UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

---

FORM 10-K

---

|ý |  | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934    
|- |  | ----------------------------------------------------------------------------------------
|  |  | For The Fiscal Year Ended December 30, 2006                                             
|  |  | OR                                                                                      
|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: 001-32568

---

MAIDENFORM BRANDS, INC.(Exact name of registrant as specified in its charter)

|Delaware(State or other jurisdiction of
incorporation or organization) |  | 06-1724014(I.R.S. Employer Identification No.)
|---------------------------------------------------------------------- |  | ----------------------------------------------
|154 Avenue E, Bayonne, NJ(Address of principal executive offices)      |  | 07002(Zip Code)                               

(201) 436-9200(Registrant's telephone number, including area code)

---

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
Common Stock, par value $0.01 per share
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
None

Indicate by check mark whether the registrant is a well-known seasoned issuer, as defined in rule 405 of the Securities
Act.    Yes o        No ý

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the
Act.    Yes o        No ý

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during 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 ý        No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of the registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment
to this Form 10-K. o

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

Large
accelerated filer o        Accelerated
filer ý        Non-accelerated filer o

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

As of March 9, 2007, there were 22,980,144 shares of the registrant's common stock, par value $0.01 per share, outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the definitive Proxy Statement for the 2007 Annual Meeting of Stockholders are incorporated by reference into Items 10, 11, 12, 13
and 14 of Part III of this Form 10-K.



---



MAIDENFORM BRANDS, INC.  INDEX TO ANNUAL REPORT ON FORM 10-K  FOR THE FISCAL YEAR ENDED DECEMBER 30, 2006

|         |          |  |                                                                                                               | PAGE
|-------- | -------- |  | ------------------------------------------------------------------------------------------------------------- | ----
|PART I   |          |  |                                                                                                               |     
|         | Item 1:  |  | Business                                                                                                      |     
|         | Item 1A: |  | Risk Factors                                                                                                  |     
|         | Item 1B: |  | Unresolved Staff Comments                                                                                     |     
|         | Item 2:  |  | Properties                                                                                                    |     
|         | Item 3:  |  | Legal Proceedings                                                                                             |     
|         | Item 4:  |  | Submission of Matters to a Vote of Security Holders                                                           |     
|PART II  |          |  |                                                                                                               |     
|         | Item 5:  |  | Market for Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities |     
|         | Item 6:  |  | Selected Financial Data                                                                                       |     
|         | Item 7:  |  | Management's Discussion and Analysis of Financial Condition and Results of Operations                         |     
|         | Item 7A: |  | Quantitative and Qualitative Disclosures about Market Risk                                                    |     
|         | Item 8:  |  | Financial Statements and Supplementary Data                                                                   |     
|         | Item 9:  |  | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure                          |     
|         | Item 9A: |  | Controls and Procedures                                                                                       |     
|         | Item 9B: |  | Other Information                                                                                             |     
|PART III |          |  |                                                                                                               |     
|         | Item 10: |  | Directors, Executive Officers and Corporate Governance                                                        |     
|         | Item 11: |  | Executive Compensation                                                                                        |     
|         | Item 12: |  | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters                |     
|         | Item 13: |  | Certain Relationships and Related Transactions, and Director Independence                                     |     
|         | Item 14: |  | Principal Accountant Fees and Services                                                                        |     
|PART IV  |          |  |                                                                                                               |     
|         | Item 15: |  | Exhibits, Financial Statement Schedules                                                                       |     

---





FORWARD-LOOKING STATEMENTS

STATEMENTS IN THIS REPORT ABOUT MAIDENFORM BRANDS, INC. THAT ARE NOT HISTORICAL FACTS ARE FORWARD-LOOKING STATEMENTS BASED ON OUR CURRENT EXPECTATIONS,
ASSUMPTIONS, ESTIMATES AND PROJECTIONS ABOUT US AND OUR INDUSTRY. THESE FORWARD-LOOKING STATEMENTS ARE SUBJECT TO RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL FUTURE EVENTS OR RESULTS TO DIFFER
MATERIALLY FROM SUCH STATEMENTS. ANY SUCH FORWARD-LOOKING STATEMENTS ARE MADE PURSUANT TO THE SAFE HARBOR PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. IT IS ROUTINE FOR OUR
INTERNAL PROJECTIONS AND EXPECTATIONS TO CHANGE AS THE YEAR OR EACH QUARTER IN THE YEAR PROGRESS, AND THEREFORE IT SHOULD BE CLEARLY UNDERSTOOD THAT THE INTERNAL PROJECTIONS AND BELIEFS UPON WHICH WE
BASE OUR EXPECTATIONS MAY CHANGE PRIOR TO THE END OF EACH QUARTER OR THE YEAR. ALTHOUGH THESE EXPECTATIONS MAY CHANGE, WE ARE UNDER NO OBLIGATION TO INFORM YOU IF THEY DO. ACTUAL EVENTS OR RESULTS MAY
DIFFER MATERIALLY FROM THOSE CONTAINED IN THE PROJECTIONS OR FORWARD-LOOKING STATEMENTS. FACTORS THAT COULD CAUSE OR CONTRIBUTE TO SUCH DIFFERENCES INCLUDE THOSE DISCUSSED IN ITEM 1A., "RISK FACTORS."

(i)

---





PART I

ITEM 1. BUSINESS

Throughout this Annual Report on Form 10-K, we refer to various trademarks, service marks and trade names that we use
in our business. Maidenform®, Flexees®, Lilyette®, Sweet Nothings®,
Rendezvous®, Subtract®,
Minimizer®, Bodymates®, Self
Expressions®, One Fabulous Body®, Instant Slimmer® and Dream® are some of our registered trademarks. One Fabulous Fit, I Value
Luxury, One Fabulous Moment, Collection
M,the Lite Bra,
Flex-to-Fit, Feeling Sexy and Smooth Fit are some of our trademarks and service marks. We
also have a number of other registered service marks, trademarks, service mark applications and trademark applications related to our products that we refer to throughout this Annual Report on
Form 10-K. This Annual Report on Form 10-K also contains trademarks and service marks of other organizations and entities which are the property of their
respective holders.

OVERVIEW

Our company, Maidenform Brands, Inc., is a global intimate apparel company with a portfolio of established and well-known brands,
top-selling products and an iconic heritage. We design, source and market an extensive range of intimate apparel products, including bras, panties and shapewear. We sell our products
through multiple distribution channels, including department stores and national chain stores, mass merchants (including warehouse clubs), other (including specialty retailers, off-price
retailers and licensing income), our company-operated outlet stores and our websites. During our 85-year history, we believe we
have built strong equity for our brands and established a platform for growth through a combination of innovative, first-to-market designs and creative advertising campaigns
focused on increasing brand awareness with generations of women. We sell our products under some of the most recognized brands in the intimate apparel industry, including Maidenform, Flexees,
Lilyette, Sweet Nothings, Rendezvous, Subtract, Bodymates, and Self Expressions.

Our
Maidenform, Flexees and Lilyette brands are broadly sold in department stores (such as Macy's, Lord & Taylor and Belk) and national chains (such as Kohl's and JCPenney). We
also own brands for intimate apparel products that are distributed through select mass merchants. These brands carry our corporate endorsement and leverage our product technology, but are separate
brands with distinctly different logos. For example, our Sweet Nothings branded products are sold in more than 3,100 Wal-Mart domestic stores and over 240 Wal-Mart stores in
Canada; our Bodymates branded products are sold in Costco's 360 domestic and 125 international Costco stores; and our Self Expressions branded products are sold in more than 1,300 Target stores in the
United States and 260 Zellers' stores in Canada. In addition to these brands, we selectively design and source private-label products for certain retailers.

In
the last few years, we have achieved significant increases in our net sales and profitability. We have accomplished this by implementing key management changes, investing in marketing
our brands, introducing innovative new products and expanding a multi-brand, multi-channel distribution model while significantly lowering our cost structure through financial and operational
discipline and initiatives. For example, we have successfully transitioned from operating our own manufacturing facilities to become a global sourcing company with all of our products manufactured by
third parties. As a result of these initiatives, our net sales have grown from $263.4 million in 2002 to $416.8 million in 2006, representing a compound annual growth rate of 12.2%.

On
May 11, 2004, MF Acquisition Corporation acquired Maidenform, Inc. (the "Acquisition") through a merger of its wholly owned subsidiary into Maidenform, Inc.
Stockholders of Maidenform, Inc. received either cash or stock of MF Acquisition Corporation in exchange for their shares of Maidenform, Inc. On April 5, 2005, MF Acquisition
Corporation changed its name to Maidenform Brands, Inc.

1

---



OUR COMPETITIVE STRENGTHS

We attribute our market leadership and significant opportunities for continued growth to the following competitive strengths:

Portfolio of well-known brands with strong market position

During our 85-year history in the intimate apparel industry, we believe we have built strong equity for our brands through a combination of
innovative, first-to-market designs and creative advertising campaigns. Our products have a well-earned reputation for "everyday comfort," which we define as
excellent fit, affordability and beautiful styling and are marketed under some of the most long-standing, recognized brands in the industry, such as Maidenform, Flexees and Lilyette.

We
have extended our addressable market by offering products at lower price points through the introduction of our other brands. These brands carry our corporate endorsement and leverage
our product technology, but are separate brands with distinctly different logos. In addition, these products are similar in style to Maidenform products, but are typically produced with materials more
appropriate for these price points.

Effective multi-brand, multi-channel distribution model

We offer a wide range of brands and products at various price points targeted at distinct distribution channels. This multi-channel strategy reduces our reliance
on any single distribution channel, product, brand or price point. While the Maidenform, Flexees and Lilyette brands are generally sold in department stores and national chains, we market our other
brands to other retailers in the national chain and mass merchant channels. Specifically, Sweet Nothings is sold at Wal-Mart stores, Rendezvous and Subtract are sold at Sears stores,
Bodymates is sold at Costco stores and Self Expressions is sold at Target stores and Zellers' stores.

History of innovation and development of new products

Throughout our 85-year history, we have successfully developed and introduced new products. Some examples of our innovations include:



Our
merchandising and design teams seek to incorporate both first-to-market technologies and unique and innovative combinations of existing technologies in our
products. To assist these teams in this effort, we are operating a materials laboratory in Hong Kong, as well as employing full-time

2

---



personnel
who regularly meet with raw material producers and contract manufacturers and other component suppliers to review their latest product developments.

We
typically introduce our most innovative products into the department stores and national chain stores channel first. Upon a successful launch, we often design a related product that
modifies the design to permit value pricing under our other brands. In addition, we are focused on continually reducing our finished goods costs by sourcing our existing products from third parties,
without
compromising quality levels. We work closely with our sourcing partners, who enter into confidentiality agreements, to share best practices and keep abreast of new advances in design and technology.

Effective and compelling marketing strategies

Our creative advertising campaigns have been key to building brand equity for the Maidenform brand and for our other brands. In our advertising campaigns, we
consistently strive to portray intelligent and confident women and to relate to women's aspirations. Notable campaigns we have used in the past to convey this image include the first Dream campaign
("I Dreamed..."), launched in 1949, and the 1970's launch of "The Maidenform Woman. You Never Know Where She'll Turn Up" campaign. More recently, we re-introduced a modern interpretation
of the classic "I Dreamed..." campaign as part of a successful strategy to increase brand recognition with our core consumer and attract a younger, more contemporary consumer. This campaign has had
substantial placement in print media. We also invest in point-of-sale advertising and cooperative advertising, which is our contribution to retailer-produced advertising. In
all of our advertising, we strive to present a consistent image of the Maidenform brand. We place significant marketing emphasis on the Maidenform brand, as we believe consumers are driven to purchase
our products not only for their product features, but also because of the image conveyed by the brand. Furthermore, development of Maidenform brand equity has additional positive effects on our other
brands including Sweet Nothings, Rendezvous, Bodymates and Self Expressions.

The
Flexees and Lilyette brands are supported more directly at point-of-sale as the consumer for these brands typically has more specialized needs and tends to be
driven to purchase our products based on practical product features as well as brand image. Informative hangtags highlighting product benefits and features are the most effective means of
communication to this consumer.

OUR GROWTH STRATEGIES

We intend to increase sales and profitability by strengthening our position in the intimate apparel industry through the following key strategic initiatives:

Continue to increase consumer identification with our brands

We plan to increase our focus on marketing, especially for the Maidenform brand. We currently use substantial print media and
point-of-sale hang-tags on our products to reinforce our brand image. Going forward, we will look to increase our total number of advertising impressions in a
variety of media and coordinate these images with our cooperative advertising, outdoor advertising and point-of-sale materials to ensure that all touchpoints with our consumers
reinforce the brand image. At the same time, we will continue to monitor the media where our advertisements are placed to ensure we are as effective as possible in reaching our core consumer. We are
also focused on promoting our other brands, including Sweet Nothings, Rendezvous, Bodymates and Self Expressions. For our Flexees and Lilyette brands, we will continue to focus our marketing efforts
at the point-of-sale, with informative hang-tags on the product that explain product benefits, and will continue to provide cooperative advertising support for
inclusion in retailer-produced advertising.

3

---



Continue to launch innovative products

We intend to build upon our past successes in innovation by continuing to be the first-to-market with new product features and designs. We
plan to do this in a manner that expands our consumer base with limited impact on the sales of existing products. We expect that this will result in an increase in our inventory levels and the number
of stock keeping units, or SKUs we carry. To further assist us in this effort, we are planning to increase the size of our merchandising and design teams, as well as our support operations in Asia.

Increase market share in department stores and national chains

We intend to increase market share in department and national chains by expanding and refreshing product offerings through innovative technology and design
expertise within our core brandsMaidenform, Lilyette and Flexees. In addition, we will continue to support the advertising efforts of our retail partners through cooperative advertising
programs and the aggressive pursuit of point-of-sale visual presentation that clearly represent our brands on the selling floors.

Expand presence in mass merchant channel

The mass merchant channel continues to provide opportunity for us. We intend to aggressively pursue increased sales through organic growth and the expansion of
selling space through the placement of new product categories.

Our
global sourcing strategy has enabled us to develop product offerings that are priced competitively in the mass merchant channel and has recently afforded us the opportunity to launch
new product concepts concurrently in the mass merchant and department stores and national chains stores channels. Our value/price product strategy has proven successful with the mass market consumer.

Expand our international presence

Our products are currently distributed outside the United States in approximately 54 countries and territories, representing 6.8% of our net sales, the majority
of which are generated in the United Kingdom and Canada. We intend to continue to focus our international selling efforts in markets with consumer preferences similar to those found in the United
States.

Our
European growth is focused within the United Kingdom, where the Maidenform and Flexees collections have gained momentum. In the United Kingdom, we launched the Maidenform brand at
Debenhams in 2003 and, following successful tests, launched at the House of Fraser and John Lewis in 2004.

In
Canada, in addition to aggressively expanding the door distribution for Maidenform, Flexees and Lilyette within department stores, sales have also benefited from the expanded
placement of new categories of business such as the Maidenform One Fabulous Fit pant collection at The Bay, and Lilyette Minimizer bras and special occasion bras in department stores. Our Canadian
business also expanded within the mass merchant channel of distribution through the sales of Sweet Nothings at Wal-Mart Canada, Bodymates at Costco in Canada and Self Expressions bras and
shapewear at Zellers.

In
2006, we experienced growth in Russia, the Benelux countries and Ireland and believe that there is a continuing opportunity to grow our brands and develop our presence in the
international markets.

Continue to improve product sourcing

We employ a sourcing strategy that expedites our speed to market. We source our products from a network of quality manufacturers in China, Hong Kong, Indonesia,
Macau, the Philippines and Thailand, among other countries. In most cases, we identify and mandate the raw materials and the sub-contractors we want these suppliers to use. In the future,
we may source our products

4

---



from
Bangladesh, Cambodia, Egypt, India and other countries due to the easing of trade restrictions and the maturing of the infrastructure in those countries. In connection with this increase in
products sourced from third-party manufacturers, we have significantly reduced our number of employees since 2001.

We
are expanding the number of our sourcing partners in an effort to achieve efficient product supply to the marketplace and provide the appropriate balance of flexibility and diversity
necessary to service the ever-changing needs of the retailer and the consumer. We intend to multi-source our largest selling items at various facilities and with diverse suppliers in order
to improve service and pricing levels. We are upgrading and implementing new technologies that will enable us to better communicate with our sourcing partners for bidding, technical specification and
to track product in production and in transit.

Make selective acquisitions

We plan to target select strategic acquisitions in order to grow our consumer base and we would utilize the acquired companies to complement the products,
channels and geographic reach of our existing portfolio. We believe that acquisitions could enhance our product offering to retailers and provide potential growth. We believe we can leverage our core
competencies such as product development, brand management, logistics and marketing to create significant value from the acquired businesses.

PRODUCTS AND BRANDS

We sell a broad range of intimate apparel products including bras, panties and shapewear under the following brands:

Maidenform®

We sell a collection of bras and panties under the Maidenform brand primarily at department stores, national chains and our company-operated outlet stores and
websites. Maidenform branded bras are best described as "everyday comfort" bras with excellent fit, feminine styling and consumer-friendly technology, offering a woman the perfect combination of style
and function. The target consumer for Maidenform branded products are women between the ages of 25 and 65 with a career or active lifestyle, a sense of style and who appreciate how a comfortable,
fit-flexible bra can improve the way they look in clothes. Product lines under the Maidenform brand include:



5

---









Flexees®

Flexees is a collection of shapewear products sold primarily in department stores and national chains and our company-operated outlet stores and websites.
Shapewear products create a more slimmed and toned appearance. Examples of shapewear include high leg briefs, full briefs, waist nipper briefs, waist nippers, body briefers, control slips and control
camisoles. Flexees products serve as an under layer for all types of clothing, offering a woman comfort and flexibility while slimming and shaping. Flexees is designed with shape defining properties
to provide a range of control from firm to lighter control. The target consumers of our Flexees products are women between the ages of 25 and 65. The Flexees product is categorized by level of
control. Product lines under the Flexees brand name include:



Lilyette®

Lilyette is a collection of bras for the full-figured woman sold primarily in department stores and national chains and our company-operated outlet
stores and website. Lilyette bras are targeted at larger-busted women between the ages of 25 and 65, and are typically offered in cup sizes of C and larger. The Lilyette brand represents higher
quality luxury at a good value. The Lilyette collection is categorized by product feature:



Other Brands



6

---





DISTRIBUTION CHANNELS

Our Maidenform, Flexees and Lilyette brands are broadly sold in department stores (such as Macy's, Lord & Taylor and Belk) and national chains (such as
Kohl's and JCPenney). Our Sweet Nothings branded products are sold in Wal-Mart stores, Rendezvous is sold in Sears stores, our Bodymates branded products are sold in Costco stores and our
Self Expressions branded products are sold in Target stores and Zellers' stores in Canada. These brands carry our corporate endorsement and leverage our product technology but are separate brands with
distinctly different logos. In addition to these brands, we selectively design, develop and source private-label products for certain specialty retailers and a mass merchant. We currently operate 76
outlets stores and our websites,www.maidenform.comandwww.maidenform.co.uk,through which we primarily
sell our branded products.

Our
diversified brand and product portfolio allows us to target a variety of channels and price points without causing channel conflict. We operate in two segments, wholesale and retail.
Our wholesale segment includes domestic wholesale distribution, international distribution and licensing. Our retail segment includes our company-operated outlet stores and our websites. In 2006, we
derived approximately 87% of our net sales from our wholesale segment and approximately 13% of our net sales from our retail segment. We had two customers that each accounted for more than 10% of our
net sales in 2006 and 2005, one customer that accounted for more than 10% of
our net sales for the period May 11, 2004 through January 1, 2005 and two customers that each accounted for more than 10% of our net sales for the period December 28, 2003 through
May 10, 2004.

In
addition, our mix of products sold between bras, shapewear, and panties in the wholesale segment are summarized below:

2006

2005

2004Bras

68
%
68
%
68
%Shapewear

22
%
20
%
22
%Panties

10
%
12
%
10
%100
%
100
%
100
%


Domestic wholesale distribution

We enjoy longstanding relationships with industry-leading customers in our wholesale channel. Our major wholesale customers include Federated, JCPenney, Kohl's,
Mervyns, Sears, Target, Wal-Mart and Costco. In 2006, net sales from our ten largest customers totaled $287.0 million, or 68.9% of total net sales, and 79.6% of our total wholesale
net sales.

Department Stores and National Chain Stores.The department stores and national chain stores are where we generally sell the
Maidenform, Flexees and Lilyette brands. We plan to continue to invest in increasing our net sales with department store customers, which we believe is important to our long-term
positioning in the channel. There has been a growing trend toward
consolidation of department stores. We expect the rate of our future net sales growth with department stores to be moderated by the reduction in both the number of department store customers and the
number of doors (distinct locations operated by a particular retailer) operated by those customers. We have grown both our market share and our net sales significantly in the past several years with
national chain stores. We expect to see continued growth with national chain stores in the future as consumers continue to seek out value alternatives and as our customers in this channel continue to
open new doors. We have customers located outside the United States that purchase our Maidenform, Flexees and Lilyette brands. The majority of these net sales to these customers are included in the
department store and national chain store channel.

Mass Merchants.The mass merchant channel includes both mass merchants and warehouse clubs. We intend to improve our
penetration in this channel through the use of Sweet Nothings,

7

---



Bodymates
and Self Expressions, as well as private brands. We have experienced significant growth in this channel over the past several years and expect to achieve growth in the future as we are able
to increase both the floor space and number of doors at which our products are sold. We expect that both our net sales to this channel and our net sales to this channel as a percentage of our total
net sales are likely to increase over time. The volume and mix of net sales of our brands and of private label in the mass merchants channel can vary from period to period based upon strategic changes
that our customers may implement from time to time. Net sales to customers in the mass channel that are located outside the United States are included in this channel.

Other.Our net sales from this channel, which include sales to specialty retailers and to off-price retailers,
have historically been a smaller component of our overall net sales. We participate in private brands in the specialty retailer area as opportunities present themselves. Because of fluctuations in
opportunities in this channel, we continually reevaluate for growth opportunities. Our licensing income is included in this channel as well as sales to foreign distributors.

We
will selectively target strategic acquisitions or a brand start-up to grow our consumer base and would utilize the acquired companies to complement the products, channels
and geographic reach of our existing portfolio. We believe that acquisitions could enhance our product offerings to retailers and provide potential growth. We believe we can leverage our core
competencies such as product development, brand management, logistics and marketing to create significant value from the acquired businesses. The opportunity to license designer brands is also a
potential opportunity for us.

We
also generate net sales from licensing our brand names to qualified partners for natural line extensions in the intimate apparel market such as sleepwear, teen bras and panties, bra
accessories, socks and slippers. Licensing royalties have accounted for less than 1% of our total net sales. Our licensed products are sold at department stores, national chains and mass merchants, at
our company-operated outlet stores and through our websites. We believe this gives us the opportunity to introduce our brands to new consumers at a relatively early age. We believe that we can
potentially expand our licensing activities beyond our current offerings.

Domestic retail distribution

We sell our products directly to consumers through our 76 company-operated outlet stores and our websites.

Company-Operated Outlet Stores.We currently operate 76 outlet stores through which we primarily sell our branded products.
In addition, we sell products such as sleepwear, bra accessories and teen bras under the Maidenform label which we purchase from our licensees and other third-party vendors. We regularly review our
real-estate portfolio in order to optimize our store base. Our company-operated outlet stores reduce our dependence on off-price retailers, to which excess merchandise is
typically sold at or below cost, and increase brand awareness through direct-to-consumer sales of our products. Our retail stores also provide us with a unique opportunity to
test consumer response to new products in an environment entirely within our control. Our company-operated outlet stores have an average footprint size of approximately 2,500 square feet.

The
following table highlights the number of stores opened and closed since the beginning of 2004.

2006

2005

2004Beginning fiscal year

74

81

94Open

7

2

3Closed

(5
)
(9
)
(16
)Ending fiscal year

76

74

81


8

---



Our Websites.Our websites, which we operate through wholly owned subsidiaries, are designed to heighten brand awareness and
serve as a channel for our products to be sold directly to consumers. Online sales are expected to increase as a result of our more contemporary target audience and our increased market share.

MERCHANDISING AND DESIGN

We continue to focus on innovation across all product lines. Our new product designs are typically conceived by our merchandising teams, which are generally
organized by channel (e.g., department stores and national chains or mass merchants) and brands.

These
merchandising teams first work together to develop broad new product concepts that reflect women's changing tastes, new fabric improvements and manufacturing innovations.
Subsequently, the merchandising team for each channel works independently to interpret the broad new product concepts into the price points specific to such channel. We also have research and
development personnel who assist in this stage of development by working both to develop new technologies and also to meet with our manufacturers to review their new technologies. Once the new product
concepts are created, our designers develop the detailing and work with our sourcing partners to generate a prototype. Our product and cost engineers work with these new products and sourcing partners
to ensure product fit and quality that consistently meets our stringent specifications prior to manufacture, as well as to ensure products are made in a cost-efficient manner.

Our
design personnel and research and development team operate as a shared resource available to all merchandising teams.

SALES AND MARKETING

Existing and potential customers view our latest product lines and place orders during marketing periods that take place twice a year, in the spring and fall.
Throughout the year, our products are continuously ordered on a replenishment basis, typically at weekly intervals. In addition, most of our customers order new styles, products or colors in advance
in order to ensure sufficient quantities.

Our
marketing team operates as a shared resource across channels to maximize productivity and creativity. We focus our advertising and promotional spending on brand and/or product
specific advertising, primarily through point-of-sale product displays, visuals and individual in-store promotions. We also spend a significant portion of our
advertising budget on cooperative advertising, which constitutes contributions to the advertising cost of our products by retailers.

COMPETITION

The intimate apparel industry is highly competitive. We believe, however, that our combination of brand strength, size, design capability and operational
expertise position us well against our competitors. Competition is generally based upon product quality, brand name recognition, price, selection, customer service and purchasing convenience. Our
primary competitors include Aerie by American Eagle, Cupid Foundations, Inc., Gap Inc., Hanesbrands, Inc., Jockey International, Inc., the Lane Bryant division of Charming
Shoppes, Inc., the Soma division of Chico's, Inc., Triumph International, VF Corporation, the Victoria's Secret division of Limited Brands, Inc., Wacoal Corp. and The Warnaco
Group, Inc. Additionally, department stores and national chain stores, specialty retailers and other retailers, including our customers, have significant private label product offerings that
compete with us. Because of the highly fragmented nature of the industry, we also compete with many small manufacturers and retailers. Some of our competitors are much larger than us and have greater
resources than we do.

We
offer a diversified portfolio of brands across a wide range of price points in several channels of distribution in an effort to appeal to a broad cross-section of consumers. We
believe

9

---



that
our ability to serve multiple distribution channels with a diversified portfolio of products under widely recognized brand names is a competitive strength.

ENVIRONMENTAL MATTERS

We are subject to various federal, state and local laws and regulations that govern activities or operations that may have adverse environmental or health and
safety effects. Noncompliance with these laws and regulations can result in significant liabilities, penalties and costs. Compliance with environmental laws and regulations has not had a material
impact on our operations, but there can be no assurance that future compliance with such laws and regulations will not have a material adverse effect on our operations. While we believe that we do not
face any environmental issues that would have a material adverse impact on our financial position, operations or results of operations, current environmental requirements may change or become more
stringent, unforeseen environmental incidents may occur, or environmental conditions may be discovered on
our properties or in connection with our operations, any of which could have a material adverse effect on our financial position, operations or results of operations.

TRADEMARKS, COPYRIGHTS AND LICENSING AGREEMENTS

We own a portfolio of highly recognized trademarks and trade names, including Maidenform, Flexees, Lilyette, Sweet Nothings, Rendezvous, Subtract, Bodymates and
Self Expressions. We also own copyrights. These intellectual property rights are important to our marketing efforts. Our owned brands are protected by registration or otherwise in the United States
and most other markets where our brands are sold. These intellectual property rights are enforced and protected from time to time by litigation.

Each
trademark registration in the United States has a duration of ten years and is subject to an indefinite number of renewals for a like period upon appropriate application. The
duration of proprietary rights in trademarks, service marks and trade names in the United States, whether registered or not, is predicated on our continued use. Trademarks registered outside of the
United States have a duration of between seven and fourteen years depending upon the jurisdiction and are also generally subject to an indefinite number of renewals for a like period upon appropriate
application. We are using all of our material marks. Maidenform, Flexees, Lilyette, Sweet Nothings and Self Expressions are some of the trademarks that we have registered with the U.S. Patent and
Trademark Office and analogous agencies in a number of other markets where our brands are sold. We have renewed the registrations (or applied for variant forms of the registration, where appropriate,
to assure continued protection) of our material registered trademarks. We plan to continue to use all of our material brand names and marks and to renew the registrations of all of our material
registered trademarks so long as we continue to use them. We have granted licenses to other parties to manufacture and sell specified products under our trademarks in specified distribution channels
and geographic areas. Some of these license agreements contain minimum annual licensing and advertising commitments. Some are for a short term and may not contain specific renewal options. We do not
license from third parties any trademarks that are material to our business.

10

---



IMPORTS AND IMPORT RESTRICTIONS

Our operations are, or may become, subject to various existing and proposed international trade agreements and regulations such as the North American Free Trade
Agreement, the Central American Free Trade Agreement and the Caribbean Basin Initiative, and the activities and regulations of the World Trade Organization, or WTO. Generally, these trade agreements
benefit our business by reducing or eliminating the duties and/or quotas assessed on products manufactured in a particular country. However, trade agreements can also impose requirements that
negatively affect our business, such as limiting the countries from which we can purchase raw materials and setting quantitative limits on products that may be imported from a particular country. We
are exposed to these risks as we import goods from third party suppliers in Asia and Central America.

In
general, previously existing quotas on the importation of fabrics and apparel were phased out over a ten-year period that ended on January 1, 2005. Such quotas were
phased out in 1998 for cotton bras and in 2002 for bras of man-made fabrics. These phased-out quotas only applied to WTO-member countries. With China's accession to
the WTO in 2001, the phase-out completed on January 1, 2005 was applicable to that country as well. Given this short time frame, however, a "safeguard" mechanism was established
with respect to China only. The safeguard mechanism is a transition rule to protect against surges of imports from China that would disrupt the domestic market in such goods.

On
December 24, 2003, the U.S. government imposed a safeguard quota on imports of bras and other foundation garments. This quota was filled as of November 28, 2004,
resulting in no imports of bras and certain shapewear products from China from this date through December 23, 2004. The U.S. government self-initiated a safeguard inquiry with
respect to panties and imposed a safeguard quota that resulted in an embargo on panties imported from China into the United States, which foreclosed any such imports through the end of the 2005
calendar year. A new petition to impose another safeguard quota on the importation of bras and certain shapewear from China was also filed. These and other safeguard actions led to the negotiation of
a three-year bilateral arrangement with China that sets quantitative restrictions on the importation of certain products, including panties, bras and certain shapewear products, with
planned and predictable increases to those limits over the three-year period ending December 31, 2008. If there is growth in imports from China which exceed the negotiated increases
in the annual quotas, ensuing embargoes could have a disruptive effect on the regular flow of products to fill orders. In anticipation of this possibility, we have been sourcing from other countries
in the Asia-Pacific region and should be able to shift production as necessary in order to reduce the risk of adverse consequences from an embargo. The safeguard mechanism will expire and
it is likely that no safeguard actions will be invoked after December 31, 2008 with respect to China.

The
European Union (EU) has entered into a trade agreement with China that established annual quantitative limitations on bras and other categories which resulted in an embargo on bras
in 2005 and could result in an embargo on bras and other categories imported from China in 2007 and 2008.

Apart
from safeguards with respect to China, there remain all of the normal General Agreement on Tariffs and Trade, or GATT, protections that might be invoked by the United States or any
other country against China or any other trading party, such as anti-dumping petitions which could result in extra duty applied, anti-subsidy protections which could result in
countervailing duties, and any action proving violation of WTO rules could lead to extra tariffs.

Management
regularly monitors new developments and risks related to duties, tariffs, quantitative limits and other trade-related matters pending with the United States and foreign
governments, for potential positive or negative effects on our operations. In response to the changing import environment resulting from the elimination of quotas, management has chosen to source 100%
of our products. We limit our sourcing exposure through, among other measures, geographic diversification and shifts among countries and contractors. We will continue to manage

11

---



our
supply chain from a global perspective and adjust as needed to changes in the quota environment.

The
United States and other countries in which our products are manufactured and sold may impose new duties, tariffs, change the classification of products or other restrictions. Any of
these actions could impact our ability to import products at current or increased levels.

GOVERNMENT REGULATION

We are subject to federal, state and local laws and regulations affecting our business, including those promulgated under the Occupational Safety and Health Act,
the Consumer Product Safety Act, the Flammable Fabrics Act, the Textile Fiber Product Identification Act, the rules and regulations of the Consumer Products Safety Commission and various environmental
laws and regulations. Our international businesses are subject to similar regulations in the countries where they operate. Our operations are also subject to various international trade agreements and
regulations. See "Imports and Import Restrictions" above. We believe that we are in compliance in all material respects with all applicable governmental regulations.

