised entirely of unvested restricted stock awards and PSUs that have met their relevantperformance criteria.

14




(Unaudited)

Earnings per share ("EPS") is determined using the two-class method when it is more dilutive than the treasury stock method. Basic EPS excludes dilutionand is computed by dividing net income available to common shareholders by the weighted-average number of common shares outstanding during the period,including participating securities. Diluted EPS reflects the dilutive effect of potential common shares from non-participating securities such as stock options, PSUsand restricted stock units.

The following table sets forth the computation of net (loss) income per basic and diluted share shown on the face of the accompanying condensedconsolidated statements of (loss) income:


August 3, 2019 August 4, 2018 August 3, 2019 August 4, 2018Numerator

Net (loss) income $ (2,309) $ 16,768 $ (284) $ 45,772Net income and dividends declared allocated to participatingsecurities — (444) — (1,169)Net (loss) income available to common shareholders $ (2,309) $ 16,324 $ (284) $ 44,603

Denominator Weighted average common shares outstanding – basic 114,802 124,730 114,618 125,003Dilutive effect of non-participating securities — 44 — 51Weighted average common and common equivalent sharesoutstanding – diluted 114,802 124,774 114,618 125,054

Net (loss) income per common share: Basic $ (0.02) $ 0.13 $ 0.00 $ 0.36Diluted $ (0.02) $ 0.13 $ 0.00 $ 0.36

For the thirteen weeks ended August 3, 2019 and August 4, 2018, 0.8 million and 0.8 million potential shares of common stock, respectively, wereexcluded from the diluted per share calculation relating to non-participating securities, because the effect of including these potential shares was antidilutive.

For the twenty-six weeks ended August 3, 2019 and August 4, 2018, 0.4 million and 0.8 million potential shares of common stock, respectively, wereexcluded from the diluted per share calculation relating to non-participating securities, because the effect of including these potential shares was antidilutive.

9. FAIR VALUE MEASUREMENTS

Our financial instruments consist of cash, money market accounts, marketable securities, assets held in our non-qualified deferred compensation plan,accounts receivable and payable, and debt. Cash, accounts receivable and accounts payable are carried at cost, which approximates their fair value due to the short-term nature of the instruments.

Marketable securities are classified as available-for-sale and as of August 3, 2019 generally consist of corporate bonds, commercial paper, U.S.government agencies and municipal securities, with $39.4 million of securities with maturity dates within one year or less and $24.0 million with maturity datesover one year and less than two years.

We consider all marketable securities available-for-sale, including those with maturity dates beyond 12 months, and therefore classify these securitieswithin current assets on the condensed consolidated balance sheets as they are available to support current operational liquidity needs. Marketable securities arecarried at fair value, with the unrealized holding gains and losses, net of income taxes, reflected in accumulated other comprehensive (loss) income until realized.For the purposes of computing realized and unrealized gains and losses, cost is determined on a specific identification basis.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market in anorderly transaction between market participants on the measurement date. Entities are required to use a three-level hierarchy, which requires an entity to maximizethe use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

15




(Unaudited)

The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability on the measurement date. The three levels aredefined as follows:

Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities

Level 2 — Unadjusted quoted prices in active markets for similar assets or liabilities; or Unadjusted quoted prices for identical or similar assets or

liabilities in markets that are not active; or Inputs other than quoted prices that are observable for the asset or liability Level 3 — Unobservable inputs for the asset or liability

We measure certain financial assets at fair value on a recurring basis, including our marketable securities, which are classified as available-for-salesecurities, certain cash equivalents, specifically our money market accounts and assets held in our non-qualified deferred compensation plan. The money marketaccounts are valued based on quoted market prices in active markets. Our marketable securities are generally valued based on other observable inputs for thosesecurities (including market corroborated pricing or other models that utilize observable inputs such as interest rates and yield curves) based on informationprovided by independent third-party pricing entities, except for U.S. government securities which are valued based on quoted market prices in active markets. Theinvestments in our non-qualified deferred compensation plan are valued using quoted market prices and are included in other assets on our consolidated balancesheets.

From time to time, we measure certain assets at fair value on a non-recurring basis. This includes the evaluation of long-lived assets, goodwill and otherintangible assets for impairment using Company-specific assumptions which would fall within Level 3 of the fair value hierarchy.

We assess the carrying amount of long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of anasset may not be recoverable. The Company uses market participant rents to calculate fair value of ROU assets and discounted future cash flows of the asset orasset group using a discount rate that approximates the cost of capital of a market participant to quantify fair value for other long-lived assets. The asset group isdefined as the lowest level for which identifiable cash flows are available and largely independent of the cash flows of other groups of assets, which for our retailstores, is primarily at the store level. On February 3, 2019, the Company recorded a transition day fair value impairment on our ROU asset of $1.3 million, after-tax, as a decrease to opening retained earnings upon adoption of ASC 842.

To assess the fair value of goodwill, we utilize both an income approach and a market approach. Inputs used to calculate the fair value based on theincome approach primarily include estimated future cash flows, discounted at a rate that approximates the cost of capital of a market participant. Inputs used tocalculate the fair value based on the market approach include identifying sales and EBITDA multiples based on guidelines for similar publicly traded companiesand recent transactions.

To assess the fair value of trade names, we utilize a relief from royalty approach. Inputs used to calculate the fair value of the trade names primarilyinclude future sales projections, discounted at a rate that approximates the cost of capital of a market participant and an estimated royalty rate.

The carrying value of goodwill for the Chico's and White House Black Market ("WHBM") reporting units and WHBM trade name as of August 3, 2019and August 4, 2018 was $36.4 million, $60.4 million and $34.0 million, respectively. No impairment charges were recognized for the thirteen and twenty-sixweeks ended August 3, 2019 and August 4, 2018. If profitability trends do not improve as projected during fiscal 2019 for our Chico's and WHBM reporting units,it is possible that an interim test, or our annual impairment test in the fourth quarter of fiscal 2019, may result in an impairment of these assets.

As of August 3, 2019 and February 2, 2018, our revolving loan and letter of credit facility approximates fair value as this instrument has a variable interestrate which approximates current market rates (Level 2 criteria).

To assess the fair value of long-term debt as of August 4, 2018, we utilized a discounted future cash flow model using current borrowing rates for similartypes of debt of comparable maturities.

Fair value calculations contain significant judgments and estimates, which may differ from actual results due to, among other things, economic conditions,changes to the business model or changes in operating performance.

16




(Unaudited)

During the quarter ended August 3, 2019, we did not make any transfers between Level 1 and Level 2 financial assets. Furthermore, as of August 3,2019, February 2, 2019 and August 4, 2018, we did not have any Level 3 financial assets measured on a recurring basis. We conduct reviews on a quarterly basis toverify pricing, assess liquidity and determine if significant inputs have changed that would impact the fair value hierarchy disclosure.

In accordance with the provisions of the guidance, we categorized our financial assets and liabilities which are valued on a recurring basis, based on thepriority of the inputs to the valuation technique for the instruments, as follows:

Fair Value Measurements at Reporting Date Using

Balance as of August

3, 2019

Quoted Prices inActive Markets for

Identical Assets (Level 1)

Significant OtherObservable Inputs

(Level 2)

Significant UnobservableInputs

(Level 3)Financial Assets: Current Assets

Cash equivalents: Money market accounts $ 286 $ 286 $ — $ —

Marketable securities: Corporate bonds 60,476 — 60,476 —Commercial paper 2,970 — 2,970 —

Noncurrent Assets Deferred compensation plan 7,112 7,112 — —

Total $ 70,844 $ 7,398 $ 63,446 $ —Financial Liabilities: Long-term debt $ 50,000 $ — $ 50,000 $ —

Balance as ofFebruary 2, 2019

Financial Assets: Current Assets


Marketable securities: Corporate bonds 60,281 — 60,281 —Commercial paper 1,706 — 1,706 —



Balance as of August4, 2018

Financial Assets: Current Assets


Marketable securities: Municipal securities 3,423 — 3,423 —U.S. government agencies 6,773 — 6,773 —Corporate bonds 46,542 — 46,542 —Commercial paper 4,989 — 4,989 —






(Unaudited)

10. DEBT

On August 2, 2018, the Company and certain of its domestic subsidiaries entered into a credit agreement (the “Agreement”) as borrowers and guarantors,with Wells Fargo Bank, National Association, as Agent, letter of credit issuer and swing line lender, and certain lenders party thereto. Our obligations under theAgreement are guaranteed by the subsidiary guarantors and secured by a lien on certain assets of the Company and the subsidiary borrowers and guarantors,including inventory, accounts receivable, cash deposits, and certain insurance proceeds. The Agreement provides for a five-year asset-based senior securedrevolving loan and letter of credit facility of up to $200 million, maturing August 2, 2023. In addition, during the term of the Agreement, the Company mayincrease the commitments under the Agreement by up to an additional $100 million, subject to customary conditions, including obtaining the agreements from thelenders to provide such commitment increase. The interest rate applicable to the loans under the Agreement will be equal to, at the Company's option, either a baserate, determined by reference to the federal funds rate, plus an interest rate margin, or a LIBO rate, plus an interest rate margin, in each case, depending onavailability under the Agreement. The Company expects borrowings to be at a LIBO rate, plus an interest rate margin. In addition, the Company will pay acommitment fee per annum on the unused portion of the commitments under the Agreement.

The Agreement contains customary representations, warranties, and affirmative covenants, as well as customary negative covenants, that, among otherthings restrict, subject to certain exceptions, the ability of the Company and certain of its domestic subsidiaries to: (i) incur liens, (ii) make investments, (iii) issueor incur additional indebtedness, (iv) undergo significant corporate changes, including mergers and acquisitions, (v) make dispositions, (vi) make restrictedpayments, (vii) prepay other indebtedness and (viii) enter into certain other restrictive agreements. The Company may pay cash dividends and repurchase sharesunder its share buyback program, subject to certain thresholds of available borrowings based upon the lesser of the aggregate amount of commitments under theAgreement and the borrowing base (the "Loan Cap"), determined after giving effect to any such transaction or payment, on a pro forma basis.

As of August 3, 2019, our outstanding debt consisted of $50.0 million in borrowings under the Agreement, resulting in $150.0 million available forborrowings under the revolving loan and letter of credit facility. As of August 3, 2019, an unamortized debt discount of $0.5 million was outstanding related to theAgreement and is presented in other current assets in the accompanying unaudited consolidated balance sheet.

The credit agreement entered into on May 4, 2015 with JPMorgan Chase Bank, N.A., as Administrative Agent, Bank of America, N.A., as SyndicationAgent and other lenders, which was unsecured and had provided for a term loan commitment in the amount of $100 million and a $100 million revolving creditfacility, was terminated on August 2, 2018 in connection with the Company entering into the Agreement described above, and all outstanding amounts thereunderwere repaid. We used the proceeds from the initial draw of the revolving loan of the Agreement to repay such obligations.

The following table provides additional detail on our outstanding long-term debt:

August 3, 2019 February 2, 2019 August 4, 2018Credit Agreement $ 50,000 $ 57,500 $ 61,250

11. COMMITMENTS AND CONTINGENCIES

In July 2015, White House Black Market, Inc. ("WHBM") was named as a defendant in Altman v. White House Black Market, Inc., a putative classaction filed in the United States District Court for the Northern District of Georgia ("District Court"). The complaint alleges that WHBM, in violation of federallaw, willfully published more than the last five digits of a credit or debit card number on customers' point-of-sale receipts. The plaintiff seeks an award of statutorydamages of $100 to $1,000 for each alleged willful violation of the law, as well as attorneys' fees, costs and punitive damages. WHBM denies the materialallegations of the complaint and believes the case is without merit. On February 12, 2018, the District Court issued an order certifying the class.

On April 9, 2018, the District Court, sua sponte, issued an order granting WHBM's earlier 2016 request to appeal, to the Eleventh Circuit Court ofAppeals ("Eleventh Circuit"), the District Court's ruling that the plaintiff has standing to maintain the lawsuit. On April 19, 2018, WHBM filed a petition for reviewin the Eleventh Circuit. In the meantime, the District Court stayed all further proceedings in the case pending the outcome of the appeal in the Eleventh Circuit.

18




(Unaudited)

On July 12, 2018, the plaintiff and WHBM notified the Eleventh Circuit that the plaintiff and WHBM had reached a class settlement on all claims andtherefore voluntarily dismissed WHBM's appeal to the Eleventh Circuit. On August 2, 2018, the District Court reopened the case for purposes ofreviewing/approving the proposed settlement. On October 22, 2018, the plaintiff filed the settlement papers with the District Court, along with a motion to stay theDistrict Court's consideration of the settlement pending the Eleventh Circuit's final disposition of Muransky v. Godiva Chocolatier, Inc., in which the EleventhCircuit held, in an opinion issued October 3, 2018, that the display of the first five and last four digits of a credit or debit card number on a customer's receipt givenat the point of sale establishes a "concrete injury" sufficient to confer Article III standing, enabling the customer to maintain a lawsuit. The motion to stay wasgranted on November 15, 2018. A petition for rehearing on the October 2018 opinion was filed in the Muransky case on October 24, 2018. The Eleventh Circuitissued a new opinion on April 22, 2019, sua sponte, superseding the October 2018 opinion, and reaffirming the establishment of Article III standing in theMuransky case. A petition for rehearing on that April 2019 opinion was filed on May 13, 2019 and is currently pending before the Eleventh Circuit. The Muranskyopinion, if not altered on the petition for rehearing, would bind the District Court in the Altman case and likely establish that the plaintiff has standing to maintainher lawsuit against WHBM. In such event, the stay will be lifted and the proposed settlement will be reviewed by the District Court. If the Eleventh Circuit doesnot find standing in the Muransky case, the parties have agreed to submit the proposed settlement to the Superior Court for Cobb County, Georgia for approval.The proposed settlement would not have a material adverse effect on the Company's consolidated financial condition or results of operations.

