**UNITED
          STATES SECURITIES AND EXCHANGE COMMISSION**
 **Washington,
          D.C. 20549**
 **______________**
 
 **FORM
          10-Q**
 **______________**
 
 **x**
                **QUARTERLY
                    REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                    ACT OF
                    1934**
                  **For
                    the quarterly period ended June 30, 2007**OR**o**
                **TRANSITION
                    REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                    ACT OF
                    1934**
                  For
                    the transition periodfrom______
                    to ______
 
 Commission
          File Number: 001-32568
 __________________
 
 **MAIDENFORM
          BRANDS, INC.**
 (Exact
          name of registrant as specified in its charter)
  **Delaware**
                **06-1724014**(State
                    or other jurisdiction of incorporation or organization)
                (I.R.S.
                    Employer Identification No.)**154
                    Avenue E, Bayonne, NJ**
                **07002**(Address
                    of principal executive offices)
                (Zip
                    Code)
  **(201)
          436-9200**
 (Registrant’s
          telephone number, including area code)
 __________________
 
 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 x No 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 filero
                Accelerated
                    filerx
                Non-accelerated
                    filero
  
 Indicate
          by check mark whether the registrant is a shell company (as defined in
          Rule
          12b-2 of the Exchange Act). Yes o No x
 
 As
          of
          August 3, 2007, there were 23,054,105 shares of the registrant’s common stock,
          par value $0.01 per share, outstanding.
  
 
 8/6/2007 9:03:00
                  PM
 
 **INDEX**
 
 
 **PART
                    I - FINANCIAL INFORMATION**
                **PAGE**Item
                    1. Financial Statements (Unaudited)Condensed
                    Consolidated Balance Sheets at June 30, 2007 and December 30,
                    2006
                2Condensed
                    Consolidated Statements of Income for the Three and Six Months
                    Ended June
                    30, 2007 and July 1, 2006
                3Condensed
                    Consolidated Statements of Cash Flows for the Six Months Ended
                    June 30,
                    2007 and July 1, 2006
                4Notes
                    to the Condensed Consolidated Financial Statements
                5Item
                    2. Management’s Discussion and Analysis of Financial Condition and Results
                    of Operations
                12Item
                    3. Quantitative and Qualitative Disclosures About Market
                    Risk
                22Item
                    4. Controls and Procedures
                23**PART
                    II - OTHER INFORMATION**Item1.
                    Legal Proceedings
                24Item1A.
                    Risk Factors
                24Item
                    2. Unregistered Sales of Equity Securities and Use of
                    Proceeds
                24Item
                    3. Defaults Upon Senior Securities
                24Item
                    4. Submission of Matters to a Vote of Security Holders
                24Item
                    5. Other Information
                25Item
                    6. Exhibits
                25
  
  **PART
          I - FINANCIAL INFORMATION**
 
 **Item
          1. Financial Statements (Unaudited)**
  **MAIDENFORM
                      BRANDS, INC. AND SUBSIDIARIES****CONDENSED
                      CONSOLIDATED BALANCE SHEETS*****(in
                      thousands, except share and per share
                      amounts)******(unaudited)*****June
                      30, 2007**
                  
                  **December
                      30, 2006****Assets**Current
                      assetsCash
                      and cash equivalents
                  
                  $
                  15,253
                  
                  $
                  14,617Accounts
                      receivable, net
                  
                  
                  57,268
                  
                  
                  39,142Inventories
                  
                  
                  55,290
                  
                  
                  46,911Deferred
                      income taxes
                  
                  
                  9,556
                  
                  
                  9,459Prepaid
                      expenses and other current assets
                  
                  
                  5,991
                  
                  
                  6,203Total
                      current assets
                  
                  
                  143,358
                  
                  
                  116,332Property,
                      plant and equipment, net
                  
                  
                  19,784
                  
                  
                  18,454Goodwill
                  
                  
                  7,884
                  
                  
                  7,884Intangible
                      assets, net
                  
                  
                  99,097
                  
                  
                  99,678Other
                      non-current assets
                  
                  
                  1,209
                  
                  
                  2,505Total
                      assets
                  
                  $
                  271,332
                  
                  $
                  244,853**Liabilities
                      and stockholders’ equity**Current
                      liabilitiesCurrent
                      portion of long-term debt
                  
                  $
                  1,100
                  
                  $
                  -Accounts
                      payable
                  
                  
                  25,969
                  
                  
                  13,195Accrued
                      expenses and other current liabilities
                  
                  
                  21,912
                  
                  
                  21,176Total
                      current liabilities
                  
                  
                  48,981
                  
                  
                  34,371Long-term
                      debt
                  
                  
                  98,900
                  
                  
                  110,000Deferred
                      income taxes
                  
                  
                  19,411
                  
                  
                  16,223Other
                      non-current liabilities
                  
                  
                  8,618
                  
                  
                  9,358Total
                      liabilities
                  
                  
                  175,910
                  
                  
                  169,952Commitments
                      and contingencies (Note 9)Stockholders’
                      equityPreferred
                      stock - $0.01 par value; 10,000,000 shares
                      authorizedand
                      none issued and outstanding
                  
                  
                  -
                  
                  
                  -Common
                      stock - $0.01 par value; 100,000,000 shares
                      authorized;23,488,357
                      shares issued and 23,053,355 outstanding at June 30, 2007and
                      23,488,357 issued and 22,964,826 outstanding at December 30,
                      2006
                  
                  
                  235
                  
                  
                  235Additional
                      paid-in capital
                  
                  
                  60,376
                  
                  
                  59,478Retained
                      earnings
                  
                  
                  39,396
                  
                  
                  20,953Accumulated
                      other comprehensive income
                  
                  
                  336
                  
                  
                  158Treasury
                      stock, at cost (435,002 shares at June 30, 2007 and 523,531
                      sharesat
                      December 30, 2006)
                  
                  
                  (4,921
                  )
                  
                  (5,923
                  )Total
                      stockholders’ equity
                  
                  
                  95,422
                  
                  
                  74,901Total
                      liabilities and stockholders’ equity
                  
                  $
                  271,332
                  
                  $
                  244,853The
                      accompanying notes are an integral part of these condensed
                      consolidated
                      financial statements.
  2
 **MAIDENFORM
                      BRANDS, INC. AND SUBSIDIARIES****CONDENSED
                      CONSOLIDATED STATEMENTS OF INCOME*****(in
                      thousands, except share and per share
                      amounts)******(unaudited)*****Three
                      months ended**
                  
                  **Six
                      months ended****June
                      30, 2007**
                  
                  **July
                      1, 2006**
                  
                  **June
                      30, 2007**
                  
                  **July
                      1, 2006**Net
                      sales
                  
                  $
                  118,960
                  
                  $
                  117,139
                  
                  $
                  226,193
                  
                  $
                  217,983Cost
                      of sales
                  
                  
                  71,394
                  
                  
                  72,923
                  
                  
                  139,755
                  
                  
                  135,788Gross
                      profit
                  
                  
                  47,566
                  
                  
                  44,216
                  
                  
                  86,438
                  
                  
                  82,195Selling,
                        general and administrative expenses
                  
                  
                  27,063
                  
                  
                  26,121
                  
                  
                  45,739
                  
                  
                  51,443Operating
                      income
                  
                  
                  20,503
                  
                  
                  18,095
                  
                  
                  40,699
                  
                  
                  30,752Interest
                      expense, net
                  
                  
                  4,246
                  
                  
                  2,201
                  
                  
                  6,267
                  
                  
                  4,269Income
                      before provisionfor
                      income taxes
                  
                  
                  16,257
                  
                  
                  15,894
                  
                  
                  34,432
                  
                  
                  26,483Income
                      tax expense
                  
                  
                  6,775
                  
                  
                  6,476
                  
                  
                  14,358
                  
                  
                  10,818Net
                      income
                  
                  $
                  9,482
                  
                  $
                  9,418
                  
                  $
                  20,074
                  
                  $
                  15,665Basic
                      earnings per common share
                  
                  $
                  0.41
                  
                  $
                  0.41
                  
                  $
                  0.87
                  
                  $
                  0.68Diluted
                      earnings per common share
                  
                  $
                  0.39
                  
                  $
                  0.39
                  
                  $
                  0.83
                  
                  $
                  0.65Basic
                      weighted average number ofshares
                      outstanding
                  
                  
                  23,014,893
                  
                  
                  22,996,480
                  
                  
                  22,996,174
                  
                  
                  23,157,568Diluted
                      weighted average number ofshares
                      outstanding
                  
                  
                  24,196,358
                  
                  
                  24,118,332
                  
                  
                  24,170,707
                  
                  
                  24,276,912The
                      accompanying notes are an integral part of these condensed
                      consolidated
                      financial statements.
 
