UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~January~~April 3130, 2010

o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________________ to ______________________.

Commission file number 0-23001

SIGNATURE EYEWEAR, INC.

(Exact Name of Registrant as Specified in its Charter)

California

(State or Other Jurisdiction of

Incorporation or Organization)

95-3876317

(I.R.S. Employer

Identification No.)

498 North Oak Street

Inglewood, California 90302

(Address of Principal Executive Offices)

(310) 330-2700

(Registrant’s Telephone Number, Including Area Code)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by checkmark whether the registrant: (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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 the past 90 days. ý Yes ¨ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer o	Accelerated Filer ¨
Non-accelerated Filer o (Do not check if a smaller reporting company)	Smaller reporting company x

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 6,955,639 shares issued and outstanding as of ~~March~~June 13, 2010.

SIGNATURE EYEWEAR, INC.

INDEX TO FORM 10-Q

PART I	FINANCIAL INFORMATION	Page
Item 1	Financial Statements	3
	Balance Sheets	3
	Statements of Income	5
	Statements of Cash Flows	6
	Notes to the Financial Statements	7
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	11
Item 3	Quantitative and Qualitative Disclosures About Market Risk	1314
Item 4	Controls and Procedures	14
PART II	OTHER INFORMATION	14
Item 1	Legal Proceedings	1415
Item 1A	Risk Factors	1415
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	1415
Item 3	Defaults upon Senior Securities	1415
Item 4	Removed and Reserved	1415
Item 5	Other Information	15
Item 6	Exhibits	15

References in this ~~Report~~report to ~~the~~ “~~Company~~we,” “~~Signature~~our,” “weus” or the “usCompany” refer to Signature Eyewear, Inc.

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PART I.

FINANCIAL INFORMATION

Item 1. Financial Statements

SIGNATURE EYEWEAR, INC.

BALANCE SHEETS

AT ~~JANUARY~~ 31APRIL 30, 2010 (UNAUDITED)

AT AND OCTOBER 31, 2009 (AUDITED)

ASSETS
	January 31,		October 31,
	2010		2009
Current assets
Cash and cash equivalents	$	398,662	$	431,037
Accounts receivable - trade, net of allowance for doubtful accounts of $42,163		2,788,890		2,565,125
Inventory		3,841,218		3,843,793
Promotional products and materials		180,142		209,847
Prepaid expenses and other current assets		345,433		263,594
Deferred income taxes		376,500		376,500
Total current assets		7,930,845		7,689,896
Property and equipment, net		328,228		313,324
Deposits and other assets		104,000		250,500
Deferred income taxes		2,600,700		2,600,700
Total assets	$	10,963,773	$	10,854,420

ASSETS

	April 30,		October 31,
	2010		2009
Current assets

Cash and cash equivalents	$	618,370	$	431,037
Accounts receivable - trade, net of allowance for
doubtful accounts of $42,163		2,873,659		2,565,125
Inventory		3,182,879		3,843,793
Promotional products and materials		175,852		209,847
Prepaid expenses and other current assets		265,864		263,594
Deferred income taxes		376,500		376,500

Total current assets		7,493,124		7,689,896

Property and equipment, net		323,470		313,324
Deposits and other assets		80,000		250,500
Deferred income taxes		2,600,700		2,600,700

Total assets	$	10,497,294	$	10,854,420

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

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SIGNATURE EYEWEAR, INC.

BALANCE SHEETS

AT ~~JANUARY~~ 31APRIL 30, 2010 (UNAUDITED)

AT AND OCTOBER 31, 2009 (AUDITED)

LIABILITIES AND SHAREHOLDERS’ EQUITY
	January 31,			October 31,
	2010			2009
Current liabilities
Accounts payable - trade	$	3,558,698		$	3,532,159
Accrued expenses and other current liabilities		1,451,173			1,538,516
Current portion of long-term debt		415,000			415,000
Total current liabilities		5,424,871			5,485,675
Long-term debt, net of current portion		3,832,500			3,805,000
Total liabilities		9,257,371			9,290,675
Commitments and contingencies
Shareholders’ equity
Preferred stock, $0.001 par value
5,000,000 shares authorized
Series A 2% convertible preferred stock, $0.001 par value; liquidation preference (approximately $919,000 and $915,000 at January 31, 2010 and October 31, 2009, respectively)
1,360,000 shares authorized
1,200,000 shares issued and outstanding		1,200			1,200
Common stock, $0.001 par value
30,000,000 shares authorized
6,955,639 shares issued and outstanding		6,956			6,956
Additional paid-in capital		15,656,812			15,656,812
Accumulated deficit		(13,958,566	)		(14,101,223	)
Total shareholders’ equity		1,706,402			1,563,745
Total liabilities and shareholders’ equity	$	10,963,773		$	10,854,420