However, no assurance can be given that the proposed settlement will be approved. If the proposed settlement is rejected and the case were to proceed as aclass action and WHBM were to be unsuccessful in its defense on the merits, then the ultimate resolution of the case could have a material adverse effect on theCompany’s consolidated financial condition or results of operations.

In May 2016, Chico's Retail Services, Inc. ("CRS") was named as a defendant in Corporate Cleaners, Inc. v. Chico's Retail Services, Inc., an action filedin the Seventeenth Judicial Circuit of Florida (“Seventeenth Judicial Circuit”). The plaintiff alleges that CRS breached a contract (and related amendments thereto)with the plaintiff by, among other reasons, failing to pay outstanding invoices and failing to allow the plaintiff the exclusive right to provide certain cleaningservices. The plaintiff seeks an award of lost profits, lost revenue, as well as attorneys' fees and costs. CRS denies the material allegations brought by the plaintiffand filed a counterclaim seeking recovery of amounts associated with alleged misrepresentations by the plaintiff as to the quantity of inventory units cleaned by theplaintiff.

Mediation commenced in 2018, but was adjourned with the expectation that the parties would continue mediation after expert disclosures have beenexchanged. CRS' expert was deposed in April 2019. A trial date was set for September 17, 2019; however, on August 15, 2019, the parties entered intoa settlement agreement for an amount that was not material to our annual consolidated financial statements. The Seventeenth Judicial Circuit will dismiss the caseupon the Company's payment of the settlement.

In May 2019, the Company was named as a defendant in Fisher v. Chico's FAS, Inc., a putative class action filed in the United States District Court forthe Southern District of California. The complaint alleges that the Company advertised fictitious prices and corresponding phantom discounts on its made-for-outlet products in its Chico's outlets in violation of California's Unfair Competition Laws, California's False Advertising Laws and the California Consumer LegalRemedies Act. The plaintiff seeks disgorgement of the Company's profits and alleged unjust enrichment resulting from such advertising practices, injunctive relief,a corrective advertising campaign, as well as attorneys' fees and costs. The Company was served on May 10, 2019. The parties have scheduled a mediation date ofOctober 22, 2019. Additionally, the parties have jointly asked the court to extend Company’s response deadline to November 22, 2019.

The Company is currently investigating the underlying allegations and will vigorously defend the case. At this time, it is not possible to predict whether this matterultimately will be permitted to proceed as a class action, and no assurance can be given as to the ultimate outcome of this matter. However, if the matter were toproceed as a class action and the Company were to be unsuccessful in its defense on the merits, then the ultimate resolution of the case could have a materialadverse effect on the Company's consolidated financial condition or results of operations.

Other than as noted above, we are not currently a party to any material legal proceedings other than claims and lawsuits arising in the normal course ofbusiness. All such matters are subject to uncertainties, and outcomes may not be predictable. Consequently, the ultimate aggregate amounts of monetary liability orfinancial impact with respect to these matters as of August 3, 2019 are not estimable. However, while such matters could affect our consolidated operating results

19




(Unaudited)

when resolved in future periods, management believes that upon final disposition, any monetary liability or financial impact to us would not be material to ourannual consolidated financial statements.

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") should be read in conjunction with the unauditedcondensed consolidated financial statements and notes thereto included in this Form 10-Q and in our Annual Report on Form 10-K for the fiscal year endedFebruary 2, 2019, filed with the SEC on March 19, 2019 ("2018 Annual Report on Form 10-K").

Executive Overview

We are a leading omnichannel specialty retailer of women's private branded, sophisticated, casual-to-dressy apparel, intimates and complementaryaccessories, operating under the Chico's, White House Black Market ("WHBM"), Soma® and TellTaleTM brand names in the United States ("U.S."), Puerto Rico,the U.S. Virgin Islands and Canada. Our distinct lifestyle brands serve the needs of fashion-savvy women 35 years and older. We earn revenue and generate cashthrough the sale of merchandise in our domestic and international retail stores, our various Company-operated e-commerce websites, our call center (which takesorders for all of our brands), through an unaffiliated franchise partner in Mexico and through third-party channels.

We utilize an integrated, omnichannel approach to managing our business. We want our customers to experience our brands holistically and to view thevarious retail channels we operate as a single, integrated experience rather than as separate sales channels operating independently. This approach allows ourcustomers to browse, purchase, return or exchange our merchandise through whatever sales channel and at whatever time is most convenient. As a result, we tracktotal sales and comparable sales on a combined basis.

In July 2019, our Board of Directors (the "Board") appointed Bonnie Brooks as Chief Executive Officer ("CEO") and President of Chico's FAS, Inc., andMs. Brooks will remain on the Company's Board. Furthermore, the responsibility for the Company's apparel group was consolidated under one leader, MollyLangenstein, who was appointed President, Apparel Group, and will lead all business activities for the Chico's and WHBM brands, and Mary van Praag, President,Intimates Group, continues to lead Soma and TellTale. We believe this new leadership structure will strengthen the organization, create clear lines of responsibilityand accelerate our sales driving priorities to deliver shareholder value.

The Company reported second quarter loss per diluted share of $0.02, compared to $0.13 earnings per diluted share in last year's second quarter.Comparable store sales were down 6.1%, driven by lower average dollar sale and a decrease in transaction count.

Fiscal 2019 Second Quarter Business Highlights

• The Company announced the appointment of Bonnie Brooks as CEO and President of Chico’s FAS and a new organizational structure for the Company.Molly Langenstein was appointed President, Apparel Group, leading Chico’s and White House Black Market (“WHBM”), and Mary van Praag, President,Intimates Group, continues to lead Soma® and TellTale™. The new structure and leadership appointments are designed to strengthen the organization,create clear lines of responsibility and accelerate sales driving priorities.

• Soma reported positive 10.9% comparable sales growth in the second quarter, the brand’s best comparable sales performance in four years, and remains aleading performer in the industry. The focus on innovation, improved aesthetic and additional marketing at Soma are driving new customer acquisition.

• Chico’s comparable sales improved sequentially compared to the first quarter, driven by momentum in key items and better in-stock positions.

• WHBM comparable sales were lower sequentially compared to the first quarter due to product misses in color and print, which were identified in the firstquarter and have been addressed through significant leadership changes and a more rigorous approval process. The sales trends in the Fall 1 assortment,set in stores and online in early August, have improved. The Company anticipates the performance at the brand to gradually improve throughout the falland holiday seasons.

• The Company continues to make progress on executing its three operating priorities which are driving stronger sales through improved product andmarketing; optimizing the customer journey by simplifying, digitizing and extending the Company’s unique and personalized service; and transformingsourcing and supply chain operations to increase product speed to market and improve quality.

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Current Trends

Macroeconomic Impacts

The Company has exposure to volatility of the macroeconomic environment due to political uncertainty and potential changes to international tradeagreements, such as new tariffs imposed on certain Chinese-made products imported to the U.S. During fiscal 2018, the U.S. began to impose duties oncertain Chinese-made imported products. On May 5, 2019, the current administration announced an increase to the tariffs currently being imposed on certainimports from 10% to 25%, effective May 10, 2019, and as indicated, will be further increased to 30% beginning on October 1, 2019. The current administrationalso recently indicated it will impose tariffs on additional products beginning September 1, 2019 that could potentially impact the Company's offerings and resultsof operations. To minimize this risk, the Company is actively reducing its penetration of Chinese-made imported products and, in the event such tariffs areimposed, will engage vendor participation to negotiate cost-sharing agreements, and manage and adjust spring buys and product pricing. There can be no assurancethat these actions will mitigate the impact of new and/or incremental tariffs and consequentially future net sales, income from operations and net income may beadversely impacted at a material level.

Unsolicited Takeover Offer

On June 19, 2019, the Company received an unsolicited proposal from Sycamore Partners Management, L.P. ("Sycamore") to acquire the Company for$3.00 per share in cash. After reviewing the proposal in consultation with its independent financial and legal advisors, the Board determined that Sycamore'sproposal substantially undervalued the Company and was not in the best interests of the Company's shareholders. This followed the Board’s review and rejection ofprevious proposals from Sycamore for $3.50 and $4.30 per share on May 10, 2019 and April 14, 2019, respectively, which the Board also determined substantiallyundervalued the Company and were not in the best interests of shareholders.

Our Business Strategy

Our overall business strategy is focused on building a collection of distinct high-performing retail brands serving the fashion needs of women 35 andolder. The primary function of the Company is the production and procurement of beautiful merchandise that delivers the brand promise and brand positioning ofeach of our brands and resonates with customers. To that end, we are further strengthening our merchandise and design capabilities in the coming months andenhancing our sourcing and supply chain to deliver product in a timely manner to our customers while also concentrating on improvements to the quality andaesthetic of our merchandise. Over the long term, we may build our brand portfolio by organic development or acquisition of other specialty retail concepts ifresearch indicates that the opportunity complements our current brands and is appropriate and in the best interest of the shareholders.

We pursue improving the performance of our brands by building our omnichannel capabilities, managing our store base, growing our online presence,executing marketing plans, effectively leveraging expenses, considering additional sales channels and markets, and optimizing the merchandise offerings of each ofour brands. We continue to invest heavily in advancing our omnichannel capabilities, so our customers can fully experience our brands in the manner they choose.

We view our stores and e-commerce websites as a single, integrated sales function rather than as separate, independently operated sales channels. As aresult, we maintain a shared inventory platform for our operations, allowing us to fulfill orders for all channels from our distribution center ("DC") in Winder,Georgia. Our domestic customers can return merchandise to a store or to our DC, regardless of the original purchase location. Using our enhanced "Locate" tool,we ship in-store orders from other locations directly to the customer, expediting delivery times while reducing our shipping costs. In addition, we expanded ouromnichannel capabilities in fiscal 2018 with the launch of Endless Aisle, our shared inventory system, enabling customers to purchase online and ship from store.

We seek to acquire new customers and retain existing customers by leveraging existing customer-specific data and through targeted marketing, includingdigital marketing, social media, television, catalogs and mailers. We seek to optimize the potential of our brands with improved product offerings, potential newmerchandise opportunities, and brand extensions that enhance the current offerings, as well as through our continued emphasis on our trademark "Most AmazingPersonal Service" standard. We also will continue to consider potential alternative sales channels for our brands, including international franchise, wholesale,licensing and other opportunities.

In fiscal 2016, we implemented cost reduction and operating efficiency initiatives, including realigning marketing and digital commerce, improvingsupply chain efficiency and reducing non-merchandise expenses. In fiscal 2017, we focused on our brand positioning and evolving the customer experience andleveraging actionable retail science to drive sales. In fiscal 2018, we launched multiple initiatives that utilize technology and new platforms to drive growth such asEndless Aisle and STYLECONNECTTM (which enables store associates to personalize the customer experience). As a result of these multi-year initiatives, wehave the technology and tools in place to leverage our omnichannel capabilities, which should allow us to capture and stay connected with our customers, whetherin-store or online.

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To support our supply chain strategy, we are working diligently to consolidate our vendor base. Through ongoing negotiations with our vendors, webelieve there is opportunity for even more consolidation and scale. As such, over the next 18 months we plan to significantly reduce our base to a key set of topvendors. We intend to supplement that with a subset of smaller niche vendors to support us where we have unique needs. As we exit 2019, we anticipate areduction in our vendor base of an additional 25% on top of last year’s 25% reduction. As we reach scale with key vendors, we believe we will have strongerpartnerships, greater control over product quality, and the ability to achieve better terms and lower costs.

We also continue to reduce our exposure in China by diversifying into other countries of origin. Over the next 18 months, we anticipate we will be in thelow 30% range compared to our current penetration in China of approximately 40% as we shift more of our sourcing to other countries. We are also working onmitigating strategies with respect to tariffs expected to be imposed in the second half of 2019, including engaging with our vendors on cost-sharing agreements andmanaging and adjusting our forward buys and product pricing.

In the fourth quarter of fiscal 2018, we announced a retail fleet optimization plan to rebalance the mix between our physical store presence and our digitalnetwork with the closure of at least 250 stores in the U.S. in fiscal years 2019-2021. The Company had a challenging conclusion to fiscal 2018 and, under thedirection of the Board, is addressing these challenges and taking steps to better position the Company for growth and future success.

On April 24, 2019, the Company announced a CEO transition plan and appointed Bonnie Brooks, former Vice Chair, President and CEO of Hudson’s BayCompany and a member of the Company's Board, as Interim CEO of the Company. Ms. Brooks made significant changes to leadership and reset the Company’spriorities for growth and value creation in 2019. Actions are underway across the brands with a focus on three distinct areas that we believe will positively impactresults. These are:

• Driving stronger sales through improved product and marketing;

• Optimizing the customer journey by simplifying, digitizing and extending our unique and personalized service; and

• Transforming our sourcing and supply chain operations to increase product speed to market and improve quality.