 3
  **MAIDENFORM
                      BRANDS, INC. AND SUBSIDIARIES****CONDENSED
                      CONSOLIDATED STATEMENTS OF CASH FLOWS*****(in
                      thousands)******(unaudited)*****Six
                      months ended****June
                      30, 2007**
                  
                  **July
                      1, 2006****Cash
                      flows from operating activities**Net
                      income
                  
                  $
                  20,074
                  
                  $
                  15,665Adjustments
                      to reconcile net income to net cashfrom
                      operating activitiesDepreciation
                      and amortization
                  
                  
                  1,453
                  
                  
                  1,394Amortization
                      of intangible assets
                  
                  
                  581
                  
                  
                  581Amortization
                      of deferred financing costs
                  
                  
                  2,787
                  
                  
                  427Stock-based
                      compensation
                  
                  
                  1,048
                  
                  
                  1,045Deferred
                      income taxes
                  
                  
                  3,764
                  
                  
                  2,846Excess
                      tax benefits related to stock-based compensation
                  
                  
                  (514
                  )
                  
                  -Pension
                      plan curtailment gain
                  
                  
                  (6,099
                  )
                  
                  -Net
                      changes in operating assets and liabilitiesAccounts
                      receivable
                  
                  
                  (18,126
                  )
                  
                  (25,169
                  )Inventories
                  
                  
                  (8,379
                  )
                  
                  (6,569
                  )Prepaid
                        expenses and other current and non-current assets
                  
                  
                  (463
                  )
                  
                  (996
                  )Accounts
                      payable
                  
                  
                  12,774
                  
                  
                  11,710Accrued
                        expenses and other current and non-current
                        liabilities
                  
                  
                  3,722
                  
                  
                  1,771Income
                      taxes payable
                  
                  
                  408
                  
                  
                  4,102Net
                      cash from operating activities
                  
                  
                  13,030
                  
                  
                  6,807**Cash
                      flows from investing activities**Capital
                      expenditures
                  
                  
                  (2,313
                  )
                  
                  (1,068
                  )Net
                      cash from investing activities
                  
                  
                  (2,313
                  )
                  
                  (1,068
                  )**Cash
                      flows from financing activities**Term
                      loan borrowings
                  
                  
                  100,000
                  
                  
                  -Term
                      loan repayments
                  
                  
                  (110,000
                  )
                  
                  (12,500
                  )Borrowings
                      under revolving loan
                  
                  
                  5,000
                  
                  
                  -Repayments
                      under revolving loan
                  
                  
                  (5,000
                  )
                  
                  -Deferred
                      financing costs
                  
                  
                  (1,068
                  )
                  
                  (300
                  )Proceeds
                      from stock options exercised
                  
                  
                  338
                  
                  
                  36Excess
                      tax benefits related to stock-based compensation
                  
                  
                  514
                  
                  
                  -Payments
                      of capital lease obligations
                  
                  
                  (50
                  )
                  
                  -Purchase
                      of common stock for treasury
                  
                  
                  -
                  
                  
                  (6,098
                  )Net
                      cash from financing activities
                  
                  
                  (10,266
                  )
                  
                  (18,862
                  )Effects
                      of exchange rate changes on cash
                  
                  
                  185
                  
                  
                  (201
                  )Net
                      increase (decrease) in cash
                  
                  
                  636
                  
                  
                  (13,324
                  )**Cash
                      and cash equivalents**Beginning
                      of period
                  
                  
                  14,617
                  
                  
                  30,978End
                      of period
                  
                  $
                  15,253
                  
                  $
                  17,654**Supplementary
                      disclosure of cash flow information**Cash
                      paid during the periodInterest
                  
                  $
                  4,179
                  
                  $
                  4,756Income
                      taxes
                  
                  $
                  9,139
                  
                  $
                  3,722**Supplemental
                      schedule of non-cash investing and financing
                      activities**Equipment
                      acquired with capital lease obligations
                  
                  $
                  470
                  
                  $
                  -The
                      accompanying notes are an integral part of these condensed
                      consolidated
                      financial statements.
  4
 
 **MAIDENFORM
              BRANDS, INC. AND SUBSIDIARIES**
 **NOTES
              TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 ***(in
              thousands, except share and per share amounts)***
 ***(unaudited)***
 **1.**  **SUMMARY
            OF SIGNIFICANT ACCOUNTING POLICIES**
 
 *Basis
          of Presentation*
 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 77 and 75 retail outlet stores as of June 30, 2007 and July 1,
          2006,
          respectively, and sell products on our websites.
 
 In
          our
          opinion, the accompanying unaudited condensed consolidated financial statements
          contain all adjustments necessary to state fairly our financial position
          at June
          30, 2007, the results of our operations for the three and six-month periods
          ended June 30, 2007 and July 1, 2006, and cash flows for the six months
          ended
          June 30, 2007 and July 1, 2006. These adjustments consist of normal recurring
          adjustments. Operating results for the three and six-month periods ended
          June
          30, 2007 are not necessarily indicative of the results that may be expected
          for
          any other future interim period or for a full fiscal year. The condensed
          consolidated balance sheet at December 30, 2006 has been derived from our
          audited consolidated financial statements at that date, but does not include
          all
          disclosures required by accounting principles generally accepted in the
          United
          States of America.
 
 These
          condensed consolidated financial statements have been prepared in accordance
          with Article 10 of Regulation S-X promulgated by the Securities and Exchange
          Commission. Accordingly, certain information and disclosures normally included
          in financial statements prepared in accordance with accounting principles
          generally accepted in the United States of America have been condensed
          or
          omitted pursuant to the rules and regulations of the Securities and Exchange
          Commission. The financial statements included herein should be read in
          conjunction with our Annual Report on Form 10-K for the year ended December
          30,
          2006.
 
 **2.**  **DEBT**
  **June
                      30, 2007**
                  
                  **December
                      30, 2006**Long-term
                      debt
                  
                  $
                  100,000
                  
                  $
                  110,000Current
                      maturities of long-term debt
                  
                  
                  1,100
                  
                  
                  -Non-current
                      portion of long-term debt
                  
                  $
                  98,900
                  
                  $
                  110,000
  On
          June
          15, 2007, we entered into a credit agreement, consisting of a 7-year, $100,000
          amortizing first lien term loan (the “Term Loan”) and a 5-year, $50,000
          revolving loan facility (the “Revolving Loan” and together with the Term Loan,
“Credit Facility”). The Revolving Loan provides for direct borrowings and
          issuance of stand-by letters of credit on our behalf. 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. Borrowings
          are limited by the borrowing base, which consists of 85.0% of eligible
          accounts
          receivable and 50.0% of eligible inventory. We used the proceeds from the
          borrowings, together with operating cash, to repay all amounts due under
          our
          existing credit facility.
 
 At
          June
          30, 2007, borrowings under the Term Loan bore interest, at our option,
          at the
          London Interbank Offered Rate (“LIBOR”) plus 1.25%, or at the base rate plus
          0.25%. Borrowings under the Revolving Loan bear interest at 25 basis points
          below the rates available under the Term Loan. The LIBOR margin and the
          base
          rate margin will be determined quarterly based on our leverage ratio for
          the
          preceding four fiscal quarters.
 
 Additional
          fees are payable under the Credit Facility including (i) a fee on outstanding
          letters of credit equal to the margin over LIBOR applicable to the Revolving
          Loan, (ii) a letter of credit fronting fee equal to 0.25% per annum on
          the daily
          amount available to be drawn under outstanding letters of credit and (iii)
          an
          unused line fee on the maximum principle amount undrawn under the Revolving
          Loan
          ranging from 0.15% to 0.35% determined quarterly based on our leverage
          ratio for
          the preceding four fiscal quarters.
  5
 
 **MAIDENFORM
              BRANDS, INC. AND SUBSIDIARIES**
 **NOTES
              TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
              (Continued)**
 ***(in
              thousands, except share and per share amounts)***
 ***(unaudited)***
 The
          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.  In
          addition, subject to specified exceptions and limitations and reinvesting
          options, partial prepayments of outstanding loans may be required with
          the
          proceeds of asset sales, sales of equity and debt securities and with certain
          insurance and condemnation proceeds.
 
 At
          June
          30, 2007, we had $100,000 outstanding under our Term Loan, $0 outstanding
          under
          our Revolving Loan with $47,709 available for borrowings under the Revolving
          Loan, after giving effect to $2,291 of outstanding letters of credit. Principal
          payments on the Term Loan are payable in quarterly installments of $275
          commencing on September 28, 2007, with all remaining amounts due on the
          maturity
          date. We are permitted to voluntary prepay all or part of the principal
          balance
          of the Term Loan with such payments applied to scheduled principal payments
          in
          inverse order of their maturity. The borrowings and other obligations under
          the
          Credit Facility and the guarantees are 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 the borrower and
          guarantors.
 
 In
          connection with the new Credit Facility, we paid fees of $1,068. For the
          three
          and six-month periods ended June 30, 2007, amortization of financing costs
          included in interest expense was $2,577 and $2,787, respectively, which
          includes
          the write-off of deferred financing costs of $2,365 as a result of refinancing
          our Credit Facility.
 
 Payments
          due on long-term debt during each of the five years subsequent to June
          30, 2007,
          are as follows:
  Balance
                      of fiscal 2007
                  
                  $
                  550In
                      fiscal 2008
                  
                  
                  1,100In
                      fiscal 2009
                  
                  
                  1,100In
                      fiscal 2010
                  
                  
                  1,100In
                      fiscal 2011
                  
                  
                  1,100In
                      fiscal 2012 and thereafter
                  
                  
                  95,050
 During
          July 2007, we made additional prepayments of $10,000 on our Term Loan which
          are
          not reflected in the above table. These debt prepayments reduced the final
          installment of principal under the Term Loan.
 
