TABLE OF CONTENTS




|                                |                                                                                                |  |  |  |  |  |  | 
|------------------------------- | ---------------------------------------------------------------------------------------------- |  |  |  |  |  |  | 
|PART 1 -- FINANCIAL INFORMATION
|                                | Item 1. Financial Statements.                                                                 
|                                | Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.
|                                | Item 3. Quantitative and Qualitative Disclosures about Market Risk.                           
|PART II OTHER INFORMATION      
|                                | Item 1. Legal Proceedings.                                                                    
|                                | Item 2. Changes in Securities and Use of Proceeds.                                            
|                                | Item 3. Defaults upon Senior Securities.                                                      
|                                | Item 4. Submission of Matters to a Vote of Security Holders.                                  
|                                | Item 5. Other Information.                                                                    
|                                | Item 6. Exhibits and Reports on Form 8-K.                                                     



---



##### Table of Contents



FORM 10-Q

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549


(Mark One)

[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE

SECURITIES EXCHANGE ACT OF 1934


For the quarterly period ended: April 28, 2001


OR


[ ] 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:
  333-57011

Iron Age Corporation






|                               |  |                       
|------------------------------ |  | ----------------------
|Delaware                       |  | 25-1376723            
|                               |  |                       
|(State or other jurisdiction   |  | (I.R.S. Employer      
|incorporation or organization) |  | Identification Number)

Robinson Plaza Three, Suite 400, Pittsburgh,
Pennsylvania 15205








(412) 787-4100






Not Applicable.






Indicate by check mark whether registrant (1) has 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.
Yes [x]       No [ ]

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY





APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the
issuers classes of common stock as of the latest
practicable date. Not Applicable.



---



##### Table of Contents









PART 1  FINANCIAL INFORMATION







Item 1.  Financial Statements.

The following financial statements are presented herein:



| |                                                                                                                     
| | --------------------------------------------------------------------------------------------------------------------
| | Condensed Consolidated Balance Sheets as of April 28, 2001 and
 January 27, 2001                                    
|
| | Condensed Consolidated Statements of Income for the three months
        ended April 28, 2001 and April 29, 2000    
|
| | Condensed Consolidated Statements of Cash Flows for the three
        months ended April 28, 2001 and April 29, 2000
|
| | Notes to Condensed Consolidated Financial Statements                                                                

-2-



---



##### Table of Contents



Iron Age Corporation

Condensed Consolidated Balance Sheets


|                                             |                                                                                     |                                            |        |            |         |  |        |        |         | 
|-------------------------------------------- | ----------------------------------------------------------------------------------- | ------------------------------------------ | ------ | ---------- | ------- |  | ------ | ------ | ------- | 
|                                             |                                                                                     | April
28                                   |        | January 27
|                                             |                                                                                     | 2001                                       |        | 2001      
|                                             |                                                                                     |                                            |        |           
|                                             |                                                                                     | (unaudited)                                |        |           
|                                             |                                                                                     |                                           
|                                             |                                                                                     | (Dollars in Thousands)                    
|                                            
|                                            
|                                            
|                                            
|Assets                                       |                                                                                     |                                            |        |            |         |  |        |       
|                                            
|                                            
|                                            
|                                            
|Current assets:                              |                                                                                     |                                            |        |            |         |  |        |       
|                                            
|                                            
|                                            
|                                            
|                                             | Cash and cash equivalents                                                           |                                            | $      | 58         |         |  | $      | 82     |        
|                                            
|                                            
|                                            
|                                            
|                                             | Accounts receivable, net                                                            |                                            |        | 17,211     |         |  |        | 16,960 |        
|                                            
|                                            
|                                            
|                                            
|                                             | Inventories (Note 2)                                                                |                                            |        | 34,516     |         |  |        | 33,452 |        
|                                            
|                                            
|                                            
|                                            
|                                             | Prepaid expenses                                                                    |                                            |        | 1,895      |         |  |        | 2,386  |        
|                                            
|                                            
|                                            
|                                            
|                                             | Deferred income taxes                                                               |                                            |        | 837        |         |  |        | 839    |        
|                                             |                                                                                     |                                            |        |            |         |  |        |       
|                                             |                                                                                     | Total current assets                       |        |            | 54,517  |  |        |        | 53,719  | 
|                                            
|                                            
|                                            
|                                            
|Other noncurrent assets                      |                                                                                     |                                            | 4,036  |            |         |  | 3,656  |       
|                                            
|                                            
|                                            
|                                            
|Property and equipment, net                  |                                                                                     |                                            | 10,567 |            |         |  | 10,210 |       
|                                            
|                                            
|                                            
|                                            
|Intangible assets, net                       |                                                                                     |                                            | 97,761 |            |         |  | 98,662 |       
|                                             |                                                                                     |                                            |        |            |         |  |        |       
|                                             |                                                                                     | Total assets                               |        | $          | 166,881 |  |        | $      | 166,247 | 
|                                             |                                                                                     |                                            |        |            |         |  |        |       
|Liabilities and stockholders equity         |                                                                                     |                                            |        |            |         |  |        |       
|                                            
|                                            
|                                            
|                                            
|Current liabilities:                         |                                                                                     |                                            |        |            |         |  |        |       
|                                            
|                                            
|                                            
|                                            
|                                             | Current maturities of long-term debt                                                |                                            | $      | 6,751      |         |  | $      | 5,194  |        
|                                            
|                                            
|                                            
|                                            
|                                             | Accounts payable                                                                    |                                            |        | 2,808      |         |  |        | 3,027  |        
|                                            
|                                            
|                                            
|                                            
|                                             | Accrued expenses                                                                    |                                            |        | 6,333      |         |  |        | 6,555  |        
|                                             |                                                                                     |                                            |        |            |         |  |        |       
|                                             |                                                                                     | Total current liabilities                  |        |            | 15,892  |  |        |        | 14,776  | 
|                                            
|                                            
|                                            
|                                            
|Long-term debt, less current maturities      |                                                                                     |                                            | 92,376 |            |         |  | 93,272 |       
|                                            
|                                            
|                                            
|                                            
|Other noncurrent liabilities                 |                                                                                     |                                            | 368    |            |         |  | 380    |       
|                                            
|                                            
|                                            
|                                            
|Deferred income taxes                        |                                                                                     |                                            | 5,755  |            |         |  | 5,777  |       
|                                             |                                                                                     |                                            |        |            |         |  |        |       
|                                             |                                                                                     | Total liabilities                          |        |            | 114,391 |  |        |        | 114,205 | 
|                                            
|                                            
|                                            
|                                            
|Commitments and contingencies                |                                                                                     |                                            |       |            |         |  |       |       
|                                            
|                                            
|                                            
|                                            
|Series B redeemable preferred stock (Note 4) |                                                                                     |                                            | 6,944  |            |         |  | 6,647  |       
|Series C redeemable preferred stock (Note 4) |                                                                                     |                                            | 5,475  |            |         |  | 5,152  |       
|                                            
|                                            
|                                            
|                                            
|Stockholders equity:                        |                                                                                     |                                            |        |            |         |  |        |       
|                                            
|                                            
|                                            
|                                            
|                                             | Common stock, $1 par value; 1,000 shares
        authorized, issued and outstanding |                                            |        | 1          |         |  |        | 1      |        
|                                            
|                                            
|                                            
|                                            
|                                             | Additional paid-in capital                                                          |                                            |        | 44,466     |         |  |        | 44,466 |        
|                                            
|                                            
|                                            
|                                            
|                                             | Accumulated deficit                                                                 |                                            |        | (4,128     | )       |  |        | (4,003 | )      
|                                            
|                                            
|                                            
|                                            
|                                             | Accumulated other comprehensive loss                                                |                                            |        | (268       | )       |  |        | (221   | )      
|                                             |                                                                                     |                                            |        |            |         |  |        |       
|                                             |                                                                                     | Total stockholders equity                 |        |            | 40,071  |  |        |        | 40,243  | 
|                                             |                                                                                     |                                            |        |            |         |  |        |       
|                                             |                                                                                     | Total liabilities and stockholders equity |        | $          | 166,881 |  |        | $      | 166,247 | 
|                                             |                                                                                     |                                            |        |            |         |  |        |       