EMPLOYEES

As of December 30, 2006, we had approximately 1,300 employees. We consider our relationships with our employees to be satisfactory and have not experienced
any significant interruptions of operations due to labor disagreements since 1978. Our union employees are represented by UNITE-HERE and Local 153 of OPEIU. Our contract with
UNITE-HERE, which covers approximately 235 employees at our Fayetteville and Bayonne locations, expires on September 30, 2009. Our union contract with OPEIU, which covers 20
clerical employees at our headquarters in Bayonne, New Jersey, expires on September 30, 2009.

AVAILABLE INFORMATION

Our investor relations website can be accessed atwww.maidenformbrands.com.There, we make available, free of
charge, our Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and any amendments to those reports, proxy
statement, directors and officer reports on Form 3, Form 4 and Form 5, and amendments to these reports, as soon as reasonably practicable after we electronically file such
material with, or furnish it to, the Securities and Exchange Commission (SEC). The information found on our website is not part of this or any other report we file with or furnish to the SEC. We also
make available on our website the Maidenform Brands, Inc. Code of Ethics and Conduct, our Corporate Governance Guidelines, and the charters for the Audit, Compensation and Nominating and
Corporate Governance Committees of the Board of Directors.

12

---



ITEM 1A. RISK FACTORS
Risks Related To Our Business and Our Industry

Our growth cannot be assured. Even if we do experience growth, we cannot assure you that we will grow profitably.

Although
we have experienced significant growth in our net sales since 2002, historical growth rates may not be sustainable and are not necessarily indicative of future operating
results. Our efforts to generate future growth in net sales might not result in increased net sales, higher margins or continued profitability. To the extent that net sales do not grow at anticipated
rates, that increases in operating expenses precede or are not subsequently followed by commensurate increases in net sales, or that we are unable to adjust operating expense levels accordingly, our
business, results of operations and financial condition could be materially and adversely affected.

We have experienced losses in the past and may incur losses in the future.

We
experienced net losses for our 2004 year and for each of the years from 1995 to 2001. Furthermore, our predecessor company declared bankruptcy in July 1997 and emerged
from bankruptcy in July 1999. We expect that our expenses will increase in the near term in order to continue expanding our business. We may incur losses in future periods. If we are not able
to maintain profitability, our stock price is likely to decline.

If we experience fluctuations in our results of operations or rate of growth and fail to meet net sales and earnings expectations, our stock price may fall rapidly and without
advance notice.

We
base our current and future expense levels and our investment plans on estimates of our future net sales, our future estimated gross margin and our future rate of growth. Our actual
results may vary significantly from these estimates. We expect that our expenses will generally increase in the future, but may fluctuate from period to period. We may not be able to adjust our
spending quickly enough if our net sales fall short of our expectations or our gross margins erode.

Our
results of operations depend on both the continued growth of demand for the products we offer and, to a lesser extent, general economic and business conditions. Any softening of
demand for the products we offer will harm our operating results.

A
new product introduction by us may result in higher growth in our net sales in the quarter in which the product is introduced as compared to subsequent quarters when the customer is
re-stocking the item rather than stocking it for the first time.

Our
results of operations may fluctuate on a quarterly basis, which could result in decreases in our stock price. Growth in net sales may not be sustainable and may decrease in the
future. We believe that period-to-period comparisons of our results of operations may not be meaningful and you should not rely upon them as an indication of future
performance.

We depend on a limited number of customers for a significant portion of our sales, and our financial success is linked to the success of our customers, our customers'
commitment to our products and our ability to satisfy and retain our customers. Some of our customers have experienced financial difficulties during the past several years.

We
depend on a limited number of customers for a significant portion of our sales. Net sales from our ten largest customers totaled 68.9%, 64.5% and 63.3% of our total net sales during
2006, 2005 and 2004, respectively. We expect that these customers will continue to represent a significant portion of our net sales in the future. Two customers each accounted for more than 10% of our
net sales in 2006 and 2005, one customer accounted for more than 10% of our net sales for the period May 11, 2004 through January 1, 2005 and two customers each accounted for more than
10% of our net sales for the period December 28, 2003 through May 10, 2004.

13

---



We
sell the majority of our products to department stores and national chain stores, and mass merchants which in turn sell our products to consumers. We do not have long-term
contracts with any of our customers, as sales to retailers are generally made on an order-by-order basis. If we cannot fill customers' orders on time, orders may be cancelled
and relationships with customers may suffer, which could have an adverse effect on us. Furthermore, if any of our customers experiences a significant downturn in its business, or fails to remain
committed to our products or brands, the customer may reduce or discontinue purchases from us. The loss of a customer or a reduction in the amount of our products purchased by one or more of our
customers could have a material adverse effect on our business, results of operations or financial condition.

During
the past several years, various retailers, including some of our customers, have experienced significant changes and difficulties, including restructurings, bankruptcies and
liquidations. These and other financial problems experienced by some of our customers, as well as general weakness in the retail environment, increase the risk of extending credit to these customers.
A significant adverse change in a customer relationship or in a customer's financial position could cause us to limit or discontinue business with that customer, require us to assume more credit risk
relating to that customer's receivables or limit our ability to collect amounts related to previous purchases by that customer, all of which could have a material adverse effect on our business,
results of operations or financial condition.

We operate in a highly competitive market, and the size and resources of some of our competitors may allow them to compete more effectively than we can, resulting in a loss of
market share and, as a result, a decrease in net sales and profitability.

The
intimate apparel industry is highly competitive. Competition is generally based upon product quality, brand name recognition, price, selection, service and purchasing convenience.
Both branded and private brand manufacturers compete in the intimate apparel industry. Our primary competitors include Aerie by American Eagle, Cupid Foundations Inc., Gap Inc.,
Hanesbrands, Inc.,
Jockey International, Inc., the Lane Bryant division of Charming Shoppes, Inc., the Soma division of Chico's, Inc., Triumph International, VF Corporation, the Victoria's Secret
division of Limited Brands, Inc., Wacoal Corp., and The Warnaco Group, Inc. Because of the highly fragmented nature of the balance of the industry, both domestically and internationally,
we also compete with many small manufacturers and retailers. Additionally, department stores, specialty retailers and other retailers, including our customers, have significant private brand product
offerings that compete with us, and these retailers may choose to source these private brand product offerings directly from third-party manufacturers.

Specialty
retailers, such as Victoria's Secret, have grown at a faster rate in recent years than the industry in general and more than department stores and national chain stores, to
which we sell the majority of our products, in particular. Furthermore, many specialty retailers primarily sell private brand products, and we cannot predict the future growth, if any, for our
products with specialty retailers.

Many
of our competitors have significantly greater financial, marketing and other resources, broader product lines outside of intimate apparel and a larger customer base than we have and
may be less financially leveraged than we are. As a result, these competitors may be able to:



14

---





The
elimination of quotas and other trade barriers could increase competition further, as barriers to entry into the industry are reduced.

We
might not be able to compete successfully with these competitors in the future. If we fail to compete successfully, our market share and results of operations would be materially and
adversely affected.

Retail trends could result in increased downward pressure on our prices, reduced floor space for our products and other changes that could be harmful to our
business.

There
has been a growing trend toward retailer consolidation and, as a result, we increasingly sell our products to a reduced number of customers. As a result of this consolidation, we
have observed an increased centralization of buying decisions and greater negotiating power by such retailers. Policy changes by our customers, such as reductions in inventory levels, limitations on
access to display space, development of private brands and other changes by customers, could result in lower net sales and lower gross margins for us. These consolidations in the retail industry, as
well as further consolidations that may occur in the future, could result in price and other competition that could damage our business. Additionally, as our customers grow larger, they may
increasingly require us to provide them with our products on an exclusive basis, which would cause an increase in the number of SKUs we must carry and, consequently, our inventory levels and working
capital requirements could increase. The potential impact of these types of policy changes by our customers has been amplified by the recent consolidation of retailers, as each retailer now represents
a greater portion of our net sales.

The intimate apparel industry is subject to pricing pressures that may cause us to lower the prices we charge for our products.

Average
prices in the intimate apparel industry have generally declined in the past several years, primarily as a result of the growth of the mass merchant channel of distribution,
increased competition, consolidation in the retail industry and a promotional retail environment.

To
remain competitive, we must adjust our prices from time to time in response to these industry-wide pricing pressures. Many of our competitors source their product
requirements, as we do, from lesser-developed countries to achieve lower operating costs. Our competitors may possibly source from regions with lower costs than those of our sourcing partners and
those competitors may apply such additional cost savings to further reduce prices.

Moreover,
increased customer demands for markdown allowances, incentives and other forms of economic support reduce our gross margins and affect our profitability. Our financial
performance may be negatively affected by these pricing pressures if we are forced to reduce our prices without being able to correspondingly reduce our costs for finished goods or if our costs for
finished goods increase and we cannot increase our prices.

We may not be able to keep pace with constantly changing fashion trends, and if we misjudge consumer preferences, the image of one or more of our brands may suffer and the
demand for our products may decrease.

Our
success depends, in part, on management's ability to anticipate and respond effectively to rapidly changing fashion trends and consumer tastes and to translate market trends into
appropriate, saleable product offerings. If we are unable to anticipate, identify or react to changing styles or trends and misjudge the market for our products or any new product lines, our sales may
be lower and we may be faced with a significant amount of unsold finished goods inventory. In response, we may be forced to increase our marketing promotions, to provide markdown allowances to our
customers, or to liquidate excess merchandise, any of which could have a material adverse effect on our net sales and profitability. Our brand image may also suffer if

15

---



customers
believe that we are no longer able to offer innovative products, respond to the latest fashion trends or maintain the quality of our products.

Even
if we are able to anticipate and respond effectively to changing fashion trends and consumer preferences, our competitors may quickly duplicate or imitate one or more aspects of our
products, promotions, advertising, brand image and business processes, whether or not they are protected under applicable intellectual property law, which may materially reduce our sales and
profitability.

Our customers may decide to discontinue carrying one or more of our brands or product lines in their stores if the brand or product line does not generate sufficient retail
sales.

Retailers
have in the past sought, and may in the future seek, to consolidate their product offerings and reduce the number of overlapping products they carry in an effort to reduce
their inventory and other costs. In doing so, retailers may decide not to purchase one or more of our brands or product lines if that brand or product line does not generate sufficient retail sales
and profits for the retailer. The decision by any one of our major customers to stop selling one or more of our brands or product lines may result in other retailers following suit. Even if other
retailers do not stop selling the brand or product line, the loss of economies of scale may make it less profitable for us to continue selling the brand or product line. We may ultimately be required
to discontinue selling that brand or product line, which may have a material adverse effect on our net sales and profitability. They may also decide that private brands should be a larger percentage
of their total business and that could also impact our profitability.

Our substantial leverage could adversely affect our financial condition.

Our
substantial indebtedness could have significant negative consequences. For example, it could:



In
addition, our credit facility contains financial and other restrictive covenants that may limit our ability to engage in activities that may be in our long-term best
interests such as selling assets, strategic acquisitions, paying dividends, stock repurchases and borrowing additional funds. Our failure to comply with those covenants could result in an event of
default which, if not cured or waived, could result in the acceleration of all of our debt which could leave us unable to meet some or all of our obligations. See notes to the audited consolidated
financial statements included elsewhere in this Annual Report on Form 10-K.

16

---



External events may cause disruptions to our supply chain, result in increased cost of sales or lead to an inability to deliver our products to our
customers.

Currently,
we source all of our production through a network of various offshore vendors predominately in the Asia-Pacific region, including China. There are myriad potential
events that could disrupt our foreign supply chain, including the following:



These
and other events could interrupt production in offshore facilities, increase our cost of sales, disrupt merchandise deliveries, delay receipt of the products into the United States
or prevent us from sourcing our products at all. Depending on timing, these events could also result in lost sales, cancellation charges, excessive markdowns or increased air freight charges to
compensate for late deliveries. Our future performance may be subject to the occurrence of such events, which are beyond our control, and which could have a material adverse effect on our financial
condition and results of operations.

The loss of one or more of our suppliers of finished goods or raw materials may interrupt our supplies.

We
purchase intimate apparel designed by us from a limited number of third-party manufacturers. In addition, approximately 70% of our total sourcing is concentrated in two foreign
countries, China and Indonesia. We do not have any material or long-term contracts with any of our suppliers. Furthermore, our finished goods suppliers also purchase the fabrics and
accessories used in our products from a limited number of suppliers. The loss of one or more of these vendors could interrupt our supply chain and impact our ability to deliver products to our
customers, which would have a material adverse effect on our net sales and profitability.

Increases in the price of raw materials used to manufacture our products could materially increase our costs and decrease our profitability.

The
principal fabrics used in our business are made from cotton, synthetic fabrics and cotton-synthetic blends. The prices for these fabrics are dependent on the market price for the raw
materials used to produce them, primarily cotton and chemical components of synthetic fabrics, and there can be no assurance that prices for these and other raw materials will not increase in the near
future. These raw materials are subject to price volatility caused by weather, supply conditions, power outages, government regulations, economic climate and other unpredictable factors. Fluctuations
in crude oil or petroleum prices may also influence the prices of related items such as chemicals, dyestuffs, man-made fiber and foam. Any raw material price increase would increase our
cost of sales and decrease our profitability unless we are able to pass higher prices on

17

---



to
our customers. In addition, if one or more of our competitors is able to reduce its production costs by taking advantage of any reductions in raw material prices or favorable sourcing agreements,
we may face pricing pressures from those competitors and may be forced to reduce our prices or face a decline in net sales, either of which could have a material and adverse effect on our business,
results of operations and financial condition.

Changing international trade regulation and future quantitative limits, duties or tariffs may increase our costs or limit the amount of products that we can import from
suppliers in a particular country.

Our
operations are, or may become, subject to various existing and proposed international trade agreements and regulations such as the North American Free Trade Agreement, the Central
American Free Trade Agreement and the Caribbean Basin Initiative, and the activities and regulations of the World Trade Organization, or WTO. These trade agreements can impose requirements that
negatively affect our business, such as limiting the countries from which we can source our products, restricting availability of raw material sourcing by requiring fabric from a particular country
and setting quantitative limits on products that may be imported from a particular country. We are exposed to these risks as we import goods from third-party suppliers in Asia and Central America. Our
suppliers may have to pay additional charges for allocation of quota for goods produced in China which could impact the supply of product and cost of product.

The
countries in which our products are manufactured, or into which they are imported, may from time to time impose additional new regulations, or modify existing regulations, including:



Adverse
changes in these costs and restrictions could interrupt production in offshore facilities or delay receipt of our products in the United States and international markets, which
would harm our business. Safeguard actions have been initiated in the past with respect to panties and bras by the United States. The United States entered into a three-year bilateral
agreement with China setting quantitative limits on imports on panties, bras and certain shapewear products that could result in embargoes in 2007 and 2008. Similarly, the European Union (EU) has
entered into a trade agreement with China that has resulted in annual quantitative limitations on bras and other categories that did result in an embargo on bras in 2005 and could result in an embargo
on bras and other categories imported from China in 2007 and 2008. Furthermore, future trade agreements could provide our competitors with an advantage over us, or increase our costs, either of which
could have a material adverse effect on our business, results of operations or financial condition.

18

---



Decreases in the value of the U.S. dollar could materially increase our cost of sales.

We
have shifted all of our production to third-party suppliers, primarily in countries in the Asia-Pacific region. While we pay these third-party suppliers in U.S. dollars,
their costs are typically based upon the local currency of the country in which they operate. Any decrease in the value of the U.S. dollar against these foreign currencies could result in a
corresponding increase in our future cost of sales and decrease in our profitability, which could have a material adverse effect on our financial condition and operating results.

We expect to continue to expand our sales operations outside of the United States and we may be unsuccessful in these efforts.

We
expect to continue to expand our operations outside of the United States. There are certain risks inherent in doing business in international markets, which include:



Our
inability to manage these risks effectively could adversely affect our business and limit our ability to expand our international operations, which could have a material adverse
effect on our business, financial condition and results of operations.

Any problems at our distribution centers could materially affect our ability to distribute our products.

Our
distribution centers in Fayetteville, North Carolina and Shannon, Ireland serve our domestic and foreign customers. We do not have a backup facility or any alternate distribution
arrangements in place. In the event that we experience problems at our distribution centers that impede the timeliness or fulfillment quality of the products being distributed, or that either of our
distribution centers is partially or completely destroyed, becomes inaccessible, or is otherwise not fully usable, it would have a material adverse effect on our ability to distribute our products,
which in turn would have a material adverse effect on our net sales, profitability, financial condition and operating performance.

We may suffer negative publicity or be sued if the manufacturers of our merchandise violate labor laws or engage in practices that are viewed as
unethical.

We
rely on our sourcing personnel, utilizing established procedures, to select manufacturers with legal and ethical labor practices, but we cannot control the business and labor
practices of our manufacturers. If one of these manufacturers violates, or is accused of violating, labor laws or other

19

---



applicable
regulations, or if such a manufacturer engages in labor or other practices that would be viewed as unethical if such practices occurred in the United States, we could in turn suffer
negative publicity or be sued. In addition, if such negative publicity affected one of our customers, it could result in a loss of business for us.

If we are unable to renew or replace our store leases or enter into leases for new stores on favorable terms, or if we violate any of the terms of our current leases, our
growth and profitability could be harmed.

We
lease all of our outlet store locations. The majority of our store leases contain provisions for base rent plus an additional amount based on a percentage of sales in excess of an
agreed upon minimum annual sales level. A number of our leases include a termination provision which applies if we do not meet certain sales levels during a specified period, typically in the third to
fourth year of the lease. In addition, our leases all expire within the next ten years with a shorter average remaining life and generally do not contain options to renew. Furthermore, some of these
leases contain various restrictions relating to the change of control of our company. Our leases also subject us to risks relating to compliance with changing outlet center rules and the exercise of
discretion by our landlords on various matters within the outlet centers. If we are unable to renew or replace our store leases or enter into leases for new stores on favorable terms, or if we violate
any of the terms of our current leases, our growth and profitability could be harmed.

Our company-operated outlet stores are heavily dependent on the ability and desire of consumers to travel and shop.

Our
company-operated outlet stores are located principally in outlet centers, which are typically located at or near vacation destinations or away from large population centers where
department stores and other traditional retailers are concentrated. As a result, developments that would lead to decreased travel, such as fuel shortages, increased fuel prices, travel restrictions,
travel concerns, bad weather and other circumstances, including as a result of war, terrorist attacks or the perceived threat of war or terrorist attacks, could have a material adverse effect on us,
as was the case after the September 11th terrorist attacks. Other factors which could affect the success of our stores include:



We experience fluctuations in our comparable outlet store sales and margins.

Our
continued success depends, in part, upon our ability to continue to further improve sales, as well as both gross margins and operating margins, at our company-operated outlet stores.
A variety of factors affect comparable store sales, including competition, current economic conditions, the timing of release of new merchandise and promotional events, changes in our merchandise mix,
the success of marketing programs and weather conditions. These factors may cause our comparable store sales results to differ materially from prior periods and from expectations.

20

---



Our ability to further improve our comparable store sales results and margins depends in large part on improving our forecasting of demand and fashion trends, selecting effective
marketing techniques, providing an appropriate mix of merchandise for our broad and diverse consumer base, managing inventory effectively, using effective pricing strategies, and optimizing store
performance by controlling operating costs and closing underperforming stores. Our inability to execute these strategies may cause our comparable store sales results and operating results to differ
materially from prior periods and from expectations.

We are implementing changes to our Information Technology systems that may disrupt operations.

We
continue to evaluate and are currently implementing, in a phased approach, modifications and upgrades to our information technology systems for sourcing and distribution operations,
financial reporting, planning and forecasting. Modifications involve replacing legacy systems with successor systems, making changes to legacy systems or acquiring new systems with new functionality.
We might not successfully launch these new systems as planned or without disruptions to our operations. Information technology system disruptions, if not anticipated and appropriately mitigated, could
have a material adverse effect on our operations. We could have cost overruns on the technology that would impact our results of operations.

We are subject to potential challenges relating to overtime pay and other regulations, and union contracts that affect our relationship with our employees, which could
adversely affect our business.

Federal
and state laws governing our relationships with our employees affect our operating costs. These laws include wage and hour laws and regulations, fair labor standards, minimum
wage requirements, overtime pay, unemployment tax rates, workers' compensation rates, citizenship requirements and payroll taxes. A determination that we do not comply with these laws could harm our
profitability or business reputation. Additional government-imposed increases in minimum wages, overtime pay, paid leaves of absence or mandated health benefits could also materially adversely affect
us.

We
are a party to contracts with two separate unions. Our contracts with Local 153 of OPEIU and UNITE-HERE both expire on September 30, 2009. Our failure or inability
to renew either of these contracts could have a material adverse effect on our ability to operate our business and on our results of operations.

We are subject to various laws and regulations in the countries in which we operate.

We
are subject to federal, state and local laws and regulations affecting our business, including those promulgated under the Occupational Safety and Health Act, the Consumer Product
Safety Act, the Flammable Fabrics Act, the Textile Fiber Product Identification Act, the rules and regulations of the Consumer Products Safety Commission and various labor, workplace and related laws,
as well as environmental laws and regulations. Our international business is subject to similar regulations in the foreign countries in which we operate. We may be required to make significant
expenditures to comply with governmental laws and regulations, including labeling laws and privacy laws, compliance with which may require significant additional expense. Complying with existing or
future laws or regulations may materially limit our business and increase our costs. Failure to comply with such laws may expose us to potential liability and have a material adverse effect on our
results of operations.

We cannot predict our future capital needs or our ability to obtain additional financing if we need it.

Our
business is dependent upon the availability of adequate funding. Historically, we have satisfied these needs primarily through debt financing and, more recently, internally-generated
funds and our initial public offering. We believe there are a significant number of capital intensive opportunities for us to maximize our growth and strategic position, including, among others,

21

---



acquisitions,
joint ventures, strategic alliances or other investments. As a result, we may need to raise additional funds to:



We
might not be able to obtain additional financing, if needed, in amounts or on terms acceptable to us, if at all. If sufficient funds are not available or are not available on terms
acceptable to us, our ability to fund our expansion, take advantage of acquisition opportunities, develop or enhance our products, or otherwise respond to competitive pressures would be significantly
limited. These limitations could materially and adversely affect our business, results of operations and financial condition.

We might not successfully integrate future acquisitions, which could have a material adverse effect on our business, financial condition, results of operations and cash
flows.

Although
members of our current management team have previous experience in integrating acquisitions, they have not completed any acquisitions as a team. If appropriate opportunities
present themselves, we may acquire or invest in businesses, products or technologies that we believe are strategic. We might not be able to identify, negotiate or finance any future acquisition
or investment successfully. Even if we do succeed in acquiring or investing in a business, product or technology, such acquisitions and investments involve a number of risks, including:



Future
acquisitions could have an adverse effect on our operating results, particularly in the quarters immediately following their completion while we integrate the operations of the
acquired business. Once integrated, acquired operations may not achieve levels of revenues, profitability or productivity comparable with those achieved by our existing operations, or otherwise
perform as expected.

Furthermore,
the consideration paid in connection with an investment or acquisition will affect our financial results. If we were to proceed with one or more significant acquisitions in
which the

22

---



consideration
included cash, we could be required to use a substantial portion of our available cash and our available borrowing capacity to consummate any acquisition. To the extent we issue shares
of capital stock or other rights to purchase capital stock, including options or other rights, existing stockholders may be diluted and earnings per share may decrease. In addition, acquisitions may
result in the incurrence of debt, large one-time write-offs (such as those relating to acquired in-process research and development costs) or restructuring charges.
They may also result in goodwill and other intangible assets that are subject to impairment tests, which could result in future impairment charges. Any of these factors could have a material adverse
effect on our business, financial condition, results of operations and cash flows.

Our failure to register, renew or otherwise protect our trademarks and other intellectual property could have a negative impact on the value of our brand names and our ability
to use those names in certain geographical areas.

We
use trademarks on nearly all of our products, which is an important factor in creating a market for our products, in identifying us, and in distinguishing our products from those of
others. We believe our trademarks, service marks, copyrights, trade secrets, patent applications and similar intellectual property are critical to our success. We rely on trademark, copyright and
other intellectual property laws to protect our proprietary rights. We also depend on trade secret protection through confidentiality agreements with our employees, licensees, suppliers and others,
and through license agreements with our licensees with whom we develop the fabrics, other components and machinery used to make our products. We may not have agreements containing adequate protective
provisions in every case and the contractual provisions that are in place may not provide us with adequate protection in all circumstances. The unauthorized reproduction or other misappropriation of
our intellectual property could diminish the value of our brand, competitive advantages or goodwill and result in decreased net sales.

Despite
our efforts to protect our intellectual property rights, intellectual property laws afford us only limited protection. A third party could copy our products, designs and/or
brands, or otherwise obtain information from us without authorization. Accordingly, we may not be able to prevent misappropriation of our intellectual property or to deter others from developing
similar products. Further, monitoring the unauthorized use of our intellectual property, including our trademarks and service marks, is difficult. Litigation has been and may continue to be necessary
to enforce our intellectual property rights or to determine the validity and scope of the proprietary rights of others. Litigation of this type has resulted in and could in the future result in
further substantial costs and diversion of resources, may result in counterclaims or other claims against us and could significantly harm our results of operations. In addition, the laws of some
foreign countries do not protect our proprietary rights to the same extent as do the laws of the United States. In addition, we have not obtained trademark protection for all of our brands in all of
the countries where we sell our products. This could leave us helpless to stop potential infringers or possibly even unable to sell our products in certain territories.

We may have disputes with, or be sued by, third parties for infringement or misappropriation of their proprietary rights, which could have a negative impact on our
business.

Other
parties have asserted in the past, and may assert in the future, claims with respect to trademark, patent, copyright or other intellectual property rights that are important to our
business. Other parties might seek to block the use of, or seek monetary damages or other remedies for the prior use of, our trademarks or other intellectual property or the sale of our products as a
violation of their trademark, patent or other proprietary rights. Defending any claims, even claims without merit, could be time-consuming, result in costly settlements, litigation or
restrictions on our business and could damage our reputation.

In
addition, there may be prior registrations or use of intellectual property in the United States or foreign countries (including, but not limited to, similar or competing marks or
other proprietary rights) of which we are not aware. In all such countries, it may be possible for any third-party owner of a

23

---



trademark
registration in that country or other proprietary right to enjoin or limit our expansion into those countries or to seek damages for our use of such intellectual property in such countries.
In the event a claim against us were successful and we could not obtain a license to the relevant intellectual property or redesign or rename our products or operations to avoid infringement, our
business, financial condition or results of operations could be harmed. In addition, securing registrations does not fully insulate us against intellectual property claims, as another party may have
rights superior to our registration or our registration may be vulnerable to attack on various other grounds.

Any
such claims of infringement or misappropriation, whether meritorious or not, could



Third
parties might assert infringement claims against us in the future with respect to any of our products. Any such assertion might require us to enter into royalty arrangements or
litigation that could be costly to us. Any of these events could have a material adverse effect on our business, results of operations or financial condition.

Sales of shares of common stock by us or our stockholders could limit our ability to utilize certain income tax benefits.

At
December 30, 2006, we had approximately $62.8 million of federal and state net operating loss carryforwards available for future utilization during the years 2007
through 2023. To the extent any sales of common stock by us or certain of our stockholders results in an "ownership change" within the meaning of Section 382 of the Internal Revenue Code
("Section 382"), we may not be able to realize certain of these net operating loss carryforwards existing at the date of such ownership change or the timing of when we can use these net
operating loss carryforwards may be modified. For more information regarding these potential income tax benefits and our net operating loss carryforwards, see notes to the audited consolidated
financial statements included elsewhere in this Annual Report on Form 10-K.

We are dependent on our management team, and the loss of any key member of this team may prevent us from implementing our business plan in a timely
manner.

Our
success depends largely upon the continued services of our executive officers and other key personnel, including senior design, marketing, operational and finance executives. Any
loss or
interruption of the services of one or more of our executive officers or key personnel could result in our inability to manage our operations effectively and/or pursue our business strategy.

Because competition for our employees is intense, we may not be able to attract and retain the highly skilled employees we need to support our planned
growth.

Our
ability to provide high quality products, as well as our ability to execute our business plan generally, depends in large part upon our ability to attract and retain highly qualified
personnel. Competition for such personnel is intense. We have in the past experienced, and we expect to experience in the future, difficulty in hiring and retaining highly skilled employees with
appropriate qualifications. The location of our corporate offices outside of New York City has made it

24

---



increasingly
difficult to recruit personnel in certain fields, such as finance, marketing and design. We might not be successful in our efforts to recruit and retain the required personnel. If we fail
to attract new personnel or fail to retain and motivate our current personnel, our business and future growth prospects could be severely harmed.

As we enter new markets, we may not be able to successfully adapt our products and marketing strategy for use in those markets.

Our
strategy includes leveraging our brands and products to enter new markets. We might not be successful in our efforts to adapt our products and marketing strategy for use in those
markets. If these efforts are not successful, we may realize less than expected earnings, which in turn could result in a decrease in the market value of our common stock. Furthermore, these efforts
may divert management attention or inefficiently utilize our resources.

The requirements of being a public company may strain our resources and require significant management time and attention.

As
a public company, we are subject to the reporting requirements of the Securities Exchange Act of 1934, the Sarbanes-Oxley Act and the rules of the New York Stock Exchange (NYSE). The
requirements of these rules and regulations have in the past increased, and may further increase in the future, our legal and financial compliance costs, make some activities more difficult,
time-consuming or costly and may also place undue strain on our systems and resources. The Securities Exchange Act of 1934 requires, among other things, that we file annual, quarterly and
current reports with respect to our business and financial condition. The Sarbanes-Oxley Act requires, among other things, that we report on the effectiveness of our disclosure controls and
procedures, and internal controls over financial reporting. In order to maintain and improve the effectiveness of our disclosure controls and procedures, and internal control over financial reporting,
significant resources and management oversight will be required. In addition, beginning with our 2006 fiscal year, we were required to comply with Section 404 of the Sarbanes-
Oxley Act. As a result, management's attention may be diverted from other business concerns, which could have a material adverse effect on our business, financial condition, results of operations and
cash flows. These rules and regulations could also make it more difficult for us to attract and retain qualified independent members of our Board of Directors and qualified members of our management
team.

The worldwide apparel industry is heavily influenced by general economic conditions.

The
apparel industry is highly cyclical and heavily dependent upon the overall level of consumer spending. Purchases of apparel and related goods tend to be highly correlated with
changes in the disposable income of consumers. Consumer spending is dependent on a number of factors, including actual and perceived economic conditions affecting disposable consumer income (such as
unemployment, wages and salaries), business conditions, interest rates, availability of credit and tax rates in the general economy and in the international, regional and local markets where our
products are sold. Our wholesale customers may anticipate and respond to adverse changes in economic conditions and uncertainty by reducing inventories and canceling orders. Furthermore, in such
circumstances, our customers may encounter difficulties in other apparel categories or their non-apparel businesses that may cause them to change their strategy with respect to intimate
apparel. As a result, any deterioration in general economic conditions, reductions in the level of consumer spending or increases in interest rates in any of the regions in which we compete could
adversely affect the sales of our products.

A
return to recessionary or inflationary conditions, whether in the United States or globally, additional terrorist attacks or similar events could have further adverse effects on
consumer confidence and spending and, as a result, could have a material adverse effect on our financial condition and results of operations.

25

---



Other Risks

The market price of our common stock may be highly volatile or may decline regardless of our operating performance.

The
trading price of our common stock may fluctuate substantially. The price of our common stock may be higher or lower than the price you pay to purchase your shares, depending on many
factors, some of which are beyond our control. Broad market and industry factors may adversely affect the market price of our common stock, regardless of our actual operating performance. The
fluctuations could cause you to lose all or part of your investment in our shares of common stock. Factors that could cause fluctuation in the trading price of our common stock may include, but are
not limited to, the following:



In
addition, if the market for apparel company stocks or the stock market in general experiences loss of investor confidence, the trading price of our common stock could decline for
reasons unrelated to our business, results of operations or financial condition. The trading price of our common stock might also decline in reaction to events that affect other companies in our
industry or related industries even if these events do not directly affect us.

In
the past, following periods of volatility in the market price of a company's securities, securities class action litigation has often been brought against that company. Due to the
potential volatility of our stock price, we may therefore be the target of securities litigation in the future. Securities litigation could result in substantial costs and divert management's
attention and resources from our business.

The concentrated ownership of our capital stock by insiders will likely limit your ability to influence corporate matters.

As
of March 7, 2007, our executive officers, directors, current 5% or greater stockholders and affiliated entities (based upon the most recent filings with the SEC with respect to each
such stockholder) together beneficially own approximately 47% of our common stock outstanding. Among the 5% or greater stockholders as of the same date, Ares Corporate Opportunities Fund, L.P.
("Ares"), who is our largest stockholder, beneficially owned approximately 16% of our common stock outstanding. As a result, these stockholders, should they act together, may be able to influence or
control matters that require approval by our stockholders, including the election of directors and approval of significant corporate transactions such as mergers and acquisitions. These stockholders

26

---



may
also have interests that differ from yours and may vote in a way with which you disagree and which may be adverse to your interests. Corporate action might be taken even if other stockholders
oppose them. This concentration of ownership might also have the effect of delaying or preventing a change of control of our company that other stockholders may view as beneficial, could deprive our
stockholders of an opportunity to receive a premium for their common stock as part of a sale of our company and might ultimately affect the market price of our common stock.