 **3.**  **BENEFIT
          PLANS AND POSTRETIREMENT PLANS**
  We
          sponsor a defined benefit pension plan covering substantially all eligible
          employees not covered by the union plans. Effective January 1, 2007, the
          defined
          benefit pension plan was frozen for current participants and closed to
          new
          entrants. In connection with the freeze, we recorded a $6,099 non-cash
          curtailment benefit in accordance with Statement
          of Financial Accounting Standards (SFAS) No. 88, “Employer’s Accounting for
          Settlements and Curtailments of Defined Benefit Pension Plans and for
          Termination Benefits,” using actuarial assumptions consistent with those we used
          at December 30, 2006. The standard requires curtailment accounting if an
          event
          eliminates, for a significant number of employees, the accrual of defined
          benefits for some or all of their future service. If we choose to terminate
          the
          pension plan, we 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. We
          also
          maintain postretirement medical benefit plans for certain eligible retirees
          for
          which postretirement benefit expense on a quarterly basis is
          insignificant.
  6
 
 **MAIDENFORM
              BRANDS, INC. AND SUBSIDIARIES**
 **NOTES
              TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
              (Continued)**
 ***(in
              thousands, except share and per share amounts)***
 ***(unaudited***
 The
          components of pension benefit (income) expense charged to operations are
          as
          follows:
  **Three
                      months ended**
                  
                  **Six
                      months ended****June
                      30, 2007**
                  
                  **July
                      1, 2006**
                  
                  **June
                      30, 2007**
                  
                  **July
                      1, 2006**Service
                      cost
                  
                  $
                  -
                  
                  $
                  481
                  
                  $
                  -
                  
                  $
                  962Interest
                      cost
                  
                  
                  272
                  
                  
                  347
                  
                  
                  544
                  
                  
                  694Expected
                      return on plan assets
                  
                  
                  (381
                  )
                  
                  (316
                  )
                  
                  (762
                  )
                  
                  (632
                  )Recognized
                      net actuarial loss
                  
                  
                  -
                  
                  
                  33
                  
                  
                  -
                  
                  
                  66Net
                      periodic benefit (income) expense
                  
                  
                  (109
                  )
                  
                  545
                  
                  
                  (218
                  )
                  
                  1,090Curtailment
                      gain
                  
                  
                  -
                  
                  
                  -
                  
                  
                  (6,099
                  )
                  
                  -Total
                  
                  $
                  (109
                  )
                  $
                  545
                  
                  $
                  (6,317
                  )
                  $
                  1,090
 **4.**  **STOCKHOLDERS’
          EQUITY**
 **Accumulated****Common**
                  
                  **Treasury**
                  
                  **Additional**
                  
                  
                  
                  **other**
                  
                  **Total****stock**
                  
                  **stock**
                  
                  **paid-in**
                  
                  **Retained**
                  
                  **comprehensive**
                  
                  **stockholders'****Shares**
                  
                  **$**
                  
                  **Shares**
                  
                  **$**
                  
                  **capital**
                  
                  **earnings**
                  
                  **income**
                  
                  **equity****Balance
                      at December 30, 2006**
                  
                  
                  23,488,357
                  
                  $
                  235
                  
                  
                  (523,531
                  )
                  $
                  (5,923
                  )
                  $
                  59,478
                  
                  $
                  20,953
                  
                  $
                  158
                  
                  $
                  74,901Stock-based
                      compensation
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  1,048
                  
                  
                  
                  
                  
                  
                  
                  
                  1,048Stock
                      options exercised
                  
                  
                  
                  
                  
                  
                  
                  
                  88,529
                  
                  
                  1,002
                  
                  
                  (150
                  )
                  
                  
                  
                  
                  
                  
                  
                  852Adoption
                      of FIN No. 48 (see Note 6)
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  (1,631
                  )
                  
                  
                  
                  
                  (1,631
                  )**Comprehensive
                      income**Net
                      income
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  20,074
                  
                  
                  
                  
                  
                  20,074Changes
                      during the period
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  178
                  
                  
                  178Total
                      comprehensive income
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  20,252**Balance
                      at June 30, 2007**
                  
                  
                  23,488,357
                  
                  $
                  235
                  
                  
                  (435,002
                  )
                  $
                  (4,921
                  )
                  $
                  60,376
                  
                  $
                  39,396
                  
                  $
                  336
                  
                  $
                  95,422
 **5** **.**  **COMPREHENSIVE
          INCOME**
  The
          changes in comprehensive income are as follows:
 **Six
                      months ended****June
                      30, 2007**
                  
                  **July
                      1, 2006**Net
                      income
                  
                  $
                  20,074
                  
                  $
                  15,665Foreign
                      currency translation adjustments (a)
                  
                  
                  185
                  
                  
                  (201
                  )Pension
                      plan curtailment, net of tax
                  
                  
                  146
                  
                  
                  -Interest
                      rate swaps, net of tax
                  
                  
                  (153
                  )
                  
                  265Comprehensive
                      income
                  
                  $
                  20,252
                  
                  $
                  15,729
 (a)
                No
                    tax benefit has been provided associated with the foreign currency
                    translation adjustment due to management’s intention to permanently
                    reinvest the earnings of our foreign
                    subsidiaries.
  7
 
 **MAIDENFORM
              BRANDS, INC. AND SUBSIDIARIES**
 **NOTES
              TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
              (Continued)**
 ***(in
              thousands, except share and per share amounts)***
 ***(unaudited)***
 **6.**  **INCOME
          TAXES**
 
 Effective
          at the beginning of the first quarter of 2007, we adopted Financial Accounting
          Standards Board (FASB) Interpretation No. 48 (FIN No. 48), “Accounting for
          Uncertainty in Income Taxes,” which clarifies the accounting and disclosure for
          uncertainty in income taxes. As a result of the adoption, we recorded a
          decrease
          to beginning retained earnings of approximately $1,631 and increased our
          accruals for uncertain tax positions and related interest and penalties
          by a
          corresponding amount. As of the adoption date, the total unrecognized tax
          benefits were approximately $4,711 (net of federal and, if applicable,
          state
          effect) and would impact our effective rate if recognized.
  We
          recognize interest and, if applicable, penalties which could be assessed
          related
          to unrecognized tax benefits in income tax expense. As of the adoption
          date, the
          total amount of accrued interest and penalties, before federal and, if
          applicable, state effect, is approximately $698. For the three and six-month
          periods ended June 30, 2007, we recorded approximately $100 and $172,
          respectively, in interest before federal and, if applicable, state effect.
 
 We
          file
          income tax returns in the U.S. federal jurisdiction and various states
          and
          foreign jurisdictions. For federal income tax purposes, our 2003 through
          2006
          tax years remain open for examination by the tax authorities under the
          normal
          three year statute of limitations. For state tax purposes, our 2002 through
          2006
          tax years remain open for examination by the tax authorities under a four
          year
          statute of limitations, however, certain states may keep their statute
          open for
          six to ten years.
  We
          review
          our annual effective tax rate on a quarterly basis and we make necessary
          changes
          if information or events warrant such changes. The annual effective tax
          rate is
          forecasted quarterly using actual historical information and forward-looking
          estimates. The estimated annual effective tax rate may fluctuate due to
          changes
          in forecasted annual operating income; changes to the valuation allowance
          for
          deferred tax assets (such changes would be recorded discretely in the quarter
          in
          which they occurred); changes to actual or forecasted permanent book to
          tax
          differences (non-deductible expenses); impacts from future tax settlements
          with
          state, federal or foreign tax authorities (such changes would be recorded
          discretely in the quarter in which they occurred); or impacts from tax
          law
          changes (to the extent such changes effect our deferred tax assets/liabilities,
          these changes would generally be recorded discretely in the quarter in
          which
          they occurred). Our effective income tax rate for the three and six-month
          periods ended June 30, 2007 was 41.7%, as compared to an effective income
          tax
          rate for the three and six-month periods ended July 1, 2006 of 40.7% and
          40.8%,
          respectively. The increase in the effective income tax rate was primarily
          the
          result of FIN No. 48.
 