LIABILITIES AND SHAREHOLDERS’ EQUITY

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

	April 30,			October 31,
	2010			2009
Current liabilities
Accounts payable - trade	$	3,448,098		$	3,532,159
Accrued expenses and other current liabilities		1,511,074			1,538,516
Current portion of long-term debt		415,000			415,000

Total current liabilities		5,374,172			5,485,675

Long-term debt, net of current portion		3,260,000			3,805,000

Total liabilities		8,634,172			9,290,675

Commitments and contingencies

Shareholders' equity
Preferred stock, $0.001 par value
5,000,000 shares authorized
Series A 2% convertible preferred stock, $0.001
par value; liquidation preference (approximately
$924,000 and $915,000 at April 30, 2010
and October 31, 2009 respectively);
1,360,000 shares authorized;
1,200,000 issued and outstanding		1,200			1,200
Common stock, $0.001 par value;
30,000,000 shares authorized;
6,955,639 shares issued
and outstanding		6,956			6,956
Additional paid-in capital		15,656,812			15,656,812
Accumulated deficit		(13,801,846	)		(14,101,223	)

Total shareholders' equity		1,863,122			1,563,745

Total liabilities and shareholders' equity	$	10,497,294		$	10,854,420

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

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SIGNATURE EYEWEAR, INC.

STATEMENTS OF INCOME

FOR THE THREE MONTHS AND SIX MONTHS ENDED ~~JANUARY~~APRIL 3130, 2010 (UNAUDITED)

AND ~~JANUARY~~ 31APRIL 30, 2009 (UNAUDITED)

	2010			2009
	For The Three Months Ended						For The Six Months Ended
Net sales	$	5,168,880		$	5,959,355
	2010			2009			2010			2009
Cost of sales		1,920,797			2,110,716
Net sales	$	5,858,595		$	6,111,339		$	11,027,475		$	12,070,694
Gross profit		3,248,083			3,848,639
Cost of sales		2,176,887			2,204,263			4,097,684			4,314,979
Operating expenses
Gross profit		3,681,708			3,907,076			6,929,791			7,755,715
Selling		1,905,636			2,138,817
Operating expenses
General and administrative		1,108,591			1,424,125
Selling		2,245,840			2,220,120			4,151,476			4,358,937
Depreciation and amortization		44,929			34,828
General and administrative		1,186,604			1,379,957			2,295,195			2,804,082
Total operating expenses		3,059,156			3,597,770
Depreciation and amortization		48,759			36,838			93,688			71,666
Income from operations		188,927			250,869
Total operating expenses		3,481,203			3,636,915			6,540,359			7,234,685
Interest expense		(45,835	)		(51,043	)
Income from operations		200,505			270,161			389,432			521,030
Income before taxes		143,092			199,826
Interest expense/other, net		(43,785	)		(52,734	)		(89,620	)		(103,777	)
Income taxes		435			1,081
Income before income taxes		156,720			217,427			299,812			417,253
Net income		142,657			198,745
Income taxes		-			1,067			435			2,148
Preferred stock dividend	$	(4,554	)	$	(4,464	)
Net income		156,720			216,360			299,377			415,105
Net income available to common shareholders	$	138,103		$	194,281
Preferred stock dividend	$	(4,577	)	$	(4,486	)	$	(9,130	)	$	(8,950	)
Basic earnings per share	$	0.02		$	0.03
Net income available to common shareholders	$	152,143		$	211,874		$	290,247		$	406,155
Diluted earnings per share	$	0.02		$	0.02
Basic earnings per share	$	0.02		$	0.03		$	0.04		$	0.06
Weighted-average common shares
Diluted earnings per share	$	0.02		$	0.03		$	0.04		$	0.05
outstanding - Basic		6,955,639			6,955,639
Weighted-average common shares
Weighted-average common shares
outstanding - Basic		6,955,639			6,955,639			6,955,639			6,955,639
outstanding - Diluted		8,327,761			8,300,776
Weighted-average common shares
outstanding - Diluted		8,334,691			8,307,472			8,334,591			8,307,472

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

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SIGNATURE EYEWEAR, INC.

STATEMENTS OF CASH FLOWS

FOR THE ~~THREE~~SIX MONTHS ENDED ~~JANUARY~~APRIL 3130, 2010 (UNAUDITED)

AND ~~JANUARY~~ 31APRIL 30, 2009 (UNAUDITED)