The future sale of shares of our common stock may negatively affect our stock price.

If
our existing stockholders sell substantial amounts of our common stock, including shares issuable upon the exercise of outstanding options in the public market, or if our stockholders
are perceived by the market as intending to sell substantial amounts of our common stock, the market price of our common stock could fall. These sales also might make it more difficult for us to sell
equity securities in the future at a time and price that we deem appropriate.

Our stockholders could sell large blocks of securities, which could cause the price of our common stock to decline.

Sales
of substantial amounts of common stock by our existing stockholders or the perception that those sales could occur may adversely affect the market price for our common stock.

We do not expect to pay any dividends on our common stock for the foreseeable future.

We
do not anticipate that we will pay any dividends to holders of our common stock in the foreseeable future. Accordingly, investors must rely on sales of their common stock after price
appreciation, which may never occur, as the only way to realize any future gains on their investment.

If securities analysts do not publish research or reports about our business or if they downgrade our stock, the price of our stock could decline.

The
trading market for our common stock will rely in part on the research and reports that industry or financial analysts publish about us or our business. We do not control these
analysts. If one or more of the analysts who cover us downgrade our stock, our stock price could decline rapidly. If one or more of these analysts cease coverage of our company, we could lose
visibility in the market, which in turn could cause our stock price to decline.

Provisions in our amended and restated certificate of incorporation and bylaws or Delaware law might discourage, delay or prevent a change of control of our company or changes
in our management and, therefore, depress the trading price of our common stock.

Delaware
corporate law and our amended and restated certificate of incorporation and bylaws contain provisions that could discourage, delay or prevent a change in control of our company
or changes in our management that the stockholders of our company may deem advantageous. These provisions:



ITEM 1B. UNRESOLVED STAFF COMMENTS

None

27

---



ITEM 2. PROPERTIES

Our company headquarters are located in Bayonne, New Jersey and house the corporate, marketing, merchandising and design functions. We own the entire building,
which is approximately 98,700 square feet. During 2007, we will relocate our company headquarters to leased premises of approximately 67,000 square feet located in Iselin, New Jersey. This lease
expires in February 2017.

We
currently lease our 11,250 square foot New York City showroom, which is located at 200 Madison Avenue. The lease for the showroom expires on June 30, 2016.

We
have two distribution centers. We own our distribution center located in Fayetteville, North Carolina, which is approximately 262,000 square feet in size and serves our U.S. and
Canadian operations. We currently lease our distribution center located in Shannon, Ireland, which is approximately 21,000 square feet and serves our European markets. This lease expires on
May 26, 2016, but may be terminated by us at any time on one year's notice.

We
currently operate 76 outlet stores in 28 states and Puerto Rico. All of these store locations are leased with an average remaining lease period of 2.5 years and lease
expiration dates ranging from 2007 to 2015. We also lease space for a sourcing office in Hong Kong.

We
believe that our existing space is adequate for our current operations. We believe that suitable replacement and additional space will be available in the future on commercially
reasonable terms.

ITEM 3. LEGAL PROCEEDINGS

We are not currently a party to any material legal proceedings. We are subject to various claims and legal actions arising from time to time in the ordinary
course of business.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matters were submitted to our stockholders during the fourth quarter of 2006.

28

---





PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES

Price Range and Number of Holders

Since July 22, 2005, Maidenform Brands, Inc.'s common stock has been traded on the New York Stock Exchange under the symbol MFB. Prior to
July 22, 2005, Maidenform Brands, Inc's common stock was not publicly traded. The last reported sales price per share of Maidenform Brands, Inc.'s common stock on February 28,
2007 was $18.29, and on that date there were approximately 8 holders of record of Maidenform Brands, Inc.'s common stock.

The
following table sets forth for the period indicated the high and low sales price per share of common stock as reported by the New York Stock Exchange:

Fiscal 2006

High

LowFirst quarter

$
13.47

$
8.76Second quarter


12.76


10.76Third quarter


19.30


12.38Fourth quarter


22.15


17.99


Fiscal 2005

High

LowThird quarter (commencing July 22, 2005)

$
19.85

$
13.75Fourth quarter


14.17


11.30


Stock Performance Graph

The graph depicted below compares the performance of the Company's common stock with the cumulative total return of the Standard & Poor's 500 Stock Index
("S&P 500 Index") and the Peer Group Index from July 22, 2005, the first day of trading of the Company's common stock after our initial public offering, plus reinvested dividends and
distributions through December 30, 2006, the last day of our fiscal year.

Pursuant
to the SEC's rules, the Company created a peer group index with which to compare its own stock performance since a relevant published industry or
line-of-business index does not exist. Because the Company was the only stand-alone publicly traded intimate apparel company in the U.S. through September 2006, no
grouping could closely mirror the Company's businesses or weight those businesses to match the relative contributions of each of the Company's business segments to the Company's performance. The
Company has selected a grouping of companies that it believes share similar characteristics to its own. All of the companies included in the Peer Group Index were, for the relevant period, engaged in
some of the businesses in which the Company is engaged or are companies that are not engaged in businesses in which the Company participates but it believes share some similar characteristics with our
Company. The companies included in the Peer Group Index are as follows: Hartmarx Corp., Jones Apparel Group Inc., Kellwood Co., Oxford Industries Inc., Perry Ellis International,
Phillips-Van Heusen Corp, Inc., Polo Ralph Lauren Corp., Tommy Hilfiger Corp., VF Corp., and Warnaco Group Inc.

29

---



GRAPHIC

Notes:

Issuer Purchases of Equity Securities

In 2006, we purchased $7.6 million of common stock at an average price per share of $11.30, pursuant to a stock repurchase program in an amount up to
$20.0 million that was approved by the Board of Directors of the Company in February 2006. The Company's current credit facility was amended to permit the plan subject to certain
restrictions and limitations set forth in the amendment to the credit facility. The stock repurchase program, which is open-ended, allows us to repurchase our shares on the open market,
depending on market conditions and other corporate considerations, from available cash flow and borrowings under the Amended and Restated Credit Facility dated June 29, 2005, as amended.

30

---



|Period                             |  | Total
number
of shares
repurchased |  | Average
price paid
per share |       | Total number
of shares
repurchased
as part of publicly
announced
program |         | Maximum
dollar
value of shares
that may yet be
repurchased under
the program
|---------------------------------- |  | ---------------------------------- |  | ---------------------------- | ----- | ------------------------------------------------------------------------ | ------- | ----------------------------------------------------------------------------
|January 1, 2006  February 4, 2006 |  |                                   |  | $                            |      |                                                                          |        |                                                                             
|February 5  March 4, 2006         |  | 344,000                            |  |                              | 9.87  |                                                                          | 344,000 |                                                                             
|March 5  April 1, 2006            |  | 59,800                             |  |                              | 10.32 |                                                                          | 59,800  |                                                                             
|April 2  May 6, 2006              |  | 72,600                             |  |                              | 10.99 |                                                                          | 72,600  |                                                                             
|May 7  June 3, 2006               |  | 46,800                             |  |                              | 12.62 |                                                                          | 46,800  |                                                                             
|June 4  July 1, 2006              |  | 56,200                             |  |                              | 12.41 |                                                                          | 56,200  |                                                                             
|July 2  August 5, 2006            |  |                                   |  |                              |      |                                                                          |        |                                                                             
|August 6  September 2, 2006       |  | 90,100                             |  |                              | 16.26 |                                                                          | 90,100  |                                                                             
|September 3  September 30, 2006   |  |                                   |  |                              |      |                                                                          |        |                                                                             
|October 1  November 4             |  |                                   |  |                              |      |                                                                          |        |                                                                             
|November 5  December 2            |  |                                   |  |                              |      |                                                                          |        |                                                                             
|December 3  December 30           |  |                                   |  |                              |      |                                                                          |        |                                                                             
|                                   |  |                                    |  |                              |       |                                                                          |         |                                                                             
|Total                              |  | 669,500                            |  | $                            | 11.30 |                                                                          | 669,500 |                                                                             
|                                   |  |                                    |  |                              |       |                                                                          |         |                                                                             

No
purchases of our common stock were made by or on behalf of the Company or any affiliated purchaser during 2005.

Dividend Policy

We do not anticipate paying cash dividends on our common stock in the foreseeable future but intend to retain future earnings, if any, for reinvestment in the
future operations, expansion of our business and related development activities, repayment of our borrowings under our credit facility, and potentially, to effectuate additional purchases under the
stock repurchase program. Any future determination to pay cash dividends will be at the discretion of our Board of Directors and will depend upon our financial condition, results of operations, terms
of financing agreements, capital requirements, and such other factors as our Board of Directors deems relevant.

Securities Authorized for Issuance Under Equity Compensation Plans

Information regarding our equity compensation plans is hereby incorporated by reference to the table in Item 12 of this Form 10-K.

Use of Proceeds

On July 22, 2005, we priced our initial public offering, pursuant to a registration statement (Registration No. 333-124228) that was
declared effective by the Securities and Exchange Commission on July 21, 2005. The offering closed on July 27, 2005. The managing underwriters were UBS Investment Bank, Credit Suisse
First Boston and Goldman, Sachs & Co.

We
received net proceeds from the sale of the shares of our common stock in the offering of $52.6 million, at an initial public offering price of $17.00 per share, after deducting
underwriting discounts and commissions and other offering expenses. Approximately, $46.8 million of the net proceeds to us were used to redeem all the outstanding shares of our preferred stock,
including shares of preferred stock acquired upon the exercise of all outstanding options to purchase shares of our preferred stock, and to pay all accrued and unpaid dividends associated with the
preferred
stock and preferred stock options. The remaining proceeds were used to pay down our revolving facility.

31

---



Recent Sales of Unregistered Securities

The registrant was incorporated on March 11, 2004 under the laws of the State of Delaware and has issued the following securities that were not registered
under the Act:



The
issuances of securities in the transactions described in items 1 and 2 above were determined to be exempt from registration under Section 4(2) of the Securities Act of 1933,
as amended (the "Securities Act") and Rule 506 of Regulation D thereunder as transactions by an issuer not involving a public offering. The issuances of securities listed above in item 3
were deemed to be exempt from registration under the Securities Act in reliance on Rule 701 promulgated under Section 3(b) of the Securities Act as transactions pursuant to compensatory
benefit plans and contracts relating to compensation. The recipients of securities in each such transaction represented their intention to acquire the securities for investment only and not with a
view to or for sale in connection with any distribution thereof and appropriate legends were affixed to the share certificates and other instruments issued in such transactions. All recipients either
received adequate information about us or had access, through employment or other relationships, to such information. There were no underwriters employed in connection with any of the transactions set
forth in this Item 5, Recent Sales of Unregistered Securities. After giving effect to the sale of shares by us and selling stockholders in connection with our initial public offering, the redemption
of all the outstanding
shares of our preferred stock (including shares of preferred stock acquired upon the exercise of all outstanding options to purchase shares of our preferred stock), the filing of an S-8
registration statement with respect to our stock option plans pursuant to which the options referred to above were granted and the registration on a Registration Statement on
Form S-3 filed on October 31, 2006 (pursuant to which the vast majority of the balance of the foregoing securities were registered), the balance of the foregoing securities
are deemed restricted securities for purposes of the Securities Act.

32

---



ITEM 6. SELECTED FINANCIAL DATA

On May 11, 2004, MF Acquisition Corporation acquired Maidenform, Inc. (the "Acquisition") through a merger of its wholly owned subsidiary into
Maidenform, Inc. Stockholders of Maidenform, Inc. received either cash or stock of MF Acquisition Corporation in exchange for their shares of Maidenform, Inc. On April 5,
2005, MF Acquisition Corporation changed its name to Maidenform Brands, Inc. The financial statements for the period including and after May 11, 2004 are those of Maidenform
Brands, Inc. and subsidiaries (the "Successor"). The financial statements for periods prior to May 11, 2004 are those of Maidenform Inc. and subsidiaries (the "Predecessor"). The
Acquisition was accounted for as a purchase in accordance with Statement of Financial Accounting Standards (SFAS) No. 141, "Business Combinations," and Emerging Issues Task Force (EITF)
No. 88-16, "Basis in Leveraged Buyout Transactions." As a result of the Acquisition, the financial statements for the period including and after May 11, 2004 are not
comparable to those prior to that date.

The
historical consolidated financial data included below and elsewhere in this Annual Report on Form 10-K are not necessarily indicative of future performance. The
following selected financial data should be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations," and our audited consolidated financial
statements and related notes included elsewhere in this Annual Report on Form 10-K.

33

---



The
following table sets forth selected financial data as of and for the five fiscal years ended December 30, 2006.

|                                                             |  | Successor(2) |            | Predecessor(1) |  
|------------------------------------------------------------ |  | ------------ | ---------- | -------------- | -
|
|
|
|OPERATING DATA:                                              |  |              |            |                |  
|Wholesale                                                    |  | $            | 360,647    |                | $
|Retail                                                       |  |              | 56,188     |                |  
|                                                             |  |              |            |                |  
|Net sales                                                    |  |              | 416,835    |                |  
|Cost of sales(3)                                             |  |              | 260,083    |                |  
|                                                             |  |              |            |                |  
|Gross Profit                                                 |  |              | 156,752    |                |  
|Selling, general and administrative expenses(4)              |  |              | 101,238    |                |  
|Acquisition-related charges(5)                               |  |              |           |                |  
|                                                             |  |              |            |                |  
|Operating income (loss)                                      |  |              | 55,514     |                |  
|Interest expense, net(6)                                     |  |              | 8,521      |                |  
|Other income(7)                                              |  |              |           |                |  
|                                                             |  |              |            |                |  
|Income (loss) before income taxes                            |  |              | 46,993     |                |  
|Income tax expense (benefit)(8)                              |  |              | 19,231     |                |  
|                                                             |  |              |            |                |  
|Net income (loss)                                            |  |              | 27,762     |                |  
|Preferred stock dividends and changes in redemption value(9) |  |              |           |                |  
|                                                             |  |              |            |                |  
|Net income (loss) available to common stockholders           |  | $            | 27,762     |                | $
|                                                             |  |              |            |                |  
|EARNINGS (LOSS) PER SHARE DATA(10)(11):                      |  |              |            |                |  
|Basic earnings (loss) per common share                       |  | $            | 1.21       |                | $
|                                                             |  |              |            |                |  
|Diluted earnings (loss) per common share                     |  | $            | 1.15       |                | $
|                                                             |  |              |            |                |  
|Basic weighted average number of shares outstanding          |  |              | 23,024,986 |                |  
|                                                             |  |              |            |                |  
|Diluted weighted average number of shares outstanding        |  |              | 24,194,468 |                |  
|                                                             |  |              |            |                |  
|Dividends per share                                          |  | $            |           |                | $
|                                                             |  |              |            |                |  

(footnotes appear on following page)

34

---



|                                                 |  | Successor(2) |         | Predecessor(1)
|------------------------------------------------ |  | ------------ | ------- | --------------
|
|
|
|BALANCE SHEET DATA (end of period):              |  |              |         |               
|Cash and cash equivalents                        |  | $            | 14,617  |               
|Total assets                                     |  |              | 244,853 |               
|Total indebtedness, including current maturities |  |              | 110,000 |               
|Redeemable preferred stock                       |  |              |        |               
|Common stock subject to put option               |  |              |        |               
|Total stockholders' equity (deficit)             |  |              | 74,901  |               

NOTES TO SELECTED FINANCIAL DATA

35

---





36

---



ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following is a discussion of our results of operations and financial condition. This discussion should be read in conjunction with our audited consolidated
financial statements and notes included elsewhere in this Annual Report on Form 10-K. The discussion of our results of operations and financial condition includes various
forward-looking statements about our markets, the demand for our products, and our future results and is intended to provide the reader of our audited consolidated financial statements with a
narrative discussion about our business. This discussion is presented in the following sections:



We
based our statements on assumptions or estimates that we consider reasonable. Actual results may differ materially from those suggested by our forward-looking statements for various
reasons including those discussed in Item 1A, "Risk Factors" included elsewhere in this Annual Report on Form 10-K.

MANAGEMENT OVERVIEW

We are a global intimate apparel company with a portfolio of established, well-known brands, top-selling products and an iconic heritage.
We design, source and market an extensive range of intimate apparel products, including bras, panties and shapewear. We sell through multiple distribution channels, including department stores and
national chain stores, mass merchants (including warehouse clubs), other (including specialty retailers, off-price retailers and licensing income), our company-operated outlet stores and
our websites.

We
sell our products under some of the most recognized brands in the intimate apparel industry, including Maidenform, Flexees, Lilyette, Sweet Nothings, Rendezvous, Subtract, Bodymates
and Self Expressions. Our Maidenform, Flexees and Lilyette brands are broadly sold in department stores and national chain stores. Our other brands are distributed through national chain stores and
selected mass merchants. These other brands leverage our product technology, but are separate brands with distinctly different logos. In addition to our owned brands, we also supply private brand
products to selected retailers.

Trends in our business

We operate in two segments, wholesale and retail. Our wholesale segment includes both our domestic and international wholesale markets. Our retail segment
includes our company-operated outlet stores and our websites.

We
have identified many near-term opportunities for growth and operational improvements, as well as challenges to our business. In particular, management believes that there
are many factors influencing the intimate apparel industry, including but not limited to: consistent demand for foundation garments, consumer demand for product innovation and leading brands, sourcing
and supply chain efficiencies, continued growth of the mass merchant channel, pressure from retailers brought about by the consolidation in the retail industry, increases in the cost of the raw
materials used in intimate apparel products and uncertainty surrounding import restrictions.

37

---



We believe we are well-positioned to capitalize on or address these trends by, among other things:



Wholesale Segment

The following trends are among the key variables that will affect our wholesale segment:

Department Stores and National Chain Stores.The department stores and national chain stores are where we generally sell the
Maidenform, Flexees and Lilyette brands. We plan to continue to invest in increasing our net sales with department store customers, which we believe is important to our long-term
positioning in the channel. There has been a trend toward consolidation of department stores. We expect the rate of our future net sales growth with department stores to be moderated by the reduction
in both the number of department store customers and the number of doors (distinct locations operated by a particular retailer) operated by those customers. We have grown both our market share and our
net sales significantly in the past several years with national chain stores. We expect to see continued growth with national chain stores in the future as consumers continue to seek out value
alternatives and as our customers in this channel continue to open new doors. We have customers located outside the United States that purchase our Maidenform, Flexees and Lilyette brands. The
majority of these net sales are included in the department store and national chain store channel.

Mass Merchants.The mass merchant channel includes both mass merchants and warehouse clubs. We intend to improve our
penetration with mass merchants through the use of our brands Sweet Nothings, Bodymates, and Self Expressions as well as private brands. We have experienced significant growth in this channel over the
past several years and expect to achieve significant growth in the future as we are able to increase both the floor space and number of doors at which our products are sold. We expect that both our
net sales to this channel and our net sales to this channel as a percentage of our total net sales is likely to increase over time. The volume and mix of net sales of our brands and of private label
in the mass merchants channel can vary from period-to-period based upon strategic changes that our customers may implement from time-to-time. Net sales
to customers in the mass channel that are located outside the United States are included in this channel.

Other.Our net sales from this channel, which include sales to specialty retailers and to off-price retailers,
have historically been a relatively small component of our overall net sales. We participate in private brands in the specialty retailer area as opportunities present themselves.

38

---



We continually
evaluate this channel for opportunities. Licensing income is included in this channel as well as our sales to foreign distributors.

We
will selectively target strategic acquisitions or a brand start-up to grow our consumer base and would utilize the acquired companies to complement the products, channels
and geographic reach of our existing portfolio. We believe that acquisitions could enhance our product offerings to retailers and provide potential growth. We believe we can leverage our core
competencies such as product development, brand management, logistics and marketing to create significant value from the acquired businesses. The opportunity to license designer brands is also a
potential opportunity for us.

Retail Segment

We believe our retail sales volume is driven by our ability to service our existing consumers and obtain new consumers, as well as overall general economic
conditions, such as the general retail environment, that can affect our consumers and ultimately their levels of overall spending. Additionally, identifying optimal retail outlet locations, favorable
leasing arrangements, and improving our store productivity are factors important to growing our retail segment's net sales. We also sell our products through our websites, www.maidenform.comandwww.maidenform.co.uk.Although we currently do not generate a significant amount
of net sales through these sites, we do expect it to continue to grow.

Our
objectives in our retail segment are to continue to increase the productivity of our portfolio of stores through effective merchandising and focused advertising, as well as
selectively closing less productive locations and potentially opening new stores in more productive locations. Even in those situations where we selectively close less productive outlet stores and do
not open a new store in that region, we believe those consumers still purchase many of our Maidenform brands from our other outlet stores, our websites or our wholesale segment customers that carry
these brands. Historically, we have primarily sold excess and, to a lesser extent, obsolete inventories through our outlet stores at a higher margin than that achieved through other liquidation
alternatives.

Definitions

In reviewing our operating performance, we evaluate both the wholesale and retail segments by focusing on each segment's operating income, cash flows from
operations and inventory turns.

Net Sales.Our net sales are derived from two operating segments, wholesale and retail. Our net sales in the wholesale
segment are sales recorded net of cooperative advertising allowances, sales returns, sales discounts, and markdown allowances provided to our customers. Net sales in our retail segment are recognized
at the time the customer takes possession of the merchandise at the point-of-sale in our stores and for our internet sales, net sales are recognized when the products are
shipped and title passes to the customer.

Cost of Sales.We outsource all manufacturing of the products we sell and, therefore the principal elements of our cost of
sales are for finished goods inventories purchased from our sourced vendors. Included in cost of sales and affecting our overall gross margins are freight expenses from the manufacturers to our
distribution centers in situations where such expenses are charged separately. Also included in cost of sales is the cost of warehousing, labor and overhead related to receiving and warehousing at our
distribution centers, and depreciation of assets related to our receiving and warehousing in our distribution centers. Direct labor, cost of fabrics, as well as raw materials for fabrics, are the
primary components driving the overall cost of our sourced finished goods inventories from our sourcing vendors.

39

---



Selling, General and Administrative Expenses (SG&A).Our SG&A include all of our marketing, selling, distribution and general
and administrative expenses for both the wholesale and retail segments (which include our retail outlet store payroll and related benefits), and rent expense. General and administrative expenses
include management payroll, benefits, travel, information systems, accounting, insurance and legal. Additionally, depreciation related to the shipping function in our distribution centers and our
corporate office assets such as furniture, fixtures, and equipment, as well as amortization of intellectual property, is included in SG&A.

Income Taxes.We account for income taxes using the liability method, which recognizes the amount of income tax payable or
refundable for the current year and recognizes deferred tax liabilities and assets for the future tax consequences of the events that have been recognized in the financial statements or tax returns.
We routinely evaluate all deferred tax assets to determine the likelihood of their realization and record a valuation allowance if it is more likely than not that a deferred tax asset will not be
realized. For more information, see notes to the audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

Net
operating loss carryforwards (NOLs) enable a company to apply net operating losses incurred during a current period against a future period's profits in order to reduce cash tax
liabilities in those future periods. In periods when a company is generating operating losses, its NOLs will increase. The tax effect of the NOLs is recorded as a deferred tax asset. If the company
does not believe that it is more likely than not that it will be able to utilize the NOLs, it records a valuation allowance against the deferred tax asset. Additionally, Section 382 imposes
limitations on a corporation's ability to utilize its NOLs if it experiences an "ownership change." In general terms, an ownership change results from transactions increasing the ownership of certain
existing stockholders and, or, new stockholders in the stock of a corporation by more than 50 percentage points during a three year testing period. Any unused annual limitation may be carried
over to later years, and the amount of the limitation may, under certain circumstances, be increased to reflect both recognized and deemed recognized "built-in gains" that occur during the
60-month period after the ownership change. Upon emergence from bankruptcy in 1999, our NOLs were subject to Section 382 limitations. As a result of the Acquisition (defined below)
in 2004, we experienced a change in control as defined by Section 382. As a result of this ownership change, the utilization of our NOLs were subject to a new annual limitation under
Section 382. Subsequent to the Acquisition, sales of our shares by others, including the initial public offering in July 2005, have resulted in additional changes in control for the
purpose of Section 382; however, the annual limitation of our NOLs has not changed. Based on fair values of certain assets as determined in connection with the Acquisition, we had approximately
$66.7 million of deemed built-in gains that are
anticipated to be recognized or deemed recognized during the aforementioned 60-month period. At December 30, 2006, we had approximately $62.8 million of federal and state
NOLs available for utilization in the years from 2007 through 2023.

Acquisition-Related Charges.On May 11, 2004, MF Acquisition Corporation acquired 100% of Maidenform, Inc. (the
"Acquisition") through a merger of its wholly owned subsidiary into Maidenform, Inc. Stockholders of Maidenform, Inc. received either cash or stock of MF Acquisition Corporation in
exchange for their shares of Maidenform, Inc. On April 5, 2005, MF Acquisition Corporation changed its name to Maidenform Brands, Inc. Our capitalization structure changed
significantly as a result of the Acquisition. Financing for the Acquisition totaled $237.3 million and was provided by a first lien term loan of $100.0 million, revolver borrowings of
$12.5 million, a second lien term loan of $50.0 million and $74.8 million of cash and capital invested by MF Acquisition Corporation and other investors, including rollover equity
by certain members of management of $2.8 million and continuing stockholders of $15.0 million.

40

---



The
Acquisition was accounted for as a purchase in accordance with Statement of Financial Accounting Standards (SFAS) No. 141, "Business Combinations," and Emerging Issues Task
Force (EITF) No. 88-16, "Basis In Leveraged Buyout Transactions." Accordingly, the retained interest of the continuing stockholders (the 23.8% retained by certain members of
management and continuing stockholders) was recorded at carryover basis. The remainder of the investment in the assets and liabilities acquired (the 76.2% acquired by new stockholders) was recorded at
fair value. The excess of the purchase price over carryover basis of net assets acquired, treated as a deemed dividend of $21.5 million to continuing stockholders, was recognized as a reduction
of stockholders' equity (deficit). As a result, the total purchase price of $205.2 million was allocated to the assets and liabilities based on their estimated fair values at the Acquisition
date, after taking into account carryover basis as discussed above. The estimated fair values were determined by valuation reports provided by independent third-party appraisals.

RESULTS OF OPERATIONS

For discussion purposes only, our 2004 results discussed below represent the mathematical addition of the historical results for the Predecessor period from
December 28, 2003 through May 10, 2004 and the Successor period from May 11, 2004 through January 1, 2005. This approach is not consistent with generally accepted
accounting principles and yields results that are not comparable on a period-to-period basis due to the new basis of accounting established at the Acquisition date. However, we
believe it is the most meaningful way to comment on the results of operations for 2004 compared to those of 2006 and 2005 because a discussion of the partial period from December 28, 2003
through May 10, 2004 (Predecessor) separately from the period from May 11, 2004 through January 1, 2005 (Successor) compared to the period from January 1, 2006 through
December 30, 2006 and the period from January 2, 2005 through December 31, 2005 would not be meaningful.

Fiscal
2004 includes the periods from December 28, 2003 through May 10, 2004 (Predecessor) and May 11, 2004 through January 1, 2005 (Successor). The combined
2004 consisted of 53 weeks. Although 2004 had 53 weeks compared to only 52 weeks in 2006 and 2005, 2004 had only one more shipping day for our wholesale segment. Therefore, the financial results for
the three years are comparable. Our company-operated outlet stores and our internet operations include one more week in 2004 compared to 2006 and 2005 but the effect of this extra week on our results
of operations is not material.

|                                    |  | For the years ended |       |  |  
|----------------------------------- |  | ------------------- | ----- |  | -
|
|
|OPERATING DATA:                     |  |                     |       |  |  
|Wholesale sales                     |  | $                   | 360.6 |  | $
|Retail sales                        |  |                     | 56.2  |  |  
|                                    |  |                     |       |  |  
|Net sales                           |  |                     | 416.8 |  |  
|Cost of sales                       |  |                     | 260.0 |  |  
|                                    |  |                     |       |  |  
|Gross profit                        |  |                     | 156.8 |  |  
|Selling, general and administrative |  |                     | 101.3 |  |  
|Acquisition-related charges         |  |                     |      |  |  
|                                    |  |                     |       |  |  
|Operating income                    |  | $                   | 55.5  |  | $
|                                    |  |                     |       |  |  

(footnotes
appear on following page)

41

---



|                                    |  | As a percentage of net sales |  
|----------------------------------- |  | ---------------------------- | -
|
|
|OPERATING DATA:                     |  |                              |  
|Wholesale sales                     |  | 86.5                         | %
|Retail sales                        |  | 13.5                         |  
|                                    |  |                              |  
|Net sales                           |  | 100.0                        |  
|Cost of sales                       |  | 62.4                         |  
|                                    |  |                              |  
|Gross profit                        |  | 37.6                         |  
|Selling, general and administrative |  | 24.3                         |  
|Acquisition-related charges         |  |                             |  
|                                    |  |                              |  
|Operating income                    |  | 13.3                         | %
|                                    |  |                              |  

---

Our
net sales are derived from two segments, wholesale and retail. Our net sales within the wholesale segment are grouped by channel, based upon the brands we sell and the customers we
sell them to, as follows: (1) department stores and national chain stores, (2) mass merchants and (3) other.

Our
department stores and national chain stores channel primarily consists of sales of our Maidenform, Flexees, Lilyette, and private brands on a worldwide basis to customers within this
category. Within the mass merchant channel, we sell brands such as Sweet Nothings, Bodymates, Self Expressions and private brands that are primarily dedicated to specific customers. These brands are
all sold on a worldwide basis to mass merchants and, to a lesser degree, warehouse clubs. Our remaining sales are grouped within a channel designated as other and include private brand products sold
to specialty retailers and all brand sales to off-price retail stores. In addition, licensing income is included in our other channel.

|                                            |  | For the years ended |      
|------------------------------------------- |  | ------------------- | -----
|
|
|Department Stores and National Chain Stores |  | $                   | 222.8
|Mass Merchants                              |  |                     | 91.8 
|Other                                       |  |                     | 46.0 
|                                            |  |                     |      
|Total Wholesale                             |  |                     | 360.6
|                                            |  |                     |      
|Retail                                      |  |                     | 56.2 
|                                            |  |                     |      
|Total Consolidated Net Sales                |  | $                   | 416.8
|                                            |  |                     |      

42

---



Fiscal year ended December 30, 2006 compared with fiscal year ended December 31, 2005 (52 weeks in each fiscal year)

Net Sales.Consolidated net sales increased $34.6 million, or 9.1%, from $382.2 million in 2005 to
$416.8 million in 2006. Wholesale segment net sales increased by $32.8 million, or 10.0%, from $327.8 million in 2005 to $360.6 million in 2006. Net sales in our retail
segment increased by $1.8 million, or 3.3%, from $54.4 million in 2005 to $56.2 million in 2006. Total international sales, which are included in the wholesale segment, increased
$1.7 million, or 6.3%, from $26.8 million in 2005 to $28.5 million in 2006.

Of
the $32.8 million increase in the wholesale segment, $20.0 million of this increase was due to growth in net sales to department stores and national chain stores. This
increase was primarily driven by higher sales from Lilyette and Flexees product lines as a result of continued product fulfillment and new product introductions. Specific performance drivers for 2006
included continued strong growth in the overall shapewear category which includes our Flexees and Collection M brands. Additionally, we expanded our assortment in our full figure category of Lilyette
as well as gaining additional door distribution. An additional $16.6 million of the increase in the wholesale segment was from increased sales to mass merchants. Growth in the mass merchant
channel, including growth in the full figure category, was largely driven by the introduction of and the replenishment of a customer's private brand styles, a new program with a warehouse customer,
and entering into new product classifications, including shapewear, with one mass customer. Other net sales, which include sales to specialty retailers, off-price retailers, and licensing
income, decreased by $3.8 million largely driven by lower liquidation sales. Our international sales, which are included across all three channels of the wholesale segment, increased
$1.7 million to $28.5 million in 2006 primarily due to stronger sales from Russia, the Benelux countries and Ireland, partially offset by lower sales in the United Kingdom.

Retail
segment net sales increased $1.8 million largely driven by increased internet sales, increased same store sales and the effect of a more favorable product mix. We operated
76 outlet stores at the end of 2006 as compared to 74 stores at the end of 2005. Our internet sales increased $1.0 million from $2.4 million in 2005 to 3.4 million in 2006. Same
store sales, defined as stores that have been open for more than one year, increased 4.0%.

Gross Profit.Consolidated gross profit increased by $21.7 million from $135.1 million in 2005 to
$156.8 million in 2006. As a percentage of net sales, gross profit increased by 2.3 percentage points from 35.3% in 2005 to 37.6% in 2006. Our gross margins for 2006 were positively
impacted by a change in product mix and cost re-engineering from our sourcing initiatives. Our gross margins for 2005 included unfavorable manufacturing variances of $5.7 million
from plant closings and the unfavorable effect of excess and close-out inventories of approximately $3.9 million from the discontinuance of a full support product in late 2005.