 **7.**  **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 stores, 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.
          Licensing income is also included in our Wholesale segment. Within our
          reportable segments, Wholesale includes corporate-related assets. 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
          or
          units produced to support each segment’s net sales. Intersegment sales and
          transfers are recorded at cost and treated as a transfer of
          inventory.
  8
 **MAIDENFORM
                BRANDS, INC. AND SUBSIDIARIES**
 **NOTES
                TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                (Continued)**
 ***(in
                thousands, except share and per share amounts)***
 ***(unaudited)***
 
 Information
          on segments and reconciliation to income before provision for income taxes,
          are
          as follows:
  **Three
                        months ended**
                    
                    **Six
                        months ended****June
                        30, 2007**
                    
                    **July
                        1, 2006**
                    
                    **June
                        30, 2007**
                    
                    **July
                        1, 2006**Net
                        salesWholesale
                    
                    $
                    105,152
                    
                    $
                    102,639
                    
                    $
                    202,158
                    
                    $
                    193,022Retail
                    
                    
                    13,808
                    
                    
                    14,500
                    
                    
                    24,035
                    
                    
                    24,961Total
                    
                    $
                    118,960
                    
                    $
                    117,139
                    
                    $
                    226,193
                    
                    $
                    217,983Operating
                        incomeWholesale
                    
                    $
                    19,403
                    
                    $
                    16,447
                    
                    $
                    40,716
                    
                    $
                    29,766Retail
                    
                    
                    1,100
                    
                    
                    1,648
                    
                    
                    (17
                    )
                    
                    986Operating
                        income
                    
                    
                    20,503
                    
                    
                    18,095
                    
                    
                    40,699
                    
                    
                    30,752Interest
                        expense, net
                    
                    
                    4,246
                    
                    
                    2,201
                    
                    
                    6,267
                    
                    
                    4,269Income
                        before provisionfor
                        income taxes
                    
                    $
                    16,257
                    
                    $
                    15,894
                    
                    $
                    34,432
                    
                    $
                    26,483Depreciation
                        and amortizationWholesale
                    
                    $
                    671
                    
                    $
                    658
                    
                    $
                    1,315
                    
                    $
                    1,264Retail
                    
                    
                    356
                    
                    
                    342
                    
                    
                    719
                    
                    
                    711Total
                    
                    $
                    1,027
                    
                    $
                    1,000
                    
                    $
                    2,034
                    
                    $
                    1,975Net
                        sales by geographic areaUnited
                        States
                    
                    $
                    108,621
                    
                    $
                    108,299
                    
                    $
                    208,670
                    
                    $
                    203,770International
                        (a)
                    
                    
                    10,339
                    
                    
                    8,840
                    
                    
                    17,523
                    
                    
                    14,213Total
                    
                    $
                    118,960
                    
                    $
                    117,139
                    
                    $
                    226,193
                    
                    $
                    217,983Intercompany
                        sales from wholesaleto
                        retail
                    
                    $
                    3,566
                    
                    $
                    4,266
                    
                    $
                    6,140
                    
                    $
                    6,620**June
                        30, 2007**
                    
                    
                    **December
                        30,****2006**Identifiable
                        assetsWholesale
                    
                    $
                    244,279
                    
                    $
                    218,636Retail
                    
                    
                    27,053
                    
                    
                    26,217Total
                    
                    $
                    271,332
                    
                    $
                    244,853
 (a)
          International net sales are identified based on the location of the customer.
 
 At
          June
          30, 2007 and December 30, 2006, our five largest uncollaterized receivables
          represented approximately 65% and 57% of total accounts receivable,
          respectively. For the three and six-month periods ended June 30, 2007,
          four
          customers in the Wholesale segment each accounted for more than 10% of
          our
          consolidated net sales as compared to two customers in the Wholesale segment
          for
          the three and six-month periods ended July 1, 2006.
  9
 **MAIDENFORM
                BRANDS, INC. AND SUBSIDIARIES**
 **NOTES
                TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                (Continued)**
 ***(in
                thousands, except share and per share amounts)***
 ***(unaudited)***
 
 **8.**  **EARNINGS
          PER SHARE**
  The
          following is a reconciliation of basic number of common shares outstanding
          to
          diluted common and common equivalent shares outstanding:
 **Three
                      months ended**
                  
                  **Six
                      months ended****June
                      30, 2007**
                  
                  **July
                      1, 2006**
                  
                  **June
                      30, 2007**
                  
                  **July
                      1, 2006**Net
                      income
                  
                  $
                  9,482
                  
                  $
                  9,418
                  
                  $
                  20,074
                  
                  $
                  15,665Weighted
                      average number of common andcommon
                      equivalent shares outstanding:Basic
                      number of common sharesoutstanding
                  
                  
                  23,014,893
                  
                  
                  22,996,480
                  
                  
                  22,996,174
                  
                  
                  23,157,568Impact
                      of dilutive securities
                  
                  
                  1,181,465
                  
                  
                  1,121,852
                  
                  
                  1,174,533
                  
                  
                  1,119,344Dilutive
                      number of common and commonequivalent
                      shares outstanding
                  
                  
                  24,196,358
                  
                  
                  24,118,332
                  
                  
                  24,170,707
                  
                  
                  24,276,912Basic
                      earnings per common share
                  
                  $
                  0.41
                  
                  $
                  0.41
                  
                  $
                  0.87
                  
                  $
                  0.68Diluted
                      earnings per common share
                  
                  $
                  0.39
                  
                  $
                  0.39
                  
                  $
                  0.83
                  
                  $
                  0.65
 For
          the
          three and six-month periods ended June 30, 2007, the anti-dilutive effects
          of
          equity awards that were excluded from the calculation of diluted earnings
          per
          share were not material.
 
 Options
          to purchase approximately 497,000 and 494,500 shares of common stock outstanding
          during the three and six-month periods ended July 1, 2006, respectively,
          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.
 
 **9.**  **COMMITMENTS
          AND CONTINGENCIES**
  **Purchase
          commitments**
  In
          the
          normal course of business, we enter into purchase commitments for both
          finished
          goods and raw materials. At June 30, 2007, we had purchase commitments
          of
          $63,597 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. While it is
          possible
          that our cash flows and results of operations in a particular quarter or
          year
          could be materially affected, it is our opinion that these matters will
          not have
          a material impact on our consolidated financial position, or ongoing results
          of
          operations and cash flows.
  10
 **MAIDENFORM
                BRANDS, INC. AND SUBSIDIARIES**
 **NOTES
                TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                (Continued)**
 ***(in
                thousands, except share and per share amounts)***
 ***(unaudited)***
 
 **10.**  **ACCRUED
          EXPENSES AND OTHER CURRENT LIABILITIES**
 
 **June
                      30, 2007**
                  
                  **December
                      30, 2006**Accrued
                      wages, incentive compensation and payroll taxes
                  
                  $
                  6,324
                  
                  $
                  8,457Accrued
                      trade promotions
                  
                  
                  3,004
                  
                  
                  1,796Accrued
                      professional fees
                  
                  
                  1,573
                  
                  
                  1,604Federal,
                      state and local income taxes payable
                  
                  
                  1,991
                  
                  
                  4,295Accrued
                      other
                  
                  
                  9,020
                  
                  
                  5,024$
                  21,912
                  
                  $
                  21,176
 
 Other
          accrued expenses and current liabilities include, among other items, accrued
          interest, accrued medical insurance, and accrued advertising.
  11
  **Item
          2. Management’s Discussion and Analysis of Financial Conditions and Results of
          Operations**
  *You
          should read the following discussion and analysis in conjunction with our
          financial statements and related notes included elsewhere in this report. 
This report contains forward-looking statements relating to future events
          and
          our future performance within the meaning of Section 27A of the Securities
          Act
          of 1933, as amended, and Section 21E of the Securities Exchange Act of
          1934, as
          amended, including, without limitation, statements regarding our expectations,
          beliefs, intentions or future strategies that are signified by the words
          “anticipates,”  “believes,”  “estimates,”  “expects,” 
“intends,”  “plans,”  “potential,”  “predicts,” 
“projects” or similar words or phrases, although not all forward-looking
          statements contain such identifying words.  All forward-looking statements
          included in this report are based on information available to us on the
          date
          hereof.  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 below and elsewhere in this report, particularly in the section
          captioned “PART II - OTHER INFORMATION, Item 1A - Risk
          Factors.”*
 
 **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 carry our corporate endorsement and 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
          caused by
          the ongoing consolidation in the retail industry, increases in the cost
          of the
          raw materials used in intimate apparel products and uncertainty surrounding
          import restrictions.
 
 We
          believe we are well-positioned to capitalize on or address these trends
          by,
          among other things:
 
 •
          increasing consumer identification with our brands through further marketing
          investments;
 •
          continuing to launch innovative products;
 •
          increasing our presence in department stores and national chain stores
          through
          the use of Maidenform ® ,
          Flexees ® and
          Lilyette ® ;
 •
          increasing our presence in the mass merchant channel through the use of
          our
          Sweet Nothings ® ,
          Bodymates ® ,
          Self
          Expressions ® and
          private brands;
 •
          expanding our international presence;
 •
          marketing our brands of intimate apparel;
 •
making
          selective acquisitions, entering into licenses, and developing products
          and
          marketing that will complement our existing products or distribution channels;
          and
 •
          merchandising, marketing and selling private brand products to selected
          retailers.
  12
 
 *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 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 the net sales to these customers are included in the department
          stores and national chain stores 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 growth in the future as we
          are able
          to increase both the floor space and number of doors in 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 merchant 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. We continually evaluate this
          channel
          for opportunities. Licensing income, as well as sales to foreign distributors,
          are included in this channel.
 
 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.com* ** and *www.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 location
          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.
  13
 
 ***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 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
          and duty and related expenses 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.
 
 *Selling,
          General and Administrative Expenses (SG&A).* Our
          SG&A includes 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 condensed consolidated financial statements included elsewhere in this
          Quarterly Report on Form 10-Q.
 