On July 18, 2019, the Company announced the appointment of Ms. Brooks as CEO and President of Chico's FAS, Inc. and a new organizational structureto drive a simpler, nimbler organization. The responsibility of our apparel brands, Chico’s and WHBM, was consolidated under one leader, President, ApparelGroup, to create clear lines of responsibility and accelerate sales driving priorities. The Company’s intimate brands, Soma and TellTale, are led by the President,Intimates Group.

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Results of Operations

Thirteen Weeks Ended August 3, 2019 Compared to the Thirteen Weeks Ended August 4, 2018

Net Sales

The following table depicts net sales by Chico's, WHBM and Soma in dollars and as a percentage of total net sales for the thirteen weeks ended August 3,2019 (the "second quarter") and the thirteen weeks ended August 4, 2018 ("last year's second quarter"):


August 3, 2019 August 4, 2018

(dollars in millions) (1)

Chico's $ 269 52.9% $ 287 52.7%WHBM 140 27.5 169 31.0Soma (2) 100 19.6 89 16.3

Total Net Sales $ 508 100.0% $ 545 100.0%(1) May not foot due to rounding

(2) Includes TellTale net sales, which is not a significant component of Soma revenue.

For the second quarter of fiscal 2019, net sales were $508 million compared to $545 million in last year's second quarter. This decrease of 6.7% reflects acomparable sales decline of 6.1% as well as the impact of 53 net store closures since last year's second quarter. The comparable sales decline was driven by loweraverage dollar sale and a decrease in transaction count. In the second quarter, comparable sales at Soma continued to show strong growth while Chico’s postedquarter-over-quarter improvement. Product, marketing and in-store presentation adjustments to change the performance at WHBM are underway.

The following table depicts comparable sales percentages by Chico's, WHBM and Soma for the thirteen weeks ended August 3, 2019 and August 4, 2018:


August 3, 2019 August 4, 2018Chico's (5.6)% (3.8)%WHBM (16.1) (3.5)Soma 10.9 (0.9)Total Company (6.1) (3.2)

Cost of Goods Sold/Gross Margin

The following table depicts cost of goods sold ("COGS") and gross margin in dollars and gross margin as a percentage of total net sales for the thirteenweeks ended August 3, 2019 and August 4, 2018:



(dollars in millions)Cost of goods sold $ 340 $ 348Gross margin 169 197Gross margin percentage 33.2% 36.1%

For the second quarter of fiscal 2019, gross margin was $169 million, or 33.2% of net sales, compared to $197 million, or 36.1% of net sales, in last year'ssecond quarter. This 290-basis point decrease primarily reflects an increased effort to clear WHBM inventory, continued charges related to our omnichannelprograms and accelerated depreciation as a result of our retail fleet optimization plan announced in the fourth quarter of fiscal 2018.

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Retail Fleet Optimization Plan

In the second quarter of fiscal 2019, the Company recorded approximately $3 million in pre-tax accelerated depreciation charges of property andequipment within cost of goods sold related to our retail fleet optimization plan. The second quarter after-tax impact of these charges was approximately $2million.

Selling, General and Administrative Expenses

The following table depicts selling, general and administrative expenses ("SG&A"), which includes direct operating expenses, marketing expenses andNational Store Support Center ("NSSC") expenses, in dollars and as a percentage of total net sales for the thirteen weeks ended August 3, 2019 and August 4, 2018:



(dollars in millions)Selling, general and administrative expenses $ 171 $ 174Percentage of total net sales 33.7% 31.9%

For the second quarter of fiscal 2019, SG&A was $171 million, or 33.7% of net sales, compared to $174 million, or 31.9% of net sales, for last year'ssecond quarter. This $3 million decrease primarily reflects a reduction in non-payroll employee-related costs, partially offset by investments in marketing in ourintimates group.

Income Taxes

For the second quarter, the effective tax rate was 0.0% compared to 25.4% for last year’s second quarter. The 0.0% effective tax rate was primarily theresult of an income tax benefit on the second quarter operating loss, offset by a true-up from the first quarter provision due to an increase in the forecasted annualeffective tax rate.

Net (Loss) Income and Earnings per Diluted Share

For the second quarter of fiscal 2019, the Company reported a net loss of $2 million, or $0.02 loss per diluted share, compared to net income of $17million, or $0.13 earnings per diluted share in last year's second quarter. Results for the second quarter include the unfavorable impact of accelerated depreciationcharges of approximately $2 million, after-tax, related to our retail fleet optimization plan. The change in earnings per diluted share reflects a decrease in netincome.

Twenty-Six Weeks Ended August 3, 2019 Compared to the Twenty-Six Weeks Ended August 4, 2018

Net Sales

The following table depicts net sales by Chico's, WHBM and Soma in dollars and as a percentage of total net sales for the twenty-six weeks endedAugust 3, 2019 and August 4, 2018:



(dollars in millions) (1)

Chico's $ 546 53.2% $ 588 53.1%WHBM 301 29.3 352 31.8Soma (2) 180 17.5 167 15.1

Total net sales $ 1,026 100.0% $ 1,107 100.0%(1) May not foot due to rounding(2) Includes TellTale net sales, which is not a significant component of Soma revenue.

Net sales for the twenty-six weeks ended August 3, 2019 decreased to $1,026 million from $1,107 million for the twenty-six weeks ended August 4, 2018.This decrease of 7.3% reflects a comparable sales decline of 6.6% as well as the impact of 53 net store closures since last year's second quarter. The comparablesales decline was driven by lower average dollar sale and a decrease in transaction count.

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The following table depicts comparable sales percentages by Chico's, WHBM and Soma for the twenty-six weeks ended August 3, 2019 and August 4,2018:


August 3, 2019 August 4, 2018Chico's (6.8)% (4.7)%WHBM (13.0) (5.1)Soma 7.4 (3.2)Total Company (6.6) (4.6)

Cost of Goods Sold/Gross Margin

The following table depicts COGS and gross margin in dollars and gross margin as a percentage of total net sales for the twenty-six weeks endedAugust 3, 2019 and August 4, 2018:



(dollars in millions)Cost of goods sold $ 667 $ 683Gross margin 359 424Gross margin percentage 35.0% 38.3%

Gross margin for the twenty-six weeks ended August 3, 2019 was $359 million, or 35.0% of net sales, compared to $424 million, or 38.3% of net sales,for the twenty-six weeks ended August 4, 2018. This 330-basis point decrease primarily reflects continued charges related to our omnichannel programs,accelerated depreciation as a result of our retail fleet optimization plan announced in the fourth quarter of fiscal 2018 and an increased effort to clear WHBMinventory.

Retail Fleet Optimization Plan

For the twenty-six weeks ended August 3, 2019, the Company recorded approximately $8 million in pre-tax accelerated depreciation of property andequipment within cost of goods sold related to our retail fleet optimization plan. The after-tax impact of these charges for the twenty-six weeks ended August 3,2019 was approximately $6 million.

Selling, General and Administrative Expenses

The following table depicts SG&A, which includes store and direct operating expenses, marketing expenses and NSSC expenses, in dollars and as apercentage of total net sales for the twenty-six weeks ended August 3, 2019 and August 4, 2018:



(dollars in millions)Selling, general and administrative expenses $ 356 $ 361Percentage of total net sales 34.7% 32.6%

For the twenty-six weeks ended August 3, 2019, SG&A was $356 million, or 34.7% of net sales, compared to $361 million, or 32.6% of net sales, for thetwenty-six weeks ended August 4, 2018. This 210-basis point decrease primarily reflects deleverage of store operating expenses as well as investments inmarketing in our intimates group.

Income Taxes

For the twenty-six weeks ended August 3, 2019, the income tax provision was $3 million compared to $17 million for the twenty-six weeks endedAugust 4, 2018. The effective tax rate for the twenty-six weeks ended August 3, 2019 and August 4, 2018 was 109.1% and 27.0%, respectively. The effective taxrates of 109.1% and 27.0% was primarily the result of the additional tax expense related to employee share-based awards against lower pre-tax income.

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Net (Loss) Income and Earnings per Diluted Share

For the twenty-six weeks ended August 3, 2019, the Company reported a net loss of $0.3 million, or $0.00 earnings per diluted share, compared to netincome of $46 million, or $0.36 earnings per diluted share, for the twenty-six weeks ended August 4, 2018. Results for the twenty-six weeks ended August 3, 2019include the unfavorable impact of accelerated depreciation charges of approximately $6 million, after-tax, related to our retail fleet optimization plan. The changein earnings per diluted share reflects a decrease in net income.

Cash, Marketable Securities and Debt

At the end of the second quarter, cash and marketable securities totaled $163 million, a decrease of $76 million compared to last year's second quarter,while debt totaled $50 million, a decrease of $11 million from last year's second quarter. This $76 million decrease in cash and marketable securities primarilyreflects a return of cash to shareholders through share repurchases and dividend payments.

Inventories

At the end of the second quarter, inventories totaled $228 million compared to $224 million at the end of last year's second quarter. This $4 million, or1.6%, increase primarily reflects investments in our intimates group to fund growth, partially offset by the benefit of inventory management in our apparel group.

Adoption of New Accounting Pronouncements

As discussed in Note 1 and Note 4 to our unaudited consolidated financial statements included in this Form 10-Q, we adopted ASC 842, Leases, as ofFebruary 3, 2019. As of August 3, 2019, we had $697 million, $159 million, and $611 million of operating lease assets, current portion of operating lease liabilitiesand noncurrent portion of operating lease liabilities, respectively, as a result of the adoption of ASC 842.

Recently Issued Accounting Pronouncements

See Note 2 to our unaudited consolidated financial statements included in this Form 10-Q for a description of certain newly issued accountingpronouncements which may impact our financial statements in future reporting periods.

Liquidity and Capital Resources

We believe that our existing cash and marketable securities balances, cash generated from operations, available credit facilities and potential futureborrowings will be sufficient to fund capital expenditures, working capital needs, dividend payments, potential share repurchases, commitments and other liquidityrequirements associated with our operations for the foreseeable future. Furthermore, while it is our intention to repurchase our stock and pay a quarterly cashdividend in the future, any determination to repurchase additional shares of our stock or pay future dividends will be made by the Board of Directors and willdepend on our stock price, future earnings, financial condition and other factors considered by the Board.

Our ongoing capital requirements will continue to be primarily for enhancing and expanding our omnichannel capabilities, including expanded, relocatedand remodeled stores; information technology; and supply chain.

The following table summarizes cash flows for the year-to-date period August 3, 2019 compared to last year's year-to-date period August 4, 2018:


August 3, 2019 August 4, 2018 (dollars in millions)Net cash provided by operating activities $ 21 $ 100Net cash used in investing activities (15) (21)Net cash used in financing activities (30) (61)Net (decrease) increase in cash and cash equivalents $ (24) $ 18

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Operating Activities

Net cash provided by operating activities for the year-to-date period of fiscal 2019 was $21 million compared to $100 million in last year's year-to-dateperiod. The change in net cash provided by operating activities primarily reflects lower 2019 net income and incentive compensation, the timing of payables andthe impact of income taxes, and investments in our intimates group inventory to fund growth.

Investing Activities

Net cash used in investing activities for the year-to-date period of fiscal 2019 was $15 million compared to $21 million in last year's year-to-date period,primarily reflecting a $6 million decrease in purchases of property and equipment.

Financing Activities

Net cash used in financing activities for the year-to-date period of fiscal 2019 was $30 million compared to $61 million in last year's year-to-date period,primarily reflecting a $28 million decrease in share repurchases in the current year.

Credit Facility

On August 2, 2018, the Company and certain of its domestic subsidiaries entered into a credit agreement (the “Agreement”) as borrowers and guarantors,with Wells Fargo Bank, National Association, as Agent, letter of credit issuer and swing line lender, and certain lenders party thereto. Our obligations under theAgreement are guaranteed by the subsidiary guarantors and secured by a lien on certain assets of the Company and the subsidiary borrowers and guarantors,including inventory, accounts receivable, cash deposits, and certain insurance proceeds.

The Agreement provides for a five-year asset-based senior secured revolving loan and letter of credit facility of up to $200 million, maturing August 2,2023. In addition, during the term of the Agreement, the Company may increase the commitments under the Agreement by up to an additional $100 million,subject to customary conditions, including obtaining the agreements from the lenders to provide such commitment increase. The interest rate applicable to the loansunder the Agreement will be equal to, at the Company's option, either a base rate, determined by reference to the federal funds rate, plus an interest rate margin, ora LIBO rate, plus an interest rate margin, in each case, depending on availability under the Agreement. The Company expects borrowings to be at a LIBO rate, plusan interest rate margin. In addition, the Company will pay a commitment fee per annum on the unused portion of the commitments under the Agreement.

The previous credit agreement entered into on May 4, 2015 with JPMorgan Chase Bank, N.A., as Administrative Agent, Bank of America, N.A., asSyndication Agent and other lenders, which was unsecured and had provided for a term loan commitment in the amount of $100 million and a $100 millionrevolving credit facility, was terminated on August 2, 2018 in connection with the Company entering into the Agreement described above, and all outstandingamounts thereunder were repaid. We used the proceeds from the initial draw of the revolving loan of the Agreement to repay such obligations.

As of August 3, 2019, $50 million in net borrowings were outstanding under the Agreement and is reflected as long-term debt in the unaudited condensedbalance sheet included in this Form 10-Q.