Gross
profit from our wholesale segment increased by $18.9 million from $106.0 million in 2005 to $124.9 million in 2006. As a percentage of net sales, gross profit
from our wholesale segment increased by 2.3 percentage points from 32.3% in 2005 to 34.6% in 2006. As discussed above, wholesale gross margins were favorably affected by product mix, cost
re-engineering from our sourcing initiatives as well as less promotional activity with certain wholesale customers. Wholesale gross margins for 2005 included unfavorable manufacturing
variances related to plant closings of $5.7 million, in addition to the unfavorable effect of excess and close-out inventories of approximately $3.9 million from the
discontinuance of a full support product in late 2005.

Gross
profit from our retail segment increased by $2.8 million from $29.1 million in 2005 to $31.9 million in 2006. As a percentage of net sales, gross profit from
our retail segment increased by 3.3 percentage points from 53.5% in 2005 to 56.8% in 2006. Improved performance in the

43

---



retail
segment was largely driven by a change in overall product mix, cost re-engineering from our sourcing initiatives, and increased internet sales which have a higher gross margin.

Selling, General and Administrative Expenses (SG&A).Our consolidated SG&A decreased by $0.3 million, or 0.3%, from
$101.6 million in 2005 to $101.3 million in 2006. As a percentage of net sales, SG&A was 24.3% for 2006 and 26.6% for 2005.

Wholesale
segment SG&A, which include corporate-related expenses, decreased by $0.5 million, or 0.7%, to $73.6 million in 2006 from $74.1 million in 2005. As a
percentage of net sales, wholesale segment SG&A decreased from 22.6% in 2005 to 20.4% in 2006. The prior year included non-recurring expenses including initial public offering expenses of
$3.8 million, a special bonus paid in connection with the 2005 credit facility amendment of $1.5 million and severance expense of $1.3 million associated with the 2005 plant
closures. Partially offsetting these non-recurring expenses in 2006 were increased payroll and related benefits of $4.4 million, including severance of $0.7 million,
stock-based compensation expense of $0.4 million, incentive compensation of $1.0 million and other compensation of $0.5 million. In addition, 2006 includes a full year of
professional fees and insurance premiums which amounted to an increase of $1.8 million of public company related expenses, including expenses for Sarbanes-Oxley readiness and expenses
associated with the secondary stock offering in November 2006, and other expense increases of $0.6 million. Partially offsetting the 2006 increased expenses was a decrease in workers'
compensation expense of $0.7 million resulting from the closing of our manufacturing plants.

Retail
segment SG&A increased slightly by $0.2 million, or 0.7%, to $27.7 million in 2006 from $27.5 million in 2005. However, as a percentage of net sales, retail
segment SG&A decreased from 50.6% in 2005 to 49.3% in 2006. This increase of $0.2 million was a result of promotional strategies associated with our internet business partially offset by
operating fewer outlet stores through most of the year when compared to last year.

Operating Income.Our consolidated operating income increased $22.0 million from $33.5 million in 2005 to
$55.5 million in 2006. Operating income, as a percentage of net sales, increased from 8.7% in 2005 to 13.3% in 2006. Our 2005 consolidated operating income was negatively affected by
$6.6 million of non-recurring and unusual charges, including initial public offering expenses, severance expense, a special cash bonus paid in connection with the credit facility
amendment; and $5.7 million of plant closing costs.

For
the foregoing reasons, operating income for the wholesale segment was $51.3 million in 2006 as compared to $31.9 million in 2005. Also, for the reasons discussed above,
operating income for the retail segment increased $2.6 million from $1.6 million in 2005 to $4.2 million in 2006.

Interest Expense, Net.Interest expense, net decreased by $7.3 million, or 46.2% from $15.8 million in 2005 to
$8.5 million in 2006. This decrease was primarily the result of a lower average debt outstanding at a lower average interest rate for 2006 when compared to 2005 and a decrease in deferred
financing costs of $4.9 million associated with the amendment of the Company's credit facility on June 29, 2005.

The
highest level of debt outstanding for 2006 was $137.5 million, at an average interest rate of 6.5%, and the highest level of debt outstanding for 2005 was
$160.0 million, at an average interest rate of 6.8%.

Income Taxes.We had an income tax expense in 2006 of $19.2 million as compared to $8.7 million in 2005. The
effective tax rate for 2006 was 40.9% as compared to 49.4% for 2005. Our income tax expense for 2006 was negatively impacted by non-deductible expenses related to the secondary offering in
November 2006. Our income tax expense for 2005 was negatively

44

---



impacted
by non-deductible expenses incurred during 2005 in connection with our initial public offering.

Because
of significant net operating loss carryforwards (NOLs) available to offset income taxes payable, our cash income taxes to be paid are expected to be at a rate lower than our
effective income tax rate.

Net Income.For the foregoing reasons, our net income increased from $8.9 million in 2005 to $27.8 million in
2006.

Preferred Stock Dividends and Changes in Redemption Value.For 2005, preferred stock dividends and changes in redemption
value, including a special preferred stock dividend, were $17.3 million. All outstanding shares of preferred stock, including shares of preferred stock acquired upon the exercise of all
outstanding options to purchase shares of our preferred stock, were redeemed in connection with our initial public offering in July 2005.

Net Income (Loss) Available to Common Stockholders.For the foregoing reasons, our net income (loss) available to common
stockholders increased from a loss of $8.3 million in 2005 to income of $27.8 million in 2006.

Fiscal year ended December 31, 2005 compared with fiscal year ended January 1, 2005 (52 weeks as compared to 53 weeks)

Net Sales.Consolidated net sales increased $45.2 million, or 13.4%, from $337.0 million in 2004 to
$382.2 million in 2005. Wholesale segment net sales increased by $46.1 million, or 16.4%, from $281.7 million in 2004 to $327.8 million in 2005. Net sales in our retail
segment decreased by $0.9 million, or 1.6%, from $55.3 million in 2004 to $54.4 million in 2005.

Of
the $46.1 million increase in the wholesale segment, $28.5 million of this increase was due to growth in net sales to mass merchants, which included an
$8.0 million increase in the first quarter of 2005 due to the product placement in all stores for a mass merchant customer. In addition, net sales in this channel grew from new store openings
and floor space growth within existing stores, new product introductions, and existing product rollouts. An additional $13.5 million of the increase in the wholesale segment was from increased
sales to department stores and national chain stores driven by a $2.0 million launch of a line of panties at a national chain store, the introduction of the Dream Bra, strong demand for the
Lilyette and Flexees brands, continued growth in international net sales, and new store growth. In the second half of 2005, we were negatively affected by unusually large reserves for markdowns and
returns, particularly for the Full Support line. This product has been redesigned with an improved alternative, containing a Flex-to-Fit feature, which will be delivered to
customers in the Spring of 2006. We were also negatively affected by certain customers in this channel cautiously driving down inventory levels toward year-end. Additionally, other net
sales, which include sales to specialty retailers, off-price retailers, and licensing income, increased by $4.1 million largely driven by increased program sales and liquidations
with off-price retailers and an increase in licensing income. Our international sales, which are included across all three channels of the wholesale segment, increased $8.6 million
to $26.8 million in 2005.

Retail
segment net sales decreased $0.9 million reflecting select store closings in 2005 as a result of our efforts to optimize our portfolio of outlet stores. We operated 74
outlet stores at the end of 2005 as compared to 81 stores at the end of 2004. The decline in retail net sales in 2005 caused by fewer stores was offset, in part, by increased same store sales, defined
as stores that have been open for more than one year, of 5.5%, and internet sales nearly doubling to approximately $2.4 million.

45

---





Gross Profit.Consolidated gross profit increased by $27.1 million from $108.0 million in 2004 to
$135.1 million in 2005. As a percentage of net sales, gross profit increased by 3.3 percentage points from 32.0% in 2004 to 35.3% in 2005. In our wholesale segment, our gross margins for
2005 were negatively affected by $5.7 million of plant closing costs, including negative manufacturing variances associated with operating our plants at less than optimum capacity as we phased
out our internal manufacturing, and a loss on the disposal of plant assets. The 2004 margins were impacted by non-recurring adjustments of $19.8 million ($15.5 million
recognized by our wholesale segment and $4.3 million recognized by our retail segment) related to increasing inventories to fair market value and $2.8 million of additional depreciation
expense. The impact of closing our manufacturing facilities during 2005 on our consolidated gross margin, as a percentage of net sales, was a decrease in gross margin of 1.5 percentage points
to 35.3%. The impact of non-cash purchase accounting adjustments and the additional depreciation expense on our consolidated gross margin, as a percentage of net sales, was a decrease in
gross margin of 6.7 percentage points to 32.0% for 2004. Excluding these items, consolidated gross profit decreased 1.9 percentage points primarily due to the change in the sales mix by
channel, excess and close-out inventories particularly associated with our Full Support product line totaling approximately $3.9 million, and a highly promotional environment
causing increased markdown expenses for excess and close-out inventories.

Gross
profit from our wholesale segment increased by $22.7 million from $83.3 million in 2004 to $106.0 million in 2005. As a percentage of net sales, gross profit
from our wholesale segment increased by 2.7 percentage points from 29.6% in 2004 to 32.3% in 2005. The costs associated with the closing of our manufacturing facilities during 2005 decreased
our wholesale gross margin by 1.7 percentage points. The impact of the non-cash purchase accounting adjustments and additional depreciation expense to our 2004 wholesale gross
profit was a decrease in gross margin of 6.5 percentage points. Excluding these items, wholesale gross profit
decreased 2.1 percentage points primarily due to a change in the mix of net sales by channel, increased markdown expenses for excess and close-out inventories associated with our
Full Support product line of $3.9 million, and a highly promotional environment.

Gross
profit from our retail segment increased by $4.4 million from $24.7 million in 2004 to $29.1 million in 2005. As a percentage of net sales, gross profit from
our retail segment increased by 8.8 percentage points from 44.7% in 2004 to 53.5% in 2005. Our gross margins for 2005 were favorably impacted by increased internet sales at a higher gross
margin, offset in part by a change in sales mix in our retail stores. Our gross margins for 2004 were negatively impacted by the non-recurring purchase accounting adjustments related to
increasing inventories to fair market value at the date of the Acquisition. The impact of these adjustments on our 2004 retail gross profit was a decrease in gross margins of 7.8 percentage
points to 44.7%.

Selling, General and Administrative Expenses (SG&A).Our consolidated SG&A increased by $9.6 million, or 10.4%, from
$92.0 million in 2004 to $101.6 million in 2005. However, as a percentage of net sales, SG&A decreased from 27.3% to 26.6%, primarily as a result of increased net sales. The
$9.6 million increase is primarily a result of the following items within our wholesale segment: $3.8 million of expenses associated with our initial public offering; $1.7 million
of payroll and related benefits, primarily higher payroll expense with certain new positions, partially offset by a $0.6 million incentive bonus waived by our Chief Executive Officer;
$0.8 million related to the cheap stock portion of stock-based compensation expense; $1.5 million special cash bonus paid in connection with the credit facility amendment;
$1.3 million severance expense and other expenses associated with the closing of the manufacturing facilities; and $1.5 million of other expenses. These increases are offset in part by a
reduction in SG&A for our retail segment of $1.0 million primarily as a result of seven fewer stores in 2005. Our 2004 SG&A included $1.1 million

46

---



of
additional depreciation and amortization expense from non-cash purchase accounting adjustments as a result of the Acquisition.

Wholesale
segment SG&A, which includes corporate-related expenses, increased by $10.6 million, or 16.7%, to $74.1 million in 2005 from $63.5 million in 2004. As a
percentage of net sales, wholesale segment SG&A increased slightly from 22.5% to 22.6%. The increase of $10.6 million is a result of the items discussed above.

Retail
segment SG&A decreased by $1.0 million, or 3.5%, to $27.5 million in 2005 from $28.5 million in 2004. As a percentage of net sales, retail segment SG&A
decreased slightly from 51.5% to 50.6%. This decrease was primarily as result of seven fewer stores in 2005 when compared to 2004.

Acquisition-Related Charges.Acquisition-related charges of $14.3 million were recorded in 2004 in connection with the
Acquisition, including (i) $6.6 million for sellers' transaction fees and expenses, (ii) $5.6 million for stock-based compensation expense from settlement of stock options
on May 10, 2004, (iii) $2.0 million in special compensation paid to management and (iv) $0.1 million in other Acquisition-related charges.

Operating Income.Our consolidated operating income increased $31.8 million from $1.7 million in 2004 to
$33.5 million in 2005. Operating income, as a percentage of net sales, increased from 0.5% in 2004 to 8.7% in 2005. Our 2005 consolidated operating income was negatively affected by
$7.4 million of unusual charges, including initial public offering expenses, severance expense and other expenses, a special cash bonus paid in connection with the credit facility amendment,
the cheap stock portion of stock-based compensation expense; and $5.7 million of plant closing costs. Our 2004 operating income was negatively affected by non-cash purchase
accounting adjustments and additional depreciation and amortization both totaling $23.7 million and $14.3 million of Acquisition-related charges. Excluding these items, operating income
as a percentage of net sales would have increased from 11.8% in 2004 to 12.2% in 2005.

For
the foregoing reasons, operating income for the wholesale segment was $31.9 million in 2005 as compared to $19.8 million in 2004. Also, for the reasons discussed above,
operating income for the retail segment increased $5.4 million, from a loss of $3.8 million in 2004 to income of $1.6 million in 2005.

Interest Expense, Net.On June 29, 2005, we amended our credit facility by prepaying the total balance of
$50.0 million outstanding on our Second Lien Facility bearing an interest rate of LIBOR plus 7.5%. Simultaneously, we increased the borrowings on our First Lien Term Facility from
$88.9 million to $150.0 million and modified the interest rate from LIBOR plus 2.75% to LIBOR plus 2.25%. The interest rate margin was reduced by 0.25% on December 29, 2005 due to
the completion of our initial public offering and further reduced by 0.25% as a result of our having a debt to earnings before interest, taxes, depreciation, and amortization (EBITDA) leverage ratio
of less than 3 to 1 as of the third quarter of 2005. The Prime rate margin and the LIBOR margin will be determined on a quarterly basis based on our leverage ratio for the preceding four quarters.

Interest
expense, net increased by $6.0 million from $9.8 million in 2004 to $15.8 million in 2005. This increase was a result of expensing deferred financing costs
of $4.9 million in connection with the amendment of our Credit Facility on June 29, 2005, and higher debt outstanding at a higher interest rate during 2005. Interest expense in 2004
included $1.2 million related to the early termination of our credit facilities and the acceleration of deferred financing fees as of May 10, 2004 in connection with the Acquisition.

47

---



Our
highest level of debt outstanding for 2005 was $160.0 million, at an average interest rate of 6.8%. Our highest level of debt outstanding for the Successor period from
May 11, 2004 through January 1, 2005 was $162.5 million, at an average interest rate of 6.6%, and our highest level of debt outstanding for the Predecessor period from
December 28, 2003 through May 10, 2004 was $57.8 million, at an average interest rate of 4.2%.

Income Taxes.We had an income tax expense in 2005 of $8.7 million as compared to income tax benefit of
$0.4 million in 2004. The effective tax rate for 2005 was 49.4% as compared to (5.5)% for 2004. Our income tax expense for 2005 was negatively impacted by non-deductible expenses
incurred during 2005 in connection with our initial public offering. During 2004, we incurred losses before the provision for income taxes. The income tax benefit from the losses was negatively
impacted by non-deductible expenses incurred during 2004 in connection with the Acquisition.

Because
of significant net operating loss carryforwards (NOLs) available to offset income taxes payable, our cash income taxes to be paid are expected to be at a rate significantly lower
than our effective income tax rate for the next several years.

Net Income (Loss).For the foregoing reasons, our net income (loss) increased from a loss of $7.6 million in 2004 to
income of $8.9 million in 2005.

Preferred Stock Dividends and Changes in Redemption Value.On July 27, 2005, our preferred stock and options to
purchase our preferred stock were redeemed in connection with our initial public offering. For 2005, preferred stock dividends and changes in redemption value include a special preferred stock
dividend of $13.3 million. For 2004, there was no such special dividend.

Net Loss Available to Common Stockholders.For the foregoing reasons, our net loss available to common stockholders decreased
from a loss of $12.4 million in 2004 to a loss of $8.3 million in 2005.

LIQUIDITY AND CAPITAL RESOURCES

For discussion purposes only, our 2004 cash flow data discussed below represent the mathematical addition of the historical cash flow data for the Predecessor
period from December 28, 2003 through May 10, 2004 and the Successor period from May 11, 2004 through January 1, 2005. This approach is not consistent with generally
accepted accounting principles and yields results that are not comparable on a period-to-period basis due to the new basis of accounting established at the Acquisition date.
However, we believe it is the most meaningful way to comment on the cash flows for 2004 compared to 2006 and 2005 because a discussion of partial periods would not be meaningful.

Our
cash requirements are primarily for working capital, debt service, our stock repurchase program and capital expenditures. Our primary source of liquidity will continue to be cash
flows from operations and borrowings under our Revolving Facility (defined below).

In
2007, we expect to spend a total of approximately $6.9 million on capital expenditures, driven by information technology upgrades including system enhancements specifically
related to distribution operations and expenditures associated with the relocation of our company headquarters.

We
had $14.6 million and $31.0 million in cash and cash equivalents as of December 30, 2006 and December 31, 2005, respectively. The decrease in cash of
$16.4 million is primarily a result of debt prepayments of $27.5 million and purchases of our common stock of $7.6 million.

48

---



Partially
offsetting this decrease was an increase in net income reduced by changes in working capital.

Our
existing first lien facilities entered into in connection with the Acquisition, were amended and restated in June 2005 ("Amended and Restated Credit Facility") to provide for
borrowings in the aggregate amount of $200.0 million maturing on May 11, 2010 and is comprised of: (i) a $150.0 million amortizing term loan facility (the "Term Loan
Facility") and (ii) a $50.0 million revolving credit facility (the "Revolving Facility.")

On
February 8, 2006, the Board of Directors approved a stock repurchase program in an amount up to $20.0 million and we entered into the First Amendment to the Amended and
Restated Credit Facility, amending certain provisions to enable us to initiate our stock repurchase program. Through December 30, 2006, we repurchased $7.6 million of common stock at an
average price per share of $11.30. The stock repurchase program, which is open-ended, allows us to repurchase our shares of common stock on the open market depending on market conditions
and other corporate considerations from available cash flow and borrowings under our Revolving Facility.

At
December 30, 2006, we had $110.0 million outstanding under our Term Loan Facility and we had $0 outstanding and approximately $47.7 million was available for
borrowings under our Revolving Facility, after giving effect to $2.3 million of outstanding letters of credit. We use the letters of credit as collateral for our workers' compensation insurance
programs and bonds issued on our behalf to secure our obligation to pay customs duties. We continued to de-leverage our balance sheet with $27.5 million of debt prepayments during
2006. With each debt prepayment, our amortization schedule is revised. Our next scheduled mandatory principal payment will be October 3, 2009. At December 30, 2006, we had a ratio of
debt to earnings before interest, taxes, depreciation and amortization (EBITDA) of 1.83 to 1.0. There will be no mandatory excess cash flow prepayment for 2006 because our ratio of debt to EBITDA is
less than 2.5 to 1.0 as of December 30, 2006.

The
Amended and Restated Credit Facility contains affirmative and restrictive covenants, including: (a) maintenance of a minimum fixed charge coverage ratio,
(b) maintenance of a maximum leverage ratio, (c) limitations on consolidated capital expenditures, (d) limitations on the incurrence of indebtedness and liens,
(e) limitations on investments/acquisitions and (f) restrictions on payments between Maidenform Brands, Inc. and its subsidiaries. There are a number of circumstances in which
additional partial prepayments are required based upon conditions set forth in the Amended and
Restated Credit Facility, including net asset sales and net insurance/condemnation proceeds not reinvested in other assets of the business, net securities proceeds from the issuance of capital stock
(excluding the initial public offering proceeds), additional debt facilities, and a percentage of annual consolidated excess cash flows, as defined.

The
financial covenants for this facility include various restrictions with respect to the Company and its wholly owned subsidiary Maidenform, Inc., including the transfer of
assets or the payment of dividends between Maidenform, Inc. and its subsidiaries and the Company. At December 30, 2006 and December 31, 2005, Maidenform, Inc. had
restricted net assets of approximately $64.7 million, or 86.4%, of total net assets and $30.9 million, or 58.7%, of total net assets, respectively. We were in compliance with all debt
covenants at December 30, 2006 and December 31, 2005.

On
July 22, 2005, we priced an initial public offering of 14,513,889 shares of common stock of which 3,375,000 and 11,138,889 shares were offered by us and selling stockholders,
respectively, at a price of $17.00 per share. Upon the consummation of the offering on July 27, 2005, net proceeds of $52.6 million and $176.1 million were distributed to us and
selling stockholders, respectively. We did not receive any of the proceeds from the sale of shares by the selling

49

---



stockholders.
Approximately $46.8 million of the net proceeds to us were used to redeem all the outstanding shares of our preferred stock, including shares of preferred stock acquired upon the
exercise of all outstanding options to purchase shares of our preferred stock, and to pay all accrued and unpaid dividends associated with the preferred stock and preferred stock options. The
remaining proceeds were used to pay down our Revolving Facility.

We
believe that our existing cash balances and available borrowings under the Revolving Facility, along with our future cash flow from operations, will enable us to meet our liquidity
needs and capital expenditure requirements for at least the next twelve months.

Operating activities.In 2006, 2005 and 2004, we generated $21.6 million, $25.4 million and
$33.5 million, respectively, in cash flow from operations. Cash flow from operations during 2006 was negatively impacted by increased working capital requirements, partially offset by an
increase in net income compared to 2005. The primary reason for the increased working capital in 2006 was an $11.7 million increase in inventory at the end of 2006 versus a decrease of
$1.8 million in 2005 as a result of several factors including, among other things, higher sales volume and our desire to increase our inventory levels for higher customer fulfillment of orders
and to take advantage of incremental sales opportunities and meet ongoing sales demand of our products. Another contributing factor was a $6.0 million decrease in accounts payable at the end of
2006 versus an increase of $7.5 million in 2005. This decrease in accounts payable was due to the timing of payments and inventory receipts. Accounts receivable increased $5.0 million at
the end of 2006 versus an increase of $10.2 million in 2005 as a result of higher wholesale net sales and the timing of cash collections. The reduction in cash provided by operations did not
result in increased borrowings due to the availability of our cash on hand.

Cash
flows from operations during 2005 included the impact of non-recurring items such as expenses associated with the initial public offering, a special bonus paid in
connection with the credit facility amendment, incremental manufacturing costs as a result of phasing out all internal manufacturing and prepayment fees in connection with our Credit Facility
amendment. The reduction in cash provided by operations compared to 2004 was primarily due to these non-recurring items and an increase in working capital requirements in 2005 partially
offset by an increase in net income, as adjusted for non-cash items. The primary reason for the larger increase in working capital requirements in 2005 was a $10.2 million increase
in accounts receivable at the end of 2005 versus a decrease of $3.4 million in 2004. The increase in accounts receivable was primarily due to wholesale net sales increasing 9.4% in the fourth
quarter of 2005 as compared to the fourth quarter of 2004. In addition, accrued expenses decreased largely as a result of severance payments made in 2005. These factors were partially offset by an
increase in accounts payable as a result of the timing of payments and an increase in income taxes payable in 2005 compared to 2004.

Investing activities.Cash flows used in investing activities were $2.7 million in 2006 compared to cash provided by
investing activities of $2.9 million in 2005 and cash flows used in investing activities of $161.1 million in 2004. Cash flows used in investing activities in 2006 were for capital
expenditures. During 2005, cash flows includes proceeds received from the sale of our manufacturing facilities, net of capital expenditures. The significant use of cash in 2004 was primarily due to
payments of $158.5 million related to the Acquisition.

Financing activities.Cash flows used in financing activities were $35.3 million in 2006 compared to cash used in
financing activities of $20.4 million in 2005 and cash flows provided by financing activities of $149.8 million in 2004. The increase in cash used in financing activities for 2006 was
due to prepayments of our Term Loan Facility outstanding totaling $27.5 million and the repurchase of common stock as part of our $20.0 million stock repurchase program totaling

50

---



$7.6 million.
Cash flows used in financing activities during 2005 were primarily from lower net borrowings and the payment of a special preferred stock dividend partially offset by the net
proceeds from our initial public offering during 2005. The cash provided from financing activities during 2004 was primarily from borrowings from new credit facilities entered into at the time of the
Acquisition, offset by the payment of all debt outstanding at May 11, 2004.

Contractual obligations, commitments and off balance sheet arrangements

We have various contractual obligations which are recorded as liabilities in our consolidated financial statements. Other items, such as certain purchase
commitments and other executory contracts, are not recognized as liabilities in our consolidated financial statements but are required to be disclosed. For example, we are contractually committed to
make certain minimum lease payments for the use of property under operating lease agreements.

The
following table summarizes our significant contractual obligations and commercial commitments at December 30, 2006 and the future periods in which such obligations are
expected to be settled in cash. In addition, the table reflects the timing of principal payments on outstanding borrowings. Additional details regarding these obligations are provided in the notes to
the audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

|                                            |  | In fiscal |       |  |   |     
|------------------------------------------- |  | --------- | ----- |  | - | ----
|
|
|Long-term debt(1)                           |  | $         |      |  | $ |    
|Interest on long-term debt(2)               |  |           | 7.5   |  |   | 7.5 
|Obligations under capital lease(3)          |  |           | 0.1   |  |   | 0.1 
|Operating leases                            |  |           | 5.4   |  |   | 6.0 
|                                            |  |           |       |  |   |     
|Total financial obligations                 |  |           | 13.0  |  |   | 13.6
|                                            |  |           |       |  |   |     
|Purchase obligations(4)                     |  |           | 92.1  |  |   | 0.2 
|                                            |  |           |       |  |   |     
|Total financial obligations and commitments |  | $         | 105.1 |  | $ | 13.8
|                                            |  |           |       |  |   |     

---

In
addition to the total contractual obligations and commitments included in the table above, we have pension and post-retirement benefit obligations included in other
non-current liabilities, as further described in the notes to the audited consolidated financial statements included elsewhere

51

---



in
this Annual Report on Form 10-K. We expect to contribute approximately $2.0 million to our pension and post-retirement plans before the end of
September 2007.

Off-Balance Sheet Agreements.Our most significant off-balance sheet financing arrangements as of
December 30, 2006 are non-cancelable operating lease agreements, primarily for our company-operated outlet stores, our new company headquarters and our warehouse distribution center
in Ireland. We do not participate in any off-balance sheet arrangements involving unconsolidated subsidiaries that provide financing or potentially expose us to unrecorded financial
obligations.

CRITICAL ACCOUNTING POLICIES

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements which have been prepared in
accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported
amounts of assets, liabilities, revenues, expenses, and related disclosure of contingent assets and liabilities. We base our estimates on historical experience and on various other assumptions that we
believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other
sources. Actual results may differ from these estimates under different assumptions or conditions.

Our
significant accounting policies are described in our notes to the audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
The following discussion addresses our critical accounting policies, which are those that require our most difficult and subjective judgments, often as a result of the need to make estimates about the
effect of matters that are inherently uncertain.

Accounts Receivable.Accounts receivable consist primarily of amounts due from customers. We provide reserves for accounts
receivable that may not be realized as a result of uncollectibility, sales returns, markdowns, and other customer allowances. Reserves are determined based on historical experience, credit quality,
age of accounts receivable balances, and economic conditions that may affect a customer's ability to pay. We believe that our reserves provide reasonable assurance that such balances are reflected at
net realizable value.

Inventories.Inventories are stated at the lower of cost or market. The cost of wholesale inventory is based on standard
costs, which approximate first-in, first-out (FIFO), while the cost of product acquired from third parties for sale through our retail segment is based on the retail inventory
method. We provide reserves for slow-moving inventory equal to the difference between the cost of inventory and the estimated market value based upon assumptions about future demand and
market conditions. If actual market conditions are less favorable than those we project, additional reserves may be required.

Goodwill and Intangible Assets.Goodwill and other intangible assets with indefinite useful lives are evaluated by us for
impairment on an annual basis, or more frequently if certain events occur or circumstances exist. We evaluated goodwill and intangible assets during the fourth quarter of 2006 and determined that no
impairment exists and will perform the impairment evaluation annually during the fourth quarter of each year.

We
allocate our goodwill to our reporting units. In evaluating goodwill for impairment, we compare the fair value of the reporting unit to its carrying amount. If the fair value is less
than the carrying amount, an impairment loss is recorded to the extent that the implied fair value of the

52

---



goodwill
is less than its carrying amount. To determine the fair values, we use both a discounted cash flow approach and a market approach.

In
reviewing intangible assets with indefinite useful lives for impairment, we compare the carrying amount of such asset to its fair value. We estimate the fair value using discounted
cash flows expected from the use of the asset. When the estimated fair value is less than its carrying amount, an impairment loss is recognized equal to the difference between the asset's fair value
and its carrying amount. In addition, intangible assets with indefinite useful lives are reviewed for impairment whenever events such as product discontinuance or other changes in circumstances
indicate that the carrying amount may not be recoverable.

The
performance of the goodwill and intangible asset impairment tests are subject to significant judgment in determining the estimation of future cash flows, the estimation of discount
rates, and other assumptions. Changes in these estimates and assumptions could have a significant impact on the fair value and impairment of goodwill and intangible assets.

Impairment of Long-Lived Assets.Long-lived assets, primarily property, plant and equipment and
intangible assets with finite lives, are periodically reviewed and evaluated by us when events and circumstances indicate that the carrying amount of these assets may not be recoverable. For
long-lived assets, this evaluation is based on the expected future undiscounted operating cash flows of the related assets. Should such evaluation result in us concluding that the carrying
amount of long-lived assets has been impaired, an appropriate write-down to their fair value is recorded.

Revenue Recognition.Net sales from the wholesale segment are recognized when merchandise is shipped to customers, at which
time title and the risks and rewards of ownership pass to the customer and persuasive evidence of a sale arrangement exists, delivery of the product has occurred, the price is fixed or determinable,
and payment is reasonably assured. In the case of sales by our retail operations, net sales are recognized at the time the customer takes possession of the merchandise at the
point-of-sale in our stores and for our internet sales, net sales are recognized when the products are shipped and title passes to the customer. Reserves for sales returns,
markdown allowances, cooperative advertising, discounts and other customer deductions are provided when sales are recorded or when the commitment is incurred.

Income Taxes.We account for income taxes using the liability method which recognizes the amount of income tax payable or
refundable for the current year and recognizes deferred tax liabilities and assets for the future tax consequences of the events that have been recognized in the financial statements or tax returns.
We routinely evaluate all deferred tax assets to determine the likelihood of their realization and record a valuation allowance if it is more likely than not that a deferred tax asset will not be
realized. The assessment requires us to consider all available positive and negative evidence to determine whether, based on such evidence, it is more likely than not that our net deferred tax assets
will be realized in future periods.

Application of Purchase Accounting.The consummation of the Acquisition on May 11, 2004 resulted in purchase
accounting adjustments to our consolidated balance sheet in accordance with SFAS No. 141, "Business Combinations" and EITF 88-16, "Basis in Leveraged Buyout Transactions." See notes
to the audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K. These purchase accounting entries resulted in a partial step-up
of our consolidated balance sheet whereby certain of our assets and liabilities were adjusted to reflect approximately 76% of their fair market value and approximately 24% of their historic carrying
value. The fair values of the majority of our assets and liabilities were determined based upon a variety of valuation methods including present value, depreciated replacement cost, market values
(where available) and selling prices less cost to dispose. Valuations were performed by various

53

---



independent
valuation specialists and actuaries for a significant portion of our assets and liabilities. The most significant assumptions, which were made by us in consultation with specialists,
related to discount rates, growth rates, cost of capital, royalty rates, tax rates and remaining useful lives. We believe that the assumptions used were appropriate and consistent with
observable market comparables. Changes to these assumptions could have resulted in significantly different values attributed to assets and liabilities. These values impact the amount of annual
depreciation and amortization expense and could impact the results of future impairment reviews.

For
our trademarks and royalty licenses, which were valued by a third-party appraiser, we determined that certain trademarks and royalty licenses have indefinite lives. This
determination was made after consideration of qualitative factors such as the length of time the trade names have been in existence, the strength of the name, the overall legal, regulatory,
contractual, competitive and economic environment in which these intangible assets exist and the lack of other factors that would limit the useful life of the underlying asset. Should factors change
which would require us to
amortize these intangibles, the resulting amortization expense could be material to our results of operations.

Accrued Expenses.Accrued expenses for health insurance, workers' compensation insurance, incentive compensation,
professional fees, and other outstanding obligations are based on actual commitments. These estimates are updated periodically as additional information becomes available.