See accompanying notes.

-3-



---



##### Table of Contents



Iron Age Corporation

Condensed Consolidated Statements of Income (Unaudited)


|                                    |  |                        |        |          |  |   |        | 
|----------------------------------- |  | ---------------------- | ------ | -------- |  | - | ------ | 
|                                    |  |                       
|                                    |  | Three months ended    
|                                    |  |                       
|                                    |  | April
28               |        | April
29
|                                    |  | 2001                   |        | 2000    
|                                    |  |                        |        |         
|                                    |  |                       
|                                    |  | (Dollars in Thousands)
|                                   
|                                   
|                                   
|                                   
|Net sales                           |  | $                      | 30,011 |          |  | $ | 32,125 | 
|                                   
|                                   
|                                   
|                                   
|Cost of sales                       |  |                        | 14,381 |          |  |   | 15,640 | 
|                                    |  |                        |        |          |  |   |        | 
|Gross profit                        |  |                        | 15,630 |          |  |   | 16,485 | 
|                                   
|                                   
|                                   
|                                   
|Selling, general and administrative |  |                        | 10,896 |          |  |   | 10,947 | 
|                                   
|                                   
|                                   
|                                   
|Depreciation                        |  |                        | 422    |          |  |   | 401    | 
|                                   
|                                   
|                                   
|                                   
|Amortization of intangible assets   |  |                        | 1,045  |          |  |   | 970    | 
|                                    |  |                        |        |          |  |   |        | 
|Operating income                    |  |                        | 3,267  |          |  |   | 4,167  | 
|                                   
|                                   
|                                   
|                                   
|Interest expense                    |  |                        | 2,124  |          |  |   | 2,888  | 
|                                    |  |                        |        |          |  |   |        | 
|Income before income taxes          |  |                        | 1,143  |          |  |   | 1,279  | 
|                                   
|                                   
|                                   
|                                   
|Income tax expense                  |  |                        | 649    |          |  |   | 790    | 
|                                    |  |                        |        |          |  |   |        | 
|Net income                          |  | $                      | 494    |          |  | $ | 489    | 
|                                    |  |                        |        |          |  |   |        | 

See accompanying notes.

-4-



---



##### Table of Contents



Iron Age Corporation

Condensed Consolidated Statements of Cash Flows
(Unaudited)