The Company is currently evaluating the impact that the pending discontinuation of, or transition away from, LIBOR will have on the Agreement. Wehave been in discussions with Wells Fargo Bank, National Association regarding this and do not expect the move to have a significant impact on our unauditedconsolidated financial statements.

Store and Franchise Activity

During the fiscal 2019 year-to-date period, we had 31 store closures consisting of 15 Chico's stores, 12 WHBM stores and 4 Soma stores. As part of ourretail fleet optimization plan, the Company expects to close approximately 100 Chico's, 90 WHBM and 60 Soma locations in fiscal years 2019-2021, with themajority of the closings occurring in fiscal years 2020-2021. We continuously evaluate the appropriate store base in light of economic conditions and our businessstrategy and may adjust the openings and closures as conditions require or as opportunities arise. As of August 3, 2019, the Company's franchise operationsconsisted of 83 international retail locations in Mexico and 2 domestic airport stores.

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Critical Accounting Policies and Estimates

The discussion and analysis of our financial condition and results of operations are based upon the condensed consolidated financial statements, whichhave been prepared in accordance with accounting principles generally accepted in the United States. The preparation of condensed consolidated financialstatements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosure of contingentassets and liabilities. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances,the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actualresults may differ from these estimates under different assumptions or conditions. Management has discussed the development and selection of these criticalaccounting policies and estimates with the Audit Committee of our Board of Directors and believes the assumptions and estimates, as set forth in our 2018 AnnualReport on Form 10-K, are significant to reporting our results of operations and financial position. There have been no material changes to our critical accountingpolicies as disclosed in our 2018 Annual Report on Form 10-K, except for the adoption of ASC 842, Leases. See Note 1 and Note 4 to our unaudited consolidatedfinancial statements included in this Form 10-Q for further information on our adoption of ASC 842.

Forward-Looking Statements

This Form 10-Q may contain certain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, andSection 21E of the Securities Exchange Act of 1934, as amended, which reflect our current views with respect to certain events that could have an effect on ourfuture financial performance, including but without limitation, statements regarding our plans, objectives, and the future success of our store concepts and businessinitiatives. These statements may address items such as future sales and sales initiatives, strategic initiatives, customer traffic, gross margin expectations, SG&Aexpectations, including expected savings, operating margin expectations, earnings per share expectations, planned store openings, closings and expansions,proposed business ventures, new channels of sales or distribution, future tax rates, the expected impact of tariffs, taxes or other import regulations, particularly withrespect to China, the expected impact of ongoing litigation, future stock repurchase plans, future plans to pay dividends, future comparable sales, future productsourcing plans, future inventory levels, including the ability to leverage inventory management and targeted promotions, planned marketing expenditures, plannedcapital expenditures and future cash needs.

These statements relate to expectations concerning matters that are not historical fact and may include the words or phrases such as "will," "should,""expects," "believes," "anticipates," "plans," "intends," "estimates," "approximately," "our planning assumptions," "future outlook" and similar expressions. Exceptfor historical information, matters discussed in this Form 10-Q are forward-looking statements. These forward-looking statements are based largely on informationcurrently available to our management and on our current expectations, assumptions, plans, estimates, judgments and projections about our business and ourindustry, and are subject to various risks and uncertainties that could cause actual results to differ materially from historical results or those currently anticipated.Although we believe our expectations are based on reasonable estimates and assumptions, they are not guarantees of performance and there are a number of knownand unknown risks, uncertainties, contingencies and other factors (many of which are outside our control) that could cause actual results to differ materially fromthose expressed or implied by such forward-looking statements. Accordingly, there is no assurance that our expectations will, in fact, occur or that our estimates orassumptions will be correct, and we caution investors and all others not to place undue reliance on such forward-looking statements. Factors that could cause orcontribute to such differences include, but are not limited to, those described in Item 1A, "Risk Factors" in our 2018 Annual Report on Form 10-K and thefollowing:

The financial strength of retailing in particular and the economy in general; the extent of financial difficulties or economic uncertainty that may beexperienced by customers; our ability to secure and maintain customer acceptance of styles and in-store and online concepts; the ability to leverage inventorymanagement and targeted promotions; the ability to effectively manage our inventory and allocation processes; the extent and nature of competition in the marketsin which we operate; the ability to remain competitive with customer shipping terms and costs pertaining to product deliveries and returns; the extent of the marketdemand and overall level of spending for women's private branded clothing and related accessories; the effectiveness of our brand strategies, awareness andmarketing programs; the ability to coordinate product development with buying and planning; the quality and timeliness of merchandise received from suppliers;changes in the costs of manufacturing, raw materials, transportation, distribution, labor and advertising; the availability of quality store sites; our ability to manageour store fleet and the risk that our investments in merchandise or marketing initiatives may not deliver the results we anticipate; our ability to successfullynavigate the increasing use of on-line retailers for fashion purchases and the pressure that puts on traffic and transactions in our physical stores; the ability tooperate our own retail websites in a manner that produces profitable sales; the ability to successfully identify and implement additional sales and distributionchannels; the ability to successfully execute our business strategies and particular strategic initiatives (including, but not limited to, the Company’s retail fleetoptimization plan and three operating priorities which are driving stronger sales through improved product and marketing; optimizing the customer journey bysimplifying, digitizing and extending the Company’s unique and personalized service; and

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transforming sourcing and supply chain operations to increase product speed to market and improve quality), sales initiatives and multi-channel strategies, and toachieve the expected results from them; the continuing performance, implementation and integration of management information systems; the impact of anysystems failures, cyber security or other data or security breaches, including any security breaches that result in theft, transfer, or unauthorized disclosure ofcustomer, employee, or company information or our compliance with domestic and foreign information security and privacy laws and regulations in the event ofsuch an incident; the ability to hire, train, motivate and retain qualified sales associates, managerial employees and other employees; the successful recruitment ofleadership and the successful integration of new members of our senior management team; uncertainties regarding future unsolicited offers to buy the Companyand our ability to respond effectively to them as well as to actions of activist shareholders and others; the ability to utilize our distribution center and other supportfacilities in an efficient and effective manner; the ability to secure and protect trademarks and other intellectual property rights and to protect our reputation andbrand images; the risk that natural disasters, public health crises, political uprisings, uncertainty or unrest, or other catastrophic events could adversely affect ouroperations and financial results; the impact of unanticipated changes in legal, regulatory or tax laws; the risks and uncertainties that are related to our reliance onsourcing from foreign suppliers, including significant economic (including the impact of changes in tariffs, taxes or other import regulations, particularly withrespect to China), labor, political or other shifts; and changes in governmental policies in or towards foreign countries; currency exchange rates and other similarfactors.

All forward-looking statements that are made or attributable to us are expressly qualified in their entirety by this cautionary notice. The forward-lookingstatements included herein are only made as of the date of this Quarterly Report on Form 10-Q. We undertake no obligation to publicly update or revise anyforward-looking statements, whether as a result of new information, future events or otherwise.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The market risk of our financial instruments as of August 3, 2019 has not significantly changed since February 2, 2019. We are exposed to market riskfrom changes in interest rates on any future indebtedness and our marketable securities and from foreign currency exchange rate fluctuations.

Our exposure to interest rate risk relates in part to our revolving line of credit with our bank. On August 2, 2018, we entered into a new credit agreement,as further discussed in Note 10 to our unaudited consolidated financial statements included in this Form 10-Q. The Agreement, which matures on August 2, 2023,has borrowing options which accrue interest, at our election, at either a base rate, determined by reference to the federal funds rate, plus an interest rate margin, orLIBOR, plus an interest rate margin, as defined in the Agreement. An increase or decrease in market interest rates of 100 basis points would not have a materialeffect on annual interest expense.

Our investment portfolio is maintained in accordance with our investment policy which identifies allowable investments, specifies credit quality standardsand limits the credit exposure of any single issuer. Our investment portfolio consists of cash equivalents and marketable securities primarily including corporatebonds, commercial paper, municipal securities and U.S. government agencies. The marketable securities portfolio as of August 3, 2019, consisted of $39.4 millionof securities with maturity dates within one year or less and $24.0 million with maturity dates over one year and less than or equal to two years. We consider allmarketable securities available-for-sale, including those with maturity dates beyond 12 months, and therefore classify these securities as short-term investmentswithin current assets on the condensed consolidated balance sheets as they are available to support current operational liquidity needs. As of August 3, 2019, anincrease or decrease of 100 basis points in interest rates would not have a material effect on the fair value of our marketable securities portfolio.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed in our reports under theSecurities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms.

As of the end of the period covered by this report, an evaluation was carried out under the supervision and with the participation of management,including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (asdefined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended). Based upon that evaluation, the Chief Executive Officer andChief Financial Officer concluded that, as of the end of such period, our disclosure controls and procedures were effective in providing reasonable assurance intimely alerting them to material information relating to us (including our consolidated subsidiaries) and that information required to be disclosed in our reports isrecorded, processed, summarized and reported as required to be included in our periodic SEC filings.

Changes in Internal Controls

There were no significant changes in our internal controls or in other factors that could significantly affect our disclosure controls and proceduressubsequent to the date of the above referenced evaluation. Furthermore, there was no change in our internal control over financial reporting or in other factorsduring the quarterly period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financialreporting.

During the quarter ended April 4, 2019, we implemented controls to ensure we adequately evaluated our contracts and properly assessed the impact of thenew lease accounting standard on our financial statements in connection with the adoption of ASC 842, Leases, on February 3, 2019.

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PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Information regarding legal proceedings is incorporated by reference from Note 11 to our unaudited consolidated financial statements included in thisForm 10-Q under the heading "Commitments and Contingencies."

ITEM 1A. RISK FACTORS

In addition to the other information discussed in this report, the factors described in Part I, Item 1A. “Risk Factors” in our 2018 Annual Report on Form10-K should be considered as they could materially affect our business, financial condition or future results.

There have not been any significant changes with respect to the risks described in our 2018 Annual Report on Form 10-K, except as described below, butthese are not the only risks facing our Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also mayadversely affect our business, financial condition or operating results.

The risk factors below update and supersede the risk factors associated with our business previously disclosed in Part I, Item 1A. "Risk Factors" in our2018 Annual Report on Form 10-K.

12. Cyber Security / DataPrivacy

Our business involves the storage and/or transmission of customers’ personal information, shipping preferences and credit cardinformation, as well as confidential information regarding our business, employees and third parties. In addition, as part of ouracceptance of customers’ debit and credit cards as forms of payment, we are required to comply with the Payment Card IndustryData Security Standards (“PCI”).

Because we have access to, collect or maintain information about our customers, the protection of that data is critical to ourbusiness. The regulatory environment surrounding information security and privacy continues to evolve, and new lawsincreasingly are giving customers the right to control how their personal data is used. One such law is the European Union'sGeneral Data Protection Regulation (“GDPR”). Our failure to comply with the obligations of GDPR could in the future result insignificant penalties which could have a material adverse effect on our business and results of operations. In addition, the State ofCalifornia adopted the California Consumer Protection Act of 2018 (“CCPA”), which will become effective in 2020 and willregulate the collection and use of consumers' data. Complying with GDPR, CCPA and similar U.S. federal and state laws,including a potential federal privacy law and state privacy laws, could also cause us to incur substantial costs, forego a substantialamount of revenue or be subject to business risk associated with system changes and new business processes.

We are also subject to cybersecurity risks. Cybersecurity refers to the combination of technologies, processes and proceduresestablished to protect information technology systems and data from unauthorized access, attack, exfiltration, loss or damage. Wemay not be able to anticipate or prevent rapidly evolving types of cyber-attacks. Actual or anticipated attacks may cause us to incurincreased costs including costs to deploy additional personnel and protection technologies, train employees and engage third-partyexperts and consultants.

While we have implemented measures reasonably designed to prevent security breaches, cyber incidents and privacy violations,and while we have taken steps to comply with PCI, GDPR, CCPA and other laws, those measures may not be effective and wemay experience security breaches, cyber incidents and privacy violations in the future.

A cyber breach or incident or privacy violation through any means, including indirectly through third-party service providers andvendors, could result in the loss or misuse of data and could result in significant fines, penalties, damages, loss of business, legalexpenses, remediation costs, reputational damage or loss of our ability to accept debit and credit cards as forms for payment. Inaddition, changes in laws or regulations, the PCI standards or technology, could result in increased expenses due to system oradministrative costs.

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13. Reliance on foreignsources of production

The majority of the merchandise we sell is produced outside the United States. As a result, our business remains subject to thevarious risks of doing business in foreign markets and importing merchandise from abroad, such as: geo-political instability, non-compliance with the Foreign Corrupt Practices Act and other anti-corruption laws and regulations, potential changes to the NorthAmerican Free Trade Agreement and other international trade agreements, imposition of new legislation relating to import quotas,imposition of new or increased duties, taxes, or other charges on imports, foreign ex-change rate challenges and pressurespresented by implementation of monetary policy by the Federal Reserve and other international central banks, challenges fromlocal business practices or political issues, transportation disruptions, our shift to a predominantly FOB (free on board) shippingstructure rather than predominantly DDP (delivered duty paid), natural disasters, delays in the delivery of cargo due to portsecurity considerations or government funding; seizure or detention of goods by U.S. Customs authorities, or a reduction in theavailability of shipping sources caused by industry consolidation or other reasons. We continue to source a substantial portion ofour merchandise from Asia, including China. A reduction in the number of foreign suppliers, through bankruptcy or otherwise, orany change in exchange rates, labor laws or policies affecting the costs of goods in Asia could negatively impact our merchandisecosts and the timely availability of the desired amount of merchandise. Furthermore, delays in production or shipping product,whether due to work slow-downs, work stoppages, strikes, port congestion, labor disputes, product regulations and customsinspections or other factors, could also have a negative impact.