Benefit Plans (including postretirement plans).The long-term rate of return for our pension plan is established
via a building block approach with proper consideration of diversification and rebalancing. Historical markets are studied and long-term historical relationships between equity and
fixed-income securities are preserved consistent with the widely accepted capital market principle that assets with higher volatility generate a greater return over the long run. Current market
factors, such as inflation and interest rates, are evaluated before long-term capital market assumptions are determined. We employ a total return investment approach whereby a mix of
equities and fixed-income investments are used to maximize the long-term return of plan assets for a prudent level of risk. Risk tolerance is established through careful consideration of
plan liabilities, plan funded status, and corporate financial condition. The assets of our pension plan are held in pooled-separate accounts and are invested in mutual funds consisting of a
diversified blend of equity and fixed income securities. We use this investment approach in order to meet its diversification and asset allocation goals. Furthermore, equity investments are
diversified across domestic and foreign stocks, as well as growth, value, and small and large capitalizations. Investment risk is measured and monitored on an ongoing basis through quarterly
investment portfolio reviews, annual liability measurements, and periodic asset/liability studies. We expect to contribute approximately $1.9 million to our pension plan in 2007 based upon the
current funded status and expected asset return assumptions.

At
December 30, 2006, we increased the discount rate assumption from 5.50% to 6.00% for the pension plan to reflect changes in the index fund that closely matches our expected
pension benefit payouts. At December 30, 2006, we used a long-term rate of return assumption of 8.5% based on the investment return of our pension plan assets, which are primarily
in equity securities. A 0.5% decrease or increase in the discount rate would affect our pension expense by less than $0.1 million. Similarly, a 0.5% decrease or increase in the expected return
on plan assets would affect our pension expense by less than $0.1 million.

Effective
on January 1, 2007, the Company's pension plan was frozen. See notes to the audited consolidated financial statements included elsewhere in this Annual Report on
Form 10-K.

54

---



The
postretirement medical plans are unfunded plans. We expect to contribute to the plans an amount equal to benefit payments to be made in 2007 which are estimated to be
$0.1 million.
Changes in assumptions related to our post retirement plans would not materially impact our consolidated statements of financial position, results of operations or cash flows.

Recently issued accounting standards

In July 2006, the FASB issued FASB Interpretation No. 48 (FIN No. 48), "Accounting for Uncertainty in Income Taxes," which clarifies the
accounting for uncertainty in income taxes recognized in an enterprise's financial statements in accordance with SFAS No. 109, "Accounting for Income Taxes." This interpretation prescribes a
recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. This interpretation also
provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. FIN No. 48 is effective for fiscal years beginning after
December 15, 2006. The cumulative effect of applying FIN No. 48, if any, will be reported as an adjustment to retained earnings at the beginning of the period in which it is adopted. We
will adopt FIN No. 48 in the first quarter of 2007. We are evaluating our tax position and the impact that the guidance will have on our consolidated financial statements.

In
September 2006, the FASB issued SFAS No. 158, "Employers Accounting for Defined Benefit Pensions and Other Postretirement Plansan amendment of FASB
Statements No. 87, 88, 106, and 123(R)." On December 30, 2006, we adopted the recognition and disclosure provisions of SFAS No. 158. See notes to the audited consolidated
financial statements included elsewhere in this Annual Report on Form 10-K.

55

---



ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Foreign Currency Risk.We do not believe that we have significant foreign currency transactional exposures. Our net sales for
the years ended 2006, 2005 and 2004 in currencies other than U.S. dollars were approximately $26.5 million, $23.3 million and $16.2 million, respectively, of our total net sales.
During the years 2006, 2005 and 2004, our net sales were favorably impacted by $0.8 million, $0.6 million and $1.2 million, respectively, due to foreign exchange rates. Most of
our purchases are denominated in U.S. dollars. Approximately 70% of our total sourcing is concentrated in two foreign countries, China and Indonesia. The impact of a 10% unfavorable change in the
exchange rate of the U.S. dollar against the prevailing market rates of the foreign currencies in which we have transactional exposures would be immaterial.

Interest Rate Risk.Interest rate risk is managed through a combination of variable and fixed rate debt composed of
long-term instruments. The objective is to maintain a cost-effective mix that we deem appropriate and we have entered into interest rate swap agreements to maintain that
balance. At December 30, 2006, our debt portfolio was composed of variable-rate debt of which we hedge approximately 27% to a fixed-rate. With respect to our
variable-rate debt, a 1% change in interest rates would have had a $1.1 million impact on our interest expense for 2006, a $1.2 million impact on our interest expense for
2005, a $1.0 million impact on our interest expense for the period from May 11, 2004 through January 1, 2005 (Successor), and a $0.2 million impact on our interest expense
for the period from December 28, 2003 through May 10, 2004 (Predecessor).

Commodity Price Risk.We are subject primarily to commodity price risk arising from fluctuations in the market prices of raw
materials used in the garments purchased from our sourcing vendors if they pass along these increased costs. During the past five years, there has been no significant impact from commodity price
fluctuations, nor do we currently use derivative instruments in the management of these risks. On a going-forward basis, fluctuations in crude oil prices or petroleum based product prices may also
influence the prices of the related items such as chemicals, dyestuffs, man-made fibers and foam. Any raw material price increase would increase our cost of sales and decrease our
profitability unless we are able to pass our higher costs on to our customers.

Inflation Risk.We are affected by inflation and changing prices from our suppliers primarily through the cost of raw
materials, increased operating costs and expenses, and fluctuations in interest rates. The effects of inflation on our net sales and operations have not been material in recent years. We do not
believe that inflation risk is material to our business or our consolidated financial position, results of operations or cash flows.

Seasonality.We have not experienced any significant seasonal fluctuations in our net sales or our profitability.

56

---





ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

MAIDENFORM BRANDS, INC. AND SUBSIDIARIES  INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

|                                                                                                                                                                                                                                                          |  | PAGE
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----
|Reports of Independent Registered Public Accounting Firm                                                                                                                                                                                                  |  | 58  
|Consolidated Balance Sheets at December 30, 2006 and December 31, 2005                                                                                                                                                                                    |  | 61  
|Consolidated Statements of Operations for the years ended December 30, 2006 and December 31, 2005, for the period from May 11, 2004 through January 1, 2005 (Successor) and from December 28, 2003 through May 10, 2004 (Predecessor)                     |  | 62  
|Consolidated Statements of Stockholders' Equity (Deficit) for the years ended December 30, 2006 and December 31, 2005, for the period from May 11, 2004 through January 1, 2005 (Successor) and from December 28, 2003 through May 10, 2004
(Predecessor) |  | 63  
|Consolidated Statements of Cash Flows for the years ended December 30, 2006 and December 31, 2005, for the period from May 11, 2004 through January 1, 2005 (Successor) and from December 28, 2003 through May 10, 2004 (Predecessor)                     |  | 64  
|Notes to Consolidated Financial Statements                                                                                                                                                                                                                |  | 65  

57

---





Report of Independent Registered Public Accounting Firm

To
the Board of Directors and Stockholders of
Maidenform Brands, Inc.:

In
our opinion, the accompanying consolidated statements of operations, stockholders' equity and cash flows present fairly, in all material respects, the results of the operations and
cash flows of Maidenform Brands, Inc. and its subsidiaries (Predecessor Company) for the period from December 28, 2003 through May 10, 2004 in conformity with accounting
principles generally accepted in the United States of America. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit. We conducted our audit of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis for our opinion.

As
explained in Note 12 to the consolidated financial statements, controlling ownership of the Predecessor Company was acquired in a purchase transaction as of May 11,
2004. The acquisition was accounted for as a purchase and, accordingly, the consolidated financial statements of the successor company are not comparable to those of the Predecessor Company.

/s/
PricewaterhouseCoopers LLP

Florham
Park, New Jersey
April 21, 2005

58

---





Report of Independent Registered Public Accounting Firm

To
the Board of Directors and Stockholders of
Maidenform Brands, Inc.:

We
have completed an integrated audit of Maidenform Brands, Inc.'s 2006 consolidated financial statements and of its internal control over financial reporting as of
December 30, 2006 and audits of its 2005 consolidated financial statements and its results of operations and cash flows for the period from May 11, 2004 through January 1, 2005 in
accordance with the standards of the Public Company Accounting Oversight Board (United States). Our opinions, based on our audits, are presented below.

Consolidated financial statements

In our opinion, the accompanying consolidated statements of operations, stockholders' equity and cash flows present fairly, in all material respects, the
financial position of Maidenform Brands, Inc. and its subsidiaries (Successor Company) at December 30, 2006 and December 31, 2005, and the results of their operations and their
cash flows for the years then ended and for the period from May 11, 2004 through January 1, 2005 in conformity with accounting principles generally accepted in the United States of
America. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our
audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material misstatement. An audit of financial statements includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the
overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

Internal control over financial reporting

Also, in our opinion, management's assessment, included in Management's Annual Report on Internal Control Over Financial Reporting appearing under Item 9A, that
the Company maintained effective internal control over financial reporting as of December 30, 2006 based on criteria established inInternal
ControlIntegrated Frameworkissued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), is fairly stated, in all material respects,
based on those criteria. Furthermore, in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 30, 2006, based on
criteria established inInternal ControlIntegrated Frameworkissued by the COSO. The Company's management is responsible for maintaining
effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting. Our responsibility is to express opinions on management's
assessment and on the effectiveness of the Company's internal control over financial reporting based on our audit. We conducted our audit of internal control over financial reporting in accordance
with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective
internal control over financial reporting was maintained in all material respects. An audit of internal control over financial reporting includes obtaining an understanding of internal control over
financial reporting, evaluating management's assessment, testing and evaluating the design and operating effectiveness of internal control, and performing such other procedures as we consider
necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinions.

A
company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted accounting principles.

59

---



A company's
internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and
fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial
statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and
directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could
have a material effect on the financial statements.

Because
of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future
periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/
PricewaterhouseCoopers LLP

Florham
Park, New Jersey
March 9, 2007

60

---





MAIDENFORM BRANDS, INC. AND SUBSIDIARIES        CONSOLIDATED BALANCE SHEETS        (in thousands, except share and per share amounts)

|                                              |                                                                                                                                                                                                  | December 30, 2006                          |         | December 31, 2005 |        
|--------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ------------------------------------------ | ------- | ----------------- | -------
|Assets                                        |                                                                                                                                                                                                  |                                            |         |                   |        
|Current assets                                |                                                                                                                                                                                                  |                                            |         |                   |        
|                                              | Cash and cash equivalents                                                                                                                                                                        |                                            | $       | 14,617            |        
|                                              | Accounts receivable, net                                                                                                                                                                         |                                            |         | 39,142            |        
|                                              | Inventories                                                                                                                                                                                      |                                            |         | 46,911            |        
|                                              | Deferred income taxes                                                                                                                                                                            |                                            |         | 9,459             |        
|                                              | Prepaid expenses and other current assets                                                                                                                                                        |                                            |         | 6,203             |        
|                                              |                                                                                                                                                                                                  |                                            |         |                   |        
|                                              |                                                                                                                                                                                                  | Total current assets                       |         |                   | 116,332
|Property, plant and equipment, net            |                                                                                                                                                                                                  |                                            | 18,454  |                   |        
|Goodwill                                      |                                                                                                                                                                                                  |                                            | 7,884   |                   |        
|Intangible assets, net                        |                                                                                                                                                                                                  |                                            | 99,678  |                   |        
|Other non-current assets                      |                                                                                                                                                                                                  |                                            | 2,505   |                   |        
|                                              |                                                                                                                                                                                                  |                                            |         |                   |        
|                                              |                                                                                                                                                                                                  | Total assets                               |         | $                 | 244,853
|                                              |                                                                                                                                                                                                  |                                            |         |                   |        
|Liabilities and stockholders' equity          |                                                                                                                                                                                                  |                                            |         |                   |        
|Current liabilities                           |                                                                                                                                                                                                  |                                            |         |                   |        
|                                              | Accounts payable                                                                                                                                                                                 |                                            | $       | 13,195            |        
|                                              | Accrued expenses and other current liabilities                                                                                                                                                   |                                            |         | 21,176            |        
|                                              |                                                                                                                                                                                                  |                                            |         |                   |        
|                                              |                                                                                                                                                                                                  | Total current liabilities                  |         |                   | 34,371 
|Long-term debt                                |                                                                                                                                                                                                  |                                            | 110,000 |                   |        
|Deferred income taxes                         |                                                                                                                                                                                                  |                                            | 16,223  |                   |        
|Other non-current liabilities                 |                                                                                                                                                                                                  |                                            | 9,358   |                   |        
|                                              |                                                                                                                                                                                                  |                                            |         |                   |        
|                                              |                                                                                                                                                                                                  | Total liabilities                          |         |                   | 169,952
|                                              |                                                                                                                                                                                                  |                                            |         |                   |        
|Commitments and contingencies (Note 8 and 19) |                                                                                                                                                                                                  |                                            |         |                   |        
|Stockholders' equity                          |                                                                                                                                                                                                  |                                            |         |                   |        
|                                              | Preferred stock$0.01 par value; 10,000,000 shares authorized and none issued and outstanding                                                                                                    |                                            |         |                  |        
|                                              | Common stock$0.01 par value; 100,000,000 shares authorized; 23,488,357 shares issued and 22,964,826 outstanding at December 30, 2006 and 23,488,357 issued and outstanding at December 31, 2005 |                                            |         | 235               |        
|                                              | Additional paid-in capital                                                                                                                                                                       |                                            |         | 59,478            |        
|                                              | Retained earnings (accumulated deficit)                                                                                                                                                          |                                            |         | 20,953            |        
|                                              | Accumulated other comprehensive income                                                                                                                                                           |                                            |         | 158               |        
|                                              | Treasury stock (523,531 shares at an average price per share of $11.31)                                                                                                                          |                                            |         | (5,923            | )      
|                                              |                                                                                                                                                                                                  |                                            |         |                   |        
|                                              |                                                                                                                                                                                                  | Total stockholders' equity                 |         |                   | 74,901 
|                                              |                                                                                                                                                                                                  |                                            |         |                   |        
|                                              |                                                                                                                                                                                                  | Total liabilities and stockholders' equity |         | $                 | 244,853
|                                              |                                                                                                                                                                                                  |                                            |         |                   |        

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

61

---



MAIDENFORM BRANDS, INC. AND SUBSIDIARIES        CONSOLIDATED STATEMENTS OF OPERATIONS        (in thousands, except share and per share amounts)

|                                                          |                                                    | Successor |            | Predecessor |  
|--------------------------------------------------------- | -------------------------------------------------- | --------- | ---------- | ----------- | -
|
|
|Net sales                                                 |                                                    | $         | 416,835    |             | $
|Cost of sales                                             |                                                    |           | 260,083    |             |  
|                                                          |                                                    |           |            |             |  
|                                                          | Gross profit                                       |           |            | 156,752     |  
|Selling, general and administrative expenses              |                                                    |           | 101,238    |             |  
|Acquisition-related charges                               |                                                    |           |           |             |  
|                                                          |                                                    |           |            |             |  
|                                                          | Operating income (loss)                            |           |            | 55,514      |  
|Interest expense, net                                     |                                                    |           | 8,521      |             |  
|                                                          |                                                    |           |            |             |  
|                                                          | Income (loss) before provision for income taxes    |           |            | 46,993      |  
|Income tax expense (benefit)                              |                                                    |           | 19,231     |             |  
|                                                          |                                                    |           |            |             |  
|                                                          | Net income (loss)                                  |           |            | 27,762      |  
|Preferred stock dividends and changes in redemption value |                                                    |           |           |             |  
|                                                          |                                                    |           |            |             |  
|                                                          | Net income (loss) available to common stockholders |           | $          | 27,762      |  
|                                                          |                                                    |           |            |             |  
|Basic earnings (loss) per common share                    |                                                    | $         | 1.21       |             | $
|                                                          |                                                    |           |            |             |  
|Diluted earnings (loss) per common share                  |                                                    | $         | 1.15       |             | $
|                                                          |                                                    |           |            |             |  
|Basic weighted average number of shares outstanding       |                                                    |           | 23,024,986 |             |  
|                                                          |                                                    |           |            |             |  
|Diluted weighted average number of shares outstanding     |                                                    |           | 24,194,468 |             |  
|                                                          |                                                    |           |            |             |  

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

62

---





MAIDENFORM BRANDS, INC. AND SUBSIDIARIES        CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)        (in thousands, except share amounts)

|                                                                                         |                            | Common
Stock             |  | Treasury
Stock |     |  |          |   |   |        |   |   |        
|---------------------------------------------------------------------------------------- | -------------------------- | ------------------------ |  | -------------- | --- |  | -------- | - | - | ------ | - | - | -------
|
|
|
|Predecessor:                                                                             |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|Balance at December 27, 2003                                                             |                            | 14,056,822               |  | $              | 141 |  | (328,943 | ) | $ | (2,714 | ) | $ | 80,709 
|Stock-based compensation                                                                 |                            |                          |  |                |     |  |          |   |   |        |   |   | 6,869  
|Tax effect on stock-based compensation                                                   |                            |                          |  |                |     |  |          |   |   |        |   |   | 1,420  
|Comprehensive loss                                                                       |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|Net loss                                                                                 |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|Changes during the period                                                                |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|                                                                                         |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|                                                                                         |                            | Total comprehensive loss |  |                |     |  |          |   |   |        |   |   |        
|                                                                                         |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|Balance at May 10, 2004                                                                  |                            | 14,056,822               |  | $              | 141 |  | (328,943 | ) | $ | (2,714 | ) | $ | 88,998 
|                                                                                         |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|Successor:                                                                               |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|Issuance of common stock at fair market value                                            |                            | 15,675,000               |  | $              | 157 |  |         |   | $ |       |   | $ | 27,761 
|Deemed dividend to continuing stockholders                                               |                            |                          |  |                |     |  |          |   |   |        |   |   | (21,529
|Preferred stock dividends and changes in redemption value                                |                            |                          |  |                |     |  |          |   |   |        |   |   | (4,756 
|Adjust common stock, subject to put option, to redemption value                          |                            |                          |  |                |     |  |          |   |   |        |   |   | 511    
|Stock-based compensation                                                                 |                            |                          |  |                |     |  |          |   |   |        |   |   | 251    
|Other stock transactions                                                                 |                            |                          |  |                |     |  |          |   |   |        |   |   | (140   
|Comprehensive loss                                                                       |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|Net loss                                                                                 |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|Changes during the period                                                                |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|                                                                                         |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|                                                                                         | Total comprehensive loss   |                          |  |                |     |  |          |   |   |        |   |   |        
|                                                                                         |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|Balance at January 1, 2005                                                               |                            | 15,675,000               |  |                | 157 |  |         |   |   |       |   |   | 2,098  
|Preferred stock dividends and changes in redemption value                                |                            |                          |  |                |     |  |          |   |   |        |   |   | (4,883 
|Initial public offering and exercise of stock options                                    |                            | 3,688,357                |  |                | 37  |  |          |   |   |        |   |   | 52,542 
|Reclassification of common stock subject to put optionupon extinguishment of put option |                            | 4,125,000                |  |                | 41  |  |          |   |   |        |   |   | 5,547  
|Preferred stock options purchased                                                        |                            |                          |  |                |     |  |          |   |   |        |   |   | (1,393 
|Adjust common stock, subject to put option, to redemption value                          |                            |                          |  |                |     |  |          |   |   |        |   |   | 768    
|Tax effect from exercise of stock options                                                |                            |                          |  |                |     |  |          |   |   |        |   |   | 2,775  
|Stock-based compensation                                                                 |                            |                          |  |                |     |  |          |   |   |        |   |   | 1,609  
|Comprehensive income                                                                     |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|Net income                                                                               |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|Changes during the period                                                                |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|                                                                                         |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|                                                                                         | Total comprehensive income |                          |  |                |     |  |          |   |   |        |   |   |        
|                                                                                         |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|Balance at December 31, 2005                                                             |                            | 23,488,357               |  |                | 235 |  |         |   |   |       |   |   | 59,063 
|Stock-based compensation                                                                 |                            |                          |  |                |     |  |          |   |   |        |   |   | 2,016  
|Purchase of common stock for treasury                                                    |                            |                          |  |                |     |  | (669,500 | ) |   | (7,563 | ) |   |        
|Stock options exercised                                                                  |                            |                          |  |                |     |  | 145,969  |   |   | 1,640  |   |   | (1,601 
|Initial adoption of SFAS No. 158, net of tax (Note 3)                                    |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|Comprehensive income                                                                     |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|Net income                                                                               |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|Changes during the period                                                                |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|                                                                                         |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|                                                                                         | Total comprehensive income |                          |  |                |     |  |          |   |   |        |   |   |        
|                                                                                         |                            |                          |  |                |     |  |          |   |   |        |   |   |        
|Balance at December 30, 2006                                                             |                            | 23,488,357               |  | $              | 235 |  | (523,531 | ) | $ | (5,923 | ) | $ | 59,478 
|                                                                                         |                            |                          |  |                |     |  |          |   |   |        |   |   |        

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

63

---





MAIDENFORM BRANDS, INC. AND SUBSIDIARIES        CONSOLIDATED STATEMENTS OF CASH FLOWS        (in thousands)

|                                                                                               |                                                                       | Successor                                                      |                                    | Predecessor |        
|---------------------------------------------------------------------------------------------- | --------------------------------------------------------------------- | -------------------------------------------------------------- | ---------------------------------- | ----------- | -------
|
|
|Cash flows from operating activities                                                           |                                                                       |                                                                |                                    |             |        
|Net income (loss)                                                                              |                                                                       | $                                                              | 27,762                             |             | $      
|Adjustments to reconcile net income (loss) to net cash from operating activities               |                                                                       |                                                                |                                    |             |        
|                                                                                               | Depreciation and amortization                                         |                                                                |                                    | 2,817       |        
|                                                                                               | Amortization of intangible assets                                     |                                                                |                                    | 1,160       |        
|                                                                                               | Amortization of deferred financing costs                              |                                                                |                                    | 888         |        
|                                                                                               | Purchase accounting step-up of inventory                              |                                                                |                                    |            |        
|                                                                                               | Stock-based compensation                                              |                                                                |                                    | 2,016       |        
|                                                                                               | Deferred income taxes                                                 |                                                                |                                    | 4,734       |        
|                                                                                               | Tax benefit from exercise of stock options                            |                                                                |                                    |            |        
|                                                                                               | Excess tax benefits related to share-based compensation               |                                                                |                                    | (1,881      | )      
|                                                                                               | Other non-cash items                                                  |                                                                |                                    |            |        
|                                                                                               | Net changes in operating assets and liabilities, (net of Acquisition) |                                                                |                                    |             |        
|                                                                                               |                                                                       | Accounts receivable                                            |                                    |             | (4,973 
|                                                                                               |                                                                       | Inventories                                                    |                                    |             | (11,656
|                                                                                               |                                                                       | Prepaid expenses and other current and non-current assets      |                                    |             | 1,868  
|                                                                                               |                                                                       | Accounts payable                                               |                                    |             | (6,017 
|                                                                                               |                                                                       | Accrued expenses and other current and non-current liabilities |                                    |             | (331   
|                                                                                               |                                                                       | Income taxes payable                                           |                                    |             | 5,246  
|                                                                                               |                                                                       |                                                                |                                    |             |        
|                                                                                               |                                                                       |                                                                | Net cash from operating activities |             |        
|                                                                                               |                                                                       |                                                                |                                    |             |        
|Cash flows from investing activities                                                           |                                                                       |                                                                |                                    |             |        
|Capital expenditures                                                                           |                                                                       |                                                                | (2,716                             | )           |        
|Proceeds from sale of assets                                                                   |                                                                       |                                                                |                                   |             |        
|Payments in connection with the Acquisition                                                    |                                                                       |                                                                |                                   |             |        
|                                                                                               |                                                                       |                                                                |                                    |             |        
|                                                                                               |                                                                       |                                                                | Net cash from investing activities |             |        
|                                                                                               |                                                                       |                                                                |                                    |             |        
|Cash flows from financing activities                                                           |                                                                       |                                                                |                                    |             |        
|Term loan facility repayments                                                                  |                                                                       |                                                                | (27,500                            | )           |        
|Term loan facility borrowings                                                                  |                                                                       |                                                                |                                   |             |        
|Repayments under revolving facility                                                            |                                                                       |                                                                |                                   |             |        
|Borrowings under revolving facility                                                            |                                                                       |                                                                |                                   |             |        
|Proceeds from issuance of preferred and common stock                                           |                                                                       |                                                                |                                   |             |        
|Redemption of preferred stock and preferred stock options and payment of accumulated dividends |                                                                       |                                                                |                                   |             |        
|Cash dividends paid                                                                            |                                                                       |                                                                |                                   |             |        
|Purchase of common stock for treasury                                                          |                                                                       |                                                                | (7,563                             | )           |        
|Proceeds from stock options exercised                                                          |                                                                       |                                                                | 171                                |             |        
|Common stock options purchased                                                                 |                                                                       |                                                                |                                   |             |        
|Payments of employee withholding taxes related to net stock option exercises                   |                                                                       |                                                                | (2,013                             | )           |        
|Excess tax benefits related to share-based compensation                                        |                                                                       |                                                                | 1,881                              |             |        
|Deferred financing costs                                                                       |                                                                       |                                                                | (300                               | )           |        
|                                                                                               |                                                                       |                                                                |                                    |             |        
|                                                                                               |                                                                       |                                                                | Net cash from financing activities |             |        
|Effects of exchange rate changes on cash                                                       |                                                                       |                                                                | 46                                 |             |        
|                                                                                               |                                                                       |                                                                |                                    |             |        
|                                                                                               |                                                                       |                                                                | Net (decrease) increase in cash    |             |        
|Cash and cash equivalents                                                                      |                                                                       |                                                                |                                    |             |        
|Beginning of period                                                                            |                                                                       |                                                                | 30,978                             |             |        
|                                                                                               |                                                                       |                                                                |                                    |             |        
|End of period                                                                                  |                                                                       | $                                                              | 14,617                             |             | $      
|                                                                                               |                                                                       |                                                                |                                    |             |        
|Supplementary disclosure of cash flow information                                              |                                                                       |                                                                |                                    |             |        
|Cash paid during the period                                                                    |                                                                       |                                                                |                                    |             |        
|Interest                                                                                       |                                                                       | $                                                              | 9,296                              |             | $      
|                                                                                               |                                                                       |                                                                |                                    |             |        
|Income taxes                                                                                   |                                                                       | $                                                              | 8,959                              |             | $      
|                                                                                               |                                                                       |                                                                |                                    |             |        
|Supplemental schedule of non-cash investing and financing activities                           |                                                                       |                                                                |                                    |             |        
|Equipment acquired with capital lease obligations                                              |                                                                       | $                                                              | 325                                |             | $      
|                                                                                               |                                                                       |                                                                |                                    |             |        

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

64

---



MAIDENFORM BRANDS, INC. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share amounts)

1. NATURE OF OPERATIONS

Maidenform Brands, Inc. and its subsidiaries (the "Company," "we," "us" or "our") design, source and market an extensive range of intimate apparel
products, including bras, panties and shapewear. We sell through multiple distribution channels including department stores and national chain stores, mass merchants (including warehouse clubs), and
other (including specialty retailers, off-price retailers and licensing income). In addition, we also operated 76 and 74 retail outlet stores as of December 30, 2006 and
December 31, 2005, respectively, and sell products on our websites.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

The accompanying consolidated financial statements include the accounts of Maidenform Brands, Inc. and its subsidiaries and the accounts of its
Predecessor. All significant intercompany transactions and balances have been eliminated in consolidation.

Use of estimates

The preparation of these consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires us
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 net sales and expenses during the reporting period. The more significant estimates and assumptions are those used in determining accounts receivable and inventory reserves,
deferred income tax valuation reserves, pension and postretirement liabilities, and goodwill and intangible impairment analyses. Actual results could ultimately differ from these estimates.

Fiscal reporting period

We report our annual results of operations based on a fiscal period comprised of 52 or 53 weeks. On May 11, 2004, we changed our year end to the Saturday,
in December or January, closest to December 31 from the last Saturday in the year. Our fiscal years 2006 and 2005 ended December 30, 2006 and December 31, 2005, respectively. Our
fiscal year 2004 is presented in the Successor period from May 11, 2004 through January 1, 2005, which included 34 weeks, and Predecessor period from December 28, 2003 through
May 10, 2004, which included 19 weeks. Unless otherwise stated, references to years in the financial statements refer to fiscal years.

Fair value of financial instruments

Cash and cash equivalents, accounts receivable, accounts payable and accrued expenses are reflected at fair value because of the short-term maturity
of these instruments. The
carrying amount of long-term debt at December 30, 2006 and December 31, 2005 approximates fair value as a result of the variable interest rates being accrued and paid on the
majority of our debt.

Foreign currency translation

We have wholly owned subsidiaries operating in Hong Kong, Indonesia, Mexico and Ireland. Subsidiaries operating in Mexico and Ireland function as distributors for
us. The subsidiaries in Hong Kong and Indonesia function as quality control centers for inventory purchases from third party vendors and other sourcing support services. These foreign operations use
their respective local

65

---



currency as the functional currency. Assets and liabilities of these subsidiaries are translated at the current exchange rates in effect at the balance sheet date while net
sales and expenses are translated at the average exchange rate for the period. The resulting translation adjustments are recorded as a component of accumulated other comprehensive income within
stockholders' equity.

Cash and cash equivalents

All highly liquid investments with a remaining maturity of three months or less at the date of our balance sheet are classified as cash.

Accounts receivable

Accounts receivable consist primarily of amounts due from customers. We provide reserves for accounts receivable that may not be realized as a result of
uncollectibility, sales returns, markdowns, and other customer allowances. Reserves are determined based on actual commitments, historical experience, credit quality, age of accounts receivable
balances, and
existing economic conditions. Reserves provided for accounts receivable aggregated $10,490 and $9,566 at December 30, 2006 and December 31, 2005, respectively. We believe that these
reserves provide reasonable assurance that such balances are reflected at net realizable value.

Inventories

Inventories are stated at the lower of cost or market. The cost of wholesale inventory is based on standard costs, which approximate first-in,
first-out (FIFO), while the cost of product acquired from third parties for sale through our retail segment is based on the retail inventory method. Inventories at December 30, 2006
and December 31, 2005 consist of finished goods inventory.

Property, plant and equipment

Property, plant and equipment additions are recorded at cost. Equipment under capital leases and related obligations are recorded at an amount equal to the
present value of future minimum lease payments computed on the basis of our incremental borrowing rate or, when known, the interest rate implicit in the lease. Depreciation and leasehold amortization
are calculated using the straight-line method over the estimated useful lives of the assets. Depreciation of equipment under capital leases is calculated on a straight-line
basis over the lease term and is included in depreciation expense.

Useful
lives for property, plant and equipment are established for each common asset class and are based on our historical experience:

Buildings and building improvements

10-50 yearsMachinery and production equipment

3-12 yearsFurniture, fixtures and equipment

5-12 yearsLeasehold improvements

Lesser of initial lease term or estimated useful life


Repairs
and maintenance are expensed in the year they are incurred. When fixed assets are sold or otherwise disposed, the original costs of the assets and the related accumulated
depreciation and any resulting profit or loss is credited or charged to earnings.

66

---



Operating leases

Several of our operating leases contain rent holidays and/or predetermined rent increases during the term of such leases. For these leases, the aggregate rental
expense is recognized on a straight-line basis over the initial lease term. The difference in lease expense charged to earnings in any year and amounts payable under the leases during that
year is recorded as deferred rent.

Amortization
of improvements to leased properties is computed using the straight-line method based upon the non-cancelable lease term of the applicable lease or
the estimated useful life of the improvements, whichever is less, and ranges from 4 months to 10 years. If we receive landlord incentives or allowances for leasehold improvements, the
incentive or allowance is recorded as deferred rent and amortized as a reduction to lease expense over the initial lease term.

Goodwill and intangible assets

Goodwill and other intangible assets with indefinite useful lives are evaluated by us for impairment on an annual basis, or more frequently if certain events
occur or circumstances exist. We evaluated goodwill and intangible assets during the fourth quarter of 2006 and determined that no impairment exists and will perform the impairment evaluation annually
during the fourth quarter of each year.

We
allocate our goodwill to our reporting units. In evaluating goodwill for impairment, we compare the fair value of the reporting unit to its carrying amount. If the fair value is less
than the carrying amount, an impairment loss is recorded to the extent that the implied fair value of the goodwill is less than its carrying amount. To determine the fair values, we use both a
discounted cash flow approach and a market approach.

In
reviewing intangible assets with indefinite useful lives for impairment, we compare the carrying amount of such asset to its fair value. We estimate the fair value using discounted
cash flows
expected from the use of the asset. When the estimated fair value is less than its carrying amount, an impairment loss is recognized equal to the difference between the asset's fair value and its
carrying amount. In addition, intangible assets with indefinite useful lives are reviewed for impairment whenever events such as product discontinuance or other changes in circumstances indicate that
the carrying amount may not be recoverable.

The
performance of the goodwill and intangible asset impairment tests are subject to significant judgment in determining the estimation of future cash flows, the estimation of discount
rates, and other assumptions. Changes in these estimates and assumptions could have a significant impact on the fair value and impairment of goodwill and intangible assets.

Impairment of long-lived assets

Long-lived assets, primarily property, plant and equipment and intangible assets with finite lives, are periodically reviewed and evaluated by us when
events and circumstances indicate that the carrying amount of these assets may not be recoverable. For long-lived assets, this evaluation is based on the expected future undiscounted
operating cash flows of the related assets. Should such evaluation result in us concluding that the carrying amount of long-lived assets has been impaired, an appropriate
write-down to their fair value is recorded.