|                                                                                          |                                                                      |                                         |        |                    |        |   |        |       |       |  
|----------------------------------------------------------------------------------------- | -------------------------------------------------------------------- | --------------------------------------- | ------ | ------------------ | ------ | - | ------ | ----- | ----- | -
|                                                                                          |                                                                      | Three months ended                      |        | Three months ended
|                                                                                          |                                                                      | April
28                                |        | April
29          
|                                                                                          |                                                                      | 2001                                    |        | 2000              
|                                                                                          |                                                                      |                                         |        |                   
|                                                                                          |                                                                      |                                        
|                                                                                          |                                                                      | (Dollars in Thousands)                 
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Operating activities                                                                      |                                                                      |                                         |        |                    |        |   |        |      
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Net income                                                                                |                                                                      | $                                       | 494    |                    |        | $ | 489    |      
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Adjustments to reconcile net income to net cash
        provided by operating activities: |                                                                      |                                         |        |                    |        |   |        |      
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                          | Change in fair market value of interest rate
swap agreement          |                                         |        | (337               | )      |   |        |      |      
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                          | Depreciation and amortization                                        |                                         |        | 1,585              |        |   |        | 1,495 |      
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                          | Amortization of deferred financing fees included
        in interest |                                         |        | 135                |        |   |        | 147   |      
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                          | Provision for losses on accounts receivable                          |                                         |        | 70                 |        |   |        | 32    |      
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                          | Deferred income taxes                                                |                                         |        | (20                | )      |   |        | (38   | )    
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                          | Changes in operating assets and liabilities:                         |                                         |        |                    |        |   |        |       |      
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                          |                                                                      | Accounts receivable                     |        |                    | (321   | ) |        |       | (817  | )
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                          |                                                                      | Inventories                             |        |                    | (1,064 | ) |        |       | 1,688 |  
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                          |                                                                      | Prepaid expenses                        |        |                    | 491    |   |        |       | 579   |  
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                          |                                                                      | Other noncurrent assets                 |        |                    | 29     |   |        |       | 35    |  
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                          |                                                                      | Accounts payable                        |        |                    | (219   | ) |        |       | (464  | )
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                          |                                                                      | Accrued expenses                        |        |                    | (222   | ) |        |       | 171   |  
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                          |                                                                      | Payment of other noncurrent liabilities |        |                    | (12    | ) |        |       |      |  
|                                                                                          |                                                                      |                                         |        |                    |        |   |        |      
|Net cash provided by operating activities                                                 |                                                                      |                                         | 609    |                    |        |   | 3,317  |      
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Investing activities                                                                      |                                                                      |                                         |        |                    |        |   |        |      
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Capitalization of internal use software costs                                             |                                                                      |                                         | (115   | )                  |        |   | (260   | )    
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Purchases of property and equipment                                                       |                                                                      |                                         | (897   | )                  |        |   | (291   | )    
|                                                                                          |                                                                      |                                         |        |                    |        |   |        |      
|Net cash used in investing activities                                                     |                                                                      |                                         | (1,012 | )                  |        |   | (551   | )    
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Financing activities                                                                      |                                                                      |                                         |        |                    |        |   |        |      
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Borrowing under revolving credit agreement                                                |                                                                      |                                         | 3,550  |                    |        |   |       |      
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Principal payment on debt                                                                 |                                                                      |                                         | (2,950 | )                  |        |   | (2,700 | )    
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Payment of financing costs                                                                |                                                                      |                                         | (127   | )                  |        |   | (4     | )    
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Principal payments on capital leases                                                      |                                                                      |                                         | (47    | )                  |        |   | (58    | )    
|                                                                                          |                                                                      |                                         |        |                    |        |   |        |      
|Net cash provided by (used in) financing activities                                       |                                                                      |                                         | 426    |                    |        |   | (2,762 | )    
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Effect of exchange rate changes on cash and cash
        equivalents                      |                                                                      |                                         | (47    | )                  |        |   | (55    | )    
|                                                                                          |                                                                      |                                         |        |                    |        |   |        |      
|Decrease in cash and cash equivalents                                                     |                                                                      |                                         | (24    | )                  |        |   | (51    | )    
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Cash and cash equivalents at beginning of period                                          |                                                                      |                                         | 82     |                    |        |   | 260    |      
|                                                                                          |                                                                      |                                         |        |                    |        |   |        |      
|Cash and cash equivalents at end of period                                                |                                                                      | $                                       | 58     |                    |        | $ | 209    |      
|                                                                                          |                                                                      |                                         |        |                    |        |   |        |      
|Supplemental schedule of noncash investing and
        financing activities               |                                                                      |                                         |        |                    |        |   |        |      
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Dividends and accretion on preferred stock                                                |                                                                      | $                                       | 619    |                    |        | $ | 396    |      
|                                                                                         
|                                                                                         
|                                                                                         
|                                                                                         
|Transition adjustment related to the adoption
of SFAS No. 133                             |                                                                      |                                         | 113    |                    |        |   |       |      

See accompanying notes.

-5-



---



##### Table of Contents



Iron Age Corporation

Notes to Condensed Consolidated


Financial Statements (Unaudited)


April 28, 2001

1.  Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial
statements have been prepared in accordance with generally accepted accounting
principles for interim financial information and with the instructions to
Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered necessary
for a fair presentation have been included. Operating results for the three
month period ended April 28, 2001 are not necessarily indicative of the
results that may be expected for the fiscal year ended January 26, 2002.
For further information, refer to Iron Age Corporations (Iron Age or the
Company) consolidated financial statements and footnotes thereto for the
fiscal year ended January 27, 2001.

2.  Inventory

Inventories consist of the following:

|                |  |          |        |            |  |   |        | 
|--------------- |  | -------- | ------ | ---------- |  | - | ------ | 
|                |  | April
28 |        | January 27
|                |  | 2001     |        | 2001      
|                |  |          |        |           
|Raw materials   |  | $        | 2,265  |            |  | $ | 2,116  | 
|               
|               
|               
|               
|Work-in-process |  |          | 571    |            |  |   | 640    | 
|               
|               
|               
|               
|Finished goods  |  |          | 31,680 |            |  |   | 30,696 | 
|                |  |          |        |            |  |   |        | 
|                |  | $        | 34,516 |            |  | $ | 33,452 | 
|                |  |          |        |            |  |   |        | 

3.  Derivative Financial Instrument

In June 1998, the Financial Accounting Standards Board
(FASB) issued Statement No. 133, Accounting for Derivative Instruments and Hedging
Activities (SFAS No. 133). SFAS No. 133 requires the Company to recognize
all derivatives on the balance sheet at fair value. Derivatives that are not
hedges must be adjusted to fair value through income. If a derivative is a
hedge, depending upon the nature of the hedge, changes in the fair value of
the derivative will either be offset against the change in fair value of the
hedged asset, liability or firm commitment through earnings, or recognized in
other comprehensive income until the hedged item is recognized in earnings.
The ineffective portion of a derivatives change in fair value will be
immediately recognized in earnings.