There have been ongoing discussions, commentary and governmental actions regarding potentially significant changes to theUnited States trade policies, treaties, tariffs and taxes, including trade policies and tariffs regarding China. In July and August2018, the Office of the U.S. Trade Representative (the “USTR”) enacted two rounds of tariffs on certain imports into the U.S. fromChina. In September 2018, the USTR enacted another tariff on the import of other Chinese products with an additional combinedimport value of approximately $200 billion. The tariff became effective on September 24, 2018, with an initial rate of 10%, whichwas increased to 25% in May 2019, and as indicated, will be further increased to 30% beginning in October 2019. The currentadministration also recently indicated it will also impose tariffs on additional products beginning September 1, 2019 that couldpotentially impact the Company's offerings and results of operations.

These tariffs, as well as any additional tariffs, may result in lower gross margins on affected products. Our ability to mitigate thenegative effect of tariffs on our cost of goods is limited and our efforts to do so may not be successful. We may be able to shift agreater portion of our sourcing away from China to avoid tariffs, but executing such a shift could take time and could result in anincrease in non-tariff related manufacturing costs and/or negatively affect the quality of our products. Our ability to pass increasesin our cost of goods through to our customers via increased prices is also limited. Any such increase in pricing could reduce thecompetitiveness of our products. We can offer no assurances that price increases would be accepted by our customers, or that priceincreases would be sufficient to offset the effect of future cost increases.

There is significant uncertainty about the future relationship between the United States and other countries with respect to the tradepolicies, treaties, taxes, government regulations and tariffs that would be applicable. It is unclear what changes might beconsidered or implemented and what response to any such changes may be by the governments of other countries. Significanttariffs or other restrictions placed on Chinese imports and any related counter-measures that are taken by China could have anadverse effect on our financial condition or results of operations. Even in the absence of further tariffs, the related uncertainty andthe market's fear of an escalating trade war might create forecasting difficulties for us and cause our customers and businesspartners to place fewer orders for our products, which could have a material adverse effect on our business, liquidity, financialcondition, and/or results of operations. These developments, or the perception that any of them could occur, may have a materialadverse effect on global economic conditions and the stability of global financial markets, and may significantly reduce globaltrade and, in particular, trade between these nations and the United States. Any of these factors could depress economic activityand restrict our access to suppliers or customers and have a material adverse effect on our business, financial condition and resultsof operations and affect our strategy around the world.

Given the relatively fluid regulatory environment in China and the United States and relative uncertainty with respect to tariffs,international trade agreements and policies, a trade war, further governmental action related to tariffs or international tradepolicies, or additional tax or other regulatory changes in the future could directly and adversely impact our financial results andresults of operations.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table sets forth information concerning our purchases of common stock for the periods indicated (amounts in thousands, except share andper share amounts):

Period

Total Number of

Shares Purchased (a)

Average Price Paid per Share

Total Number of Shares

Purchased as Part of

Publicly Announced

Plans (b)

Approximate Dollar Value of Shares that

May Yet Be Purchased Under

the Publicly Announced Plans

May 5, 2019 - June 1, 2019 — $ — — $ 55,192June 2, 2019 - July 6, 2019 9,308 3.32 — 55,192July 7, 2019 - August 3, 2019 8,041 2.94 — 55,192

Total 17,349 3.14 —

(a) Total number of shares purchased consists of 17,349 shares of restricted stock repurchased in connection with employee tax withholding obligationsunder employee compensation plans, which are not purchases under any publicly announced plan.

(b) In November 2015, we announced a $300 million share repurchase plan. There was approximately $55.2 million remaining under the program as ofthe end of the second quarter. The repurchase program has no specific termination date and will expire when we have repurchased all securities authorizedfor repurchase thereunder, unless terminated earlier by our Board of Directors. The Company has no continuing obligation to repurchase shares under thisauthorization, and the timing, actual number and value of any additional shares to be purchased will depend on the performance of our stock price, marketconditions and other considerations.

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ITEM 6. EXHIBITS

(a) The following documents are filed as exhibits to this Quarterly Report on Form 10-Q:

Exhibit 3.1.1

Amendment to Amended and Restated Bylaws of Chico’s FAS, Inc. (incorporated by reference to Exhibit 3.1 to theCompany’s Form 8-K, as filed with the Commission on June 24, 2019)

Exhibit 10.54

Employment Inducement Performance Award Agreement for Performance Share Units between Chico’s FAS, Inc. and BonnieR. Brooks, dated August 20, 2019 (incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K/A, as filed with theCommission on August 20, 2019)

Exhibit 10.55

Performance Award Agreement for Performance Share Units between Chico’s FAS, Inc. and Bonnie R. Brooks under theAmended and Restated 2012 Omnibus Stock and Incentive Plan, dated August 20, 2019 (incorporated by reference to Exhibit10.2 to the Company’s Form 8-K/A, as filed with the Commission on August 20, 2019)

Exhibit 10.56

Restricted Stock Award Agreement between Chico’s FAS, Inc. and Bonnie R. Brooks under the Amended and Restated 2012Omnibus Stock and Incentive Plan, dated August 20, 2019 (incorporated by reference to Exhibit 10.3 to the Company’s Form8-K/A, as filed with the Commission on August 20, 2019)

Exhibit 10.57 Employment letter agreement between the Company and Molly Langenstein, dated as of July 15, 2019 Exhibit 10.58 Restrictive covenant agreement between the Company and Molly Langenstein, dated as of August 1, 2019 Exhibit 10.59 Employment letter agreement between the Company and Bonnie R. Brooks, dated as of July 18, 2019 Exhibit 10.60 Restrictive covenant agreement between the Company and Bonnie R. Brooks, dated as of August 20, 2019

Exhibit 31.1

Chico’s FAS, Inc. and Subsidiaries Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Chief ExecutiveOfficer

Exhibit 31.2

Chico’s FAS, Inc. and Subsidiaries Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Chief FinancialOfficer

Exhibit 32.1

Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of theSarbanes-Oxley Act of 2002

Exhibit 32.2

Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of theSarbanes-Oxley Act of 2002

Exhibit 101

The following financial statements from the Company’s Quarterly Report on Form 10-Q for the quarter ended August 3, 2019,formatted in Inline XBRL: (i) Condensed Consolidated Statements of (Loss) Income, (ii) Condensed Consolidated Statementsof Comprehensive (Loss) Income, (iii) Condensed Consolidated Balance Sheets, (iv) Condensed Consolidated Statements ofShareholders' Equity, (v) Condensed Consolidated Statements of Cash Flows, and (vi) Notes to Condensed ConsolidatedFinancial Statements, tagged as blocks of text and including detailed tags.

Exhibit 104

The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended August 3, 2019, formatted in InlineXBRL (included within Exhibit 101).

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersignedthereunto duly authorized.

CHICO'S FAS, INC.

Date: August 28, 2019 By: /s/ Bonnie R. Brooks Bonnie R. Brooks President, Chief Executive Officer and Director

Date: August 28, 2019 By: /s/ Todd E. Vogensen Todd E. Vogensen

Executive Vice President, Chief Financial Officerand Assistant Corporate Secretary

Date: August 28, 2019 By: /s/ David M. Oliver David M. Oliver

Senior Vice President - Finance, Controller andChief Accounting Officer

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Exhibit 10.57July 15, 2019

Ms. Molly LangensteinXXXXXXXX, XX XXXXX

Dear Molly:

It is with great pleasure that we offer you the opportunity to join Chico’s FAS, Inc. As you are aware, we are a respected organization within whichthis position is a key driver of our success. As one of the top specialty retailers, we offer tremendous opportunity for personal and professionalgrowth. Please let this letter serve as an offer to join Chico’s FAS, Inc. and your acceptance of that offer. The following will outline the specifics:

Position: President, Apparel Group

Reports to: Bonnie Brooks, Interim President and CEO

Start Date: August 1, 2019

Base Salary: $800,000.00 annuallyBonus Plan: Target of 80% of base salary earned during the FY19 performance period (February 2019 to January 2020), which is contingent upon theachievement of corporate and brand financial objectives. The terms of the bonus, including eligibility, payouts and objectives are subject to theManagement Bonus Plan and may be modified from time to time. All payouts are based on fiscal year business results and can vary from zero (0) toa maximum of 200% of your target bonus potential (160% of base salary earned). Bonus is typically paid in March, after the conclusion of the fiscalyear.

For FY19, you will be provided with a bonus guarantee of $320,000. Payment of the guaranteed bonus is contingent on continued employment atthe time of payment.

Equity Grants: You will receive a new hire equity grant of 285,715 shares of Restricted Stock shortly after hire. You will also be eligible for an appropriate annualequity grant, beginning in FY20, delivered in a combination of 50% Restricted Stock and 50% Performance Share Units. The target amount of suchgrants and the vesting conditions are established by the Human Resources, Compensation and Benefits Committee of our Board of Directors on anannual basis and may change from year to year.

The Restricted Stock shares will vest ratably over a three-year period. The Performance Share Units will cliff vest over a three-year period,contingent upon the achievement of corporate financial objectives andcould range from zero (0%) to a maximum of 175% of the target award. Annual equity grants are typically made in March.

As a member of the Executive Team, you will be subject to the Company’s Stock Ownership guidelines, which are set by the Human Resources,Compensation and Benefits Committee of our Board of Directors and may change from year to year. Currently, your ownership guideline indicatesthat you must hold at least two times your base salary in shares. Until you meet that guideline, you must retain and hold at least 50% of vestedshares, net of taxes. Once you meet the ownership guideline, you will be deemed to always meet it, regardless of the movement of the share priceup or down.

Chico's FAS Inc. · 11215 Metro Parkway · Fort Myers, Florida 33966 · (239) 277-6200

Sign-On Bonus:You will receive a sign-on bonus of $250,000, less applicable taxes, payable within 30 days of your start date (contingent upon receipt of theattached repayment agreement).Annual Review: You will be eligible for the FY19 performance appraisal process in April 2020.Executive Coaching:You will be eligible to receive executive coaching from the executive coach of your choice, paid for by Chico’s FAS, not to exceed $17,500.

Time Off: You will be eligible for 23 days of Paid Time Off (PTO) for each full calendar year of employment. This is an accrued benefit that you start to earn onyour start date. In addition, Chico’s FAS, Inc. currently observes six paid holidays and two floating days of your choice.

You will also be eligible to participate in Chico’s FAS, Inc. comprehensive benefits program outlined below:

Group Insurance Program: Medical/Dental/Vision Plans Eligibility Date: Effective your first day of active employment

Life Insurance: The company provides term insurance equal to 1X your base salary as well as accidental death and dismemberment insurance equal to 1X yourbase salary ($500,000 maximum). Supplemental insurance is available for purchase. Eligibility Date: Effective your first day of active employment

Short and Long Term Disability: The company provides short and long term disability benefits. Eligibility Date: Effective your first day of active employment

401(k) Plan: You may participate with an eligible deferral of your compensation (subject to an IRS maximum), with a company match of 50% of your deferral.Your 401(k) contributions may be subject to additional limitations under federal regulations. You will be able to roll over existing qualified fundsimmediately. Eligibility Date: After 6 months of employmentDeferred Compensation: You will be eligible to participate in our Deferred Compensation Plan. You will have the opportunity to defer pre-tax compensation (less applicableFICA/Medicare tax withholding). You may defer up to 80% of your base salary payable during the current calendar year with a company match of50% on the first 2.5% you defer, and up to 100% of your bonus for the applicable fiscal year.Eligibility Date: Deferral available upon hire and 30-day enrollment periodEmployee Stock Purchase Plan: You will have an opportunity to purchase Chico’s FAS, Inc. stock directly from the company, two times a year, during the March and SeptemberOffering Periods. Eligibility Date: First Offering Period following 6 months of employmentExecutive Benefits Disability Income Protection: As an officer, you will be eligible for Chico’s FAS, Inc.’s Supplemental Disability Insurance program after 90 days of employment. This programprovides an increased level of income protection should you become totally disabled. Full details of the program will be provided by the BenefitsDepartment.


Annual Physical: As an officer, you are eligible to have one company paid physical per year at the Mayo Clinic in Jacksonville, FL as part of our Health and Wellnessprogram.

Executive Severance Plan: As a qualifying executive, you are eligible for severance benefits pursuant to the attached Chico’s FAS, Inc. Officer Severance Plan.

The items listed above are covered by various benefit plans. Such benefit plans may be modified from time to time. In the event this offer letter conflicts with theterms of a benefit plan document or summary plan description, the terms of the plan document or summary plan description will control.