	2010			2009
Cash flows from operating activities
Net income	$	~~142~~299,~~657~~377		$	~~198~~415,~~745~~105
Adjustments to reconcile net income to net cash used in operating activities:
Adjustments to reconcile net income
Depreciation and amortization		44,929			34,828
to net cash provided by
operating activities:
Depreciation and amortization		93,688			71,666
(Increase) decrease in:
Accounts receivable - trade		(~~223~~308,~~765~~534	)		(~~754~~234,~~105~~976	)
Inventories		2660,~~575~~914			~~344~~877,~~458~~851
Promotional products and materials		2933,~~705~~995			(7382,~~489~~677	)
Prepaid expenses and other current assets		(812,~~839~~270	)		7897,~~069~~138
Increase (decrease) in:
Accounts payable - trade		26(84,~~539~~061	)		(58769,~~581~~354	)
Accrued expenses and other current liabilities		(8727,~~343~~442	)		(~~172~~253,~~156~~966	)
Net cash used in operating activities		(146,542	)		(402,231	)
					.
Net cash provided by operating activities		665,667			120,787
Cash flows from investing activities
Purchase of property and equipment		(59103,~~833~~834	)		(3146,~~045~~698	)
Deposits and other assets		~~146~~170,500			(~~145~~670	)
Net cash provided by (used in) investing activities		8666,~~667~~666			(3147,~~190~~368	)
Cash flows from financing activities
Net increase in lines of credit		100,000			550,000
Net borrowings (payments) on lines of credit		(400,000	)		100,000
Payments on short-term debt		—			—
Payments on long-term debt		(145,000	)		(145,000	)
Payments on long-term debt		(72,500	)		(72,500	)
Net cash used in financing activities		(545,000	)		(45,000	)
Borrowings on long-term debt		—			—
Net increase in cash and cash equivalents		187,333			28,419
Net cash provided by financing activities		27,500			477,500
Net (decrease) increase in cash and cash equivalents		(32,375	)		44,079
Cash and cash equivalents, beginning of period		431,037			305,628
Cash and cash equivalents, end of period	$	~~398~~618,~~662~~370		$	~~349~~334,~~707~~047
Supplemental disclosures of cash flow information
Supplemental disclosures of cash
Interest paid	$	23,542		$	33,759
flow information
Income taxes paid	$	435		$	1,081
Interest paid	$	46,573		$	62,194
Income taxes paid	$	435		$	2,148

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

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NOTES TO FINANCIAL STATEMENTS

(Information as of ~~January~~April 3130, 2010 and for the three ~~months ended January 31, 2010~~ and ~~2009 is~~six ~~unaudited)~~months ended

April 30, 2010 and 2009 is unaudited)

Note 1. Organization and Line of Business

Signature Eyewear, Inc. (the “Company”) designs, markets and distributes eyeglass frames throughout the United States and internationally. The Company conducts its operations primarily from its principal executive offices and a warehouse in Inglewood, California.

Note 2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all normal, recurring adjustments considered necessary for a fair presentation have been included. These financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’'s Annual Report on Form 10-K for the year ended October 31, 2009. The results of operations for the ~~three~~ six months ended ~~January 31~~April 30, 2010 are not necessarily indicative of the results that may be expected for the year ending October 31, 2010.

Inventory

Inventory consists of finished goods, which are valued at the lower of cost or market. Cost is computed using the weighted-average cost, which approximates actual cost on a first-in, first-out basis.

The Company regularly and periodically evaluates its inventory to ensure that it is valued at the lower of cost or market based on current market trends, product history, and turnover.

Property and Equipment

Property and equipment are recorded at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful lives of the assets as follows:

Office furniture and equipment	7 years
Computer equipment	3 years
Software	3 years
Machinery and equipment	5 years
Leasehold improvements	Term of the lease or the estimated life of the related improvements, whichever is shorter

Expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized.

- 7 -

Fair Value of Financial Instruments

For certain of the Company’'s financial instruments, including cash and cash equivalents, accounts receivable, accounts payable - trade, and line of credit, the carrying amounts approximate fair value due to their short-term maturities. The amounts shown for long-term debt also approximate fair value because current interest rates offered to the Company for debt of similar maturities are substantially the same.

Income per Share

Basic income per share is computed by dividing the income available to common shareholders by the weighted-average number of common shares outstanding. Diluted income per share is computed similar to basic income per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. The following data show the amounts used in computing earnings per share and the effect on the weighted average number of shares of dilutive potential common stock:

Three months ended January 31, 2010	Income (Numerator)			Shares (Denominator)	Per Share Amount
Three months ended April 30, 2010	Income (Numerator)		Shares (Denominator)		Per Share Amount
Basic earnings per share	$	138,103		6,955,639	$	0.02
Basic earnings	$	152,143		6,955,639	$	0.02
Conversion of preferred stock		4,~~554~~577		1,~~372~~378,~~122~~952		0.00
Diluted earnings per share	$	142,657		8,327,761	$	0.02
Diluted earnings	$	156,720		8,334,591	$	0.02