The Company has entered into an interest rate swap agreement
to modify the interest characteristics of a portion of its outstanding
long-term debt. The interest rate swap does not meet the criteria for a
hedging transaction as defined in SFAS No. 133. The Company records the

-6-



---



##### Table of Contents



swap agreement on the balance sheet at fair value and gains and losses are
recognized in earnings (interest expense) in each period. Upon adoption, the
Company recorded an asset of approximately $0.1 million representing the
fair market value of its interest rate swap agreement and an offsetting
premium on its fixed rate debt. The debt premium is being amortized to
earnings over the life of the debt using the interest method.

The interest rate swap asset was approximately $0.4 million as of
April 28,
2001 and is included in other noncurrent assets. A gain of approximately
$0.3 million was included in interest expense for the three months ended
April 28, 2001.

4.  Redeemable Preferred Stock

On December 29, 2000, the Companys sole stockholder, Iron Age Holdings Corporation
(Holdings), authorized 2,500 shares of Series C non voting, cumulative,
redeemable preferred stock with a par value of $0.01 per share (the Holdings
Series C Preferred Stock). Holdings issued 1,000 shares of Holdings Series C
Preferred Stock to Fenway Partners Capital Fund II, L.P. (Fenway II), an
affiliate of Holdings majority stockholder Fenway Partners Capital
Fund, L.P. (Fenway), during fiscal 2001 for approximately
$4.8 million, with a
liquidation preference of $4,761 per share plus an additional amount of
approximately $2.3 million divided by the total number of outstanding and
accrued shares of Holdings Series C Preferred Stock as of the event of
liquidation. A sale of all or substantially all of Holdings assets, merger
or other change of control constitutes a liquidation. Dividends are cumulative
at an annual rate of $985.42 per share and are payable in-kind, semi annually
in arrears on April 13 and October 13, beginning April 13, 2001. The Holdings
Series C Preferred Stock ranks junior to outstanding Holdings
Series A
Preferred Stock, if any, pari passu, with Holdings Series B Preferred Stock
and senior to Holdings common stock in dividends and liquidation. The
Holdings Series C Preferred Stock is redeemable upon a change of control or a
public offering, as defined in the indenture governing the Senior Subordinated
Notes. The redemption price will be equal to the amount that would be paid to
the Holdings Series C Preferred Stock under a liquidation. The difference
between the carrying value and redemption amount is being accreted as a
charge to retained earnings using the interest method. Holdings
Series C
Preferred Stock is reflected in the financial statements of the Company
because the Company is a wholly-owned subsidiary of Holdings and the proceeds
of the Series C Preferred Stock were used to retire a portion of the
Companys Senior Subordinated Notes.

On December 29, 1999, Holdings authorized 2,500 shares of
Series B non voting, cumulative, redeemable preferred stock with a par value
of $0.01 per share (the Holdings Series B Preferred Stock). Holdings issued
1,000 shares of Holdings Series B Preferred Stock to Holdings majority
stockholder, Fenway, during fiscal 2000 for approximately $4.9 million, with
a liquidation preference of $4,938 per share plus an additional amount of
approximately $2.0 million divided by the total number of outstanding and
accrued shares of Holdings Series B Preferred Stock as of the event of
liquidation. A sale of all or substantially all of Holdings assets, merger
or other change of control constitutes a liquidation. Dividends are
cumulative at an annual rate of $953.97 per share and are payable in-kind,
semi annually in arrears on February 21 and August 21, beginning February

-7-



---



##### Table of Contents



21, 2000. The Holdings Series B Preferred Stock ranks junior to outstanding
Holdings Series A Preferred Stock, if any, and is senior to Holdings common
stock in dividends and liquidation. The Holdings Series B Preferred Stock is
redeemable upon a change of control or a public offering, as defined in the
indenture governing the Companys 9 7/8% Senior Subordinated Notes due 2008
(the Senior Subordinated Notes). The redemption price will be equal to the
amount that would be paid to the Holdings Series B Preferred Stock under a
liquidation. The difference between the carrying value and redemption amount
is being accreted as a charge to retained earnings using the interest method.
Holdings Series B Preferred Stock is reflected in the financial statements of
the Company because the Company is a wholly-owned subsidiary of Holdings and
the proceeds of Holdings Series B Preferred Stock were used to retire a
portion of the Companys Senior Subordinated Notes.

5.  Comprehensive Income

|                                            |                            |              |     |          |  |   |     |     | 
|------------------------------------------- | -------------------------- | ------------ | --- | -------- |  | - | --- | --- | 
|                                            |                            |             
|                                            |                            | Three Months
|                                            |                            | Ended       
|                                            |                            |             
|                                            |                            | April
28     |     | April
29
|                                            |                            | 2001         |     | 2000    
|                                            |                            |              |     |         
|Net income                                  |                            | $            | 494 |          |  | $ | 489 |    
|                                           
|                                           
|                                           
|                                           
|Foreign currency translation (losses) gains |                            |              | (47 | )        |  |   | (55 | )  
|                                            |                            |              |     |          |  |   |     |    
|                                            | Total comprehensive income |              | $   | 447      |  |   | $   | 434 | 
|                                            |                            |              |     |          |  |   |     |    

-8-



---



##### Table of Contents






Item 2.  Managements Discussion and
Analysis of Financial Condition and Results of Operations.

General

The following discussions should be read in conjunction with
the accompanying Condensed Consolidated Financial Statements for the period
ended April 28, 2001, and the Companys audited consolidated financial statements
and Annual Report on Form 10-K for the fiscal year ended
January 27, 2001.

Related Party Transactions

On August 29, 2000, Fenway II purchased
Holdings 12 1/8%
Senior Discount Notes due 2009 (the Discount Notes) with a face value of
approximately $7.3 million for approximately $1.4 million. The purchase
resulted in an income tax liability to Holdings of approximately
$0.9 million.
In October 2000, Fenway II funded the income tax liability through a capital
contribution.