Deferred financing costs

Debt financing costs are deferred and amortized to interest expense using the effective interest method over the term of the related debt instrument.

67

---



Interest rate swap agreements

We utilize interest rate swap agreements to manage interest rate exposure. The net interest paid or received on the swaps is recognized as interest expense. The
derivatives are recognized in the balance sheet as either an asset or liability measured at its fair value. The swaps are designated as cash flow hedges and changes in fair value, to the extent the
hedges are effective, will be recognized as components of other comprehensive income (loss) and subsequently reclassified into interest expense when the hedged exposure effects earnings. Hedge
ineffectiveness is measured at least quarterly based on the relative changes in fair value between the swap contract
and the hedged item over time. Any change in fair value resulting from ineffectiveness will be reported in earnings. There were no significant gains or losses recognized in earnings for hedge
ineffectiveness in 2006, 2005 and 2004.

Comprehensive income (loss)

Comprehensive income (loss) includes net income (loss) and adjustments for foreign currency translation, minimum pension liability and unrealized income (loss) on
interest rate swap agreements.

Revenue recognition

Net sales from our wholesale operations are recognized when merchandise is shipped to customers, at which time title and the risks and rewards of ownership pass
to the customer and persuasive evidence of a sale arrangement exists, delivery of the product has occurred, the price is fixed or determinable, and payment is reasonably assured. Reserves for sales
returns, markdown allowances, cooperative advertising, discounts and other customer deductions are provided when net sales are recorded or when the commitment is incurred. In the case of sales by our
retail operations, net sales are recognized at the time the customer takes possession of the merchandise at the point-of-sale in our stores and for our internet sales, nets
sales are recognized when the products are shipped and title passes to the customer.

Royalties and license fees

We license certain of our trademarks including Maidenform, Sweet Nothings, Self Expressions, Rendezvous and others to qualified companies for use on intimate
apparel, sleepwear and other products. These royalties are recorded as earned, based upon the sale of licensed products by our licensees. Royalty income included in net sales amounted to $2,690 and
$1,884 for 2006 and 2005, respectively, $971 for the Successor period May 11, 2004 through January 1, 2005 and $376 for the Predecessor period December 28, 2003 through
May 10, 2004.

Shipping and handling expense

Shipping and handling expenses incurred in connection with our distribution centers include shipping supplies, related labor costs, third-party shipping costs,
and certain distribution overhead. Such costs are generally absorbed by us and are included in selling, general and administrative expenses. These costs amounted to $12,250 and $11,455 for 2006 and
2005, respectively, $7,040 for the Successor period May 11, 2004 through January 1, 2005 and $3,698 for the Predecessor period December 28, 2003 through May 10, 2004. With
respect to the freight component of our shipping and handling costs, most customers arrange for the shipping of our product and pay the related freight costs directly to third party freight carriers.
However, in limited circumstances, we arrange and pay the freight for these customers and bill them for this service and those amounts are immaterial.

68

---



Advertising expense

All advertising-related production costs are charged to expense when the advertisement is first shown in media. Production costs included in prepaid expenses and
other current assets was $1,114 and $850 at December 30, 2006 and December 31, 2005, respectively. Advertising expense included in selling, general and administrative expenses are $8,583
and $8,539 for 2006 and 2005, respectively, $4,791 for the Successor period May 11, 2004 through January 1, 2005 and $3,448 for the Predecessor period December 28, 2003 through
May 10, 2004.

Stock-based compensation

Effective January 1, 2006, we adopted SFAS No. 123R, "Share-Based Payments," which revises SFAS No. 123, "Accounting for Stock-Based
Compensation." Prior to January 1, 2006, we accounted for stock-based compensation under SFAS No. 123. The adoption of SFAS No. 123R did not have a material impact on our
stock-based compensation expense for 2006.

Under
SFAS No. 123R, we are required to select a valuation technique or option-pricing model that meets the criteria as stated in the standard, which includes a binomial model and
the Black-Scholes model. At the present time, we will continue to use the Black-Scholes model, which requires the input of subjective assumptions. These assumptions include estimating the length of
time employees will retain their vested stock options before exercising them ("expected term"), the estimated volatility of our common stock price over the expected term ("volatility") and the number
of options that will ultimately be forfeited ("forfeitures.") Changes in the subjective assumptions can
materially affect the estimate of fair value of stock-based compensation and consequently, the related amount recognized in the consolidated statements of income.

SFAS
No. 123R requires us to estimate forfeitures in calculating the expense relating to stock-based compensation as opposed to only recognizing these forfeitures and the
corresponding reduction in expense as they occur. In addition, SFAS No. 123R requires us to reflect the tax savings resulting from tax deductions in excess of expense as a financing cash flow
in our statement of cash flows rather than as an operating cash flow as presented in prior periods.

On
November 10, 2005, the Financial Accounting Standards Board (FASB) issued FASB Staff Position No. FAS 123R-3, "Transition Election Related to Accounting for
Tax Effects of Share-Based Payment Awards." The Company has elected to adopt the alternative transition method provided in the FASB Staff Position for calculating the tax effects of stock-based
compensation pursuant to SFAS No. 123R. The alternative transition method includes simplified methods to establish the beginning balance of the additional paid-in capital pool
("APIC pool") related to the tax effects of employee stock-based compensation and to determine the subsequent impact on the APIC pool and consolidated statements of cash flows of the tax effects of
employee stock-based compensation awards that are outstanding upon adoption of SFAS No. 123R.

The
weighted average fair value of stock options granted during 2006 was $4.46. The fair value was estimated using the Black-Scholes option-pricing model based on the weighted average
market price at grant date of $11.42.

The
weighted average fair value of stock options granted during 2005 was $7.64. The fair value was estimated using the Black-Scholes option-pricing model based on the weighted average
market price at grant date of $16.55.

The
weighted average fair value of stock options granted during the Successor period May 11, 2004 through January 1, 2005, was $1.80. The fair value was estimated using the
Black-Scholes option-pricing model based on the weighted average market price at grant date of $3.42.

69

---



The
range of assumptions consists of the following:

|                        |  | Successor     |  | Predecessor  
|----------------------- |  | ------------- |  | -------------
|
|
|
|Dividend yield          |  | 0.0%          |  | 0.0%         
|Risk-free interest rate |  | 4.89%  4.95% |  | 4.00%  4.60%
|Expected life (years)   |  | 4 & 5         |  | 5 & 10       
|Volatility              |  | 39.4%         |  | 0.0% & 39.4% 

---

See
Note 16, "Stock Option Plans," for additional information regarding our stock option plans.

Earnings (loss) per share

Basic earnings (loss) per share are computed by dividing income (loss) available to common stockholders by the weighted-average number of shares of common stock
outstanding for the period. Diluted earnings (loss) per share reflect the potential dilution that could occur if common stock equivalents were issued and exercised.

Income taxes

We account for income taxes using the liability method which recognizes the amount of income tax payable or refundable for the current year and recognizes
deferred tax liabilities and assets for the future tax consequences of the events that have been recognized in the financial statements or tax returns. We routinely evaluate all deferred tax assets to
determine the likelihood of their realization and record a valuation allowance if it is more likely than not that a deferred tax asset will not be realized. See Note 18, "Income Taxes," for
discussion of income taxes.

Reclassifications

Certain prior period amounts in the consolidated financial statements have been reclassified to conform to the current year presentation.

70

---





3. RECENTLY ISSUED ACCOUNTING STANDARDS

In July 2006, the FASB issued FASB Interpretation No. 48 (FIN No. 48), "Accounting for Uncertainty in Income Taxes," which clarifies the
accounting for uncertainty in income taxes recognized in an enterprise's financial statements in accordance with SFAS No. 109, "Accounting for Income Taxes." This interpretation prescribes a
recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. This interpretation also
provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. FIN No. 48 is effective for fiscal years beginning after
December 15, 2006. The cumulative effect of applying FIN No. 48, if any, will be reported as an adjustment to retained earnings at the beginning of the period in which it is adopted. We
will adopt FIN No. 48 in the first quarter of 2007. We are evaluating our tax position and the impact that the guidance will have on our consolidated financial statements.

In
September 2006, the FASB issued statement No. 158, "Employers Accounting for Defined Benefit Pensions and Other Postretirement Plans (an amendment of FASB Statements
No. 87, 88, 106, and 123R," (SFAS No. 158). On December 30, 2006, we adopted the recognition and disclosure provisions of SFAS No. 158. See Note 9, "Impact of SFAS
No. 158," for further discussion.

4. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment at December 30, 2006 and December 31, 2005 consist of the following:

2006

2005Land

$
1,239

$
1,239Buildings and building improvements


8,328


8,291Machinery and production equipment


2,820


2,614Furniture, fixtures and equipment


6,911


5,428Construction-in-progress


238


123Leasehold improvements


6,011


4,84325,547


22,538LessAccumulated depreciation


(7,093
)

(4,308
)$
18,454

$
18,230


Depreciation
and amortization expense included in selling, general and administrative expenses and cost of sales is $2,817 and $5,647 for 2006 and 2005, respectively, $5,461 for the
Successor period May 11, 2004 through January 1, 2005, and $1,636 for the Predecessor period December 28, 2003 through May 10, 2004.

As
of December 30, 2006, our assets under capital leases comprised of computer equipment. The assets under capital leases are set forth in the following table at
December 30, 2006 and December 31, 2005:

2006

2005Machinery and production equipment

$
325

$
LessAccumulated depreciation


(5
)

$
320

$



71

---



5. GOODWILL AND OTHER INTANGIBLE ASSETS

In connection with the Acquisition as defined in Note 12, "Change in Ownership," we recognized the excess cost of the acquired entity over the net amounts
assigned for all assets, including intangible assets, and liabilities assumed, as goodwill. Our goodwill and certain trademarks have been deemed to have indefinite lives and are not amortizable. Our
licensing agreements and certain trademarks that do not have indefinite lives are being amortized on a straight-line basis over 15 to 25 years.

Components
of our intangible assets by segment at December 30, 2006 consist of the following:

|                                 |  | Wholesale |        | Retail |   | Total
|-------------------------------- |  | --------- | ------ | ------ | - | -----
|
|Amortizing intangible assets     |  |           |        |        |   |      
|Trademarks                       |  | $         | 16,849 |        | $ | 1,987
|Royalty licenses                 |  |           | 8,318  |        |   | 872  
|                                 |  |           |        |        |   |      
|                                 |  | $         | 25,167 |        | $ | 2,859
|                                 |  |           |        |        |   |      
|Non-amortizing intangible assets |  |           |        |        |   |      
|Trademarks                       |  | $         | 64,600 |        |   |      
|                                 |  |           |        |        |   |      

Components
of our intangible assets by segment at December 31, 2005 consist of the following:

|                                 |  | Wholesale |        | Retail |   | Total
|-------------------------------- |  | --------- | ------ | ------ | - | -----
|
|Amortizing intangible assets     |  |           |        |        |   |      
|Trademarks                       |  | $         | 16,849 |        | $ | 1,229
|Royalty licenses                 |  |           | 8,318  |        |   | 538  
|                                 |  |           |        |        |   |      
|                                 |  | $         | 25,167 |        | $ | 1,767
|                                 |  |           |        |        |   |      
|Non-amortizing intangible assets |  |           |        |        |   |      
|Trademarks                       |  | $         | 64,600 |        |   |      
|                                 |  |           |        |        |   |      

Our
non-amortizing intangible assets consist of trademarks for Maidenform and Flexees, as it is expected that these trademarks will contribute to cash flows indefinitely.
These trademarks have been in existence for many years and there is no foreseeable limit on the period of time over which they are expected to contribute cash flows. Aggregate amortization expense
related to intangible assets was $1,160 for 2006 and 2005, and $719 for the Successor period May 11, 2004 through January 1, 2005.

72

---



Estimated
amortization expense for the next five years beginning with 2007 is as follows:

2007

$
1,1602008


1,1602009


1,1602010


1,1602011


1,160


Components
of our goodwill by segment at December 30, 2006 and December 31, 2005 consist of the following:

Wholesale

Retail

TotalGoodwill acquired during 2004

$
7,435

$
449

$
7,884


6. DEBT

2006

2005Long-term debtTerm loan facility

$
110,000

$
137,500110,000


137,500Current maturities of long-term debt





Non-current portion of long-term debt

$
110,000

$
137,500


On
June 29, 2005, we amended and restated our existing first lien facilities and prepaid the outstanding balance of our second lien facility. The amended and restated first lien
facilities ("Amended and Restated Credit Facility") provides for borrowings in the aggregate amount of $200,000 maturing on May 11, 2010 and is composed of: (i) a $150,000 amortizing
term loan facility (the "Term Loan Facility") and (ii) a $50,000 revolving credit facility (the "Revolving Facility"). The Amended and Restated Credit Facility is collateralized by a first
priority perfected lien, subject to certain permitted liens, on substantially all of the personal property assets and certain real property of Maidenform, Inc. and the guarantors.

On
February 8, 2006, we entered into the First Amendment to the Amended and Restated Credit Facility. This amendment amends certain provisions of the Amended and Restated Credit
Facility to enable us to initiate our stock repurchase program of up to $20,000.

As
of December 30, 2006, we had $110,000 outstanding under our Term Loan Facility. At December 30, 2006, $0 was outstanding and approximately $47,718 was available for
borrowings under the Revolving Facility, after giving effect to $2,282 of outstanding letters of credit. We use the letters of credit as collateral for our workers' compensation insurance programs and
bonds issued on our behalf to collateralize our obligation to pay customs duties. We prepaid $27,500 of our Term Loan Facility during 2006 and our amortization schedule has been revised. There will be
no mandatory excess cash flow prepayment for 2006 because our ratio of debt to earnings before interest taxes depreciation and amortization (EBITDA) is less than 2.5 to 1.0 as of December 30,
2006. Our next scheduled principal payment will be October 3, 2009.

Borrowings
under the Term Loan Facility bear interest based, at our option, on the Prime rate or the London Interbank Offered Rate ("LIBOR"), plus a margin. During 2006, the Prime rate
margin was fixed at 0.75% and the LIBOR rate margin was fixed at 1.75%. The Prime rate margin and the LIBOR

73

---



margin
will be determined on a quarterly basis based on our leverage ratio for the preceding four quarters, effective upon our delivery of a pricing certificate.

The
Revolving Facility provides direct borrowings and issuance of stand-by letters of credit on our behalf. Borrowings under the Revolving Facility are limited by the
borrowing base, which consists of eligible accounts receivable and inventory, as defined. Borrowings under the Revolving Facility will bear interest at the same rate as the Term Loan Facility.
Additional fees, including a letter of credit fee equal to the applicable LIBOR interest rate margin and a letter of credit fronting fee of 0.25%, are charged on the outstanding stand-by
letters of credit. Additionally, an unused line of credit fee of 0.50% is charged on the maximum principal amount available under the Revolving Facility.

Our
highest level of debt outstanding for 2006 was $137,500 at an average interest rate of 6.5%, and our highest level of debt outstanding for 2005 was $160,000, at an average interest
rate of 6.8%. For 2006, amortization of financing costs included in interest expense was $888. In connection with the June 29, 2005 amendment and restatement of the Credit Facility, we paid
fees of $2,423, and in connection with the repayment of the Second Lien Facility, we paid a prepayment penalty fee of $1,000. For 2005, amortization of financing costs included in interest expense was
$5,953 (which includes the write-off of deferred financing costs of $4,943 in connection with the amendment of the First Lien Facilities and the prepayment of the Second Lien Facility).
Included in interest expense was amortization of financing costs for the Successor period May 11, 2004 through January 1, 2005 of $804 and for the Predecessor period December 28,
2003 through May 10, 2004 of $895 (which includes the write-off of unamortized deferred financing cost at the date of Acquisition in the amount of $772).

The
Amended and Restated Credit Facility contains affirmative and restrictive covenants, including: (a) maintenance of a minimum fixed charge coverage ratio,
(b) maintenance of a maximum leverage ratio, (c) limitations on consolidated capital expenditures, (d) limitations on the incurrence of indebtedness and liens,
(e) limitations on investments/acquisitions and (f) restrictions on payments between Maidenform Brands, Inc. and its subsidiaries. There are a number of circumstances in which
additional partial prepayments are required based upon conditions set forth in the Amended and Restated Credit Facility, including net asset sales and net insurance/condemnation proceeds not
reinvested in other assets of the business, net securities proceeds from the issuance of capital stock (excluding the initial public offering proceeds), additional debt facilities, and a percentage of
annual consolidated excess cash flows, as defined. We were in compliance with all debt covenants at December 30, 2006 and December 31, 2005.

Payments
due on long-term debt during each of the five years subsequent to December 30, 2006, are as follows:

2007

$
2008


2009


12,5912010


97,4092011





At
December 31, 2005, we had $137,500 outstanding under our Term Loan Facility and had approximately $43,508 available for borrowings under the Revolving Facility after
considering outstanding stand-by letters of credit of $2,182 and our borrowing base limitations. Under the Term Loan Facility, through December 29, 2005, the Prime rate margin was
fixed at 1.25% and the LIBOR rate margin was fixed at 2.25%.

74

---





7. INTEREST RATE SWAP AGREEMENTS

Effective August 16, 2004, we entered into two interest rate swap agreements, each having a notional amount of $5,625 for the period August 16, 2004
through August 15, 2005, $11,250 for the period August 16, 2005 through February 15, 2006, and $15,000 for the period February 16, 2006 through the expiration date of
August 15, 2007. Under these swap agreements, we converted a floating interest rate for the notional amount of the swaps into a fixed interest rate of 4.05% and 3.885%. These swap contracts are
not held for trading purposes. During 2006, 2005 and Successor period May 11, 2004 through January 1, 2005, there were no significant gains or losses recognized in interest expense for
hedge ineffectiveness. The cash flow effects of the swap arrangements, included in interest expense on the consolidated statement of operations was, income of $324 for 2006, an expense of $66 for
2005, and an expense of $89 for Successor period May 11, 2004 through January 1, 2005.

In
addition to the interest rate swap agreements, we purchased an interest rate cap as an economic hedge against approximately $52,500 of variable rate debt. The interest rate is capped
at 5.92% on a notional amount of $63,750 for the period July 6, 2004 through July 5, 2005, 6.52% on a notional amount of $52,500 for the period July 6, 2005 through
January 5, 2006, and 8.08% on a notional amount of $45,000 for the period January 6, 2006 through the expiration date of July 6, 2007. The interest rate cap is recognized on the
consolidated balance sheet at its fair value and changes in the fair value were reported in interest expense and was $0 for 2006, $5 for 2005 and $46 for the Successor period May 11, 2004
through January 1, 2005.

8. LEASES

We lease warehouse, retail, showroom, office facilities and equipment under non-cancelable leases which expire on various dates through 2017. In
addition to minimum rentals, certain operating leases provide for annual rent increases for real estate taxes, maintenance and inflation. Several of our operating leases contain renewal options and
contingent rental payments based on individual store sales. Certain leases that meet the lease capitalization criteria in accordance with SFAS No. 13, "Accounting for Leases," as amended, have
been recorded as an asset and liability at the net present value of the minimum lease payments at the inception of the lease. Interest rates used in computing the net present value of the lease
payments are based on our incremental borrowing rate at the inception of the lease.

75

---



Minimum
annual lease obligations under non-cancelable leases at December 30, 2006 are as follows:

|                                              |  | Operating
Leases |        | Capital Lease
Obligations |   | Total
|--------------------------------------------- |  | ---------------- | ------ | ------------------------- | - | -----
|2007                                          |  | $                | 5,375  |                           | $ | 119  
|2008                                          |  |                  | 5,981  |                           |   | 119  
|2009                                          |  |                  | 4,303  |                           |   | 109  
|2010                                          |  |                  | 3,331  |                           |   |     
|2011                                          |  |                  | 2,680  |                           |   |     
|2012 and thereafter                           |  |                  | 10,660 |                           |   |     
|                                              |  |                  |        |                           |   |      
|Total minimum lease payments                  |  | $                | 32,330 |                           |   | 347  
|                                              |  |                  |        |                           |   |      
|Less amount representing interest             |  |                  |        |                           |   | 31   
|                                              |  |                  |        |                           |   |      
|Present value of minimum lease payments       |  |                  |        |                           |   | 316  
|Current maturities of minimum lease payments  |  |                  |        |                           |   | 102  
|                                              |  |                  |        |                           |   |      
|Non-current portion of minimum lease payments |  |                  |        |                           | $ | 214  
|                                              |  |                  |        |                           |   |      

Total
rent expense included in selling, general and administrative expenses under operating leases, exclusive of property taxes and other property related expenses charged to earnings,
was $5,554 and $5,492 for 2006 and 2005, respectively, $3,690 for the Successor period May 11, 2004 through January 1, 2005 and $2,216 for the Predecessor period December 28, 2003
through May 10, 2004.

9. IMPACT OF SFAS NO. 158

On December 30, 2006, we adopted the recognition and disclosure provisions of SFAS No. 158, which required us to recognize the funded status (i.e.
the difference between the fair value of plan assets and the projected benefit obligations) of our benefit plan (see Note 10, "Benefit Plans") and our postretirement plans (see Note 11,
"Postretirement Plans") in the December 30, 2006 consolidated balance sheet, with a corresponding adjustment to accumulated other comprehensive income, net of tax. The net impact of the
adoption of SFAS No. 158 was an increase in pension and postretirement benefit obligations of $67 with an offset to accumulated other comprehensive income, net of tax. Our adoption of SFAS
No. 158 at December 30, 2006 had no impact on our earnings.

Incremental
effect of applying SFAS No. 158 on individual line items in the consolidated balance sheet at December 30, 2006 consist of:

|                                                     |  |   |         | Adjustments |   |     
|---------------------------------------------------- |  | - | ------- | ----------- | - | ----
|
|Other non-current liabilities                        |  | $ | 9,291   |             | $ | 242 
|Deferred income taxes                                |  |   | 16,250  |             |   | (96 
|Total liabilities                                    |  |   | 169,912 |             |   | 146 
|Accumulated other comprehensive income, net of taxes |  |   | 198     |             |   | (146
|Total stockholders' equity                           |  |   | 74,941  |             |   | (146

76

---



10. BENEFIT PLANS

We sponsor a defined benefit pension plan, the Maidenform, Inc. Retirement Plan (the "Retirement Plan,") covering substantially all eligible employees not
covered by the union plans described below. The benefits are based on years of service and the employees' compensation through their retirement date. The Retirement Plan is the result of the merger
between the Restated Replacement Maidenform, Inc. Retirement Plan and the NCC Defined Benefit Pension Plan (the "NCC Plan") on April 14, 1999. Benefits under the NCC Plan have been
frozen since 1991.

We
also make contributions to multiemployer plans that provide defined pension benefits and health and welfare benefits to our unionized employees represented by UNITE-HERE.
The contributions for the multiemployer defined benefit pension plans amounted to $255, $268, $168, and $118 for 2006 and 2005, for the Successor period May 11, 2004 through January 1,
2005 and for the Predecessor period December 28, 2003 through May 10, 2004, respectively. The contributions for the health and welfare plans, including a prescription drug program,
amounted to $1,012, $1,031, $643, and $443 for 2006 and 2005, for the Successor period May 11, 2004 through January 1, 2005 and for the Predecessor period December 28, 2003
through May 10, 2004, respectively.

We
sponsor the Maidenform, Inc. Savings Plan (the "401(k) Plan"), which operates pursuant to Section 401(k) of the Internal Revenue Code and covers substantially all
eligible employees not covered by the multiemployer union pension plan described above. Eligible participating employees, excluding "highly compensated employees," may contribute up to 20% of their
pre-tax wages, subject to certain IRC limitations. Through December 31, 2006, highly compensated employees may contribute up to 6% of their pre-tax wages, subject to
certain IRC limitations. Also, through December 31, 2006, the 401(k) Plan provides for employer matching contributions to a maximum of 1.5% of pre-tax wages.

During
2006 and 2005, for the Successor period May 11, 2004 through January 1, 2005 and for the Predecessor period December 28, 2003 through May 10, 2004, we
contributed $315, $315, $146 and $147 of employer matching contributions, respectively.

We
use a December 31 measurement date for our defined benefit pension plan.

77

---



Obligations and funded status

For the years endedDecember 30, 2006

December 31, 2005Changes in benefit obligationBenefit obligation, beginning of period

$
25,437

$
21,474Service cost


1,828


1,714Interest cost


1,330


1,234Plan participants' contributions


79


98Assumption changes


(2,401
)

1,189Actuarial (gain) loss


(1,055
)

135Benefits paid


(487
)

(407
)Benefit obligation, end of period

$
24,731

$
25,437Change in plan assetsFair value of plan assets, beginning of period

$
14,158

$
12,218Return on plan assets


1,699


683Employer contributions


1,853


1,617Plan participants' contributions


79


98Plan expenses


(45
)

(51
)Benefits paid


(487
)

(407
)Fair value of plan assets, end of period

$
17,257

$
14,158Funded status and net amount recognizedPlan assets less than benefit obligation

$
(7,474
)
$
(11,279
)Unrecognized net actuarial loss


N/A


4,137Net amount recognized in the consolidated balance sheets

$
(7,474
)
$
(7,142
)


As
of December 30, 2006, amounts recognized in the consolidated balance sheet consisted of $7,474 and is included in other non-current liabilities.

The
accumulated benefit obligation for the Retirement Plan was $18,391 and $18,264 at December 30, 2006 and December 31, 2005, respectively. Amounts recognized in
accumulated other comprehensive income (pretax) consists of a net loss of $242. The estimated net loss that is expected to be amortized from accumulated other comprehensive income into net periodic
benefit cost during 2007 is $0.

78

---





|                                                                                    |                           | Successor |        | Predecessor |  
|----------------------------------------------------------------------------------- | ------------------------- | --------- | ------ | ----------- | -
|
|
|Components of net periodic benefit cost                                             |                           |           |        |             |  
|Service cost                                                                        |                           | $         | 1,828  |             | $
|Interest cost                                                                       |                           |           | 1,330  |             |  
|Expected return on plan assets                                                      |                           |           | (1,267 | )           |  
|Recognized net actuarial loss                                                       |                           |           | 52     |             |  
|                                                                                    |                           |           |        |             |  
|                                                                                    | Net periodic benefit cost |           | $      | 1,943       |  
|                                                                                    |                           |           |        |             |  
|Additional information                                                              |                           |           |        |             |  
|Increase in minimum pension liability included in other comprehensive income (loss) |                           | $         |       |             | $
|                                                                                    |                           |           |        |             |  

Assumptions

Weighted average assumptions used to determine benefit obligations:

2006

2005Discount rate

6.00
%
5.50
%Rate of compensation increase

4.00
%
4.00
%


Weighted
average assumptions were used to determine net periodic benefit cost:

|                               |  | Successor |   | Predecessor |  
|------------------------------ |  | --------- | - | ----------- | -
|
|
|Discount rate                  |  | 5.50      | % | 5.75        | %
|Expected return on plan assets |  | 8.50      | % | 8.50        | %
|Rate of compensation increase  |  | 4.00      | % | 4.00        | %

The
long-term rate of return for our pension plan is established via a building block approach with proper consideration of diversification and rebalancing. Historical
markets are studied and long-term historical relationships between equity and fixed-income securities are preserved consistent with the widely accepted capital market principle that assets
with higher volatility generate a greater return over the long run. Current market factors, such as inflation and interest rates, are evaluated before long-term capital market assumptions
are determined.

79

---



Plan assets

Weighted average asset allocations for the Retirement Plan at December 30, 2006 and December 31, 2005 and the targeted asset allocation for 2007 by
asset category are as follows:

2007
Targeted

2006

2005Equity Securities

70
%
75
%
70
%Fixed Income Securities

30

25

30100
%
100
%
100
%


We
employ a total return on investment approach whereby a mix of equities and fixed-income investments are used to maximize the long-term return of plan assets for a prudent
level of risk. Risk tolerance is established through careful consideration of plan liabilities, plan funded status, and corporate financial condition. The assets of the Retirement Plan are held in
pooled-separate accounts and are invested in mutual funds consisting of a diversified blend of equity and fixed income securities. We use this investment approach in order to meet its diversification
and asset allocation goals. Furthermore, equity investments are diversified across domestic and foreign stocks, as well as growth, value, and small and large capitalizations. Investments risk is
measured and monitored on an ongoing basis through quarterly investment portfolio reviews, annual liability measurements, and periodic asset/liability studies.

Cash flows

Contributions

We
expect to contribute approximately $1,922 to the Retirement Plan in 2007, relating to the 2006 plan year, based upon the current funded status and expected asset return assumptions.

Estimated future benefit payments

Benefit payments, which reflect future service, as appropriate, are expected to be paid as follows:

2007

$
5462008


5952009


6492010


6992011


7872012-2016

$
5,104


See
Note 28, "Subsequent Event," for changes to the Retirement Plan effective January 1, 2007.

80

---





11.  POSTRETIREMENT PLANS

We use a December 31 measurement date for the postretirement plans.

Obligations and funded status

|                                               |                       | For the years ended                                      |     
|---------------------------------------------- | --------------------- | -------------------------------------------------------- | ----
|
|
|Changes in benefit obligation                  |                       |                                                          |     
|Benefit obligation, beginning of period        |                       | $                                                        | 879 
|                                               | Interest cost         |                                                          |     
|                                               | Actuarial (gain) loss |                                                          |     
|                                               | Benefits paid         |                                                          |     
|                                               |                       |                                                          |     
|                                               |                       | Benefit obligation, end of period                        |     
|                                               |                       |                                                          |     
|Changes in plan assets                         |                       |                                                          |     
|Fair value of plan assets, beginning of period |                       | $                                                        |    
|Employer contribution                          |                       |                                                          | 40  
|Benefits paid and settlements                  |                       |                                                          | (40 
|                                               |                       |                                                          |     
|                                               |                       | Fair value of plan assets, end of period                 |     
|                                               |                       |                                                          |     
|Funded status and net amount recognized        |                       |                                                          |     
|Plan assets less than benefit obligation       |                       | $                                                        | (708
|Unrecognized actuarial net gain                |                       |                                                          | N/A 
|                                               |                       |                                                          |     
|                                               |                       | Net amount recognized in the consolidated balance sheets |     
|                                               |                       |                                                          |     

As of December 30, 2006, amounts recognized in the consolidated balance sheet consisted of $999 and is included in other
non-current liabilities.

Amounts
recognized in accumulated other comprehensive income (pretax) consists of a gain of $175. The estimated gain that is expected to be amortized from accumulated other comprehensive
income into net periodic benefit cost during 2007 is $12.

|                                        |                            | Successor |    | Predecessor
|--------------------------------------- | -------------------------- | --------- | -- | -----------
|
|
|
|Components of net periodic benefit cost |                            |           |    |            
|Interest cost                           |                            | $         | 39 |            
|Amortization of (gains) and losses      |                            |           | (6 | )          
|                                        |                            |           |    |            
|                                        | Net periodic benefit costs |           | $  | 33         
|                                        |                            |           |    |            

81

---



Assumptions

Weighted average assumptions used to determine benefit obligations:

2006

2005NCC Plan

Company
Plan

NCC Plan

Company
PlanDiscount rate

6.00
%
6.00
%
5.50
%
5.50
%


Weighted
average assumptions used to determine net periodic benefit costs:

|              |  | Successor |   |      |   |      |  
|------------- |  | --------- | - | ---- | - | ---- | -
|
|
|
|
|
|Discount rate |  | 5.50      | % | 5.50 | % | 5.75 | %

Assumed healthcare cost trend rates

|                                                        |  | Successor |   | Predecessor |  
|------------------------------------------------------- |  | --------- | - | ----------- | -
|
|
|
|Healthcare cost trend rate assumed for next year        |  | 8.00      | % | 9.50        | %
|Rate to which the cost trend rate is assumed to decline |  | 5.00      | % | 4.50        | %
|Year that the rate reaches the ultimate trend rate      |  | 2013      |   | 2014        |  

Assumed healthcare cost trend rates have a significant effect on the amounts reported for the healthcare plans. A 1% point change in assumed
healthcare cost trend rates would have the following effects on the NCC Plan:

1%
Point
Increase

1%
Point
DecreaseEffect on total of service and interest cost components

$
1

$
(1
)Effect on postretirement benefit obligation


20


(19
)


82

---





A 1% point change in assumed healthcare cost trend rates would have the following effects on the Company Plan:

1%
Point
Increase

1%
Point
DecreaseEffect on total of service and interest cost components

$
1

$
(1
)Effect on postretirement benefit obligation


12


(11
)


Cash flows

Contributions

The postretirement plans are unfunded plans. We expect to contribute to the plan an amount equal to benefit payments to be made in 2007 which are estimated to be
$119.