Three months ended January 31, 2009	Income (Numerator)		Shares (Denominator)		Per Share Amount
Three months ended April 30, 2009	Income (Numerator)		Shares (Denominator)		Per Share Amount
Basic earnings per share	$	194,281		6,955,639	$	0.03
Basic earnings	$	211,874		6,955,639	$	0.03
Conversion of preferred stock		4,~~464~~486		1,~~345~~351,~~137~~833		0.00
Diluted earnings per share	$	198,745		8,300,776	$	0.02
Diluted earnings	$	216,360		8,307,472	$	0.03

The following potential common shares have been excluded from the computations of diluted income per share for the three months ended January 31, 2010 and 2009 because the effect would have been anti-dilutive:8

	2010		2009
Six months ended April 30, 2010	Income (Numerator)		Shares (Denominator)		Per Share Amount
Stock options		—		34,300
Basic earnings	$	290,247		6,955,639	$	0.04
Warrants		300,000		300,000
Conversion of preferred stock		9,130		1,378,952		0.00
Total		300,000		334,300
Diluted earnings	$	299,377		8,334,591	$	0.04

Six months ended April 30, 2009	Income (Numerator)		Shares (Denominator)		Per Share Amount

Basic earnings	$	406,155		6,955,639	$	0.06
Conversion of preferred stock		8,950		1,351,833		(0.01	)
Diluted earnings	$	415,105		8,307,472	$	0.05

The following potential common shares have been excluded from the computations of diluted income per share for the three and six months ended April 30, 2010 and 2009 because the effect would have been anti-dilutive:

	2010		2009

Stock options		-		32,900
Warrants		300,000		300,000
Total		300,000		332,900

Foreign Currency Translation

~~The Belgium~~In fiscal 2009, the Company maintained a branch ~~was~~office in Belgium, and closed asthis office at the end of ~~October~~that 31year. The functional currency of this office was the euro. Assets and liabilities are translated at exchange rates in effect at the balance sheet date. Income and expense accounts are translated at average rates. In addition, some of the Company’s liabilities are denominated in foreign currencies. Such liabilities are converted into U.S. dollars at the exchange rate prevailing at the balance sheet date. The resulting gains or losses were not material for the three months and six months ended April 30, 2009 or 2010.

The Company’s Belgium branch’s functional currency is the euro. Assets and liabilities are translated at exchange rates in effect at the balance sheet date. Income and expense accounts

- 8 -

are translated at average rates. In addition, some of the Company’s liabilities are denominated in foreign currencies. Such liabilities are converted into U.S. dollars at the exchange rate prevailing at the balance sheet date. The resulting gains or losses were not material for the three months ended January 31, 2010 and 2009.

Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

~~Recently~~Significant ~~Issued~~Recent Accounting Pronouncements

The ~~FASB recently~~recent ~~amended~~accounting ~~its~~pronouncements ~~guidance~~discussed ~~surrounding an entity’s analysis to determine whether any of its variable interests constitute controlling financial interests~~ in ~~a variable interest entity. This analysis identifies~~ the ~~primary beneficiary~~notes ~~of a variable interest entity as the enterprise that has both of the following characteristics: (a) the power~~ to ~~direct~~ the ~~activities of a variable interest entity that most significantly impact the entity~~Company’s ~~economic performance;~~audited ~~and~~financial ~~(b)~~statements ~~the~~for ~~obligation to absorb losses of~~ the ~~entity~~year ~~that~~October ~~could potentially be significant to the variable interest entity or the right to receive benefits from the entity that could potentially be significant to the variable interest entity. Additionally~~31, an2009 ~~enterprise~~included isin ~~required to assess whether it has an implicit financial responsibility to ensure that a variable interest entity operates as designed when determining whether it has~~ the ~~power to direct the activities of the variable interest entity that most significantly impact the entity~~Company’s ~~economic~~Annual ~~performance. The~~Report ~~amended guidance~~on ~~also~~Form ~~requires~~10-K ~~ongoing reassessments of whether an enterprise is the primary beneficiary of a variable interest entity. The amended guidance is effective for the first annual reporting period~~ that ~~begins~~were ~~after November 15,~~required ~~2009,~~to ~~which~~be ~~for~~adopted ~~the~~during ~~Company is~~ the ~~fiscal~~ year ~~ending~~ended October 31, ~~2011. The~~2009 ~~Company~~did ~~does~~ not ~~expect~~have ~~the~~and ~~adoption~~are ofnot ~~this~~expected ~~guidance~~ to have a ~~material~~significant impact on ~~its financial statements for~~ the ~~fiscal~~Company’s ~~year~~2010 ~~ending October~~financial ~~31, 2010~~statements.