Child Care: Chico’s FAS, Inc. is pleased to provide an early education and child development center located on campus. The center is operated by BrightHorizons Family Solutions Inc., a best in class child care provider. The center accommodates children from ages 6 weeks to 5 years. Summerprogram options are also available for children ages 5 to 12.Chico’s Clinic:You will have access to Chico’s Viva Verna Clinic, which is available to all associates and their spouses. The on-site clinic offers no cost and low-cost appointments for wellness checks, sick visits and lab work. Marathon Health operates the clinic with a staff of nurse practitioners and otherproviders.Associate Discount:You will be eligible for the Chico’s associate discount, which is generally 40% off the retail price for all Chico’s product at all 3 Chico’s Brands(Chico’s, WHBM, Soma), whether purchased on-line or in store. This discount may not apply to all products and all purchases.Ms. Molly LangensteinPage 4Relocation Benefits: In order to ensure a successful relocation, you will be provided relocation assistance as detailed in the attached Tier I Relocation Program, with thefollowing exceptions: 1) you will be eligible for temporary housing for a period of 4 months; and 2) the benefit for the sale of your house will beextended until the end of 2020.

By accepting our offer of employment, you acknowledge the at-will nature of our relationship. This offer is contingent upon thesuccessful verification of references, background check, in addition to your execution of our attached Restrictive Covenant Agreement, substantiallyillustrated in the form attached. Additionally, you represent that you are not a party to any agreement that would bar or limit the scope of youremployment with us.We hope you view this opportunity as a chance to have a positive impact while enjoying a challenging and rewarding career. Nonetheless, pleaseunderstand that Chico’s FAS, Inc. is an at-will employer. Thatmeans that either you or the company are free to end the employment relationship at any time, with or without notice or cause. We are looking forward to having you on our team. Let me be the first to welcome you aboard! We are sure you will find it a challenging andrewarding experience. If you have any questions, please feel free to contact us at the number indicated below.


Sincerely,

/s/ Bonnie Brooks Bonnie Brooks Interim President and CEO

Contact Information

For questions, please call: Kristin GwinnerSVP, CHRO(XXX) XXX-XXXX

I accept the terms and conditions of the offer as outlined above:

Please return a signed copy

/s/ Molly Langenstein Molly Langenstein

Attachments


Exhibit 10.58

RESTRICTIVE COVENANT AGREEMENT

THIS RESTRICTIVE COVENANT AGREEMENT (this “Agreement”) is made and entered into this 1st day of August, 2019 (the“Effective Date”), by and between Chico’s FAS, Inc., a Florida corporation, having a principal place of business at 11215 MetroParkway, Fort Myers, FL 33966 (the “Employer”), and Molly Langenstein (the “Executive”). In consideration of the mutualcovenants herein contained and intending to be legally bound hereby, the parties hereto agree to the following:

1. Employment. Employer desires to employ Executive in the position of President, Apparel Group (the “Position”),and Executive desires to accept such Position. In the Position, Executive will assume a key role in the organization that will requireconfidentiality and trust and will acquire information, knowledge and experience with Employer that is proprietary, confidential,unique and hard to replace. It would also place Employer at an unfair disadvantage, and Executive at an unfair advantage, shouldExecutive use this information, knowledge, and experience to further the interests of anyone other than Employer. As a result,Employer desires to protect its rights in its proprietary, confidential and trade secret information, and, as a condition of employmentand for the consideration set forth herein, Executive is willing to and has agreed to abide by and faithfully observe the obligationsand restrictions set forth herein.

2. Loyalty During Employment. While employed with Employer, Executive will remain loyal to Employer and will notengage in any activities that create a conflict of interest. Executive understands that it will be a conflict of interest for Executive topursue business activities that compete with Employer while employed with Employer or to engage in material preparations to do so.Executive will promptly inform Employer of any business opportunities related to Employer’s line of business, and will not pursueany such business opportunities independent from Employer without advance written authorization from Employer to do so.

3. Confidential Information.

(a) Nondisclosure and Non-use. Both during Executive’s employment with Employer and thereafter, Executivecovenants and agrees that Executive (i) shall exercise the utmost diligence to protect and safeguard the Confidential Information ofEmployer and its Affiliates; (ii) shall not disclose to any third party any Confidential Information, except as may be required byEmployer in the course of Executive’s employment or by law; and (iii) shall not use, directly or indirectly, for Executive’s ownbenefit or for the benefit of another, any Confidential Information. Executive acknowledges that Confidential Information has beenand will be developed and acquired by Employer and its Affiliates by means of substantial expense and effort, that the ConfidentialInformation is a valuable proprietary asset of Employer’s and its Affiliates’ business, and that its disclosure would cause substantialand irreparable injury to Employer’s and its Affiliates’ business.

For purposes of this Agreement, “Affiliate” shall mean any entity controlling, controlled by, or under common control of, Employer.

(b) Definition of Confidential Information. “Confidential Information” means all information of a confidential orproprietary nature, whether or not specifically labeled or identified as “confidential,” in any form or medium, that is or was disclosedto, or developed or learned by, Executive in connection with Executive’s past, present or future employment with Employer and thatrelates to the business, products, services, research or development of any of the Employer or its Affiliates or their suppliers,distributors or customers. Confidential Information includes, but is not limited to, the following: (i) internal business information(including, but not limited to, information relating to strategic plans and practices, business, training, marketing, promotional andsales plans and practices, cost, rate and pricing structures, accounting and business methods); (ii) identities of, individualrequirements of, specific contractual arrangements with, and information about, any of Employer’s, or any of its Affiliates’,suppliers, distributors and customers and their confidential information; (iii) trade secrets, know-how, compilations of data andanalyses, techniques, systems, formulae, research, records, reports, manuals, documentation, models, data and data bases relatingthereto; (iv) inventions, innovations, improvements, developments, methods, designs, analyses, drawings, reports and all similar orrelated information (whether or not patentable); and (v) other information or thing that has economic value, actual or potential, fromnot being generally known to or not being readily ascertainable by proper means by other persons.

(c) Not Confidential Information. Confidential Information shall not include information that Executive candemonstrate: (i) is publicly known through no wrongful act or breach of obligation of confidentiality; (ii) was rightfully received byExecutive from a third party without a breach of any obligation of confidentiality by such third party; or (iii) was known toExecutive on a non-confidential basis prior to the Executive’s employment with Employer.

(d) Presumption of Confidentiality. In any judicial proceeding, it will be presumed that the Confidential Informationconstitutes protectable trade secrets and Executive will bear the burden of proving that any Confidential Information is publicly orrightfully known by Executive.

(e) Return of Confidential Information and Materials. Executive agrees to return to Employer either before orimmediately upon the termination of Executive’s employment with Employer any and all information, materials or equipment whichconstitutes, contains, or in any way relates to the Confidential Information and any other document, equipment or materials of anykind relating in any way to the business of Employer in the possession, custody or control of Executive which was obtained byExecutive during the course of or as a result of Executive’s employment with Employer whether confidential or not, including, butwithout limitation, any copies thereof which may have been made by or for Executive. Executive shall also provide

Employer, if requested to do so, the name of the new employer of Executive and Employer shall have the right to advise anysubsequent employer of Executive’s obligations hereunder.

4. Non-Competition. Executive covenants and agrees that during the term of Executive’s employment with the Employerand for a twelve (12) month period [six (6) month period for Vice Presidents][twenty-four (24) month period in the case of the ChiefExecutive Officer] after the date of termination of the Executive’s employment hereunder for any reason (the “Restricted Period”),Executive will not, directly or indirectly, perform any job, task, function, skill, or responsibility for a Competing Business thatExecutive has provided for Employer (and/or its Affiliates) within the twelve (12) month period immediately preceding Executive’stermination date within the Restricted Territory. For purposes of this Agreement, a “Competing Business” shall mean any directcompetitor of the Employer which, in general, means a specialty retailer of: (i) better women’s intimate apparel, sleepwear and bathand body products; or (ii) better women’s apparel whose target customers are 35 years of age or older and have an annual householdincome of $75,000 or more. Competing Business includes, but is not limited to: The J. Jill Group, Inc., L Brands, Inc., SoftSurroundings Holdings, LLC, The Talbots, Inc., GAP, Inc., Victoria’s Secret Stores, Inc., and Ascena Retail Group, Inc. The“Restricted Territory” means where Employer’s products are marketed at the time of Executive’s termination.

This covenant on the part of Executive shall be construed as an agreement independent of any other provision of this Agreement; andthe existence of any claim or cause of action of Executive against Employer, whether predicated on this Agreement or otherwise,shall not constitute a defense to the enforcement by Employer of this covenant. Executive expressly agrees that the restrictions ofthis Section 4 will not prevent Executive from otherwise obtaining gainful employment upon termination of Executive’s employmentwith Employer.

5. Non-Solicitation of Customers, Suppliers, and Business Associates. For a period of two (2) years after the date oftermination of Executive’s employment for any reason, Executive shall not directly or indirectly induce, solicit or encourage anycustomer, supplier or other business associate of Employer or an Affiliate to terminate or alter its relationship with Employer orAffiliate, or introduce, offer or sell to or for any customer or business associate, any products or services that compete with anEmployer product, service, marketing item, or other item which presently exists, or which was under development or activeconsideration during Executive’s employment with Employer.

6. Non-Solicitation of Employees. For a period of two (2) years after the date of termination of Executive’s employment forany reason, Executive shall not, directly or indirectly, induce, solicit or encourage any employee of Employer or its Affiliates toterminate or alter his or her relationship with Employer or its Affiliates.

7. Remedies.

(a) Injunctive Relief. It is agreed by the parties hereto that any violation by Executive of any of the covenantscontained herein would cause immediate, material and irreparable harm to Employer and/or its Affiliates which may not beadequately compensated for by money damages, and, therefore, Employer and/or its Affiliates shall be entitled to injunctive relief(including, without limitation, one or more preliminary injunctions and/or ex parte restraining orders) in addition to, and not inderogation of, any other remedies provided by law, in equity or otherwise for such a violation including, but not limited to, the rightto have such covenants specifically enforced by any court of competent jurisdiction and the right to require Executive to account forand pay to Employer and/or its Affiliates all benefits derived or received by Executive as a result of any such breach of covenanttogether with interest thereon, from the date of such initial violation until such sums are received by Employer and/or its Affiliates. The Restricted Period set forth herein shall be extended by any period of time in which Executive is in breach of the covenantscontained in this Agreement and for any period of time which may be necessary to secure an order of court or injunction, eithertemporary or permanent, to enforce any of the covenants contained in this Agreement.

(b) Executive Acknowledgment. Executive acknowledges and agrees that the periods of restriction and geographicalareas of restriction imposed by the confidentiality and non-competition covenants of this Agreement are fair and reasonably requiredfor the protection of Employer and its Affiliates.

8. At-Will. Nothing in this Agreement is intended to alter the at-will nature of Executive’s employment.

9. Severability. In the event that, and if for any reason, any portion of this Agreement shall be held to be invalid orunenforceable, it is agreed that the remaining covenants and restrictions or portions thereof shall remain in full force and effect, andthat if the validity or unenforceability is due to the unreasonableness of the time or geographical area covered by said covenants andrestrictions, said covenants and restrictions of this Agreement shall nevertheless be effective for such period of time and for sucharea as may be determined to be reasonable by a court of competent jurisdiction.

10. Integration. This Agreement contains the entire agreement between the parties regarding the matters covered within it.To the extent other agreements cover the matters contained herein, the provisions of such agreements shall be read together with theprovisions of this Agreement to afford Employer the greatest protections allowed by applicable law.

11. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Florida,without reference to its conflict of laws provisions.

12. Binding Effect. This Agreement is binding upon the parties hereto and on their respective heirs, personalrepresentatives, successors and assigns. Executive agrees that the obligations contained in this Agreement will survive thetermination of this Agreement.

13. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, butall of which together shall constitute one and the same instrument.

Nothing in this Agreement prohibits Executive from reporting an event that Executive reasonably and in good faith believes is aviolation of law to the relevant law-enforcement agency (such as the Securities and Exchange Commission, Equal EmploymentOpportunity Commission, or Department of Labor), or from cooperating in an investigation conducted by such government agency. Executive is hereby provided notice that under the 2016 Defend Trade Secrets Act (DTSA): (1) no individual will be held criminallyor civilly liable under Federal or State trade secret law for disclosure of a trade secret (as defined under the DTSA) that: (A) ismade in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and made solelyfor the purpose of reporting or investigating a suspected violation of law; or, (B) is made in a complaint or other document filed in alawsuit or other proceeding, if such filing is made under seal so that it is not made public; and, (2) an individual who pursues alawsuit for retaliation by an employer for reporting a suspected violation of the law may disclose the trade secret to the attorney ofthe individual and use the trade secret information in the court proceeding, if the individual files any document containing the tradesecret under seal, and does not disclose the trade secret, except as permitted by court order.

This Agreement shall be considered made on the date signed by Executive below which shall be the effective date of this Agreementunless Executive is entering into this Agreement as part of Executive’s original hiring, transfer or promotion into a new position inwhich case the terms of this Agreement are understood to be effective as of the first day of Executive’s employment in such newposition (whether reduced to writing on that specific date or not).

EMPLOYER:

By: /s/ Gregory S. Baker DATE: 8/1/19Gregory S. Baker, General Counsel

EXECUTIVE:

/s/ Molly Langenstein DATE: 8/1/19Molly Langenstein

Exhibit 10.59July 18, 2019

Ms. Bonnie Brooks

Dear Bonnie:

It is with great pleasure that we offer you the opportunity to continue with Chico’s FAS, Inc. as our CEO and President. Please let this letter serve asan offer to be employed by Chico’s FAS, Inc. as CEO and President and your acceptance of that offer. The following will outline the specifics:

Position: Chief Executive Officer and President (“CEO”) of Chico’s FAS, Inc.