Estimated future benefit payments

Benefit payments, which reflect future service, as appropriate, are expected to be paid as follows:

2007

$
1192008


1142009


1082010


1022011


962012-2016


375


12.  CHANGE IN OWNERSHIP

On May 11, 2004, MF Acquisition Corporation acquired 100% of Maidenform, Inc. (the "Acquisition") through a merger of its wholly owned subsidiary
into Maidenform, Inc. Stockholders of Maidenform, Inc. received either cash or stock of MF Acquisition Corporation in exchange for their shares of Maidenform, Inc. On
April 5, 2005, MF Acquisition Corporation changed its name to Maidenform Brands, Inc. Financing for this Acquisition totaled $237,265 and was provided by a first lien term loan of
$100,000, revolver borrowings of $12,500, a second lien term loan of $50,000 and $74,765 of cash and capital from investors, including rollover equity by certain members of management of $2,765 and
continuing stockholders of $15,000. The financial statements for the period including and after May 11, 2004 are those of Maidenform Brands, Inc. and subsidiaries (the "Successor"). The
financial statements for periods prior to May 11, 2004 are those of Maidenform, Inc. and subsidiaries (the "Predecessor"). As a result of the Acquisition, the financial statements
including and after May 11, 2004 are not comparable to those prior to that date. The proceeds of the Acquisition and financing were used to pay selling stockholders $147,430, selling
stockholders' transaction expenses of $6,570, special compensation of $1,567 paid to management, buyers' transaction expenses of $2,526, and to retire all of Maidenform, Inc.'s previously
outstanding current and long-term debt of $54,065, including a debt redemption premium of $380. In addition, $658 of proceeds was held as cash for working capital purposes and $6,684 was
used to pay debt issuance costs.

The
Acquisition was accounted for as a purchase in accordance with SFAS No. 141, "Business Combinations," and Emerging Issues Task Force (EITF) No. 88-16,
"Basis In Leveraged Buyout Transactions." In accordance with EITF 88-16, the basis of continuing stockholders that have a

83

---



residual
interest in Maidenform Brands, Inc. and have a 20% or greater voting interest has been carried over at their predecessor basis. In addition, in accordance with EITF 88-16,
the basis of management's residual interest, which consisted of stock options, has also been carried over at their predecessor basis, as management actively participated in promoting the transaction.
The retained interest of the stockholders has been recorded at predecessor basis (carryover basis) and aggregated 23.8% (20.1% related to continuing stockholders and 3.7% related to certain members of
management). The remainder of the investment in the assets and liabilities acquired (the 76.2% acquired by new stockholders) was recorded at fair value. As a result, the assets and liabilities were
assigned new values, which are part carryover basis and part fair value basis. The excess of the purchase price over carryover basis of net assets acquired, the deemed dividend to continuing
stockholders, was recognized as a reduction of stockholders' equity (deficit).

The
following table summarizes both the cash and non-cash consideration, including transaction costs related to the Acquisition.

Cash consideration(1)Cash paid to sellers

$
147,430Repayment of seller's debt


54,065Transaction costs


10,663Non-cash considerationSecurities issued to continuing stockholders at carryover basis(2)


14,520Carryover basis allocated to management's residual interest(3)


Deemed dividend to continuing stockholders


(21,529
)Total purchase price

$
205,149


---

The
total purchase price of $205,149 was allocated to the acquired assets and liabilities based on their estimated fair values at the Acquisition date, after taking into account the
carryover basis discussed above. These allocations were determined by valuation reports provided by independent third party appraisal firms. The excess of the purchase price over the underlying assets
acquired and liabilities assumed was allocated to goodwill, none of which is deductible for tax purposes.

84

---



The following
table summarizes the estimated values of the assets acquired and liabilities assumed on May 11, 2004.

Other current assets

$
51,254Inventory


62,234Deferred income taxes


9,716Property, plant and equipment


31,425Intangible assets, amortizing


26,241Intangible assets, non-amortizing


76,476Other non-current assets


707Goodwill


7,884Total assets acquired


265,937Other current liabilities


39,522Employee termination costs


2,159Defined benefit pension plan


7,378Postretirement plans


1,240Deferred income taxes


10,013Other non-current liabilities


476Total liabilities assumed


60,788Net assets acquired

$
205,149


13.  CLOSING OF MANUFACTURING FACILITIES

In connection with the Acquisition, we made the decision to exit our cutting and sewing facilities located in Mexico and Florida. We closed one facility in Mexico
in January 2005, closed our facility in Florida in June 2005, and closed the remaining facility in Mexico in July 2005. As part of the allocation of the purchase price, we accrued
probable employee termination costs of $2,159 relating to services already rendered and vested for employees at these locations. Other costs of $446 associated with retention bonuses were expensed
during the Successor period from May 11, 2004 through January 1, 2005. At January 1, 2005, we had accrued employee termination costs of $2,077 related to the closing of these
facilities. During the year ended December 31, 2005, we incurred additional retention bonus expense of $261 and paid $2,103. At December 31, 2005, we accrued employee termination costs
of $235. At December 30, 2006, we have completed all terminations and no liability is outstanding. The retention bonus expense is recorded as part of our wholesale segment.

During
2005, we sold the Mexican and Florida facilities and recognized a loss of $971 which was recorded as a component of cost of sales.

14.  PREFERRED STOCK SUBJECT TO REDEMPTION AND COMMON STOCK SUBJECT TO PUT

In connection with our initial public offering, we redeemed all the outstanding shares of our preferred stock, including shares of preferred stock acquired upon
the exercise of all outstanding options to purchase shares of our preferred stock, and paid all accrued and unpaid dividends associated with the preferred stock and preferred stock options.

On
June 1, 2005, the Board of Directors approved a special cash dividend to all holders of preferred stock as of June 1, 2005 in the aggregate amount of $13,320. This
dividend was paid on June 21, 2005 and was accounted for as a reduction to additional paid-in capital to the extent available with the remaining balance recorded as a reduction to
retained earnings (accumulated deficit).

85

---





We issued 360,000 shares of preferred stock, $0.01 par value with a liquidation value of $36,000, and granted 14,055 preferred stock options to key employees in connection with the Acquisition. All
preferred shares, including preferred options, were redeemable at the option of the Board of Directors. Our majority stockholder, who owned approximately 65% of our outstanding common and preferred
stock at the time of the Acquisition, had the right to designate a majority of the members of our Board of Directors. Therefore, because any redemption of the preferred stock would be ratable across
all preferred stockholders, the redemption of all shares of preferred stock were deemed to be within the control of our majority stockholder and were classified outside of total stockholders' equity
(deficit) on our consolidated balance sheet beginning May 11, 2004. We obtained an appraisal by an independent third party which determined the fair market value for the preferred stock to be
$36,735 at May 11, 2004.

The preferred stock, which had a redemption premium of $2,145, if redeemed during the period from May 11, 2004 through May 1, 2005, was accreted to
$38,880 on May 11, 2004. Accordingly, this accretion was recorded as a reduction in net income (loss) available to common stockholders. The redemption premium was 108% at May 11, 2004
and was scheduled to reduce by two percentage points each year commencing on May 1, 2005 until reaching 100% on May 1, 2008. We reduced the redemption value from $108 per share to $106
per share on May 1, 2005. Accordingly, this change in redemption value of $720 was recorded as an increase in net income (loss) available to common stockholders.

Dividends
were cumulative, accrued quarterly on the first day of August, November, February and May, at 15% per annum. In connection with the initial public offering, we paid all accrued
and unpaid dividends associated with the preferred stock and preferred stock options.

In
connection with the Acquisition, a majority stockholder of Predecessor who was also a stockholder of Successor received 75,000 of the 360,000 shares of preferred stock, $0.01 per
value, and also received 4,125,000 of the 19,800,000 shares of common stock, $0.01 par value, as rollover equity valued at $15,000. This stockholder had a put option, with some limitations, to put
these shares back to us in an amount equal to 85% of the fair market value at the time of the put election (May 10, 2007), limited to $15,000, less any amount already received from previously
sold shares, cash dividends and cash distributions. In addition, the put terminates upon a liquidity event such as an initial public offering. Because of this put option, these shares were classified
outside of total stockholders' equity (deficit) on our consolidated balance sheet and stated as common stock of $6,356 and preferred stock of $8,644 at January 1, 2005. As the carrying amount
of the preferred stock increases as a result of dividends and accretion, the carrying amount of the common stock classified outside of total stockholders' equity (deficit) was reclassified to
additional paid-in capital to the extent the combined amount was greater than the put of $15,000. This reclassification amounted to $768 and $511 during 2005 and during the Successor
period May 11, 2004 through January 1, 2005, respectively.

15.  STOCKHOLDERS' EQUITY

Treasury stock is accounted for by the cost method. In February 2006, the Board of Directors approved a $20,000 stock repurchase program, authorizing the
repurchase of our common stock. We are authorized to make repurchases from time to time in the open market pursuant to existing rules and regulations and other parameters approved by the Board of
Directors. During 2006, we repurchased 669,500 shares of our common stock at a total cost of $7,563 at an average price per share of $11.30.

86

---



On
July 22, 2005, we priced an initial public offering of 14,513,889 shares of common stock of which 3,375,000 and 11,138,889 shares were offered by us and selling stockholders,
respectively, at a price of $17.00 per share. Upon the consummation of the offering on July 27, 2005, net proceeds of $52,579 and $176,106 were distributed to us and selling stockholders,
respectively. We did not receive any of the proceeds from the sale of shares by the selling stockholders.

16.  STOCK OPTION PLANS

On July 6, 2005, the Board of Directors adopted the Maidenform Brands, Inc. 2005 Stock Incentive Plan pursuant to which the Company can grant to
employees, consultants and non-employee directors equity-based awards. Under this plan, 1,750,000 shares were set aside and reserved for issuance. The plan provides for a variety of
vesting dates with the
majority of the options vesting in an annual increment of 25% of the number of options granted over the first four years of the grant and expiring no later than ten years after date of grant.

The
Board of Directors also amended the Maidenform Brands, Inc. 2004 Rollover Stock Option Plan, the Maidenform Brands, Inc. 2004 Stock Option Plan and the Maidenform
Brands, Inc. 2004 Stock Option Plan for Non-Employees Directors to provide that no additional equity-based awards shall be available for issuance under these plans, although
previously granted stock options will continue to remain outstanding in accordance with the terms of the applicable option agreement and the applicable plan.

In
connection with the Acquisition, we terminated all existing Employee Stock Option Plans, Non-Employee Directors Stock Option Plans and Employment Option Agreements of the
Predecessor which had been formed to provide incentives to our employees and directors in Predecessor periods (the "Former Plans"). All outstanding options under the Former Plans expired or were
cashed out, canceled, or exchanged for Successor options.

In
connection with the Acquisition, we granted options under the Rollover Plan in substitution for certain in-the-money options under the Former Plans. Those
options issued under the Former Plans were vested as a result of the Acquisition and compensation expense had been recognized in the Predecessor periods. Under this plan, 775,000 shares of common
stock and 14,100 shares of preferred stock were reserved for issuance upon exercise of options granted to key employees. Each Rollover Plan option vested in full on the date of grant and expires no
later than ten years after the initial date of grant. No additional equity-based awards shall be available for issuance under the Rollover Plan, although previously granted stock options will continue
to remain outstanding in accordance with the original terms of the awards under this plan.

On
May 11, 2004, we adopted the 2004 Employee Stock Option Plan. Under this plan, 2,500,000 shares were reserved for issuance upon exercise of options granted to key employees.
The plan provides for a variety of vesting dates with the majority of the options vesting in an annual increment of 25% of the number of options granted over the first four years of the grant and
expiring no later than ten years after date of grant. No additional equity-based awards shall be available for issuance under the Employee Stock Option Plan, although previously granted stock options
will continue to remain outstanding in accordance with the original terms of the awards under this plan.

On
July 28, 2004, we adopted the 2004 Stock Option Plan for Non-Employee Directors. Under this plan, 250,000 shares were reserved for issuance upon exercise of options
granted to non-employee directors with vesting over a three year period and expiring no later than ten years after date of grant. No additional equity-based awards shall be available for
issuance under the Stock Option plan for Non-Employee Directors, although previously granted stock options will continue to remain outstanding in accordance with the original terms of the
awards under this plan.

87

---



The
fair value of the stock options on the grant dates were $230, $4,439 and $3,644 for stock options granted during 2006 and 2005, and during the Successor period May 11, 2004
through January 1, 2005, respectively. These amounts are being expensed over the vesting periods. We recorded stock-based compensation expense, which represents the amortization of the fair
value of the stock options issued, of approximately $2,016 and $1,609 for 2006 and 2005, $251 for the Successor period May 11, 2004 through January 1, 2005 and $6,869 for the Predecessor
period December 28, 2003 through May 10, 2004, respectively.

At
December 30, 2006, there was approximately $3,955 of unrecognized compensation costs, adjusted for estimated forfeitures, related to non-vested stock options. Total
unrecognized compensation cost will be adjusted for future changes in estimated forfeitures. This amount is expected to be recognized over a weighted average period of 2.1 years and does not
include the impact of any future stock-based compensation awards.

At
December 30, 2006, the aggregate intrinsic value of options outstanding and options exercisable was $35,420 and $16,215, respectively. The aggregate intrinsic value of options
exercised, excluding the preferred stock option exercised in 2005, was $4,774 and $5,320 during 2006 and 2005, respectively. No options were exercised during the Successor period May 11, 2004
through January 1, 2005. (The intrinsic value of a stock option is the amount by which the market value of the underlying stock exceeds the exercise price of the option.)

The
following table summarizes stock options outstanding and exercisable at December 30, 2006:

Options Outstanding

Options ExercisableRange of Exercise Prices

Options
Outstanding

Weighted
Average
Remaining
Contract Life

Weighted
Average
Exercise
Price

Number
Exercisable

Weighted
Average
Remaining
Contract Life

Weighted
Average
Exercise
Price$1.82

1,005,306

7.4 years

$
1.82

321,453

7.4 years

$
1.823.64

977,542

7.4 years


3.64

474,521

7.4 years


3.6411.11  17.00

504,949

5.7 years


16.34

110,875

5.6 years


16.980.01

217,529
(a)
5.8 years


0.01

217,529

5.8 years


0.010.06

2,172
(a)
5.1 years


0.06

2,172

5.1 years


0.062,707,498






1,126,550


---

88

---



Changes
in options outstanding are summarized as follows:

|                                                    |  | Successor |   |   |       | 
|--------------------------------------------------- |  | --------- | - | - | ----- | 
|
|
|
|
|
|Options outstanding, beginning of year              |  | 3,037,871 |   | $ | 4.77  | 
|Options grantedcommon                              |  | 51,574    |   |   | 11.42 | 
|Options granted-preferred                           |  |          |   |   |      | 
|Options cancelled or forfeited                      |  | (139,543  | ) |   | 9.14  | 
|Options cashed out                                  |  |          |   |   |      | 
|Options exercisedcommon                            |  | (242,404  | ) |   | 0.73  | 
|Options exercisedpreferred                         |  |          |   |   |      | 
|Predecessor options exchanged for Successor options |  |          |   |   |      | 
|                                                    |  |           |   |   |       | 
|Options outstanding, end of year                    |  | 2,707,498 |   | $ | 5.04  | 
|                                                    |  |           |   |   |       | 
|Options exercisable, end of year, common            |  | 1,126,550 |   | $ | 3.73  | 
|                                                    |  |           |   |   |       | 

89

---





The following table summarizes stock options issued and outstanding, excluding the 2004 rollover stock options outstanding, at December 30, 2006 whose
exercise price equals, exceeds, or is less than the fair market value of the stock on the date of grant.

Options
Outstanding

Weighted Average
Exercise Price

Weighted Average Fair
Market Value1,019,275

$
9.01

$
9.01833,710


3.64


2.11634,812


2.23


7.982,487,797


17.  ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The components of and changes in accumulated other comprehensive income (loss) are as follows:

|                              |  | Foreign
Currency
Translation
Adjustment(a) |      | Minimum
Pension
Liability(b) |   | Adoption of
SFAS No. 158,
(net of tax) |   | Interest
Rate Swaps,
(net of tax) |     | Accumulated
Other
Comprehensive
Income (Loss) |  
|----------------------------- |  | ------------------------------------------ | ---- | ---------------------------- | - | -------------------------------------- | - | --------------------------------- | --- | --------------------------------------------- | -
|Predecessor                   |  |                                            |      |                              |   |                                        |   |                                   |     |                                               |  
|Balance, at December 27, 2003 |  | $                                          | (150 | )                            | $ | (1,774                                 | ) | $                                 |    |                                               | $
|Changes during the period     |  |                                            | (149 | )                            |   | (179                                   | ) |                                   |    |                                               |  
|                              |  |                                            |      |                              |   |                                        |   |                                   |     |                                               |  
|Balance, at May 10, 2004      |  | $                                          | (299 | )                            | $ | (1,953                                 | ) | $                                 |    |                                               | $
|                              |  |                                            |      |                              |   |                                        |   |                                   |     |                                               |  
|Successor                     |  |                                            |      |                              |   |                                        |   |                                   |     |                                               |  
|Changes during the period     |  | $                                          | 169  |                              | $ |                                       |   | $                                 |    |                                               | $
|                              |  |                                            |      |                              |   |                                        |   |                                   |     |                                               |  
|Balance, at January 1, 2005   |  |                                            | 169  |                              |   |                                       |   |                                   |    |                                               |  
|Changes during the period     |  |                                            | (169 | )                            |   |                                       |   |                                   |    |                                               |  
|                              |  |                                            |      |                              |   |                                        |   |                                   |     |                                               |  
|Balance, at December 31, 2005 |  |                                            |     |                              |   |                                       |   |                                   |    |                                               |  
|Changes during the period     |  |                                            | 45   |                              |   |                                       |   |                                   | (40 | )                                             |  
|                              |  |                                            |      |                              |   |                                        |   |                                   |     |                                               |  
|Balance, at December 30, 2006 |  | $                                          | 45   |                              | $ |                                       |   | $                                 | (40 | )                                             | $
|                              |  |                                            |      |                              |   |                                        |   |                                   |     |                                               |  

---

90

---



18.  INCOME TAXES

Income (loss) before provision for income taxes consists of the following:

|         |       | Successor |        | Predecessor |  
|-------- | ----- | --------- | ------ | ----------- | -
|
|
|Domestic |       | $         | 47,009 |             | $
|Foreign  |       |           | (16    | )           |  
|         |       |           |        |             |  
|         | Total |           | $      | 46,993      |  
|         |       |           |        |             |  

Our provision (benefit) for income taxes consists of the following:

|                |                                      | Successor |        | Predecessor |  
|--------------- | ------------------------------------ | --------- | ------ | ----------- | -
|
|
|Current         |                                      |           |        |             |  
|Federal         |                                      | $         | 12,050 |             | $
|State and local |                                      |           | 2,484  |             |  
|Foreign         |                                      |           | 499    |             |  
|                |                                      |           |        |             |  
|                |                                      |           | 15,033 |             |  
|                |                                      |           |        |             |  
|Deferred        |                                      |           |        |             |  
|Federal         |                                      |           | 3,324  |             |  
|State and local |                                      |           | 867    |             |  
|Foreign         |                                      |           | 7      |             |  
|                |                                      |           |        |             |  
|                |                                      |           | 4,198  |             |  
|                |                                      |           |        |             |  
|                | Total income tax provision (benefit) |           | $      | 19,231      |  
|                |                                      |           |        |             |  

91

---





Our income tax rate is reconciled to the U.S. federal statutory tax rate as follows:

|                                                     |                    | Successor |      | Predecessor |     
|---------------------------------------------------- | ------------------ | --------- | ---- | ----------- | ----
|
|
|
|Federal statutory tax rate                           |                    | 35.0      | %    | 35.0        | %   
|Foreign income taxes                                 |                    | 1.1       |      | (0.3        | )   
|State and local income taxes, net of federal benefit |                    | 4.6       |      | 7.8         |     
|Equity related costs                                 |                    | 0.3       |      | 7.6         |     
|Foreign deemed dividend                              |                    |          |      | 1.1         |     
|Change in tax method                                 |                    |          |      | (2.1        | )   
|Acquisition-related costs                            |                    |          |      |            |     
|Other                                                |                    | (0.1      | )    | 0.3         |     
|                                                     |                    |           |      |             |     
|                                                     | Effective tax rate |           | 40.9 | %           | 49.4
|                                                     |                    |           |      |             |     

Deferred
tax assets (liabilities) at December 30, 2006 and December 31, 2005 are comprised of the following:

|                                             |                              | 2006 |         | 2005   |  
|-------------------------------------------- | ---------------------------- | ---- | ------- | ------ | -
|Deferred tax assetscurrent                  |                              |      |         |        |  
|Accounts receivable reserves                 |                              | $    | 4,205   |        | $
|Inventory reserves                           |                              |      | 3,231   |        |  
|Accrued liabilities                          |                              |      | 1,680   |        |  
|Other, net                                   |                              |      | 343     |        |  
|                                             |                              |      |         |        |  
|                                             |                              |      | 9,459   |        |  
|                                             |                              |      |         |        |  
|Deferred tax (liabilities) assetsnoncurrent |                              |      |         |        |  
|Depreciation and amortization                |                              |      | (261    | )      |  
|Net operating losses                         |                              |      | 17,897  |        |  
|AMT credit                                   |                              |      | 666     |        |  
|Intangible assets                            |                              |      | (39,756 | )      |  
|Pension and postretirement liabilities       |                              |      | 2,204   |        |  
|Other, net                                   |                              |      | 3,027   |        |  
|                                             |                              |      |         |        |  
|                                             |                              |      | (16,223 | )      |  
|                                             |                              |      |         |        |  
|                                             | Net deferred tax liabilities |      | $       | (6,764 | )
|                                             |                              |      |         |        |  

Our
income tax payable of $4,295 and $930 at December 30, 2006 and December 31, 2005, respectively, was included in accrued expenses and other current liabilities.

In
2006 and 2005, we recorded an increase in additional paid-in capital of approximately $1,881 and $2,775, respectively, for tax benefits from the exercise of stock options.

92

---



Section 382
of the Internal Revenue Code (Section 382) imposes limitations on a corporation's ability to utilize its net operating losses (NOLs) if it experiences an
"ownership change." In general terms, an ownership change results from transactions increasing the ownership of certain existing stockholders and, or, new stockholders in the stock of a corporation by
more than 50 percentage points during a three year testing period. Upon emergence from bankruptcy, our NOLs were subject to Section 382 limitations. As a result of the Acquisition, we
experienced an ownership change, as defined by Section 382. As a result of this ownership change, the utilization of our NOLs are subject to a new annual limitation under Section 382.
Any unused annual limitation may be carried over to later years, and the amount of the limitation may, under certain circumstances, be increased to reflect both recognized and deemed recognized
"built-in gains" that occur during the 60-month period after the ownership change. Based on fair values of certain assets as determined in connection with the Acquisition (see
Note 12, "Change in Ownership"), we had approximately $66,700 of built-in gains that are anticipated to be recognized or deemed recognized during the aforementioned
60-month period. Subsequent to the Acquisition, the sale of shares by others, including the initial public offering in July 2005, have resulted in additional changes in control for
the purpose of Section 382; however, the annual limitation of our NOLs has not changed. At December 30, 2006, we had approximately $62,800 federal and state NOLs available for future
utilization during the years of 2007 through 2023. During 2006, our combined limitation for our NOLs was approximately $12,100 and we utilized approximately $12,100 of NOLs. During 2005, our combined
limitation for our NOLs was approximately $20,900 and we utilized approximately $18,900 of NOLs. During the Successor period May 11, 2004 through January 1, 2005, we utilized
approximately $16,000 of NOLs. During the Predecessor year 2003, we utilized approximately $14,100 of NOLs.

At
December 30, 2006 and December 31, 2005, we had approximately $1,900 of undistributed earnings from foreign operations. No deferred taxes have been provided because we
believe these earnings will be permanently reinvested abroad.

19. COMMITMENTS AND CONTINGENCIES

Purchase commitments

In the normal course of business, we enter into purchase commitments for both finished goods inventory and raw materials. At December 30, 2006, we had
purchase commitments of $92,269 and believe that we have adequate reserves for expected losses arising from all purchase commitments.

Litigation

We are party to various legal actions arising in the ordinary course of business. Based on information presently available to us, we believe that we have adequate
legal defenses, reserves or insurance coverage for these actions and that the ultimate outcome of these actions will not have a material adverse effect on our consolidated statements of financial
position, results of operations or cash flows.

93

---





20. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

|                                                        |  | 2006 |        | 2005
|------------------------------------------------------- |  | ---- | ------ | ----
|Accrued wages, incentive compensation and payroll taxes |  | $    | 8,457  |     
|Accrued trade promotion                                 |  |      | 1,796  |     
|Accrued professional fees                               |  |      | 1,604  |     
|Federal, state and local taxes payable                  |  |      | 4,295  |     
|Accrued other                                           |  |      | 5,024  |     
|                                                        |  |      |        |     
|                                                        |  | $    | 21,176 |     
|                                                        |  |      |        |     

Other
accrued expenses and current liabilities include, among other items, accrued interest, accrued medical insurance, and accrued advertising.

21. VALUATION AND QUALIFYING ACCOUNTS

|                              |  | Allowance for |     
|----------------------------- |  | ------------- | ----
|
|Predecessor                   |  |               |     
|Balance, at December 27, 2003 |  | $             | 355 
|Additions, charged to expense |  |               | (82 
|Write-offs                    |  |               |    
|                              |  |               |     
|Balance, at May 10, 2004      |  | $             | 273 
|                              |  |               |     
|Successor                     |  |               |     
|Balance, at May 11, 2004      |  | $             | 273 
|Additions, charged to expense |  |               | (127
|Write-offs                    |  |               | 42  
|                              |  |               |     
|Balance, at January 1, 2005   |  |               | 188 
|Additions, charged to expense |  |               | 60  
|Write-offs                    |  |               | (24 
|                              |  |               |     
|Balance, at December 31, 2005 |  |               | 224 
|Additions, charged to expense |  |               | 44  
|Write-offs                    |  |               |    
|                              |  |               |     
|Balance, at December 30, 2006 |  | $             | 268 
|                              |  |               |     

In
addition to the allowances for doubtful accounts and sales returns, we also include in accounts receivable reserves a reserve for markdowns and cooperative advertising commitments.

22.  MAJOR CUSTOMERS AND SUPPLIERS

Each of the following wholesale segment customers were greater than 10% of our total net sales:

|           |  | Successor |   | Predecessor |  
|---------- |  | --------- | - | ----------- | -
|
|
|Customer A |  | 12.7      | % | 12.9        | %
|Customer B |  | 12.9      | % | 12.4        | %

At
December 30, 2006 and December 31, 2005, our five largest uncollateralized receivables represented approximately 57% and 53% of total accounts receivable.

94

---





|                            |  | Successor |   | Predecessor |  
|--------------------------- |  | --------- | - | ----------- | -
|
|
|Major suppliers information |  |           |   |             |  
|Number of major suppliers   |  | 5         |   | 3           |  
|% of total purchases        |  | 58        | % | 57          | %
|                            |  |           |   |             |  

23.  RELATED PARTY TRANSACTIONS

As a result of the initial public offering, Ares Corporate Opportunity Fund, L.P. (the "Fund") reduced its holdings from 12,925,000 shares of common stock and
235,000 shares of preferred stock, which represented approximately 65% of our outstanding common and preferred stock, to holdings of 7,400,000 shares of common stock which represents approximately
31.5% of our common stock. In connection with the Acquisition, we entered into an advisory agreement with ACOF Operating Manager, L.P. (together with the Fund, the "Ares Entities"), whereby we paid
the Ares Entities an annual advisory fee of $250 plus reimbursements for reasonable expenses. In connection with the initial public offering, we terminated the advisory agreement and paid Ares
Entities $893 during 2005 for a prorated portion of the advisory fee and a termination fee. Through January 1, 2005, we paid the Ares Entities $160 under this agreement. In addition, upon
completion of the Acquisition, we paid the Ares Entities a fee for services rendered in connection with structuring the Acquisition of $2,000, $600 of which was included in deferred financing costs
amortized over the life of the obligation and $1,400 was included in the cost of the Acquisition. In connection with the Registration Statement on Form S-3 filed on
October 31, 2006, the Fund reduced its holdings from 7,400,000 shares of common stock, which represented approximately 31.5% of our outstanding common stock, to 3,737,351 shares of common
stock, which represents approximately 16.0% of our common stock.

Our
Amended and Restated Credit Facility, which includes a consortium of institutions, was arranged with a financial institution who acts as the Administrative Agent for our Amended and
Restated Credit Facility. The Administrative Agent is also a stockholder of the Company beginning May 11, 2004. See Note 6, "Debt," for details related to our Amended and Restated Credit
Facility. In connection with the amendments on February 8, 2006, June 29, 2005 and the original financing on May 11, 2004, we paid transaction costs in the amount of $300, $3,223
and $4,660, respectively. We also incurred interest expense of $8,592, $10,288 and $6,674 for 2006, 2005 and Successor period May 11, 2004 through January 1, 2005, respectively. In
connection with the Registration Statement on Form S-3 filed on October 31, 2006, the Administrative Agent reduced its holdings to approximately 1.0%.

During
2005 and 2006, certain private equity funds managed by American International Group, Inc. ("AIG") were stockholders. We obtained various insurance policies in the amount of $361
and $393 during 2006 and 2005, respectively, and $1,735 during the Successor period May 11, 2004 through January 1, 2005 and the Predecessor period December 28, 2003 through
May 10, 2004 from an affiliate of AIG. The policies obtained during 2006 and 2005 were recorded as prepaid expenses and other current assets and amortized over the term of the policies. Of the
$1,735, $242 was included in prepaid expenses and other current assets and amortized over the term of the policies and $1,493 was expensed as a cost of the Acquisition during the Predecessor period

95

---



December 28,
2003 through May 10, 2004. At December 30, 2006, certain private equity funds managed by AIG were no longer stockholders of the Company.

24.  SEGMENT INFORMATION

We report segment information in accordance with the provisions of SFAS No. 131, "Disclosures about Segments of an Enterprise and Related Information,"
which requires segment information to be disclosed based on a "management approach." The management approach refers to the internal reporting that we use for making operating decisions and assessing
the performance of reportable segments. SFAS No. 131 also requires disclosure about products and services, geographic areas and major customers. For purposes of complying with SFAS
No. 131, we identified our two reportable segments as "Wholesale" and "Retail." Our wholesale sales are to department stores, national chain store, mass merchants (including warehouse clubs),
specialty retailers, off-price retailers, and third party distributors servicing similar customers in foreign countries while our retail segment reflects our operations from our retail
stores and internet operations. Royalty income is also included in our wholesale segment. Within our reportable segments, wholesale includes corporate-related assets. The accounting policies of the
segments are the same as those described in Note 2, "Summary of Significant Accounting Policies." Each segment's results include the costs directly related to the segment's net sales and all
other costs allocated based on the relationship to consolidated net sales to support each segment's net sales. Intersegment sales and transfers are recorded at cost and treated as a transfer of
inventory.

|                                            |                             | Successor                                       |        | Predecessor |        
|------------------------------------------- | --------------------------- | ----------------------------------------------- | ------ | ----------- | -------
|
|
|Net sales                                   |                             |                                                 |        |             |        
|                                            | Wholesale                   |                                                 | $      | 360,647     |        
|                                            | Retail                      |                                                 |        | 56,188      |        
|                                            |                             |                                                 |        |             |        
|                                            |                             | Total                                           |        | $           | 416,835
|                                            |                             |                                                 |        |             |        
|Operating income (loss)                     |                             |                                                 |        |             |        
|                                            | Wholesale                   |                                                 | $      | 51,361      |        
|                                            | Retail                      |                                                 |        | 4,153       |        
|                                            | Acquisitionrelated charges |                                                 |        |            |        
|                                            |                             |                                                 |        |             |        
|                                            |                             | Operating income (loss)                         |        |             | 55,514 
|                                            |                             | Interest expense, net                           |        |             | (8,521 
|                                            |                             |                                                 |        |             |        
|                                            |                             | Income (loss) before provision for income taxes |        | $           | 46,993 
|                                            |                             |                                                 |        |             |        
|Depreciation and Amortization               |                             |                                                 |        |             |        
|                                            | Wholesale                   |                                                 | $      | 2,487       |        
|                                            | Retail                      |                                                 |        | 1,490       |        
|                                            |                             |                                                 |        |             |        
|                                            |                             | Total                                           |        | $           | 3,977  
|                                            |                             |                                                 |        |             |        
|Net sales by geographic area                |                             |                                                 |        |             |        
|                                            | United States               |                                                 | $      | 388,312     |        
|                                            | International (a)           |                                                 |        | 28,523      |        
|                                            |                             |                                                 |        |             |        
|                                            |                             | Total                                           |        | $           | 416,835
|                                            |                             |                                                 |        |             |        
|Intercompany sales from wholesale to retail |                             | $                                               | 13,731 |             | $      
|                                            |                             |                                                 |        |             |        

(footnotes appear on following page)

96

---



|                                                       |               | 2006  |   | 2005   
|------------------------------------------------------ | ------------- | ----- | - | -------
|Inventory                                              |               |       |   |        
|                                                       | Wholesale (b) |       | $ | 38,457 
|                                                       | Retail        |       |   | 8,454  
|                                                       |               |       |   |        
|                                                       |               | Total |   | $      
|                                                       |               |       |   |        
|Identifiable assets                                    |               |       |   |        
|                                                       | Wholesale     |       | $ | 218,636
|                                                       | Retail        |       |   | 26,217 
|                                                       |               |       |   |        
|                                                       |               | Total |   | $      
|                                                       |               |       |   |        
|Property, plant and equipment, net, by geographic area |               |       |   |        
|                                                       | United States |       | $ | 17,954 
|                                                       | International |       |   | 500    
|                                                       |               |       |   |        
|                                                       |               | Total |   | $      
|                                                       |               |       |   |        

---

97

---





25. EARNINGS (LOSS) PER SHARE

The following is a reconciliation of basic number of common shares outstanding to diluted common and common equivalent shares outstanding:

|                                                                           |  | Successor |            | Predecessor |  
|-------------------------------------------------------------------------- |  | --------- | ---------- | ----------- | -
|
|
|Net income (loss)                                                          |  | $         | 27,762     |             | $
|Less: Preferred stock dividends and changes in redemption value            |  |           |           |             |  
|                                                                           |  |           |            |             |  
|Net income (loss) available to common stockholders                         |  | $         | 27,762     |             | $
|                                                                           |  |           |            |             |  
|Weighted average number of common and common equivalent shares outstanding |  |           |            |             |  
|Basic number of common shares outstanding                                  |  |           | 23,024,986 |             |  
|Dilutive effect of stock options                                           |  |           | 1,169,482  |             |  
|                                                                           |  |           |            |             |  
|Dilutive number of common and common equivalent shares outstanding         |  |           | 24,194,468 |             |  
|                                                                           |  |           |            |             |  
|Basic net earnings (loss) per common share                                 |  | $         | 1.21       |             | $
|                                                                           |  |           |            |             |  
|Diluted net earnings (loss) per common share                               |  | $         | 1.15       |             | $
|                                                                           |  |           |            |             |  

Options
to purchase 509,000 shares of common stock were outstanding during 2005, but were not included in the computation of diluted earnings per share because the option
exercise prices were greater than the average market price of the shares of common stock.