The recent accounting pronouncements discussed in the notes to the Company’s audited financial statements for the year ended October 31, 2009 included in the Annual Report on Form 10-K for the year ended October 31, 2009 that were required to be adopted during the year ended October 31, 2009 did not have and are not expected to have a significant impact on the Company’s financial statements for the year ending October 31, 2010.9

Note 3. Long-Term Debt

Long-term debt (excluding accrued and unpaid interest) consisted of the following at the dates indicated:

- 9 -

	April 30, 2010			October 31, 2009
Revolving line of credit from Comerica Bank	$	2,100,000		$	2,500,000
Revolving line of credit from Bluebird Finance Limited		1,450,000			1,595,000
Term note payable to Ashford Capital, LLC.		125,000			125,000
		3,675,000			4,220,000

Less current portion		(415,000	)		(415,000	)
Long-term portion	$	3,260,000		$	3,805,000

	January 31, 2010			October 31, 2009
Revolving line of credit from Comerica Bank	$	2,600,000		$	2,500,000
Revolving line of credit from Bluebird Finance Limited		1,522,500			1,595,000
Term note payable to Ashford Capital, LLC.		125,000			125,000
		4,247,500			4,220,000
Less current portion		(415,000	)		(415,000	)
Long-term portion	$	3,832,500		$	3,805,000

Note 4. Income Taxes

As of ~~January~~ 31April 30, 2010, the Company had net operating loss carry-forwards for federal and state income tax purposes of approximately $15,~~374~~156,000 and $4,~~458~~271,000, respectively, which expire at various times from 2021 through ~~2028~~2027.

The Company has recorded a partial benefit for income taxes based on ~~its~~these net operating loss carryforwards. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not a portion of deferred tax assets will not be realized.

Realization of this deferred tax asset is dependent on the Company’s ability to generate future taxable income. Management believes that it is more likely than not that the Company will generate taxable income to utilize some of the tax carry-forwards before their expiration. However, there can be no assurance that the Company will meet its expectation of future income. As a result, the amount of the deferred tax asset considered realizable could be reduced in the near term if estimates of future taxable income are reduced. Such occurrence could materially adversely affect the Company’s results of operations and financial condition.

-Note ~~10 -~~5. Subsequent Event

Subsequent to April 30, 2010, the Company paid off its term note to Ashland Capital in the principal amount of $125,000. In addition, the warrants to purchase 300,000 shares of common stock, which warrants had been issued to Ashland Capital in connection with the term note, expired without being exercised.

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis, which should be read in connection with ~~our~~ the Company’s financial statements and accompanying footnotes, contains forward-looking statements that involve risks and uncertainties. Important factors that could cause actual results to differ materially from ~~our~~the Company’s expectations are set forth in Item 1 – Business – Factors That May Affect Our Future Operating Results”, in our Form 10-K for the year ended October 31, 2009 as well as those discussed elsewhere in this Form 10-Q. Those forward-looking statements may relate to, among other things, ~~our~~the Company’s plans and strategies, new product lines, and relationships with licensors, distributors and customers, distribution strategies and the business environment in which ~~we operate~~the Company operates.

Overview

We generate revenues through the sale of prescription eyeglass frames and sunwear under licensed brand names, including bebe, Carmen Marc Valvo, Cutter & Buck, Dakota Smith, Hart Schaffner Marx, Hummer, Laura Ashley, Michael Stars and Nicole Miller, and under our proprietary Signature brand. Our cost of sales consists primarily of purchases from foreign contract manufacturers that produce frames and cases to our specifications.

We reported net income of $~~143~~157,000 on net sales of $5.29 million for the three months ended ~~January 31~~April 30, 2010 (the “2010 Quarter”) compared to net income of $~~199~~216,000 on net sales of $6.01 million for the three months ended ~~January 31~~April 30, 2009 (the “2009 Quarter”). ~~The~~We ~~decrease~~reported innet income of $299,000 on net sales ~~was~~of ~~due primarily~~$11.0 tomillion for the ~~general~~six ~~slowdown~~months inended April 30, 2010 (the ~~domestic~~“2010 ~~economy~~Six ~~and~~Months”) ~~the~~compared ~~optical~~to ~~frame market,~~net ~~which~~income ~~adversely~~of ~~affected~~$415,000 on net sales of ~~our~~$12.1 ~~higher~~million ~~priced lines~~for the six months ended April 30, 2009 (the “2009 Six Months”). The decrease in net ~~income~~sales ~~was~~in ~~due~~the ~~primarily~~2010 toQuarter ~~lower~~was ~~sales and~~due ~~lower~~to ~~gross~~the ~~margin,~~deepening ~~which~~recession ~~was~~and ~~offset~~production ~~somewhat~~delays byat aour ~~decrease~~Chinese inmanufacturers ~~selling, general~~due ~~and~~primarily ~~administrative~~to ~~expenses~~labor shortages. ~~Selling,~~These ~~general~~labor ~~and administrative~~shortages ~~expenses~~may ~~declined~~result ~~$549,000~~in ~~from~~production delays for at least the ~~2009~~next ~~Quarter~~several toquarters ~~the~~and ~~2010 Quarter,~~higher ~~representing~~frame 58prices.2% The ofdecrease in net ~~sales~~income in the 2010 ~~Quarter~~periods aswas ~~compared~~due primarily to ~~59.8%~~ oflower ~~net~~revenues ~~sales~~and ina ~~the~~lower ~~2009~~gross ~~Quarter~~margin partially offset by lower operating expenses and interest expense.