 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 of the Internal Revenue Code ("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 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 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 $62.8 million of NOLs available for utilization
          in the years from 2007 through 2023.
  14
  **Results
          of Operations**
  **Three
                      months ended**
                  
                  **Six
                      months ended****June
                      30, 2007**
                  
                  **July
                      1, 2006**
                  
                  **June
                      30, 2007**
                  
                  **July
                      1, 2006****OPERATING
                      DATA: (in millions)**Wholesale
                      sales
                  
                  $
                  105.2
                  
                  $
                  102.6
                  
                  $
                  202.2
                  
                  $
                  193.0Retail
                      sales
                  
                  
                  13.8
                  
                  
                  14.5
                  
                  
                  24.0
                  
                  
                  25.0Net
                      sales
                  
                  
                  119.0
                  
                  
                  117.1
                  
                  
                  226.2
                  
                  
                  218.0Cost
                      of sales
                  
                  
                  71.5
                  
                  
                  72.9
                  
                  
                  139.8
                  
                  
                  135.8Gross
                      profit
                  
                  
                  47.5
                  
                  
                  44.2
                  
                  
                  86.4
                  
                  
                  82.2Selling,
                      general and administrative expenses
                  
                  
                  27.0
                  
                  
                  26.1
                  
                  
                  45.7
                  
                  
                  51.4Operating
                      income
                  
                  $
                  20.5
                  
                  $
                  18.1
                  
                  $
                  40.7
                  
                  $
                  30.8**As
                      a percentage of net sales****Three
                      months
                      ended**
                  
                  **Six
                      months ended****June
                      30, 2007**
                  
                  **July
                      1, 2006**
                  
                  **June
                      30, 2007**
                  
                  **July
                      1, 2006****OPERATING
                      DATA:**Wholesale
                      sales
                  
                  
                  88.4
                  %
                  
                  87.6
                  %
                  
                  89.4
                  %
                  
                  88.5
                  %Retail
                      sales
                  
                  
                  11.6
                  
                  
                  12.4
                  
                  
                  10.6
                  
                  
                  11.5Net
                      sales
                  
                  
                  100.0
                  
                  
                  100.0
                  
                  
                  100.0
                  
                  
                  100.0Cost
                      of sales
                  
                  
                  60.1
                  
                  
                  62.3
                  
                  
                  61.8
                  
                  
                  62.3Gross
                      profit
                  
                  
                  39.9
                  
                  
                  37.7
                  
                  
                  38.2
                  
                  
                  37.7Selling,
                      general and administrative expenses
                  
                  
                  22.7
                  
                  
                  22.3
                  
                  
                  20.2
                  
                  
                  23.6Operating
                      income
                  
                  
                  17.2
                  %
                  
                  15.5
                  %
                  
                  18.0
                  %
                  
                  14.1
                  %
  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.
 
 15
 
 **Three
                      months ended**
                  
                  **Six
                      months ended****June
                      30, 2007**
                  
                  **July
                      1, 2006**
                  
                  **$**
                    **change**
                  
                  **%**
                      **change**
                  
                  **June
                      30, 2007**
                  
                  **July
                      1, 2006**
                  
                  **$**
                    **change**
                  
                  **%**
                    **change****(in
                      millions)**
                  
                  
                  
                  
                  
                  **(in
                      millions)**Department
                      Stores andNational
                      Chain Stores
                  
                  $
                  68.2
                  
                  $
                  59.6
                  
                  $
                  8.6
                  
                  
                  14.4
                  %
                  $
                  121.7
                  
                  $
                  118.9
                  
                  $
                  2.8
                  
                  
                  2.4
                  %Mass
                      Merchants
                  
                  
                  25.5
                  
                  
                  31.0
                  
                  
                  (5.5
                  )
                  
                  (17.7
                  )
                  
                  54.1
                  
                  
                  50.1
                  
                  
                  4.0
                  
                  
                  8.0Other
                  
                  
                  11.5
                  
                  
                  12.0
                  
                  
                  (0.5
                  )
                  
                  (4.2
                  )
                  
                  26.4
                  
                  
                  24.0
                  
                  
                  2.4
                  
                  
                  10.0Total
                      Wholesale
                  
                  
                  105.2
                  
                  
                  102.6
                  
                  
                  2.6
                  
                  
                  2.5
                  
                  
                  202.2
                  
                  
                  193.0
                  
                  
                  9.2
                  
                  
                  4.8Retail
                  
                  
                  13.8
                  
                  
                  14.5
                  
                  
                  (0.7
                  )
                  
                  (4.8
                  )
                  
                  24.0
                  
                  
                  25.0
                  
                  
                  (1.0
                  )
                  
                  (4.0
                  )Total
                      Consolidated Net Sales
                  
                  $
                  119.0
                  
                  $
                  117.1
                  
                  $
                  1.9
                  
                  
                  1.6
                  %
                  $
                  226.2
                  
                  $
                  218.0
                  
                  $
                  8.2
                  
                  
                  3.8
                  %
 
 Our
          retail segment consists of outlet stores and internet sales. We had 77
          outlet
          stores as of June 30, 2007 compared to 75 stores as of July 1, 2006.
 
 In
          addition, our mix of products sold between bras, shapewear, and panties
          in the
          wholesale segment for the three and six-month periods ended June 30, 2007
          and
          July 1, 2006, respectively, is summarized below:
  **Three
                      months ended**
                  
                  **Six
                      months ended****June
                      30, 2007**
                  
                  **July
                      1, 2006**
                  
                  **June
                      30, 2007**
                  
                  **July
                      1, 2006**Bras
                  
                  69%
                  
                  69%
                  
                  72%
                  
                  68%Shapewear
                  
                  22
                  
                  21
                  
                  19
                  
                  22Panties
                  
                  9
                  
                  10
                  
                  9
                  
                  10100%
                  
                  100%
                  
                  100%
                  
                  100%
 ***Net
          Sales***
  Consolidated
          net sales increased by $1.9 million, or 1.6%, from $117.1 million for the
          three
          months ended July 1, 2006 to $119.0 million for the three months ended
          June 30,
          2007. Consolidated net sales increased by $8.2 million, or 3.8%, from $218.0
          million for the six months ended July 1, 2006 to $226.2 million for the
          six
          months ended June 30, 2007.
 
 Wholesale
          segment net sales increased by $2.6 million, or 2.5%, from $102.6 million
          for
          the three months ended July 1, 2006 to $105.2 million for the three months
          ended
          June 30, 2007. Total international sales, which are included in the wholesale
          segment, increased by $1.5 million, or 17.0%, from $8.8 million for the
          three
          months ended July 1, 2006 to $10.3 million for the three months ended June
          30,
          2007, primarily from strong net sales in Mexico from the continued expansion
          of
          the Sweet Nothings ® brand,
          in addition to expanding in other countries with a warehouse customer.
          Our
          department stores and national chain stores channel net sales increased
          by $8.6
          million, or 14.4%, from $59.6 million for the three months ended July 1,
          2006 to
          $68.2 million for the three months ended June 30, 2007. Growth in this
          channel
          was largely driven by strong performance in our full-figure Lilyette ® brand,
          the successful introduction of Maidenform’s The Smooth Bra TM Collection
          and the launch of a new shapewear brand, Control It TM ,
          with a
          national chain store customer. Our mass merchant channel net sales decreased
          by
          $5.5 million, or 17.7%, from $31.0 million for the three months ended July
          1,
          2006 to $25.5 million for the three months ended June 30, 2007 reflecting
          the
          transition throughout 2007 of re-intensifying our Self Expressions ® brand
          from a private brand with one mass customer. In the second quarter of 2007,
          we
          continued to have increased product placement and allotted selling space of our
          Sweet Nothings ® brand
          with one mass customer, particularly in full-figure bras, strapless bras
          and
          shapewear. Other channel net sales, which include sales to specialty retailers,
          off-price retailers and licensing income, decreased by $0.5 million, or
          4.2%,
          from $12.0 million for the three months ended July 1, 2006 to $11.5 million
          for
          the three months ended June 30, 2007. This decrease was due to a non-recurring
          private brand program with a specialty retailer in the year-ago period,
          which
          was partially offset by an increase in licensing income, higher sales from
          an
          off-price retailer and liquidation sales.
  16
 Net
          sales
          in our wholesale segment increased by $9.2 million, or 4.8%, from $193.0
          million
          for the six months ended July 1, 2006 to $202.2 million for the six months
          ended
          June 30, 2007. International sales increased $3.3 million, or 23.2%, from
          $14.2
          million for the six months ended July 1, 2006 to $17.5 million for the
          six
          months ended June 30, 2007. The growth in international sales was largely
          driven
          by strong sales in countries such as Mexico, Canada and the U.K. Of the
          $9.2
          million increase in wholesale segment net sales during the six months ended
          June
          30, 2007, $2.8 million was from increased sales in the department stores
          and
          national chain stores channel driven by strong sales from our
          Lilyette ® brand,
          along with solid performance in Maidenform ® bras. An
          additional $4.0 million increase came from mass merchants, primarily
          as a result of continued expansion of our Sweet Nothings ® brand
          with one customer, particularly in full-figure bras, strapless bras and
          shapewear partially offset by lower sales of private label with the
          re-intensification of our Self Expressions ® brand. Also
          contributing to the increased sales was an increase of $2.4 million from
          other,
          primarily as a result of increased licensing income, higher sales from
          an
          off-price retailer and liquidation sales, which were partially offset by
          a
          reduction in sales to a specialty retailer.
  Net
          sales
          in our retail segment decreased $0.7 million, or 4.8%, from $14.5 million
          for
          the three months ended July 1, 2006 to $13.8 million for the three months
          ended
          June 30, 2007. Net sales in our retail segment decreased $1.0 million,
          or 4.0%,
          from $25.0 million for the six months ended July 1, 2006 to $24.0 million
          for
          the six months ended June 30, 2007. We had 77 outlet stores as of June
          30, 2007
          compared to 75 outlet stores as of July 1, 2006.  Same stores sales,
          defined as sales from stores open for more than one year, for the three-month
          period ended June 30, 2007 decreased 6.1% and for the six-month period
          ended
          June 30, 2007 decreased 5.3%, due to lower customer traffic in our outlet
          stores, although average transaction sales were up. Our internet sales
          increased
          by $0.2 million, or 25.0%, from $0.8 million for the three months ended
          July 1,
          2006 to $1.0 million for the three months ended June 30, 2007. Our internet
          sales increased by $0.4 million, or 26.7%, from $1.5 million for six months
          ended July 1, 2006 to $1.9 million for the six months ended June 30, 2007.
 