On February 7, 2000, Fenway purchased Discount Notes with a
face value of $10.0 million for $1.9 million. The purchase resulted in an income
tax liability to Holdings of approximately $1.3 million. In
May 2000, Fenway
funded the income tax liability through a capital contribution.

October 2000 Transaction

On October 20, 2000, the Company purchased
$16.4 million in
principal amount of its Senior Subordinated Notes for $11.9 million (the
October 2000 Transaction). The purchase was funded by $7.1 million of
borrowings under the New Credit Facility and the issuance of
$4.8 million of
Holdings Series C Preferred Stock to Fenway II. The Company recorded an
extraordinary gain of $2.3 million, net of unamortized deferred financing
costs of $0.6 million, and income taxes of $1.7 million. Following the
purchase, such principal amount of the Senior Subordinated Notes was retired.

Results of Operations

Three Months ended April 28, 2001 compared to Three
Months ended April 29, 2000

Net Salesfor the three months ended
April 28, 2001
(first quarter 2002) were $30.0 million compared to $32.1 million for the
comparable three month period ended April 29, 2000 (first quarter 2001), a
decrease of $2.1 million, or 6.5%. The decrease in net sales was attributable
to a decrease of $1.8 million, or 5.6% in the
Companys footwear distribution business line, primarily related to a
decrease in the general economic environment, including plant closings and
employee layoffs that affected the Companys customers. In addition,

-9-



---



##### Table of Contents



net sales to non-affiliated customers in the Companys
manufacturing subsidiary decreased by $0.3 million, or 0.9%, for first
quarter 2002 compared to first quarter 2001.

Gross Profitwas $15.6 million for first quarter 2002
and $16.5 million for first quarter 2001, a decrease of $0.9 million, or
5.5%. The decrease in gross profit was related to decreased net sales as
discussed above. As a percentage of net sales, gross profit for first quarter
2002 increased to 52.1%, an increase of 0.8% from first quarter 2001. Gross
profit percentage increased in the Companys primary footwear distribution
business line by 1.6% for first quarter 2002. The increase in gross profit
percentage was partially offset by a 7.5% decrease in gross profit percentage
in the Companys manufacturing subsidiary related to the decrease in net
sales to non-affiliated customers in that subsidiary as discussed above.

Selling, General and Administrative Expensesfor
first quarter 2002 and first quarter 2001 were $10.9 million.

Operating Incomefor first quarter 2002 was
$3.3 million,
or 11.0% of net sales, compared to $4.2 million, or 13.1% of net sales, for
first quarter 2001. The decrease was primarily attributable to the decrease
in gross profit as discussed above.

Interest Expensefor first quarter 2002 was
$2.1 million compared to $2.9 million for first quarter 2001, a decrease of
$0.8 million, or 27.6%. The decrease in interest expense primarily relates to
the favorable change of $0.3 million in the fair market value of the
Companys interest rate swap agreement due to the decrease in interest rates
in first quarter 2002. In addition, the decrease in interest expense was
attributable to decreased indebtedness of the Company related to the
repurchase of a portion of the Senior Subordinated Notes in the
October 2000
Transaction, partially offset by increased indebtedness of the New Credit
Facility.

Income Tax Expensefor first quarter 2002 was an
income tax expense of $0.6 million compared to an income tax expense of
$0.8 million for first quarter 2001. Income tax expense for first quarter
2002 and income tax expense for first quarter 2001 differ from that of the
statutory income tax rate due primarily to nondeductible goodwill
amortization.

Liquidity and Capital Resources

The Companys primary cash needs are working capital,
capital expenditures and debt service. The Company anticipates
that it may use cash in the future to finance acquisitions. The
Company has financed cash requirements primarily through
internally generated cash flow and funds borrowed under credit
facilities.

Net cash provided by operating activities was $0.6 million
for first quarter 2002, a decrease of $2.7 million as
compared to net cash provided by operating activities of
$3.3 million for first quarter 2001. The reduction in cash
provided by operating activities in first quarter 2002 from first
quarter 2001 is primarily the result of a smaller decrease in
non-cash working capital than in the prior year.

-10-



---



##### Table of Contents



The Companys investing activities for first quarter 2002 consisted of capital
expenditures of approximately $0.9 million for improvements in retail stores,
shoemobiles and equipment and approximately $0.1 million for the acquisition of
software for internal use. Capital expenditures of approximately $0.3 million
for first quarter 2001 included capital expenditures related to improvements in
footwear and vision retail stores, shoemobiles and equipment and approximately
$0.3 million for the acquisition of software for internal use.

The Company provided approximately $0.4 million from financing activities for
first quarter 2002, which primarily consisted of net working capital
borrowings.

The Companys total working capital as of April 28, 2001
was $38.6 million. At
January 27, 2001, working capital was $38.9 million.

Cash flow from operations for first quarter 2002 was sufficient to cover debt
service requirements under the New Credit Facility. The Companys ability to
make scheduled payments of principal, or to pay the interest or premium (if
any) on, or to refinance, its indebtedness, or to fund planned capital
expenditures will depend on its future performance, which, to a certain extent,
is subject to general economic, financial, competitive, legislative, regulatory
and other factors that are beyond its control. Based upon the current level of
operations, management believes that cash flow from operations and available
cash, together with available borrowings under the New Credit Facility, will be
adequate to meet the Companys anticipated future requirements for working
capital, budgeted capital expenditures and scheduled payments of principal and
interest on its indebtedness for the next several years, including
approximately $6.8 million that will become due within the next
twelve month period. There can be no
assurance that the Companys business will generate sufficient cash flow from
operations or that future borrowing will be available under the New Credit
Facility in an amount sufficient to enable the Company to service its
indebtedness, including the Senior Subordinated Notes, or to make capital
expenditures.