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Results of Operations

The following table sets forth for the periods indicated selected statements of ~~operations~~ income data shown as a percentage of net sales.

	Three Months Ended
	January 31,
	2010			2009
Net sales		100.0	%		100.0	%
Cost of sales		37.2			35.4
Gross profit		62.8			64.6
Operating expenses:
Selling		36.8			35.9
General and administrative		21.4			23.9
Depreciation and amortization		0.9			0.6
Total operating expenses		59.1			60.4
Income from operations		3.7			4.2
Interest expense		0.9			0.9
Income before taxes		2.8			3.3
Income taxes		0.0			0.0
Net income		2.8	%		3.3	%

Net Sales. Net sales decreased by 13.3% or $790,000 from the 2009 Quarter to the 2010 Quarter. The decrease in net sales was due primarily to the general slowdown in the domestic economy and the optical frame market, which adversely affected sales of our higher priced lines. Net sales of Nicole Miller Eyewear and bebe eyewear decreased $810,000 to $3.2 million from the 2009 Quarter to the 2010 Quarter. Net sales of the Company’s three largest lines, bebe eyewear, Nicole Miller Eyewear and Laura Ashley Eyewear, amounted to 74.3% of our net sales in the 2010 Quarter compared to 78.5% in the 2009 Quarter.

	Three Months Ended						Six Months Ended
	April 30,						April 30,
	2010			2009			2010			2009
Net sales		100.0	%		100.0	%		100.0	%		100.0	%
Cost of sales		37.2			36.1			37.2			35.7
Gross profit		62.8			63.9			62.8			64.3
Operating expenses:
Selling		38.3			36.3			37.6			36.1
General and administrative		20.3			22.6			20.8			23.2
Depreciation and amortization		0.8			0.6			0.8			0.6
Total operating expenses		59.4			59.5			59.2			59.9
Income from operations		3.4			4.4			3.6			4.4
Interest expense/other, net		(0.7	)		(0.9	)		(0.8	)		(0.9	)
Income before income taxes		2.7			3.5			2.8			3.5
Income taxes		0.0			0.0			0.0			0.0
Net income		2.7	%		3.5	%		2.8	%		3.5	%

~~Direct~~ Net Sales. Net sales decreased by 4.1% or $253,000 from the 2009 Quarter to ~~independent~~the ~~optical~~2010 ~~retailers~~Quarter and ~~distributors~~by ~~decreased~~8.6% or $~~457~~1,043,000 in from the 2009 Six Months to the 2010 ~~Quarter~~Six Months. ~~Sales~~Unit tosales ~~optical~~decreased ~~and~~in ~~retail~~the ~~chains~~2010 ~~decreased $246,000~~Six Months despite a slight increase in unit sales in the 2010 Quarter. ~~International~~ However, the deepening recession resulted in a decrease in the average sales ~~decreased~~price ~~$77~~of our frames in the 2010 periods,~~000~~ as consumers continued to purchase lower cost frames and we offered higher customer discounts. In addition, net sales were materially impacted in the 2010 ~~Quarter~~Six Months by production delays at our Chinese manufacturers due primarily to labor shortages and may continue to impact us for at least the ~~weak~~next ~~global~~several ~~optical market~~quarters.

~~Net~~Direct sales ~~reflect~~ ~~gross~~to ~~sales~~independent ~~less~~optical aretailers ~~reserve~~and ~~for~~distributors ~~product~~decreased ~~returns~~$463,000 ~~established~~in bythe us2010 ~~based on~~Quarter ~~products~~and ~~that~~$921,000 wein ~~are~~the ~~aware~~2010 ~~will~~Six beMonths. Sales ~~returned~~to asoptical ofand ~~that~~retail ~~date. We had~~chains increased $~~760~~132,000 ~~and~~in the 2010 Quarter after decreasing $~~765~~246,000 in ~~product~~the ~~returns~~first ~~for~~quarter ~~the~~of fiscal 2010. International ~~Quarter~~sales ~~and~~increased ~~2009 Quarter~~$105,000 ~~respectively~~in the 2010 Quarter, resulting in a ~~product~~$28,000 ~~returns~~increase ~~percentage~~in ofthe ~~12.8%~~2010 ~~and 13.8%,~~Six ~~respectively~~Months.