 ***Gross
          Profit***
  Consolidated
          gross profit increased by $3.3 million, or 7.5%, from $44.2 million for
          the
          three months ended July 1, 2006 to $47.5 million for the three months ended
          June
          30, 2007. As a percentage of net sales, consolidated gross margins increased
          by
          220 basis points from 37.7% for the three months ended July 1, 2006 to
          39.9% for
          the three months ended June 30, 2007. Consolidated gross profit increased
          by
          $4.2 million, or 5.1%, from $82.2 million during the six months ended July
          1,
          2006 to $86.4 million for the six months ended June 30, 2007. As a percentage
          of
          net sales, gross profit increased by 50 basis points from 37.7% for the
          six
          month periods ended July 1, 2006 to 38.2% for the six months ended June
          30,
          2007.
  Gross
          profit as a percentage of net sales for the wholesale segment increased
          270
          basis points from 34.8% for the three months ended July 1, 2006 to 37.5%
          for the
          three months ended June 30, 2007. This increase was a result of both customer
          and product mix, including our 14.4% net sales increase in the department
          stores and national chain stores channel, as well as improvements in gross
          margin from our sourcing initiatives. Gross profit as a percentage of net
          sales for the wholesale segment was 35.2% for the six months ended July
          1, 2006
          as compared to 36.1% for the six months ended June 30, 2007. This increase
          of 90
          basis points is primarily a result of the reasons mentioned above.
  Gross
          profit for the retail segment was 58.6% for the three months ended July
          1, 2006
          as compared to 58.7% for the three months ended June 30, 2007, and 56.8%
          for the
          six months ended July 1, 2006 as compared to 56.3% for the six months ended
          June
          30, 2007. This decrease for the six months ended was largely driven by
          a change
          in the overall product mix.
 
 ***Selling,
          General and Administrative Expenses (SG&A)***
  Consolidated
          SG&A increased by $0.9 million, or 3.4%, from $26.1 million for the three
          months ended July 1, 2006 to $27.0 million for the three months ended June
          30,
          2007. As a percentage of net sales, SG&A increased from 22.3% for the three
          months ended July 1, 2006 to 22.7% for the three months ended June 30,
          2007.
 
 SG&A
          for our wholesale segment, which includes corporate-related expenses, increased
          by $0.7 million, or 3.6%, from $19.3 million for the three months ended
          July 1,
          2006 to $20.0 million for the three months ended June 30, 2007. As a percentage
          of net sales, wholesale segment SG&A increased from 18.8% for the three
          months ended July 1, 2006 to 19.0% for the three months ended June 30,
          2007. The
          increase of $0.7 million is a result of increased workers’ compensation and
          medical expenses of $1.4 million associated with increased claims in 2007
          and
          increased other expenses of $0.2 million. Partially offsetting these increases
          was a decrease in advertising expense of $0.6 million as a result of more
          focused advertising expenditures and decreased fees of $0.3 million associated
          with Sarbanes-Oxley compliance. Retail
          SG&A increased slightly by $0.2 million, or 2.9%, from $6.8 million for the
          three months ended July 1, 2006 to $7.0 million for the three months ended
          June
          30, 2007 as a result of 2 additional outlet stores.
 17
  Consolidated
          SG&A decreased by $5.7 million, or 11.1%, from $51.4 million for the six
          months ended July 1, 2006 to $45.7 million for the six months ended June
          30,
          2007. As a percentage of net sales, SG&A decreased from 23.6% for the six
          months ended July 1, 2006 to 20.2% for the six months ended June 30, 2007.
          Consolidated SG&A for the six months ended June 30, 2007 included a non-cash
          pension curtailment gain of $6.1 million as discussed below.
 
 SG&A
          for our wholesale segment, which includes corporate-related expenses and
          the
          pension curtailment gain, decreased by $6.0 million, or 15.7%, from $38.2
          million for the six months ended July 1, 2006 to $32.2 million for the
          six
          months ended June 30, 2007. Our
          pension plan was frozen effective January 1, 2007 for current employee
          participants and closed to new entrants. In connection with this freeze,
          we
          recognized a non-cash curtailment gain of $6.1 million for the six months
          ended
          June 30, 2007, reported in our wholesale segment SG&A. Wholesale segment
          SG&A, excluding this curtailment gain, remained relatively flat, increasing
          by $0.1 million, or 0.3%, to $38.3 million for the six months ended June
          30,
          2007. However, a s
          a percentage of net sales, wholesale segment SG&A decreased from 19.8% for
          the six months ended July 1, 2006 to 18.9% for the six months ended June
          30,
          2007. The
          increase of $0.1 million is a result of increased workers’ compensation and
          medical expenses of $1.6 million associated with increased claims in 2007,
          and
          increased other expenses of $0.5 million. Partially offsetting these increases
          were decreased payroll and related benefits of $0.9 million, primarily
          from a
          reduction in pension benefit expense associated with the pension plan freeze,
          decreased fees of $0.6 million associated with Sarbanes-Oxley compliance,
          and
          decreased advertising expense of $0.5 million as a result of more focused
          advertising expenditures. Retail SG&A increased by $0.3 million, or 2.3%, from $13.2 million for the
          six months ended July 1, 2006 to $13.5 million for the three months ended
          June
          30, 2007 as a result of 2 additional outlet stores.
 
 
 ***Operating
          Income***
  Our
          consolidated operating income increased by $2.4 million, or 13.3%, from
          $18.1
          million for the three months ended July 1, 2006 to $20.5 million for the
          three
          months ended June 30, 2007. Our consolidated operating income increased
          by $9.9
          million, or 32.1%, from $30.8 million for the six months ended July 1,
          2006 to
          $40.7 million for the six months ended June 30, 2007. Excluding the curtailment
          gain mentioned above, operating income for the six months ended June 30,
          2007
          increased $3.8 million, or 12.3%, to $34.6 million.
 
 For
          the
          foregoing reasons, operating income for the wholesale segment increased
          by $3.0
          million, or 18.3%, from $16.4 million for the three months ended July 1,
          2006 to
          $19.4 million for the three months ended June 30, 2007. Operating income
          for the
          wholesale segment increased by $10.9 million, or 36.6%, from $29.8 million
          during the six months ended July 1, 2006 to $40.7 million during the six
          months
          ended June 30, 2007. Excluding the curtailment gain mentioned above, operating
          income for the six months ended June 30, 2007 increased $4.8 million, or
          16.1%,
          to $34.6 million.
 