Reports to: Chico’s FAS, Inc.’s Board of Directors

Start Date: Upon receipt of work authorization. Until that date, you will continue to serve as the Company’s interim CEO and President under theProfessional Services Agreement dated as of April 24, 2019. The Professional Services Agreement will terminate immediately prior to your start dateas CEO and President, and the monthly fees provided under that agreement will cease and be prorated to reflect your start date and the terminationof that agreement.

Base Salary: $1,200,000.00 annuallyPosition:In your capacity as CEO and President, you will be the highest reporting officer in Chico’s. Your authority and duties will be commensurate withthose customarily exercised by the chief executive officer of a company. Your specific duties will include stabilizing the Company and managementteam, position the Company for sustained growth, and other duties to be determined by Chico’s FAS, Inc.’s Board of Directors.You will be expected to devote your full working time to the successful conduct of the business of Chico’s; provided, however, you may serve on upto two outside boards of directors or trustees for private companies or organizations upon approval of the Chico’s FAS, Inc.’s Board of Directors inthe case of changes to such outside board service. You are permitted to work remotely, from time-to-time, subject to the needs of the business.Incentive Cash Bonus: Annual target of 150% of base salary, contingent upon the achievement of corporate and brand financial objectives under the existing plan. For theFY19 performance period (February 2019 to January 2020), you will be eligible for a pro-ration based on the time period you serve as CEO basedon your annualized FY19 base salary; no minimum guarantee amount.

The terms of the bonus, including eligibility, payouts and objectives are subject to the Management Bonus Plan and may be modified by the Board ofDirectors from time to time. All payouts are based on fiscal year business results and can vary from zero (0) to a maximum of 200% of your targetbonus potential (300% of base salary earned). Bonus is typically paid in March, after the conclusion of the fiscal year.

Equity Grants: Following your commencement of employment with Chico’s, you will receive an equity award as follows:

Grant Date: Within 30 days after receipt of work authorization.


Grant Amount: 1,750,000 shares, with 40% in the form of time-vesting restricted stock that vests in equal installments over four years (“RSA”) and60% in the form of performance share units with a performance period that begins with the third quarter of fiscal 2019 and ends at the end of thefourth quarter of fiscal 2021 (“PSU”), as further described on Exhibit A hereto. The RSA and PSU awards are subject to approval by the HumanResources, Compensation and Benefits Committee of the Chico’s FAS, Inc. Board of Directors (“HRCBC”) on or before the Grant Date and will beset forth in award agreements entered into between you and the Company detailing all vesting provisions and other terms of the awards includingthe performance metrics of the PSU. This grant is intended to cover both fiscal 2019 and 2020 LTI awards. This front-loaded award provides astrong incentive to stabilize Company performance and the management team and re-ignite growth.

You will be eligible for additional equity awards beginning in March 2021 at the discretion of the HRCBC.

Time Off: You will be eligible for 23 days of Paid Time Off (PTO) for each full calendar year of employment. This is an accrued benefit that you start to earn onyour start date. In addition, Chico’s FAS, Inc. currently observes six paid holidays and two floating days of your choice.

Upon your start date, you will also be eligible to participate in Chico’s FAS, Inc. comprehensive benefits program outlined below:

Group Insurance Program: Medical/Dental/Vision Plans Eligibility Date: Effective your first day of active employment

Life Insurance: The company provides term insurance equal to 1X your base salary as well as accidental death and dismemberment insurance equal to 1X yourbase salary ($500,000 maximum). Supplemental insurance is available for purchase. Eligibility Date: Effective your first day of active employment

Short and Long Term Disability: The company provides short and long term disability benefits. Eligibility Date: Effective your first day of active employment

401(k) Plan: You may participate with an eligible deferral of your compensation (subject to an IRS maximum), with a company match of 50% of your deferral.Your 401(k) contributions may be subject to additional limitations under federal regulations. You will be able to roll over existing qualified fundsimmediately. Eligibility Date: After 6 months of employmentDeferred Compensation: You will be eligible to participate in our Deferred Compensation Plan. You will have the opportunity to defer pre-tax compensation (less applicableFICA/Medicare tax withholding). You may defer up to 80% of your base salary payable during the current calendar year with a company match of50% on the first 2.5% you defer, and up to 100% of your bonus for the applicable fiscal year.Eligibility Date: Deferral available upon hire and 30-day enrollment periodEmployee Stock Purchase Plan: You will have an opportunity to purchase Chico’s FAS, Inc. stock directly from the company, two times a year, during the March and SeptemberOffering Periods. Eligibility Date: First Offering Period following 6 months of employmentExecutive Benefits Disability Income Protection:


As an officer, you will be eligible for Chico’s FAS, Inc.’s Supplemental Disability Insurance program after 90 days of employment. This programprovides an increased level of income protection should you become totally disabled. Full details of the program will be provided by the BenefitsDepartment.

Annual Physical: As an officer, you are eligible to have one company paid physical per year at the Mayo Clinic in Jacksonville, FL as part of our Health and Wellnessprogram.

Executive Severance Plan: As a qualifying executive, you are eligible for severance benefits pursuant to the attached Chico’s FAS, Inc. Officer Severance Plan.

The items listed above are covered by various benefit plans. Such benefit plans may be modified from time to time. In the event this offer letter conflicts with theterms of a benefit plan document or summary plan description, the terms of the plan document or summary plan description will control.

Child Care: Chico’s FAS, Inc. is pleased to provide an early education and child development center located on campus. The center is operated by BrightHorizons Family Solutions Inc., a best in class child care provider. The center accommodates children from ages 6 weeks to 5 years. Summerprogram options are also available for children ages 5 to 12.Chico’s Clinic:You will have access to Chico’s Viva Verna Clinic, which is available to all associates and their spouses. The on-site clinic offers no cost and low-cost appointments for wellness checks, sick visits and lab work. Marathon Health operates the clinic with a staff of nurse practitioners and otherproviders.Associate Discount:You will be eligible for the Chico’s associate discount, which is generally 40% off the retail price for all Chico’s product at all 3 Chico’s Brands(Chico’s, WHBM, Soma), whether purchased on-line or in store. This discount may not apply to all products and all purchases.Relocation Benefits: Chico’s will reimburse you for relocation costs you incur with respect to any move to Florida, based on Chico’s Tier 1 relocation policy and subject torepayment as described in such policy. Your relocation benefits include company-provided housing for a minimum of four months, with anyextensions subject to agreement of the parties. During your employment we will further arrange and pay for reasonable air travel between our officesand your primary residence up to once per month.Restrictive Covenants:Your employment is conditioned on your signing a restrictive covenant agreement with the Company covering the following: non-competition andnon-solicitation in effect for 2 years following termination of employment; reasonable ongoing cooperation in effect for 5 years following terminationof employment; and confidentiality and non-disparagement covenants in effect for perpetuity.

At-Will Employment: Your employment with Chico’s is “at will.” That means that either you or the Company are free to end the employment relationship at any time, withor without notice or cause. By accepting our offer of employment, you acknowledge the at-will nature of your employment. Additionally, yourepresent that you are not a party to any agreement that would bar or limit the scope of your employment with us.

If your employment is terminated for any reason other than appointment of a new Chief Executive Officer, you will offer to resign from the Board, andthe Board will not be obligated to nominate you for re-election to the Board.This letter contains the terms and conditions of our offer of employment to you and supersedes and cancels any prior or contemporaneous written orverbal agreements.


Please indicate your acceptance of the above by signing below and returning to my attention.

Sincerely,

/s/ David F. Walker

David F. WalkerChairman, Board of DirectorsChico’s FAS, Inc.

Accepted By: /s/ Bonnie Brooks Bonnie Brooks


Exhibit A to Offer Employment Letter for Bonnie R. Brooks (July 18, 2019)

Restricted Stock Award

• 700,000 time-based restricted shares

• Granted under Amended & Restated 2012 Omnibus Plan

• Vests 1/4 on each of 1st, 2nd, 3rd and 4th anniversaries of grant date, subject to earlier forfeiture or vesting as described below

oProposed vesting period is longer than CHS’ standard RSA vesting (3-year ratable) in recognition of front-loaded nature of the grant

• Dividends to be paid currently during the vesting period, similar to CHS’ standard RSAs

• If CEO service ends due to appointment of successor CEO, vesting continues based on continued service as a director, subject to forfeiture

for non-compliance with restrictive covenants during the vesting period

oContinued vesting ensures that the executive continues to be exposed to changes in CHS stock price following termination of

employment as CEO

• If before 4th anniversary of grant date:

◦ Death or Disability - Vesting accelerates on RSAs scheduled to vest in the next 12 months

o Following Appointment of a New Chief Executive Officer, Stands for Re-election but not Elected – Vesting accelerates on RSAs

scheduled to vest in the next 12 months

o Change in Control (CIC) – Vesting accelerates on all unvested shares if (a) the continuing entity fails to assume and replace the

awards, or (b) the executive is terminated without cause or voluntarily terminates with good reason within the 24-month period following

the CIC or (c) if employment has terminated prior to CIC, the executive is not appointed to the Board of the continuing entity

o All Other Terminations of Employment or Director Service - Unvested RSAs are forfeited

• Performance Share Units

o Two PSU awards with identical terms and vesting provisions, totaling 1,050,000 target units:


oPSU for 350,000 target units granted under 2012 Omnibus Plan (max. payout: 525,000 shares)

oPSU for 700,000 target units granted outside of 2012 Omnibus Plan, in reliance on employment inducement award exemption

contained in NYSE Rule 303A.08. (max. payout 1,050,000 shares)

o Performance Period – Q3 Fiscal 2019 to end of Fiscal 2021 (30 months)

o Minimum Performance Requirement (MPR) – Must achieve four quarters of positive comparable sales growth (on combined Company

basis) during the Performance Period to be eligible to vest in any PSUs

o Performance Measures, Goals and Vesting – If the Minimum Performance Requirement is achieved, number of PSUs earned based on

highest “stock price” (defined below) achieved during the last 15 months of the Performance Period

Performance Level Highest Stock Price Achieved % of Target PSUs Vesting

Outstanding$10.00 or Higher

(Which is the current ≈ 52 week high)

150%

Target $7.50 100%

Threshold $5.00 50%

Below Threshold <$5.00 0%

o Payout for intermediate “stock prices” determined based on straight line interpolation

o “Stock price” = 20-trading day average closing stock price

o Subject to exceptions below, vesting/payout of PSUs (to the extent earned) occurs on March 1, 2022

o Vested PSUs will be paid in shares of CHS stock

o Dividend equivalents will be accumulated during the Performance Period and paid in cash based on the number of PSUs that vest


o Termination of Employment following Appointment of a New Chief Executive Officer of the Company– Vesting continues subject to

continued service on the Board and compliance with restrictive covenants during Performance Period; vesting based on actual

performance without pro-ration for CEO service

o Death or Disability - Vesting continues; vesting based on actual performance and pro-rated based on number of months of service

during the Performance Period

o Following Appointment of a New Chief Executive Officer, Stands for Re-election but not Elected – Vesting continues; vesting based on

actual performance and pro-rated based on number of months of service during the Performance Period

o Change in Control - PSUs will be converted to time-based restricted stock units that cliff-vests at the end of the Performance Period, as

described below and subject to 409A requirements

▪ Conversion – Based on stock price performance using the CIC price; Minimum Performance Requirement will be waived

§ Accelerated Vesting – Converted awards will be fully vested if (a) the continuing entity fails to assume and replace the awards,

or (b) the executive is terminated without cause or voluntarily terminates with good reason within the 24-month period following

the CIC or (c) if employment has terminated prior to CIC, the executive is not appointed to the Board of the continuing entity

o All Other Termination of Employment or Director Service Scenarios – Unvested PSUs are forfeited


Exhibit 10.60

RESTRICTIVE COVENANT AGREEMENT

THIS RESTRICTIVE COVENANT AGREEMENT (this “Agreement”) is made and entered into this 20th day of August, 2019 (the“Effective Date”), by and between Chico’s FAS, Inc., a Florida corporation, having a principal place of business at 11215 MetroParkway, Fort Myers, FL 33966 (the “Employer”), and Bonnie R. Brooks (the “Executive”). In consideration of the mutualcovenants herein contained and intending to be legally bound hereby, the parties hereto agree to the following:

1. Employment. Employer desires to employ Executive in the position of President and Chief Executive Officer (the“Position”), and Executive desires to accept such Position. In the Position, Executive will assume a key role in the organization thatwill require confidentiality and trust and will acquire information, knowledge and experience with Employer that is proprietary,confidential, unique and hard to replace. It would also place Employer at an unfair disadvantage, and Executive at an unfairadvantage, should Executive use this information, knowledge, and experience to further the interests of anyone other than Employer.As a result, Employer desires to protect its rights in its proprietary, confidential and trade secret information, and, as a condition ofemployment and for the consideration set forth herein, Executive is willing to and has agreed to abide by and faithfully observe theobligations and restrictions set forth herein.

2. Loyalty During Employment. While employed with Employer, Executive will remain loyal to Employer and will notengage in any activities that create a conflict of interest. Executive understands that it will be a conflict of interest for Executive topursue business activities that compete with Employer while employed with Employer or to engage in material preparations to do so.Executive will promptly inform Employer of any business opportunities related to Employer’s line of business, and will not pursueany such business opportunities independent from Employer without advance written authorization from Employer to do so.