The Companys debt consists of the Senior Subordinated Notes, the New Credit
Facility and certain other debt. The New Credit Facility, as amended, consists
of a $21.1 million acquisition term loan facility (the Acquisition Credit
Facility) and $30.0 million in revolving credit loans, letters of credit and
swing line loans (the Revolving Credit Facility). The Companys other debt of
$0.9 million consists primarily of capital leases and other notes. As of April
28, 2001, approximately $21.1 million of the Acquisition Credit Facility and
approximately $12.1 million of the Revolving Credit Facility were outstanding.
The Company has no additional borrowing availability under the Acquisition
Credit Facility and approximately $17.9 million under the Revolving Credit
Facility. The Acquisition Credit Facility matures in quarterly installments
from July 2001 until final payment in April 2004. The Revolving Credit Facility
will mature in April 2004 and has no scheduled interim principal payments.

The Senior Subordinated Notes are fully and unconditionally guaranteed on an
unsecured, senior subordinated basis by each Domestic Restricted Subsidiary
that is a Material Subsidiary (as such terms are defined in the indenture for
the Senior Subordinated Notes (the Senior Subordinated Notes Indenture))
(whether currently existing, newly acquired or created). Each such subsidiary
guaranty (a Subsidiary Guaranty) will provide that the subsidiary guarantor,
as primary obligor

-11-



---



##### Table of Contents



and not merely as surety, will irrevocably and
unconditionally guarantee on an unsecured, senior subordinated basis the
performance and punctual payment when due, whether at stated maturity, by
acceleration or otherwise, of all obligations of the Company under the Senior
Subordinated Notes Indenture and the Senior Subordinated Notes, whether for
payment of principal or of interest on the Senior Subordinated Notes, expenses,
indemnification or otherwise. As of April 28, 2001, none of the Companys
Domestic Restricted Subsidiaries was a Material Subsidiary, and therefore no
Subsidiary Guaranty was in force or effect.

Amendments to the New Credit Facility

On February 26, 1999, the New Credit Facility was amended to (i) amend the
definition of EBITDA for fiscal 2000 for certain purposes of the New Credit
Facility, (ii) add as a condition to drawing on the Acquisition Credit
Facility prior to April 2000 certain required interest coverage ratios and
leverage ratios, (iii) amend required interest coverage ratios applicable to
fiscal 2000, and (iv) add to the financial covenants applicable to fiscal 2000
certain required senior coverage ratios.

On June 23, 1999, the New Credit Facility was amended to (i) permit the use of
up to $13,300,000 of the Acquisition Credit Facility to repurchase Senior
Subordinated Notes at or below par value; provided that no more than two-thirds
of the purchase price of such Senior Subordinated Notes comes from borrowings
under the Acquisition Credit Facility; (ii) amend the definition of Fixed
Charge Coverage Ratio to eliminate the tax effect of any permitted repurchases
of the Senior Subordinated Notes; (iii) add as a permitted use of proceeds of
the Acquisition Credit Facility the permitted repurchases of the Senior
Subordinated Notes; (iv) reduce the borrowing base availability under the
Revolving Credit Facility by $3,000,000 from the time the Company first borrows
under the Acquisition Credit Facility to repurchase Senior Subordinated Notes
until the lenders consent to terminate such restriction on availability; (v)
amend the required interest coverage ratios applicable to fiscal year 2000; and
(vi) amend the required senior leverage ratios applicable to fiscal 2000.

On March 17, 2000, the New Credit Facility was amended to (i) permit the use of
up to $1,500,000 of the Acquisition Credit Facility to repurchase Discount
Notes at or below par value; (ii) extend the right to purchase the Senior
Subordinated Notes and the Discount Notes through August 31, 2000; (iii) amend
the definition of Fixed Charge Coverage Ratio to eliminate the tax effect of
any permitted repurchases of the Discount Notes; (iv) add as a permitted use of
proceeds of the Acquisition Credit Facility the permitted repurchases of the
Discount Notes; and (v) reinstate the borrowing base availability under the
Revolving Credit Facility by $3,000,000.

On April 24, 2001, the New Credit Facility was amended to (i) amend the
definitions of Applicable Margin, Conversion Date to mean April 24, 2001,
EBITDA to exclude any income or loss resulting from a change to the fair
market value of any Hedge Agreement as defined in the New Credit Facility,
Fenway Fund to collectively include Fenway and Fenway II and Interest
Expense to exclude any amount resulting from a change to the fair market value
of any Hedge Agreement as defined in the New Credit Facility; and (ii) amend
the required interest coverage ratios applicable to fiscal 2002.

-12-



---



##### Table of Contents



Recently Issued Accounting Standards

In June 1998, the Financial Accounting Standards Board (FASB) issued Statement
No. 133, Accounting for Derivative Instruments and Hedging Activities (the
Statement). As amended by FASB Statement No. 137, Deferral of the Effective
Date of FASB Statement No. 133, the Statement is required to be adopted for all
fiscal quarters in years beginning after June 15, 2000. The Statement permits
early adoption as of the beginning of any fiscal quarter after its issuance.
The Company adopted the Statement effective with the first fiscal quarter of
fiscal year 2002. The Statement requires the Company to recognize all
derivatives on the balance sheet at fair value. Derivatives that are not hedges
must be adjusted to fair value through income. If a derivative is a hedge,
depending upon the nature of the hedge, changes in the fair value of the
derivative will either be offset against the change in fair value of the hedged
asset, liability or firm commitment through earnings, or recognized in other
comprehensive income until the hedged item is recognized in earnings. The
ineffective portion of a derivatives change in fair value will be immediately
recognized in earnings.

Based upon the Companys derivative position at January 27, 2001, the Company,
upon adoption, recorded an asset of approximately $0.1 million representing the
fair market value of its interest rate swap agreement and an offsetting premium
on its fixed rate debt. Subsequent changes in the fair value of the Companys
interest rate swap agreement will be recognized immediately in earnings. The
debt premium will be amortized to earnings over the life of the debt using the
interest method.