 Also,
          for
          the reasons discussed above, operating income for the retail segment decreased
          by $0.6 million, or 35.3%, from $1.7 million for the three months ended
          July 1,
          2006 to $1.1 million for the three months ended June 30, 2007. The retail
          segment’s operating income decreased by $1.0 million from $1.0 million during
          the six months ended July 1, 2006 to break even during the six months ended
          June
          30, 2007.
   ***Interest
          Expense, Net***
  Interest
          expense, net, increased by $2.1 million, or 95.5%, from $2.2 million for
          the
          three months ended July 1, 2006 to $4.3 million for the three months ended
          June
          30, 2007. The increase was a result of expensing deferred financing costs
          of
          $2.4 million as a result of refinancing our credit facility on June 15,
          2007, as
          discussed below. This increase was partially offset by reduced interest
          expense
          resulting from lower average debt outstanding for the three-month period
          ending
          June 30, 2007 compared to the three-month period ending July 1, 2006. The
          average balance of total debt outstanding decreased from $129.8 million
          for the
          three months ended July 1, 2006 to $106.9 million for the three months
          ended
          June 30, 2007, and the average interest rate during the three months ended
          July
          1, 2006 was 6.5% as compared to a 6.8% average interest rate during the
          three
          months ended June 30, 2007.
  18
  Interest
          expense, net, increased $2.0 million, or 46.5%, from $4.3 million for the
          six
          months ended July 1, 2006 to $6.3 million for the six months ended June
          30,
          2007. This increase was a result of the reasons mentioned above. The average
          balance of total debt outstanding decreased from $133.6 million for the
          six
          months ended July 1, 2006 to $108.8 million for the six months ended June
          30,
          2007 and the average interest rate during the six months ended July 1,
          2006 was
          6.2% as compared to a 6.8% average interest rate during the six months
          ended
          June 30, 2007.
  ***Income
          Tax Expense***
  We
          review
          our annual effective tax rate on a quarterly basis and we make necessary
          changes
          if information or events warrant such changes. The annual effective tax
          rate is
          forecasted quarterly using actual historical information and forward-looking
          estimates. The estimated annual effective tax rate may fluctuate due to
          changes
          in forecasted annual operating income; changes to the valuation allowance
          for
          deferred tax assets (such changes would be recorded discretely in the quarter
          in
          which they occurred); changes to actual or forecasted permanent book to
          tax
          differences; impacts from future tax settlements with state, federal or
          foreign
          tax authorities (such changes would generally be recorded discretely in
          the
          quarter in which they occurred); or impacts from tax law changes (to the
          extent
          such changes effect our deferred tax assets/liabilities, these changes
          would be
          recorded discretely in the quarter in which they occurred). Our effective
          income
          tax rate for the three and six-month periods ended June 30, 2007 was 41.7%,
          as
          compared to an effective income tax rate for the three and six-month periods
          ended July 1, 2006 of 40.7% and 40.8%, respectively. This increase in the
          effective income tax rate was primarily the result of Financial Accounting
          Standards Board (FASB) Interpretation No. 48 (FIN No. 48), “Accounting for
          Uncertainty in Income Taxes.”
 
 Because
          of significant net operating loss carryforwards (NOLs) available to offset
          income taxes payable, our cash income taxes to be paid will be at a rate
          lower
          than our effective income tax rate.
 
 
 ***Net
          Income***
  For
          the
          foregoing reasons, our net income increased by $0.1 million from $9.4 million
          for the three months ended July 1, 2006 to $9.5 million for the three months
          ended June 30, 2007. Our net income increased by $4.4 million from $15.7
          million
          for the six months ended July 1, 2006 to $20.1 million for the six months
          ended
          June 30, 2007. Excluding the curtailment gain and the expensing of the
          deferred
          financing costs mentioned above, net income for the three and six-month
          periods
          ended June 30, 2007 increased $1.5 million, or 16.0%, and $2.2 million,
          or
          14.0%, respectively, when compared to the same period last year.
   **Liquidity
          and Capital Resources**
  *Operating
          activities.* Cash
          flows provided by operating activities were $13.0 million for the six months
          ended June 30, 2007 compared to $6.8 million for the six months ended July
          1,
          2006. This increase was primarily driven by changes in working capital.
          Accounts
          receivable for the six months ended June 30, 2007 increased $18.1 million
          compared to an increase of $25.2 million for the six months ended July
          1, 2006,
          the change of which was a result of the timing of cash collections and
          higher
          wholesale net sales. Income taxes payable for the six months ended June
          30, 2007
          increased $0.4 million compared to an increase of $4.1 million for the
          six
          months ended July 1, 2006, and is primarily due to higher required estimated
          tax
          payments.
  *Investing
          activities.* Cash
          flows used in investing activities were $2.3 million for the six months
          ended
          June 30, 2007 compared to $1.1 million cash flows used in investing activities
          for the six months ended July 1, 2006. Capital expenditures for the six
          months
          ended June 30, 2007 increased by $1.2 million when compared to the six
          months
          ended July 1, 2006 due primarily to information technology upgrades and
          construction expenditures related to the relocation of our company
          headquarters.
 
 *Financing
          activities.* Cash
          flows used in financing activities were $10.3 million for the six months
          ended
          June 30, 2007 compared to cash flows used in financing activities of $18.9
          million for the six months ended July 1, 2006. The decrease in cash flows
          used
          in financing activities is primarily due to the purchase of common stock
          as part
          of our stock repurchase program totaling $6.1 million for the six-month
          period
          ended July 1, 2006.
 
 19
  On
          June
          15, 2007, we entered into a credit agreement, consisting of a 7-year, $100.0
          million amortizing first lien term loan (the “Term Loan”) and a 5-year, $50.0
          million revolving loan facility (the “Revolving Loan” and together with the Term
          Loan, “Credit Facility”). The Revolving Loan provides for direct borrowings and
          issuance of stand-by letters of credit on our behalf. 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. Borrowings
          are limited by the borrowing base, which consists of 85.0% of eligible
          accounts
          receivable and 50.0% of eligible inventory. We used the proceeds from the
          borrowings, together with operating cash, to repay all amounts due under
          our
          existing credit facility.
 
 Additional
          fees are payable under the Credit Facility including (i) a fee on outstanding
          letters of credit equal to the margin over LIBOR applicable to the Revolving
          Loan, (ii) a letter of credit fronting fee equal to 0.25% per annum on
          the daily
          amount available to be drawn under outstanding letters of credit and (iii)
          an
          unused line fee on the maximum principle amount undrawn under the Revolving
          Loan
          ranging from 0.15% to 0.35% determined quarterly based on our leverage
          ratio for
          the preceding four fiscal quarters.
 
 At
          June
          30, 2007, we had $100.0 million outstanding under our Term Loan, $0 outstanding
          under our Revolving Loan with $47.7 million available for borrowings under
          the
          Revolving Loan, after giving effect to $2.3 million of outstanding letters
          of
          credit. Principal payments on the Term Loan are payable in quarterly
          installments of $0.3 million commencing on September 28, 2007, with all
          remaining amounts due on the maturity date. We are permitted to voluntary
          prepay
          all or part of the principal balance of the Term Loan with such prepayments
          applied to scheduled principal payments in inverse order of their maturity.
          The
          borrowings and other obligations under the Credit Facility and the guarantees
          are 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 the borrower and guarantors.
 
 During
          July 2007, we made additional prepayments of $10.0 million on our Term
          Loan
          which is not reflected on our balance sheet at June 30, 2007. These debt
          prepayments reduced the final installment of principal under the Term Loan.
 
 In
          connection with the new Credit Facility, we paid fees of $1.1 million.
          For the
          three and six-month periods ended June 30, 2007, amortization of financing
          costs
          included in interest expense was $2.6 million and $2.8 million, respectively,
          which includes the write-off of deferred financing costs of $2.4 million
          as a
          result of refinancing our Credit Facility.
 
 On
          August
          7, 2007, the Board of Directors increased our stock repurchase program
          by an
          additional $12.6 million. As a result of this increase, we are currently
          authorized to repurchase up to $25.0 million of common stock. The stock
          repurchase program, which is open ended, will allow 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 Revolving
          Loan. All shares will be purchased at prevailing market prices. Prior to
          this
          authorization, we had purchased a total of $7.6 million of our common stock
          under the stock repurchase program.
 
 We
          believe that our existing cash balances and available borrowings under
          our
          Revolving Loan, 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 12 months.
  
 **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. For example, we are contractually
          committed to make certain minimum lease payments for the use of property
          under
          operating lease agreements.
  20
  The
          following table summarizes our significant contractual obligations and
          commercial commitments at June 30, 2007 and the future periods in which
          such
          obligations are expected to be settled in cash. In addition, the table
          below
          reflects the timing of principal payments on outstanding borrowings.
  **Balance
                      of****fiscal**
                  
                  **In
                      fiscal**
                  
                  **In
                      fiscal**
                  
                  **In
                      fiscal**
                  
                  **In
                      fiscal****(in
                      millions)**
                  
                  **2007**
                  
                  **2008**
                  
                  **2009**
                  
                  **2010**
                  
                  **2011**
                  
                  **Thereafter**
                  
                  **Total**Long-term
                      debt (1)
                  
                  $
                  0.6
                  
                  $
                  1.1
                  
                  $
                  1.1
                  
                  $
                  1.1
                  
                  $
                  1.1
                  
                  $
                  95.0
                  
                  $
                  100.0Interest
                      on long-term debt (2)
                  
                  
                  3.6
                  
                  
                  6.6
                  
                  
                  6.4
                  
                  
                  6.4
                  
                  
                  6.3
                  
                  
                  15.2
                  
                  
                  44.5Obligations
                      under capital lease (3)
                  
                  
                  0.1
                  
                  
                  0.3
                  
                  
                  0.3
                  
                  
                  0.1
                  
                  
                  0.1
                  
                  
                  0.1
                  
                  
                  1.0Operating
                      leases
                  
                  
                  2.7
                  
                  
                  6.0
                  
                  
                  4.3
                  
                  
                  3.3
                  
                  
                  2.7
                  
                  
                  10.7
                  
                  
                  29.7Total
                      financial obligations
                  
                  
                  7.0
                  
                  
                  14.0
                  
                  
                  12.1
                  
                  
                  10.9
                  
                  
                  10.2
                  
                  
                  121.0
                  
                  
                  175.2Purchase
                      obligations (4)
                  
                  
                  63.6
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  63.6Total
                      financial obligations and commitments
                  
                  $
                  70.6
                  
                  $
                  14.0
                  
                  $
                  12.1
                  
                  $
                  10.9
                  
                  $
                  10.2
                  
                  $
                  121.0
                  
                  $
                  238.8
 *(1)* *During
          July 2007, we made additional prepayments of $10.0 million which is not
          reflected in the above table. These debt prepayments reduced the final
          installment of principal under the Term Loan* *.*
 *(2)
          The interest rate assumed for the variable portion of long-term debt was
          the
          rate in effect at June 30, 2007.*
 *(3)
          Includes amounts classified as interest and SG&A.*
 *(4)
          Unconditional purchase obligations are defined as agreements to purchase
          goods
          that are enforceable and legally binding on us and that specify all significant
          terms, including fixed or minimum quantities to be purchased; fixed, minimum,
          or
          variable price provisions; and the approximate timing of the transaction.
          The
          purchase obligations category above relates to commitments for inventory
          purchases. Amounts reflected in our condensed consolidated balance sheets
          in
          accounts payable or other current liabilities are excluded from the table
          above.*
 
 In
          addition to the total contractual obligations and commitments included
          in the
          table above, we have pension and postretirement benefit obligations included
          in
          other non-current liabilities.
 