3. Confidential Information.

(a) Nondisclosure and Non-use. Both during Executive’s employment with Employer and thereafter, Executivecovenants and agrees that Executive (i) shall exercise the utmost diligence to protect and safeguard the Confidential Information ofEmployer and its Affiliates; (ii) shall not disclose to any third party any Confidential Information, except as may be required byEmployer in the course of Executive’s employment or by law; and (iii) shall not use, directly or indirectly, for Executive’s ownbenefit or for the benefit of another, any Confidential Information. Executive acknowledges that Confidential Information has beenand will be developed and acquired by Employer and its Affiliates by means of substantial expense and effort, that the ConfidentialInformation is a valuable proprietary asset of Employer’s and its Affiliates’ business, and that its disclosure would cause substantialand irreparable injury to Employer’s and its Affiliates’ business.

For purposes of this Agreement, “Affiliate” shall mean any entity controlling, controlled by, or under common control of, Employer.

(b) Definition of Confidential Information. “Confidential Information” means all information of a confidential orproprietary nature, whether or not specifically labeled or identified as “confidential,” in any form or medium, that is or was disclosedto, or developed or learned by, Executive in connection with Executive’s past, present or future employment with Employer and thatrelates to the business, products, services, research or development of any of Employer or its Affiliates or their suppliers, distributorsor customers. Confidential Information includes, but is not limited to, the following: (i) internal business information (including, butnot limited to, information relating to strategic plans and practices, business, training, marketing, promotional and sales plans andpractices, cost, rate and pricing structures, accounting and business methods); (ii) identities of, individual requirements of, specificcontractual arrangements with, and information about, any of Employer’s, or any of its Affiliates’, suppliers, distributors andcustomers and their confidential information; (iii) trade secrets, know-how, compilations of data and analyses, techniques, systems,formulae, research, records, reports, manuals, documentation, models, data and data bases relating thereto; (iv) inventions,innovations, improvements, developments, methods, designs, analyses, drawings, reports and all similar or related information(whether or not patentable); and (v) other information or thing that has economic value, actual or potential, from not being generallyknown to or not being readily ascertainable by proper means by other persons.

(c) Not Confidential Information. Confidential Information shall not include information that Executive candemonstrate: (i) is publicly known through no wrongful act or breach of obligation of confidentiality; (ii) was rightfully received byExecutive from a third party without a breach of any obligation of confidentiality by such third party; or (iii) was known toExecutive on a non-confidential basis prior to Executive’s employment with Employer.

(d) Presumption of Confidentiality. In any judicial proceeding, it will be presumed that the Confidential Informationconstitutes protectable trade secrets and Executive will bear the burden of proving that any Confidential Information is publicly orrightfully known by Executive.

(e) Return of Confidential Information and Materials. Executive agrees to return to Employer either before orimmediately upon the termination of Executive’s employment with Employer any and all information, materials or equipment whichconstitutes, contains, or in any way relates to the Confidential Information and any other document, equipment or materials of anykind relating in any way to the business of Employer in the possession, custody or control of Executive which was obtained byExecutive during the course of or as a result of Executive’s employment with Employer whether confidential or not, including, butwithout limitation, any copies thereof which may have been made by or for Executive. Executive shall also provide

Employer, if requested to do so, the name of the new employer of Executive and Employer shall have the right to advise anysubsequent employer of Executive’s obligations hereunder.

4. Non-Competition. Executive covenants and agrees that during the term of Executive’s employment with Employer andfor a period of two (2) years after the date of termination of Executive’s employment hereunder for any reason (the “RestrictedPeriod”), Executive will not, directly or indirectly, perform any job, task, function, skill, or responsibility for a Competing Businessthat Executive has provided for Employer (and/or its Affiliates) within the twelve (12) month period immediately precedingExecutive’s termination date within the Restricted Territory. For purposes of this Agreement, a “Competing Business” shall meanany direct competitor of Employer which, in general, means a specialty retailer of: (i) better women’s intimate apparel, sleepwearand bath and body products; or (ii) better women’s apparel whose target customers are 35 years of age or older and have an annualhousehold income of $75,000 or more. Competing Business includes, but is not limited to: The J. Jill Group, Inc., L Brands, Inc.,Soft Surroundings Holdings, LLC, The Talbots, Inc., GAP, Inc., Victoria’s Secret Stores, Inc., and Ascena Retail Group, Inc. The“Restricted Territory” means where Employer’s products are marketed at the time of Executive’s termination.

This covenant on the part of Executive shall be construed as an agreement independent of any other provision of this Agreement; andthe existence of any claim or cause of action of Executive against Employer, whether predicated on this Agreement or otherwise,shall not constitute a defense to the enforcement by Employer of this covenant. Executive expressly agrees that the restrictions ofthis Section 4 will not prevent Executive from otherwise obtaining gainful employment upon termination of Executive’s employmentwith Employer.

5. Non-Solicitation of Customers, Suppliers, and Business Associates. For a period of two (2) years after the date oftermination of Executive’s employment for any reason, Executive shall not directly or indirectly induce, solicit or encourage anycustomer, supplier or other business associate of Employer or an Affiliate to terminate or alter its relationship with Employer orAffiliate, or introduce, offer or sell to or for any customer or business associate, any products or services that compete with anEmployer product, service, marketing item, or other item which presently exists, or which was under development or activeconsideration during Executive’s employment with Employer.

6. Non-Solicitation of Employees. For a period of two (2) years after the date of termination of Executive’s employment forany reason, Executive shall not, directly or indirectly, induce, solicit or encourage any employee of Employer or its Affiliates toterminate or alter his or her relationship with Employer or its Affiliates.

7. Non-Disparagement. Both during Executive’s employment with Employer and thereafter, Executive covenants andagrees that Executive shall not, directly or indirectly, disparage

Employer, or its successors, corporate affiliates, assigns, officers, directors, shareholders, attorneys, employees, agents, trustees,representatives, or insurers. Such prohibited disparagement shall include communicating or disclosing any information orcommunications to anyone or entity which is intended to or has the effect of having any negative impact on Employer, its business orreputation in the marketplace or otherwise.

8. Reasonable Cooperation. Executive acknowledges and agrees that, during the course of Executive’s employment withEmployer, Executive will be involved in, and may have information or knowledge of, business matters that may become the subjectof legal action, including threatened litigation, investigations, administrative proceedings, hearings or disputes. As such, uponreasonable notice, both during Executive’s employment with Employer and for a period of five (5) years after the date of terminationof Executive’s employment for any reason, Executive agrees to cooperate fully with any investigation into, defense or prosecutionof, or other involvement in, claims to which Executive has personal and relevant knowledge that are or may be made by or againstEmployer. This agreement to cooperate includes talking to or meeting with such persons at times and in such places as Employer andExecutive reasonably agree to, as well as giving truthful evidence and truthful testimony. Employer shall reimburse Executive forreasonable out-of-pocket expenses actually incurred in connection with such assistance. Executive also promises to notify Employerwithin five (5) days if Executive is subpoenaed or contacted by a third party seeking information about Employer activities.

9. Remedies.

(a) Injunctive Relief. It is agreed by the parties hereto that any violation by Executive of any of the covenantscontained herein would cause immediate, material and irreparable harm to Employer and/or its Affiliates which may not beadequately compensated for by money damages, and, therefore, Employer and/or its Affiliates shall be entitled to injunctive relief(including, without limitation, one or more preliminary injunctions and/or ex parte restraining orders) in addition to, and not inderogation of, any other remedies provided by law, in equity or otherwise for such a violation including, but not limited to, the rightto have such covenants specifically enforced by any court of competent jurisdiction and the right to require Executive to account forand pay to Employer and/or its Affiliates all benefits derived or received by Executive as a result of any such breach of covenanttogether with interest thereon, from the date of such initial violation until such sums are received by Employer and/or its Affiliates. The Restricted Period set forth herein shall be extended by any period of time in which Executive is in breach of the covenantscontained in this Agreement and for any period of time which may be necessary to secure an order of court or injunction, eithertemporary or permanent, to enforce any of the covenants contained in this Agreement.

(b) Executive Acknowledgment. Executive acknowledges and agrees that the periods of restriction and geographicalareas of restriction imposed by the confidentiality and non-competition covenants of this Agreement are fair and reasonably requiredfor the protection of Employer and its Affiliates.

10. At-Will. Nothing in this Agreement is intended to alter the at-will nature of Executive’s employment.

11. Severability. In the event that, and if for any reason, any portion of this Agreement shall be held to be invalid orunenforceable, it is agreed that the remaining covenants and restrictions or portions thereof shall remain in full force and effect, andthat if the validity or unenforceability is due to the unreasonableness of the time or geographical area covered by said covenants andrestrictions, said covenants and restrictions of this Agreement shall nevertheless be effective for such period of time and for sucharea as may be determined to be reasonable by a court of competent jurisdiction.

12. Integration. This Agreement contains the entire agreement between the parties regarding the matters covered within it.To the extent other agreements cover the matters contained herein, the provisions of such agreements shall be read together with theprovisions of this Agreement to afford Employer the greatest protections allowed by applicable law.

13. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Florida,without reference to its conflict of laws provisions.

14. Binding Effect. This Agreement is binding upon the parties hereto and on their respective heirs, personalrepresentatives, successors and assigns. Executive agrees that the obligations contained in this Agreement will survive thetermination of this Agreement.

15. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, butall of which together shall constitute one and the same instrument.

Nothing in this Agreement prohibits Executive from reporting an event that Executive reasonably and in good faith believes is aviolation of law to the relevant law-enforcement agency (such as the Securities and Exchange Commission, Equal EmploymentOpportunity Commission, or Department of Labor), or from cooperating in an investigation conducted by such government agency. Executive is hereby provided notice that under the 2016 Defend Trade Secrets Act (DTSA): (1) no individual will be held criminallyor civilly liable under Federal or State trade secret law for disclosure of a trade secret (as defined under the DTSA) that: (A) ismade in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and made solelyfor the purpose of reporting or investigating a suspected violation of law; or, (B) is made in a complaint or other document filed in alawsuit or other proceeding, if such filing is made under seal so that

it is not made public; and, (2) an individual who pursues a lawsuit for retaliation by an employer for reporting a suspected violationof the law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding,if the individual files any document containing the trade secret under seal, and does not disclose the trade secret, except as permittedby court order.

This Agreement shall be considered made on the date signed by Executive below which shall be the effective date of this Agreementunless Executive is entering into this Agreement as part of Executive’s original hiring, transfer or promotion into a new position inwhich case the terms of this Agreement are understood to be effective as of the first day of Executive’s employment in such newposition (whether reduced to writing on that specific date or not).

EMPLOYER:

By: /s/ Gregory S. Baker Gregory S. Baker, General Counsel

EXECUTIVE:

/s/ Bonnie R. Brooks Bonnie R. Brooks

Exhibit 31.1

CHICO’S FAS, INC. AND SUBSIDIARIES CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Bonnie R. Brooks, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Chico’s FAS, Inc. for the period ended August 3, 2019;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by thisreport;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others withinthose entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about theeffectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s mostrecent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likelyto materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which arereasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internalcontrol over financial reporting.

Date: August 28, 2019

/s/ Bonnie R. BrooksName: Bonnie R. BrooksTitle: President, Chief Executive Officer and Director

Exhibit 31.2

CHICO’S FAS, INC. AND SUBSIDIARIES CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Todd E. Vogensen, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Chico’s FAS, Inc. for the period ended August 3, 2019;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by thisreport;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others withinthose entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about theeffectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s mostrecent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likelyto materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which arereasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internalcontrol over financial reporting.

Date: August 28, 2019

/s/ Todd E. VogensenName: Todd E. VogensenTitle: Executive Vice President, Chief Financial Officer and Assistant Corporate Secretary

Exhibit 32.1

Certification Pursuant To 18 U.S.C. Section 1350,As Adopted Pursuant To

Section 906 Of The Sarbanes-Oxley Act Of 2002

I, Bonnie R. Brooks, President, Chief Executive Officer and Director of Chico’s FAS, Inc. (the “Company”) certify, pursuant to 18 U.S.C.section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

(1) The Quarterly Report of the Company on Form 10-Q for the period ended August 3, 2019 as filed with the Securities and ExchangeCommission on the date hereof (the “Report”) fully complies with the requirements of section 13(a) or 15(d) of the Securities ExchangeAct of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of theCompany.

/s/ Bonnie R. BrooksBonnie R. BrooksPresident, Chief Executive Officer and DirectorDate: August 28, 2019

Exhibit 32.2

Certification Pursuant To 18 U.S.C. Section 1350,As Adopted Pursuant To

Section 906 Of The Sarbanes-Oxley Act Of 2002

I, Todd E. Vogensen, Executive Vice President, Chief Financial Officer and Assistant Corporate Secretary of Chico’s FAS, Inc. (the“Company”) certify, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that to the best of myknowledge:

(1) The Quarterly Report of the Company on Form 10-Q for the period ended August 3, 2019 as filed with the Securities and ExchangeCommission on the date hereof (the “Report”) fully complies with the requirements of section 13(a) or 15(d) of the Securities ExchangeAct of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of theCompany.

/s/ Todd E. VogensenTodd E. VogensenExecutive Vice President, Chief Financial Officer and Assistant Corporate SecretaryDate: August 28, 2019

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