Inflation and Changing Prices

The Companys sales and costs are subject to inflation and price fluctuations.
However, they historically have not, and in the future are not expected to
have, a material adverse effect on the Companys results of operations.

Forward Looking Statements

When used in this quarterly report, the words believes, anticipates,
expects and similar expressions are used to identify forward looking
statements. Such statements are subject to risks and uncertainties which could
cause actual results to differ materially from those projected. The Company
wishes to caution readers that the following important factors and others in
some cases have affected and in the future could affect the Companys actual
results and could cause the Companys actual results to differ materially from
those expressed in any forward statements made by the Company: (i) economic
conditions in the safety shoe market, (ii) availability of credit, (iii)
increase in interest rates, (iv) cost of raw materials, (v) inability to
maintain state-of-the-art manufacturing facilities, (vi) heightened
competition, including intensification of price and service

-13-



---



##### Table of Contents



competition, the
entry of new competitors and the introduction of new products by existing
competitors, (vii) inability to capitalize on opportunities presented by
industry consolidation, (viii) loss or retirement of key executives, (ix) loss
or disruption of the Companys relationships with its major suppliers,
including the Companys largest supplier in China and (x) inability to grow by
acquisition of additional safety shoe distributors or to effectively
consolidate operations of businesses acquired.

-14-



---



##### Table of Contents






Item 3. Quantitative and Qualitative Disclosures about Market Risk.

The Company is exposed to market risk primarily from changes in interest rates
and foreign exchange rates.

The following discussion of the Companys exposure to various market risks
contains forward looking statements that are subject to risks and
uncertainties. These projected results have been prepared utilizing certain
assumptions considered reasonable in the circumstances and in light of
information currently available to the Company. Nevertheless, because of the
inherent unpredictability of interest rates and foreign currency translation
rates, actual results could differ materially from those projected in such
forward looking statements.

Interest Rates

At April 28, 2001, the Company had fixed-rate debt totaling $65.9 million in
principal amount and having a fair value of $45.2 million. These instruments
bear interest at a fixed rate and, therefore, do not expose the Company to the
risk of earnings loss due to changes in market interest rates. However, the
fair value of these instruments would decrease (to the holder) by approximately
$3.6 million if interest rates were to increase by 10% from their levels at
April 28, 2001 (i.e., an increase from the weighted average interest rate of
9.9% to a weighted average interest rate of 10.9%).

The Company has entered into an interest rate swap agreement with a notional
amount of $25.0 million to reduce the exposure that adverse fluctuations in
interest rates may have on the fair market values of its fixed-rate debt,
rather than for trading purposes. The Company has not entered into any
derivative financial instruments for trading purposes. If interest rates were
to increase by 10% from their levels at April 28, 2001, the Company would incur
additional annual interest of approximately $0.2 million.

At April 28, 2001, the Company had variable-rate debt totaling $33.2 million in
principal amount and having a fair value of $33.2 million. These borrowings are
under the New Credit Facility. If interest rates were to increase by 10% from
their levels at April 28, 2001, the Company would incur additional annual
interest expense of approximately $0.2 million.

Foreign Exchange Rates

Information relating to the sensitivity to foreign currency exchange rate
changes is omitted as foreign exchange exposure risk has not materially changed
from that disclosed in the Companys Annual Report on Form 10-K for the year
ended January 27, 2001.

-15-



---



##### Table of Contents






PART II OTHER INFORMATION




Item 1.  Legal Proceedings.

None.




Item 2.  Changes in Securities and Use of
Proceeds.

None.




Item 3.  Defaults upon Senior Securities.

None.




Item 4.  Submission of Matters to a Vote of
Security Holders.

None.




Item 5.  Other Information.

None.




Item 6.  Exhibits and Reports on
Form 8-K.

(a)  Exhibit Index.

|        |  |                                                                                                                                                                          
|------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.1(1)  |  | Iron Age Certificate of Incorporation, as amended.                                                                                                                       
|3.2(1)  |  | Iron Age By-laws.                                                                                                                                                        
|4.1(1)  |  | Indenture dated as of April 24, 1998.                                                                                                                                    
|10.1(1) |  | Credit Agreement dated as of April 24, 1998.                                                                                                                             
|10.2(1) |  | Security Agreement dated April 24, 1998.                                                                                                                                 
|10.3(1) |  | Intellectual Property Security Agreement
        April 24, 1998.                                                                                                         
|10.4(1) |  | Canadian Security Agreement dated April 24,
        1998.                                                                                                                
|10.5(1) |  | Mortgage, Assignment of Leases and Rents, Fixture
        Filing, Security Agreement and Financing Statement dated
        February  26, 1997, as amended April 24, 1998.
|10.6(1) |  | Intercompany Subordination Agreement dated
        April 24, 1998.                                                                                                       
|10.7(1) |  | Subsidiary Guaranty dated April 24, 1998.                                                                                                                                
|10.8(1) |  | Iron Age Trademark License Agreement with W.L
        Gore & Associates, Inc. dated August 15, 1994.                                                                     
|10.9(1) |  | Falcon Trademark License Agreement with
        W.L. Gore &  Associates, Inc. dated July 25,
        1994.                                                               