 Effective
          at the beginning of the first quarter of 2007, we adopted FIN No. 48 as
          described in Note 6 to the condensed consolidated financial statements.
          As of
          December 31, 2006 and June 30, 2007, our total liabilities for unrecognized
          tax
          benefits and related interest and penalties amounted to $5.4 million and
          $5.8 million,
          respectively. We do not believe that our adoption of FIN No. 48 has a material
          effect on the schedule of cash contractual obligations included in our
          most
          recent Annual Report on Form 10-K because we cannot make a reasonably reliable
          estimate of the amount and period of related future payments of our FIN
          No. 48
          liabilities.
  *Off-Balance
          Sheet Arrangements.* Our
          most
          significant off-balance sheet financing arrangements as of June 30, 2007
          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.
 
 21
 
 **Critical
          Accounting Policies and Estimates**
  Our
          discussion and analysis of our financial condition and results of operations
          is
          based upon our condensed 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.
          A summary
          of our significant accounting policies and a description of accounting
          policies
          that we believe are most critical may be found in the Management’s Discussion
          and Analysis of Financial Conditions and Results of Operations included
          in our
          Annual Report on Form 10-K for the year ended December 30, 2006.
 
 **Item
          3. Quantitative and Qualitative Disclosures about Market
          Risk**
 
 *Foreign
          Currency Risk.* We
          do not
          believe that we have significant foreign currency transactional exposures.
          For
          the three and six-month periods ended June 30, 2007, $8.6 million and $15.2
          million, respectively, of our total net sales were in currencies other
          than the
          U.S. dollar. During the three and six-month periods ended June 30, 2007,
          our net
          sales were favorably impacted by $0.4 million and $0.7 million, respectively,
          due to foreign exchange rates. 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. Our objective is to maintain a cost-effective
          mix which we deem appropriate and we have entered into interest rate swap
          agreements to balance this risk. Through June 4, 2007, our debt portfolio
          was
          composed of variable-rate debt, of which we hedged approximately 30% to
          a fixed
          rate. On June 5, 2007, we terminated the hedge agreements in anticipation
          of the
          June 15, 2007 refinancing of our credit facility. However, subsequent to
          June
          30, 2007, we entered into a new hedge agreement to convert approximately
          50% of
          our variable-rate debt to a fixed rate. As a result, with respect to our
          variable-rate debt, a 1% change in interest rates would be
          immaterial.
 
 *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 to us. During the past
          five
          years, we have not experienced any significant impact from commodity price
          fluctuations, nor do we currently use derivative instruments in the management
          of the risk of any such fluctuations. On a prospective basis, fluctuations
          in
          petroleum prices may also influence the prices of the related items such
          as
          chemicals, dyestuffs, man-made fibers and foam. Any raw material price
          increase,
          as well as any increase in transportation costs, 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 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.
  22
 
 **Item
          4. Controls and Procedures**
 
 *(a) Evaluation
          of Disclosure Controls and Procedures.*
  Our
          management, with the participation of our Chief Executive Officer and Chief
          Financial Officer, has evaluated the effectiveness of our disclosure controls
          and procedures (as defined in Rules 13a-15(e) and 15d-15(e) promulgated
          under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), as
          of the end of the period covered by this report. Based on that evaluation,
          our
          Chief Executive Officer and Chief Financial Officer have concluded that,
          as of
          such date, our disclosure controls and procedures were effective as of
          June 30,
          2007 to ensure that the 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 SEC 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.
 
 *(b) Changes
          in Internal Controls over Financial Reporting.*
  There
          was
          no change in our internal control over financial reporting (as defined
          in
          Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during our fiscal
          quarter ending June 30, 2007 that has materially affected, or is reasonably
          likely to materially affect, our internal control over financial reporting.
 
 23
 
 **PART
          II - OTHER INFORMATION**
 
 **Item
          1. 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. While it is possible that our cash flows and results
          of
          operations in a particular quarter or year could be materially affected,
          it is
          our opinion that these matters will not have a material impact on our
          consolidated financial position, or ongoing results of operations and cash
          flows.
 
 **Item
          1A. Risk Factors**
 Risks
          that could have a negative impact on our business, results of operations
          and
          financial condition include: our growth cannot be assured and any growth
          may be
          unprofitable; our history of losses; potential fluctuations in our results
          of
          operations or rate of growth; our dependence on a limited number of customers;
          we have larger competitors with greater resources; retail trends in the
          intimate
          apparel industry, including consolidation and continued growth in the
          development of private brands, resulting in downward pressure on prices,
          reduced
          floor space and other harmful changes; failure to anticipate, identify
          or
          promptly react to changing trends, styles, or consumer preferences; our
          substantial leverage could adversely affect our financial condition; external
          events may disrupt our supply chain, result in increased cost of goods
          or an
          inability to deliver our products; events which result in difficulty in
          procuring or producing products on a cost-effective basis; increases in
          the
          prices of raw materials; changing international trade regulation, including
          as
          it relates to the imposition or elimination of quotas on imports of textiles
          and
          apparel; foreign currency exposure; and the sufficiency of cash to fund
          operations and capital expenditures. This list is intended to identify
          only
          certain of the principal factors that could have a material and adverse
          impact
          on our business, results of operations and financial condition.  A more
          detailed description of each of these and other important risk factors
          can be
          found under the caption “Risk Factors” in our most recent Form 10-K, filed with
          the Securities and Exchange Commission on March 13, 2007.
  There
          are
          no material changes to the risk factors described in the Form 10-K, filed
          on
          March 13, 2007.
  **Item
          2. Unregistered Sales of Equity Securities and Use of
          Proceeds**
 
 (a)
          None.
 (b)
          None.
 (c)
          None
 
 **Item
          3. Defaults Upon Senior Securities**
 None.
 
 **Item
          4. Submission of Matters to a Vote of Security Holders**
 We
          held
          our annual meeting of shareholders on May 24, 2007. The following actions
          were
          voted upon at the meeting:
 
 1.
          The
          following individuals were elected to the Company’s Board of Directors, to hold
          office until the next annual meeting of shareholders. A total of 17,553,724
          shares were represented in person or by proxy at the Annual Meeting. The
          number
          of shares that were voted for, and that were withheld from, each of the
          director
          nominees is as follows:
 **Director
                      Nominee**
                  
                  **Favor**
                  
                  **Withheld**David
                      B. Kaplan
                  
                  16,445,359
                  
                  1,108,365Thomas
                      J. Ward
                  
                  17,243,409
                  
                  310,315Norman
                      Axelrod
                  
                  17,531,101
                  
                  22,623Harold
                      F. Compton
                  
                  17,531,101
                  
                  22,623Barbara
                      Eisenberg
                  
                  16,639,516
                  
                  914,208Karen
                      Rose
                  
                  16,830,729
                  
                  722,995Adam
                      L. Stein
                  
                  17,017,758
                  
                  535,966
 2.
          The
          shareholders approved the re-appointment of PricewaterhouseCoopers LLP
          as the
          Company’s independent registered public accounting firm for the 2007 fiscal year
          by a vote of 17,391,888 in favor, and 155,359 against, and 6,477 stockholders
          abstained.
 
 24
  **Item
          5. Other Information**
 None.
 
 **Item
          6. Exhibits**
 The
          following exhibits are filed as part of this Quarterly Report on Form
          10-Q:
 
 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
  25
  **SIGNATURES**
 
 Pursuant
          to the requirements of the Securities Exchange Act of 1934, the registrant
          has
          duly caused this report to be signed on its behalf by the undersigned thereunto
          duly authorized.
  MAIDENFORM
                    BRANDS, INC.
                  (Registrant)Date:
                    August 8, 2007
                By:
                /s/ Dorvin
                  D.
                  LivelyName:
                    Dorvin D. LivelyTitle:
                    Executive Vice President and Chief Financial Officer
                  (principal
                    financial and accounting officer)
  26
 
 **EXHIBIT
          INDEX**
 
 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
 
  
 27