Options
to purchase shares of common stock of 1,248,691 for 2005, 430,298 for the Successor period May 11, 2004 through January 1, 2005 and 468,261 for the Predecessor
period December 28, 2003 through May 10, 2004, were not included in the computation of diluted earnings per share because of their anti-dilutive effect.

98

---



26. SELECTED QUARTERLY FINANCIAL DATA (unaudited)

The following table sets forth certain unaudited quarterly financial information:

|                                            |  | 2006
|------------------------------------------- |  | ----
|
|Net sales                                   |  | $   
|Gross Profit                                |  |     
|Operating income                            |  |     
|Net income                                  |  |     
|Net income available to common stockholders |  |     
|Basic earnings per share                    |  | $   
|Diluted earnings per share                  |  | $   

|                                                   |  | 2005 |        
|-------------------------------------------------- |  | ---- | -------
|
|Net sales                                          |  | $    | 100,210
|Gross Profit                                       |  |      | 34,320 
|Operating income                                   |  |      | 10,884 
|Net income (loss)                                  |  |      | 4,471  
|Net income (loss) available to common stockholders |  |      | 3,023  
|Basic earnings (loss) per share                    |  | $    | 0.15   
|Diluted earnings (loss) per share                  |  | $    | 0.14   

99

---





27.  CONDENSED FINANCIAL INFORMATION OF PARENT COMPANY

Maidenform Brands, Inc.
Condensed Balance Sheets
(in thousands, except share and per share amounts)

|                     |                                                                                                                                                                                                  | December 30, 2006                          |   | December 31, 2005 |       
|-------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ------------------------------------------ | - | ----------------- | ------
|Assets               |                                                                                                                                                                                                  |                                            |   |                   |       
|                     | Investment in Maidenform, Inc.                                                                                                                                                                   |                                            | $ | 74,422            |       
|                     | Other assets                                                                                                                                                                                     |                                            |   | 87                |       
|                     |                                                                                                                                                                                                  |                                            |   |                   |       
|                     |                                                                                                                                                                                                  | Total current assets                       |   |                   | 74,509
|                     | Deferred tax asset                                                                                                                                                                               |                                            |   | 392               |       
|                     |                                                                                                                                                                                                  |                                            |   |                   |       
|                     |                                                                                                                                                                                                  | Total assets                               |   | $                 | 74,901
|                     |                                                                                                                                                                                                  |                                            |   |                   |       
|Stockholders' equity |                                                                                                                                                                                                  |                                            |   |                   |       
|Stockholders' equity |                                                                                                                                                                                                  |                                            |   |                   |       
|                     | Preferred stock$0.01 par value; 10,000,000 shares authorized and none issued and outstanding                                                                                                    |                                            |   |                  |       
|                     | Common stock$0.01 par value; 100,000,000 shares authorized; 23,488,357 shares issued and 22,964,826 outstanding at December 30, 2006 and 23,488,357 issued and outstanding at December 31, 2005 |                                            |   | 235               |       
|                     | Additional paid-in capital                                                                                                                                                                       |                                            |   | 59,478            |       
|                     | Retained earnings (accumulated deficit)                                                                                                                                                          |                                            |   | 20,953            |       
|                     | Accumulated other comprehensive income                                                                                                                                                           |                                            |   | 158               |       
|                     | Treasury stock (523,531 shares at an average price per share of $11.31)                                                                                                                          |                                            |   | (5,923            | )     
|                     |                                                                                                                                                                                                  |                                            |   |                   |       
|                     |                                                                                                                                                                                                  | Total stockholders' equity                 |   |                   | 74,901
|                     |                                                                                                                                                                                                  |                                            |   |                   |       
|                     |                                                                                                                                                                                                  | Total liabilities and stockholders' equity |   | $                 | 74,901
|                     |                                                                                                                                                                                                  |                                            |   |                   |       

The
accompanying note is an integral part of these condensed financial statements.

100

---



Maidenform Brands, Inc.
Condensed Statements of Operations
(in thousands, except share and per share amounts)

|                                                             |                                                    | For the years ended |            | For the period
from
May 11, 2004
through
January 1, 2005 |  
|------------------------------------------------------------ | -------------------------------------------------- | ------------------- | ---------- | -------------------------------------------------------- | -
|
|Selling, general and administrative expense                  |                                                    | $                   | (1,091     | )                                                        | $
|Income tax benefit                                           |                                                    |                     | 276        |                                                          |  
|                                                             |                                                    |                     |            |                                                          |  
|Loss before equity in net income of Maidenform, Inc.         |                                                    |                     | (815       | )                                                        |  
|Equity in net income (loss) of Maidenform, Inc. (net of tax) |                                                    |                     | 28,577     |                                                          |  
|                                                             |                                                    |                     |            |                                                          |  
|                                                             | Net income                                         |                     |            | 27,762                                                   |  
|Preferred stock dividends and change in redemption value     |                                                    |                     |           |                                                          |  
|                                                             |                                                    |                     |            |                                                          |  
|                                                             | Net income (loss) available to common stockholders |                     | $          | 27,762                                                   |  
|                                                             |                                                    |                     |            |                                                          |  
|Basic earnings (loss) per common share                       |                                                    | $                   | 1.21       |                                                          | $
|                                                             |                                                    |                     |            |                                                          |  
|Diluted earnings (loss) per common share                     |                                                    | $                   | 1.15       |                                                          | $
|                                                             |                                                    |                     |            |                                                          |  
|Basic weighted average number of shares outstanding          |                                                    |                     | 23,024,986 |                                                          |  
|                                                             |                                                    |                     |            |                                                          |  
|Diluted weighted average number of shares outstanding        |                                                    |                     | 24,194,468 |                                                          |  
|                                                             |                                                    |                     |            |                                                          |  

The
accompanying note is an integral part of these condensed financial statements.

101

---





Maidenform Brands, Inc.
Condensed Statements of Stockholders' Equity (Deficit)
(in thousands, except share amounts)

|                                                                                           |                            | Common
Stock |  | Treasury
Stock |     |  |          |   |   |        |   |   |        
|------------------------------------------------------------------------------------------ | -------------------------- | ------------ |  | -------------- | --- |  | -------- | - | - | ------ | - | - | -------
|
|
|
|Issuance of common stock at fair market value                                              |                            | 15,675,000   |  | $              | 157 |  |         |   | $ |       |   | $ | 27,761 
|Deemed dividend to continuing stockholders                                                 |                            |              |  |                |     |  |          |   |   |        |   |   | (21,529
|Preferred stock dividends and changes in redemption value                                  |                            |              |  |                |     |  |          |   |   |        |   |   | (4,756 
|Adjust common stock, subject to put option, to redemption value                            |                            |              |  |                |     |  |          |   |   |        |   |   | 511    
|Stock-based compensation                                                                   |                            |              |  |                |     |  |          |   |   |        |   |   | 251    
|Other stock transactions                                                                   |                            |              |  |                |     |  |          |   |   |        |   |   | (140   
|Comprehensive loss                                                                         |                            |              |  |                |     |  |          |   |   |        |   |   |        
|Net loss                                                                                   |                            |              |  |                |     |  |          |   |   |        |   |   |        
|Changes during the period                                                                  |                            |              |  |                |     |  |          |   |   |        |   |   |        
|                                                                                           |                            |              |  |                |     |  |          |   |   |        |   |   |        
|Total comprehensive loss                                                                   |                            |              |  |                |     |  |          |   |   |        |   |   |        
|                                                                                           |                            |              |  |                |     |  |          |   |   |        |   |   |        
|Balance at January 1, 2005                                                                 |                            | 15,675,000   |  |                | 157 |  |         |   |   |       |   |   | 2,098  
|Preferred stock dividends and changes in redemption value                                  |                            |              |  |                |     |  |          |   |   |        |   |   | (4,883 
|Initial public offering and exercise of stock options                                      |                            | 3,688,357    |  |                | 37  |  |          |   |   |        |   |   | 52,542 
|Reclassification of common stock subject to put option  upon extinguishment of put option |                            | 4,125,000    |  |                | 41  |  |          |   |   |        |   |   | 5,547  
|Preferred stock options purchased                                                          |                            |              |  |                |     |  |          |   |   |        |   |   | (1,393 
|Adjust common stock, subject to put option, to redemption value                            |                            |              |  |                |     |  |          |   |   |        |   |   | 768    
|Tax effect from exercise of stock options                                                  |                            |              |  |                |     |  |          |   |   |        |   |   | 2,775  
|Stock-based compensation                                                                   |                            |              |  |                |     |  |          |   |   |        |   |   | 1,609  
|Comprehensive income                                                                       |                            |              |  |                |     |  |          |   |   |        |   |   |        
|Net income                                                                                 |                            |              |  |                |     |  |          |   |   |        |   |   |        
|Changes during the period                                                                  |                            |              |  |                |     |  |          |   |   |        |   |   |        
|                                                                                           |                            |              |  |                |     |  |          |   |   |        |   |   |        
|                                                                                           | Total comprehensive income |              |  |                |     |  |          |   |   |        |   |   |        
|                                                                                           |                            |              |  |                |     |  |          |   |   |        |   |   |        
|Balance at December 31, 2005                                                               |                            | 23,488,357   |  |                | 235 |  |         |   |   |       |   |   | 59,063 
|Stock-based compensation                                                                   |                            |              |  |                |     |  |          |   |   |        |   |   | 2,016  
|Purchase of common stock for treasury                                                      |                            |              |  |                |     |  | (669,500 | ) |   | (7,563 | ) |   |        
|Stock options exercised                                                                    |                            |              |  |                |     |  | 145,969  |   |   | 1,640  |   |   | (1,601 
|Initial adoption of SFAS No. 158, net of tax                                               |                            |              |  |                |     |  |          |   |   |        |   |   |        
|Comprehensive income                                                                       |                            |              |  |                |     |  |          |   |   |        |   |   |        
|Net income                                                                                 |                            |              |  |                |     |  |          |   |   |        |   |   |        
|Changes during the period                                                                  |                            |              |  |                |     |  |          |   |   |        |   |   |        
|                                                                                           |                            |              |  |                |     |  |          |   |   |        |   |   |        
|Total comprehensive income                                                                 |                            |              |  |                |     |  |          |   |   |        |   |   |        
|                                                                                           |                            |              |  |                |     |  |          |   |   |        |   |   |        
|Balance at December 30, 2006                                                               |                            | 23,488,357   |  | $              | 235 |  | (523,531 | ) | $ | (5,923 | ) | $ | 59,478 
|                                                                                           |                            |              |  |                |     |  |          |   |   |        |   |   |        

The accompanying note is an integral part of these condensed financial statements.

102

---





Maidenform Brands, Inc.
Condensed Statements of Cash Flows
(in thousands)

|                                                                                                                 |                                                         | For the years ended                |        | For the period
from
May 11, 2004
through
January 1, 2005 |       
|---------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------- | ---------------------------------- | ------ | -------------------------------------------------------- | ------
|
|Cash flows from operating activities                                                                             |                                                         |                                    |        |                                                          |       
|Net income (loss)                                                                                                |                                                         | $                                  | 27,762 |                                                          | $     
|Adjustments to reconcile net income (loss) to net cash provided by operating activities
Stock-based compensation |                                                         |                                    | 502    |                                                          |       
|                                                                                                                 | Deferred income taxes                                   |                                    |        | (201                                                     | )     
|                                                                                                                 | Tax benefit from exercise of stock options              |                                    |        |                                                         |       
|                                                                                                                 | Excess tax benefits related to share-based compensation |                                    |        | (1,881                                                   | )     
|                                                                                                                 | Equity in net income (loss) of Maidenform, Inc.         |                                    |        | (28,577                                                  | )     
|                                                                                                                 | Net change in operating activities Accrued expenses     |                                    |        | 1,806                                                    |       
|                                                                                                                 |                                                         |                                    |        |                                                          |       
|                                                                                                                 |                                                         | Net cash from operating activities |        |                                                          | (589  
|                                                                                                                 |                                                         |                                    |        |                                                          |       
|Cash flows from investing activities                                                                             |                                                         |                                    |        |                                                          |       
|Investment in Maidenform, Inc.                                                                                   |                                                         |                                    | 8,113  |                                                          |       
|                                                                                                                 |                                                         |                                    |        |                                                          |       
|                                                                                                                 | Net cash from investing activities                      |                                    |        | 8,113                                                    |       
|                                                                                                                 |                                                         |                                    |        |                                                          |       
|Cash flows from financing activities                                                                             |                                                         |                                    |        |                                                          |       
|Purchase of common stock for treasury                                                                            |                                                         |                                    | (7,563 | )                                                        |       
|Proceeds from options exercised                                                                                  |                                                         |                                    | 171    |                                                          |       
|Payments of employee withholding taxes related to net stock option exercises                                     |                                                         |                                    | (2,013 | )                                                        |       
|Excess tax benefits related to stock-based compensation                                                          |                                                         |                                    | 1,881  |                                                          |       
|Proceeds from issuance of preferred and common stock                                                             |                                                         |                                    |       |                                                          |       
|Redemption of preferred stock and preferred options and payment of accumulated dividends                         |                                                         |                                    |       |                                                          |       
|Cash dividends paid                                                                                              |                                                         |                                    |       |                                                          |       
|Common stock options purchased                                                                                   |                                                         |                                    |       |                                                          |       
|                                                                                                                 |                                                         |                                    |        |                                                          |       
|                                                                                                                 |                                                         | Net cash from financing activities |        |                                                          | (7,524
|                                                                                                                 |                                                         |                                    |        |                                                          |       
|                                                                                                                 |                                                         | Net change in cash                 |        |                                                          |      
|Cash and cash equivalents                                                                                        |                                                         |                                    |        |                                                          |       
|Beginning of period                                                                                              |                                                         |                                    |       |                                                          |       
|                                                                                                                 |                                                         |                                    |        |                                                          |       
|End of period                                                                                                    |                                                         | $                                  |       |                                                          | $     
|                                                                                                                 |                                                         |                                    |        |                                                          |       
|Supplementary disclosure of cash flow information                                                                |                                                         |                                    |        |                                                          |       
|                                                                                                                 | Non-cash intercompany transaction                       |                                    | $      | 1,514                                                    |       
|                                                                                                                 |                                                         |                                    |        |                                                          |       

The
accompanying note is an integral part of these condensed financial statements.

103

---



Maidenform Brands, Inc.
Note to Condensed Financial Statements of Parent Company (in thousands)

BASIS OF PRESENTATION

On May 11, 2004, a wholly owned subsidiary of MF Acquisition Corporation acquired Maidenform Inc. (the "Acquisition,") pursuant to an Agreement and
Plan of Merger (the "Merger Agreement") dated March 16, 2004, as amended on May 3, 2004, by and among Maidenform, Inc., MF Merger Corporation, MF Acquisition Corporation, and Ares
Corporate Opportunities Fund, L.P.
("Ares.") Financing for the Acquisition totaled $237,265 (including $8,137 of transaction-related fees and expenses). Stockholders of Maidenform, Inc. received either cash or stock of MF
Acquisition Corporation in exchange for their shares of Maidenform, Inc. On April 5, 2005, MF Acquisition Corporation changed its name to Maidenform Brands, Inc. (the "Parent
Company.") The condensed financial statements for the period including and after May 11, 2004 are designated as Successor. For the predecessor periods, the Company (as defined below) did not
have a holding company structure, therefore the results of operations of the Parent Company are the same as those of the Company.

The
Parent Company follows the accounting policies as described in Note 2 to the Consolidated Financial Statements of Maidenform Brands, Inc. and subsidiaries (the
"Company") included in the accompanying prospectus with the exception of its investment in its subsidiary for which the Parent Company uses the equity method of accounting. The condensed financial
statements of the Parent Company have been revised for 2005 and for the Successor period May 11, 2004 through January 1, 2005 to record stock-based compensation expense and the related
tax effects for the Maidenform, Inc. employees as part of the equity investment in Maidenform, Inc.

For
further information, reference should be made to the Notes to Consolidated Financial Statements of the Company included in this Annual Report of Form 10-K.

28. SUBSEQUENT EVENT

Effective
January 1, 2007, the Retirement Plan was frozen for current participants and closed to new entrants. In connection with this freeze, we will recognize a
one-time curtailment gain of approximately $6,000 in the first quarter of 2007. The Company may terminate the Retirement Plan and if and when it does so, the Company will recognize a
one-time settlement loss or gain depending on the funded status at the time of termination. There is no requirement to terminate the plan.

104

---



ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures.

Our management, including the Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our "disclosure controls and procedures," as
defined in Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as of December 30, 2006. Based on that evaluation, the Chief
Executive Officer and Chief Financial Officer concluded that the disclosure controls and procedures are effective to ensure that information required to be disclosed by us in the reports that we file
or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and to ensure that
information is accumulated and communicated to our management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required
disclosure.

Changes in Internal Control Over Financial Reporting.

There were no changes in our internal control over financial reporting during the quarter ended December 30, 2006 identified in connection with the
evaluation thereof by our management, including the Chief Executive Officer and Chief Financial Officer, that have materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting.

Management's Annual Report on Internal Control Over Financial Reporting.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is
defined in Rule 13a-15(f) promulgated under the Securities Exchange Act of 1934, as amended, as a process designed by, or under the supervision of, our Chief Executive Officer and
Chief Financial Officer and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted accounting principles.

Because
of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future
periods are subject to
the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Under
the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of
our internal control over financial reporting as of December 30, 2006 based on criteria established in Internal ControlIntegrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission ("COSO"). Based on that evaluation, management concluded that its internal control over financial reporting was effective as of December 30, 2006.

PricewaterhouseCoopers
LLP, an independent registered public accounting firm, who audited our consolidated financial statements, has also audited management's assessment of our internal
control over financial reporting as of December 30, 2006 and the effectiveness of internal control over financial reporting as of December 30, 2006, as stated in their report which
appears in the "Report of Independent Registered Public Accounting Firm" included elsewhere in this Annual Report on Form 10-K.

ITEM 9B. OTHER INFORMATION

None.

105

---





PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The information required by this Item 10 with respect to (1) directors, (2) executive officers, (3) Audit Committee matters,
(4) our Code of Ethics for the Chief Executive Officer and Senior Financial Officers and (5) compliance with Section 16(a) of the Securities Exchange Act of 1934 is incorporated
by reference to the sections captioned (1) "Election of Directors," (2) "Executive Officers," (3) "Board Committees and MeetingsAudit Committee,"
(4) "Corporate Governance Documents" and (5) "Section 16(a) Beneficial Ownership Reporting Compliance" in the definitive proxy statement for our 2007 Annual Meeting of
Stockholders, to be filed not later than April 27, 2007.

ITEM 11. EXECUTIVE COMPENSATION

The information required by this Item 11 is incorporated by reference to the sections captioned "Compensation Discussion and Analysis", "Compensation Committee
Report" (which information shall be deemed furnished in this Annual Report on Form 10-K), "Executive and Director Compensation" and "Compensation Committee Interlocks and Insider
Participation" in the definitive proxy statement for our 2007 Annual Meeting of Stockholders.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The information required by this Item 12 with respect to the security ownership of certain beneficial owners and management is incorporated by reference to
the section captioned "Ownership of Securities" in the definitive proxy statement for our 2007 Annual Meeting of Stockholders, to be filed not later than April 27, 2007.

The
following table provides certain information regarding the common stock authorized for issuance under our equity compensation plans, as of December 30, 2006.

|Plan Category                                          |  | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights
(a) |  | Weighted-Average
Exercise Price of
Outstanding Options, Warrants and Rights
(b) |      | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (2)
(c)
|------------------------------------------------------ |  | ----------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------- | ---- | ----------------------------------------------------------------------------------------------------
|Equity compensation plans approved by stockholders(1)  |  | 2,707,498                                                                                       |  | $                                                                               | 5.04 |                                                                                                     
|Equity compensation plans not approved by stockholders |  |                                                                                                |  |                                                                                 |     |                                                                                                     
|                                                       |  |                                                                                                 |  |                                                                                 |      |                                                                                                     
|Total                                                  |  | 2,707,498                                                                                       |  | $                                                                               | 5.04 |                                                                                                     
|                                                       |  |                                                                                                 |  |                                                                                 |      |                                                                                                     

---

106

---



ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The information required by this Item 13 is incorporated by reference to the sections captioned "Certain Relationships and Related Transactions" and "Director
Independence" in the definitive proxy statement for our 2007 Annual Meeting of Stockholders, to be filed not later than April 27, 2007.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by this Item 14 is incorporated by reference to the section captioned "Independent Registered Public Accounting Firm Fees and
Pre-Approval Policies and Procedures" in the definitive proxy statement for our 2007 Annual Meeting of Stockholders, to be filed not later than April 27, 2007.

107

---





PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a)    Financial Statements and Schedules



(b)    Exhibits required by Item 601 of Regulation S-K

|Exhibit No. |  | Description                                                                                                                                                                    
|----------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.1         |  | Intentionally omitted                                                                                                                                                          
|3.2*        |  | Form of Amended and Restated Certificate of Incorporation to be in effect upon the consummation of this offering                                                               
|3.3         |  | Intentionally omitted                                                                                                                                                          
|3.4*        |  | Form of Amended and Restated Bylaws to be in effect upon the consummation of this offering                                                                                     
|4.1 *       |  | Specimen Common Stock Certificate                                                                                                                                              
|4.2*        |  | Amended and Restated Stockholders Agreement, dated as of July 8, 2005, by and among the Registrant and the stockholders of the Registrant listed on the signature pages thereto
|4.3*        |  | See Exhibits 3.2 and 3.4 for provisions defining the rights of holders of common stock of the Registrant                                                                       
|10.1 *      |  | Employment Agreement, dated as of May 11, 2004, between Maidenform, Inc. and Thomas J. Ward #                                                                                  
|10.2*       |  | Employment Agreement, dated as of June 14, 2005, between Maidenform, Inc. and Maurice Reznik #                                                                                 
|10.3*       |  | Employment Agreement, dated as of October 14, 2004, between Maidenform, Inc. and Dorvin D. Lively #                                                                            
|10.4*       |  | Employment Agreement, dated as of November 1, 1999, between Maidenform, Inc. and Steven N. Masket #                                                                            
|10.5(a)*    |  | 2004 Stock Option Plan #                                                                                                                                                       
|10.5(b)*    |  | Amendment to 2004 Stock Option Plan #                                                                                                                                          
|10.6(a)*    |  | 2004 Rollover Stock Option Plan #                                                                                                                                              
|10.6(b)*    |  | Amendment to 2004 Rollover Stock Option Plan #                                                                                                                                 
|10.7(a)*    |  | 2004 Stock Option Plan for Non-Employee Directors #                                                                                                                            
|10.7(b)*    |  | Amendment to 2004 Stock Option Plan for Non-Employee Directors #                                                                                                               
|10.8        |  | Intentionally omitted                                                                                                                                                          
|10.9*       |  | 2005 Stock Incentive Plan #                                                                                                                                                    
|10.10*      |  | 2005 Annual Performance Bonus Plan #                                                                                                                                           
|10.10(a)*** |  | Form of Non-Tandem Stock Appreciation Rights Agreement Pursuant to the Maidenform Brands, Inc. 2005 Stock Incentive Plan for grants to named executive officers #              
|10.10(b)*** |  | Form of Restricted Stock Agreement Pursuant to the Maidenform Brands, Inc. 2005 Stock Incentive Plan for grants to named executive officers #                                  
|            |  |                                                                                                                                                                                

108

---



|10.11(a)*  |  | Nonqualified Rollover Common Stock Option Agreement, dated as of May 11, 2004, by and between Maidenform Brands, Inc. and Thomas J. Ward #                                                                                                                     
|---------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.11(b)*  |  | Nonqualified Rollover Common Stock Option Agreement, dated as of May 11, 2004, by and between Maidenform Brands, Inc. and Thomas J. Ward #                                                                                                                     
|10.11(c)*  |  | Nonqualified Rollover Common Stock Option Agreement, dated as of May 11, 2004, by and between Maidenform Brands, Inc. and Maurice S. Reznik #                                                                                                                  
|10.11(d)*  |  | Nonqualified Rollover Common Stock Option Agreement, dated as of May 11, 2004, by and between Maidenform Brands, Inc. and Steven N. Masket #                                                                                                                   
|10.12      |  | Intentionally omitted                                                                                                                                                                                                                                          
|10.13(a)*  |  | Amended and Restated Credit Agreement, dated as of June 29, 2005, entered into by and among Maidenform, Inc., Maidenform Brands, Inc., BNP Paribas, as administrative agent, and the financial institutions listed on the
signature pages thereto              
|10.13(b)** |  | First Amendment to Amended and Restated Credit Agreement, dated as of February 8, 2006, entered into by and among Maidenform, Inc., Maidenform Brands, Inc., BNP Paribas, as administrative agent, and the financial
institutions listed on the signature pages
|10.14      |  | Intentionally omitted                                                                                                                                                                                                                                          
|10.15*     |  | Form of Indemnification Agreement                                                                                                                                                                                                                              
|10.16*     |  | Form of Sales Restriction Agreement                                                                                                                                                                                                                            
|21.1*      |  | Subsidiaries of the Registrant                                                                                                                                                                                                                                 
|23.1***    |  | Consent of Independent Registered Public Accounting Firm, PricewaterhouseCoopers LLP                                                                                                                                                                           
|31.1***    |  | Certification by Chief Executive Officer pursuant to Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                         
|31.2***    |  | Certification by Chief Financial Officer pursuant to Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                         
|32.1***    |  | Certification by Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                              
|32.2***    |  | Certification by Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                              

---

109

---





SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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 on March 13, 2007.

| |  | Maidenform Brands, Inc.(Registrant)                                                     
| |  | ----------------------------------------------------------------------------------------
| |  | /s/DORVIN D. LIVELYDorvin D. Lively Executive Vice President and
Chief Financial Officer

Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities
indicated on the 13th day of March 2007.

|Signature                             |  | Title                                                                                            
|------------------------------------- |  | -------------------------------------------------------------------------------------------------
|                                      |  |                                                                                                  
|/s/THOMAS J. WARDThomas J. Ward       |  | Chief Executive Officer and Vice Chairman of the Board (principal executive officer)             
|/s/DORVIN D. LIVELYDorvin D. Lively   |  | Executive Vice President and Chief Financial Officer (principal financial and accounting officer)
|/s/DAVID B. KAPLANDavid B. Kaplan     |  | Chairman of the Board                                                                            
|/s/NORMAN AXELRODNorman Axelrod       |  | Director                                                                                         
|/s/BARBARA EISENBERGBarbara Eisenberg |  | Director                                                                                         
|/s/KAREN ROSEKaren Rose               |  | Director                                                                                         
|/s/HAROLD COMPTONHarold Compton       |  | Director                                                                                         
|/s/ADAM L. STEINAdam L. Stein         |  | Director                                                                                         

110

---





INDEX TO EXHIBITS

The following is a list of all exhibits filed as part of this Report:

|Exhibit No. |  | Description                                                                                                                                                                    
|----------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.1         |  | Intentionally omitted                                                                                                                                                          
|3.2*        |  | Form of Amended and Restated Certificate of Incorporation to be in effect upon the consummation of this offering                                                               
|3.3         |  | Intentionally omitted                                                                                                                                                          
|3.4*        |  | Form of Amended and Restated Bylaws to be in effect upon the consummation of this offering                                                                                     
|4.1*        |  | Specimen Common Stock Certificate                                                                                                                                              
|4.2*        |  | Amended and Restated Stockholders Agreement, dated as of July 8, 2005, by and among the Registrant and the stockholders of the Registrant listed on the signature pages thereto
|4.3*        |  | See Exhibits 3.2 and 3.4 for provisions defining the rights of holders of common stock of the Registrant                                                                       
|10.1*       |  | Employment Agreement, dated as of May 11, 2004, between Maidenform, Inc. and Thomas J. Ward #                                                                                  
|10.2*       |  | Employment Agreement, dated as of June 14, 2005, between Maidenform, Inc. and Maurice Reznik #                                                                                 
|10.3*       |  | Employment Agreement, dated as of October 14, 2004, between Maidenform, Inc. and Dorvin D. Lively #                                                                            
|10.4*       |  | Employment Agreement, dated as of November 1, 1999, between Maidenform, Inc. and Steven N. Masket #                                                                            
|10.5(a)*    |  | 2004 Stock Option Plan #                                                                                                                                                       
|10.5(b)*    |  | Amendment to 2004 Stock Option Plan #                                                                                                                                          
|10.6(a)*    |  | 2004 Rollover Stock Option Plan #                                                                                                                                              
|10.6(b)*    |  | Amendment to 2004 Rollover Stock Option Plan #                                                                                                                                 
|10.7(a)*    |  | 2004 Stock Option Plan for Non-Employee Directors #                                                                                                                            
|10.7(b)*    |  | Amendment to 2004 Stock Option Plan for Non-Employee Directors #                                                                                                               
|10.8        |  | Intentionally omitted                                                                                                                                                          
|10.9*       |  | 2005 Stock Incentive Plan #                                                                                                                                                    
|10.10*      |  | 2005 Annual Performance Bonus Plan #                                                                                                                                           
|10.10(a)*** |  | Form of Non-Tandem Stock Appreciation Rights Agreement Pursuant to the Maidenform Brands, Inc. 2005 Stock Incentive Plan for grants to named executive officers #              
|10.10(b)*** |  | Form of Restricted Stock Agreement Pursuant to the Maidenform Brands, Inc. 2005 Stock Incentive Plan for grants to named executive officers #                                  
|10.11(a)*   |  | Nonqualified Rollover Common Stock Option Agreement, dated as of May 11, 2004, by and between Maidenform Brands, Inc. and Thomas J. Ward #                                     
|10.11(b)*   |  | Nonqualified Rollover Common Stock Option Agreement, dated as of May 11, 2004, by and between Maidenform Brands, Inc. and Thomas J. Ward #                                     
|10.11(c)*   |  | Nonqualified Rollover Common Stock Option Agreement, dated as of May 11, 2004, by and between Maidenform Brands, Inc. and Maurice S. Reznik #                                  
|10.11(d)*   |  | Nonqualified Rollover Common Stock Option Agreement, dated as of May 11, 2004, by and between Maidenform Brands, Inc. and Steven N. Masket #                                   
|            |  |                                                                                                                                                                                

111

---



|10.12      |  | Intentionally omitted                                                                                                                                                                                                                                          
|---------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.13(a)*  |  | Amended and Restated Credit Agreement, dated as of June 29, 2005, entered into by and among Maidenform, Inc., Maidenform Brands, Inc., BNP Paribas, as administrative agent, and the financial institutions listed on the
signature pages thereto              
|10.13(b)** |  | First Amendment to Amended and Restated Credit Agreement, dated as of February 8, 2006, entered into by and among Maidenform, Inc., Maidenform Brands, Inc., BNP Paribas, as administrative agent, and the financial
institutions listed on the signature pages
|10.14      |  | Intentionally omitted                                                                                                                                                                                                                                          
|10.15*     |  | Form of Indemnification Agreement                                                                                                                                                                                                                              
|10.16*     |  | Form of Sales Restriction Agreement                                                                                                                                                                                                                            
|21.1*      |  | Subsidiaries of the Registrant                                                                                                                                                                                                                                 
|23.1***    |  | Consent of Independent Registered Public Accounting Firm, PricewaterhouseCoopers LLP                                                                                                                                                                           
|31.1***    |  | Certification by Chief Executive Officer pursuant to Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                         
|31.2***    |  | Certification by Chief Financial Officer pursuant to Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                         
|32.1***    |  | Certification by Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                              
|32.2***    |  | Certification by Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                              

---

112

---



QuickLinks