~~Gross~~Net ~~Profit~~sales ~~and~~reflect ~~Gross Margin~~gross sales less a reserve for product returns established by us based on products that we are aware will be returned as of that date. ~~Gross~~Our ~~profit~~reserves ~~decreased~~were $~~601~~465,000 ~~from~~and ~~the~~$443,000 ~~2009~~at ~~Quarter to~~April 30, ~~the~~ 2010 ~~Quarter~~and ~~due~~October 31, to2009, ~~decreased sales~~respectively. ~~Gross~~We ~~margin~~had ~~decreased slightly~~$0.9 tomillion 62and $1.8%0 million in product returns for the 2010 Quarter and 2009 Quarter, ~~from~~respectively, 64resulting in a product returns percentage of 14.6% and 16.4%, respectively. We had $1.6 million and $1.8 million in product returns for the 2010 Six Months and 2009 Six ~~Quarter~~Months, ~~due~~respectively, ~~to competitive~~resulting ~~pricing~~in ~~and~~a ~~market~~product ~~conditions~~returns percentage of 14.6%, respectively.

~~Selling Expenses~~Gross Profit and Gross Margin. ~~Selling~~Gross ~~expenses~~profit decreased $~~233~~225,000 from the 2009 Quarter to the 2010 Quarter ~~primarily~~and $826,000 from the 2009 Six Months to the 2010 Six Months due to ~~decreases~~decreased ofsales. Gross ~~$112,000~~margin was 62.8% in ~~compensation~~ ~~expense,~~the ~~$90~~2010 Quarter and 2010 Six Months,~~000~~ down from 63.9% in ~~travel~~the ~~expense~~2009 Quarter and ~~$88,000~~64.3% in ~~advertising~~the ~~and promotional~~2009 ~~expense~~Six Months. The decrease in gross margin was due to sales of lower priced frames, which have a lower margin, constituting a higher percentage of our net sales.

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~~General~~Selling ~~and Administrative~~ Expenses. ~~General~~Selling ~~and administrative~~ expenses ~~for~~increased ~~the 2010 Quarter decreased~~ $~~316~~26,000 from the 2009 Quarter ~~primarily~~to ~~due~~the to2010 ~~decreases~~Quarter. Selling of expenses decreased $~~106~~207,000 infrom ~~international~~the ~~general~~2009 ~~and~~Six ~~administration~~Months ~~expense~~to ~~resulting~~the ~~from closing~~2010 ~~our~~Six ~~Belgium~~Months ~~sales~~primarily ~~office~~due into ~~September~~decreases ~~2009,~~of $61109,000 in ~~legal,~~advertising ~~accounting and consulting expenses, $56,000 in compensation~~ expense and $55133,000 in ~~telephone~~ ~~expense~~selling compensation.

~~Interest~~General ~~Expense~~and Administrative Expenses. General ~~Interest expense~~and ~~consists~~administrative expenses for the 2010 Quarter and 2010 Six Months decreased $193,000 and $509,000, respectively, from the comparable 2009 periods primarily due to the closing of ~~interest~~our ~~expense~~Belgium ~~offset~~office byat ~~other~~the ~~income~~end of fiscal 2009. ~~Interest expense~~These ~~decreased~~decreases were also due to a decrease of $555,000 in professional fees in the 2010 Quarter, ~~primarily~~and ~~due~~decreases toof ~~reduction~~$114,000 in ~~the weighted~~professional ~~average~~fees ~~rate~~and on$93,000 ~~our~~in ~~borrowings~~telephone expense in the 2010 Six Months.

Interest Expense/Other, Net. Interest expense, net, consists of interest expense offset by other income. Interest expense, net, decreased $9,000 in the 2010 Quarter and $14,000 in the 2010 Six Months primarily due to reductions in outstanding borrowings.

Income Taxes. As a result of our net loss carry-forward, we had no income tax expense other than franchise taxes in various states in the 2010 Quarter or the 2009 Quarter.

Financial Condition, Liquidity and Capital Resources

Our accounts receivable (net of allowance for doubtful accounts) were $2.89 million at ~~January~~ 31April 30, 2010 compared to $2.6 million at October 31, 2009, due principally to extended payment terms offered to customers.

Our inventories (at lower of cost or market) were $3.82 million at ~~both January 31~~April 30, 2010 ~~and~~compared to $3.8 million at October 31, 2009. The decrease was due to our continuing efforts to reduce our inventory levels taking into account current economic conditions, and slower deliveries from our frame manufacturers.

~~Current liabilities~~Our ~~were~~long-term debt (including current portion) was $5.4.2 million at ~~January~~October 31, 2009 and $3.7 million at April 30, 2010. See Notes as3 ~~compared~~and 5 of Notes to Financial Statements for further information regarding our long-term debt. At April 30, 2010, the interest rate on our Comerica Bank revolving line of credit was 4.0% per annum and we had $51.5 million ~~at October~~of ~~31,~~additional ~~2009~~borrowing capacity under that line.