-16-



---



##### Table of Contents



|         |  |                                                                                                                                                               
|-------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.10(1) |  | Falcon Manufacturing Certification Agreement with
        W.L. Gore & Associates, Inc. dated July 25,
        1994.                                           
|10.11(1) |  | General Services Administration Contract
        effective July 26, 1994, as modified May 24, 1995.                                                           
|10.12(1) |  | Amended and Restated Management Agreement dated
        as of February 26, 1997.                                                                              
|10.13(1) |  | Stockholders Agreement dated as of
        February 26, 1997.                                                                                                 
|10.14(1) |  | Amendment No. 1 to Stockholders Agreement
        dated as of March 25, 1997.                                                                                 
|10.15(1) |  | American Home Assurance Company Joinder to the
        Stockholders Agreement dated as of March 25, 1997.                                                     
|10.16(1) |  | Banque Nationale de Paris Joinder to the
        Stockholders Agreement dated as of March 25, 1997.                                                           
|10.17(1) |  | Stock Option Plan dated February 26, 1997.                                                                                                                    
|10.18(1) |  | Securities Purchase Agreement dated
        February 26, 1997.                                                                                                
|10.19(1) |  | Stock Purchase Agreement dated as of
        December 26, 1996.                                                                                               
|10.20(1) |  | Amendment No. 1 to the Stock Purchase
        Agreement dated as of February 26, 1997.                                                                        
|10.21(1) |  | Pittsburgh, Pennsylvania Lease Agreement dated
        March 1, 1993, as amended June 2, 1994, as amended
        June 12, 1996, as amended December 10, 1997.
|10.22(1) |  | Jerusalem, New York Lease Agreement dated
        December 9, 1992, as amended January 1, 1994, as
        amended April 1997.                                
|10.23(1) |  | Jerusalem, New York Lease Agreement dated
        June 20, 1997, as amended January 9, 1998.                                                                  
|10.24(1) |  | Lewiston, Maine Lease Agreement dated
        January 14, 1994.                                                                                               
|10.25(1) |  | Lewiston, Maine Lease Agreement dated
        November 30, 1990, as amended June 8, 1994.                                                                     
|10.26(1) |  | Ontario, Canada Lease Agreement dated
        June 11, 1991, as amended November 23, 1995.                                                                    
|10.27(1) |  | Jensen Employment Agreement dated
        February 26, 1997.                                                                                                  
|10.28(1) |  | Mills Employment Agreement dated
        November 20, 1995.                                                                                                   
|10.29(1) |  | McDonough Employment Agreement dated
        November 20, 1995.                                                                                               
|10.30(1) |  | Johanson Employment Agreement dated
        August 1, 1994.                                                                                                   
|10.31(1) |  | Johanson Non-Competition Agreement dated
        August 1, 1994.                                                                                              
|10.32(2) |  | Taaffe Severance Agrement dated January 13,
        1999.                                                                                                     
|10.33(2) |  | Taaffe Agreement and General Release dated
        January 13, 1999.                                                                                          
|10.34(2) |  | Letter Waiver to Banque Nationale de Paris Credit
        Agreement dated August 28, 1998.                                                                    
|10.35(2) |  | Amendment No. 2 and Waiver to Banque
        Nationale de Paris Credit Agreement dated February 26, 1999.                                                     
|10.36(2) |  | Election to reduce Acquisition Commitment of
        Banque Nationale de Paris Credit Agreement dated March 5,
        1999.                                  
|10.37(3) |  | Amendment No. 3 to Banque Nationale de Paris
        Credit Agreement dated June 23, 1999.                                                                    
|10.38(4) |  | Amendment No. 4 to Banque Nationale de Paris
        Credit Agreement dated March 17, 2000.                                                                   
|10.39(4) |  | Amendment No. 1 to Stock Option Plan dated
        April 8, 1999.                                                                                             
|10.40(4) |  | Amendment No. 2 to Stock Option Plan dated
        January 29, 2000.                                                                                          
|10.41(4) |  | Johanson Consulting Agreement dated
        February 1, 2000.                                                                                                 

-17-



---



##### Table of Contents



|         |  |                                                                                                                                                             
|-------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.42(4) |  | Certificate of Designation, Preferences and
        Rights of the Series B Preferred Stock of Iron Age Holdings
        Corporation dated December 29, 1999.
|10.43(5) |  | Amendment No. 5 to Banque Nationale de Paris Credit
Agreement dated September 15, 2000.                                                                     
|10.44(6) |  | Certificate of Designation, Preferences and Rights of
the Series C Preferred Stock of Iron Age Holdings Corporation dated
December 29, 2000.                
|10.45(6) |  | Amendment No. 6 to Banque Nationale de Paris Credit
Agreement dated April 24, 2001.                                                                         
|21.1(1)  |  | Subsidiaries of Holdings.                                                                                                                                   




| | 
| | 
| | 



|    |                                                                                                                                                                      
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Incorporated by reference to the similarly numbered exhibit in
        the Companys Registration Statement on Form S-4,
        No.  333-57009, filed June 17, 1998.
|   
|(2) | Incorporated by reference to the similarly numbered exhibit in
        the Companys Annual Report on Form 10-K, filed
        April 30, 1999.                       
|   
|(3) | Incorporated by reference to the similarly numbered exhibit in
        the Companys Quarterly Report on Form 10-Q, filed
        September  14, 1999.               
|   
|(4) | Incorporated by reference to the similarly numbered exhibit in
        the Companys Annual Report on Form 10-K, filed
        April 18, 2000.                       
|   
|(5) | Incorporated by reference to the similarly numbered exhibit in the
Company's Quarterly Report on Form 10-Q, filed December 11, 2000.                                 
|   
|(6) | Incorporated by reference to the similarly numbered exhibit in the
Company's Annual Report on Form 10-K, filed April 26, 2001.                                       

(b)  Reports on Form 8-K.

No reports on Form 8-K were filed during the first quarter
ended April 28, 2001.

-18-



---



##### Table of Contents



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.



| |                     
| | --------------------
| | IRON AGE CORPORATION



| |     |                       
| | --- | ----------------------
| | By: | /s/ KEITH A. MCDONOUGH

| |                         
| | ------------------------
| |                         
| | Name: Keith A. McDonough

| |        |                         
| | ------ | ------------------------
| | Title: | Executive Vice President

| |                            
| | ---------------------------
| | Chief Financial Officer and
| | Chief Operating Officer    
| | (Principal financial and   
| | accounting officer)        

Dated: June 12, 2001

-19-