~~Our long-term~~Of ~~debt~~our ~~(including~~accounts ~~current~~payable ~~portion)~~at ~~was~~April 30, ~~$4.2~~2010, ~~million~~approximately ~~at October 31~~$90,000 ~~2009 and~~were atpayable ~~January~~in ~~31,~~foreign ~~2010~~currency. ~~See~~To ~~Note~~monitor 3risks ofassociated ~~Notes~~with tocurrency ~~Financial~~fluctuations, ~~Statements for~~we ~~further~~periodically ~~information~~assess ~~regarding~~the ~~our~~volatility ~~long-term~~of ~~debt. At~~certain ~~January~~foreign ~~31, 2010,~~currencies ~~the~~and ~~interest~~review ~~rate~~the onamounts ~~our~~and ~~Comerica~~expected ~~Bank~~payment ~~revolving~~dates ~~line~~ of ~~credit~~our ~~was~~purchase ~~4.0% per~~orders ~~annum~~ and weaccounts ~~had~~payable ~~$1.4~~in ~~million~~those ~~of additional borrowing capacity available under that line~~currencies.

OfWe ~~the Company’s~~believe ~~accounts~~that, for ~~payable~~the atnext ~~January~~four ~~31,~~fiscal ~~2010~~quarters, ~~approximately~~assuming ~~$158,000~~that ~~were payable~~there inare ~~foreign~~no ~~currency. To~~unanticipated ~~monitor~~material ~~risks~~adverse ~~associated~~developments and no greater production disruptions with ~~currency~~ ~~fluctuations~~our frame manufacturers, ~~the~~we ~~Company~~continue ~~periodically~~to ~~assesses~~be ~~the~~in ~~volatility~~compliance ~~of certain~~with ~~foreign~~our ~~currencies~~credit facilities and ~~reviews~~we ~~the~~maintain ~~amounts~~current ~~and~~sales ~~expected~~levels, ~~payment~~our ~~dates~~cash ~~of its~~flows ~~purchase~~from ~~orders~~operations and ~~accounts~~through ~~payable~~credit infacilities ~~those~~will ~~currencies~~be sufficient to enable us to pay our debts and obligations as they mature.

We believe that, at least for the next four fiscal quarters, assuming that there are no unanticipated material adverse developments, we continue to be in compliance with our credit facilities and we maintain current sales levels, our cash flows from operations and through credit facilities will be sufficient to enable us to pay our debts and obligations as they mature.

Inflation

We do not believe our business and operations have been materially affected by inflation.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not applicable.

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Item 4. Controls and Procedures

We maintain disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e)) that are designed to assure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures.

In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide reasonable assurance only of achieving the desired control objectives, and management necessarily is required to apply its judgment in weighing the costs and benefits of possible new or different controls and procedures. Limitations are inherent in all control systems, so no evaluation of controls can provide absolute assurance that all control issues and any fraud within the company have been detected.

As required by Exchange Act Rule 13a-15(b), as of the end of the period covered by this report, management, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer (the same person has both titles), evaluated the effectiveness of our disclosure controls and procedures. Based on this evaluation, management concluded that our disclosure controls and procedures were effective as of that date.

There was no change in our internal control over financial reporting during our most recently completed fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II.

OTHER INFORMATION

Item 1. Legal Proceedings

Nothing to report.

Item 1A. Risk Factors

Not applicable.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Nothing to report.

Item 3. Defaults upon Senior Securities

Nothing to report.

Item 4. Removed and Reserved

Removed

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Item 5. Other Information

Nothing to report.

Item 6. Exhibits

See Exhibit Index ~~Attached~~attached.

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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 undersigned thereunto duly authorized.

Date: March 5, 2010 SIGNATURE EYEWEAR, INC. By: /s/ Michael Prince Michael Prince Chief Executive Officer Chief Financial Officer

	SIGNATURE EYEWEAR, INC.



Date: June 3, 2010	By:	/s/ Michael Prince
		Michael Prince
		Chief Executive Officer
		Chief Financial Officer

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EXHIBIT INDEX

Exhibit Number	~~Exhibit Description~~	Exhibit Description
10.1	Amendment No. 1 dated December 15, 2009 to Loan and Security Agreement between Signature Eyewear, Inc. and Comerica Bank.
31.1		Certification Pursuant to SEC Rule 13a-14(a)/15d-14(a)
10.2	License Agreement dated January 19, 2010 between Signature Eyewear, Inc. and Laura Ashley, Inc. [Portions of this Exhibit have been deleted and filed separately with the Commission pursuant to a request for Confidential Treatment.]
32.1		Certification Pursuant to 18 U.S.C. § 1350
31.1	Certification Pursuant to SEC Rule 13a-14(a)/15d-14(a)
32.1	Certification Pursuant to 18 U.S.C. § 1350

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