UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549FORM 40-F  ̈
              Registration statement pursuant to Section 12 of the Securities
              Exchange Act of 1934orþ
              Annual
              report pursuant to Section 13(a) or 15(d) of the Securities
              Exchange Act of 1934 For
              Fiscal year ended: October 4, 2009
              Commission File number: 01-14830 GILDAN ACTIVEWEAR INC.(Exact name of registrant as
              specified in its charter)Canada(Province or other
              jurisdiction of incorporation or organization)2200, 2250, 2300(Primary standard industrial
              classification code number, if applicable)Not Applicable(I.R.S. employer
              identification number, if applicable)600 de Maisonneuve Boulevard
              West, Montreal, Quebec, Canada H3A 3J2, (514) 735-2023(Address and telephone number
              of registrant's principal executive office)Puglisi & Associates, 850
              Library Avenue, Suite 204, P.O. Box 885, Newark, Delaware 19715,
              (302) 738-6680(Name, address and telephone
              number of agent for service in the United States)Securities registered pursuant
              to Section 12(b) of the Act: Title of each class
              Name of each exchange
              on which registeredCommon Shares
              New York Stock
              Exchange Securities registered or to be registered pursuant to Section
12(g) of the Act: None Securities for which there is a reporting obligation pursuant to Section 15(d)
of the Act: None For annual reports, indicate by check mark the information
filed with this form:
þ
    Annual Information Form
    þ
    Audited Annual
              Financial StatementsIndicate the number of outstanding shares of each of the
issuer's classes of capital or common stock as of the close of the period
covered by the annual report:
Common Shares: 
120,963,028

Indicate by check mark whether the registrant: (1) has filed
all reports required to be filed by Section 13 or 15(d) of the Exchange Act
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
              þ
              No ̈




GILDAN ACTIVEWEAR INC. ANNUAL INFORMATION FORMfor the year ended October 4, 2009





December 9, 2009

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|                                                              | GILDAN ACTIVEWEAR INC.                 |     
|------------------------------------------------------------- | -------------------------------------- | ----
|                                                              | 2009 ANNUAL INFORMATION FORM           |     
|                                                              | TABLE OF CONTENTS                      |     
|                                                              |                                        | Page
|                                                              |                                        |     
|1.                                                            | CORPORATE STRUCTURE                    |     
|                                                              | 1.1 Name, Address and Incorporation    | 1   
|                                                              | 1.2 Intercorporate
      Relationships | 2   
|                                                              |                                        |     
|2.                                                            | GENERAL DEVELOPMENT OF THE BUSINESS    |     
|                                                              | 2.1 Recent Developments                | 2   
|                                                              | 2.2 Developments in Fiscal 2009        | 3   
|                                                              | 2.3 Developments in Fiscal
      2008  | 4   
|                                                              | 2.4 Developments in Fiscal 2007        | 5   
|                                                              |                                        |     
|3.                                                            | DESCRIPTION OF THE
      BUSINESS      |     
|                                                              | 3.1 Business Overview                  | 6   
|                                                              | 3.2 Risk Factors                       | 13  
|                                                              | 3.3 Employees                          | 13  
|                                                              |                                        |     
|4.                                                            | DIVIDEND POLICY                        | 14  
|5.                                                            | CAPITAL STRUCTURE                      | 14  
|6.                                                            | MARKET FOR SECURITIES                  | 15  
|7.                                                            | DIRECTORS AND OFFICERS                 | 16  
|8.                                                            | AUDIT COMMITTEE
      DISCLOSURE       | 19  
|9.                                                            | LEGAL PROCEEDINGS                      | 21  
|10.                                                           | TRANSFER AGENT AND
      REGISTRAR     | 22  
|11.                                                           | MATERIAL CONTRACTS                     | 22  
|12.                                                           | INTERESTS OF EXPERTS                   | 22  
|13.                                                           | FORWARD-LOOKING STATEMENTS             | 22  
|14.                                                           | ADDITIONAL INFORMATION                 | 23  
|APPENDIX A  MANDATE OF THE AUDIT AND FINANCE
      COMMITTEE | 24                                    

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This Annual Information Form is dated December 9, 2009 and,
except as otherwise indicated, the information contained herein is given as of
December 9, 2009.

Unless otherwise indicated, all dollar amounts set forth
herein are expressed in U.S. dollars and all financial information set forth
herein is prepared in accordance with Canadian generally accepted accounting
principles.

Unless otherwise indicated, all references to share prices,
trading volumes and per share measures are adjusted, on a retroactive basis, to
reflect all stock splits.

In this Annual Information Form, Gildan, the Company or
the words we, our and us refer, depending on the context, either to Gildan
Activewear Inc. or to Gildan Activewear Inc. together with its subsidiaries and
joint venture.

The information appearing in the extracts of the documents
listed below and specifically referred to in this Annual Information Form is
incorporated herein by reference:

- Audited Consolidated Financial Statements as at and for the year ended
  October 4, 2009 (the 2009 Financial Statements);
- Managements Discussion and Analysis for the year ended October 4, 2009
  (the 2009 Annual MD&A); and
- 2008 Notice of Annual Meeting of Shareholders and Management Proxy
  Circular (the Circular).

The foregoing documents are available on the SEDAR website
at www.sedar.com, on the EDGAR website at www.sec.gov and on the Companys
website at www.gildan.com.

This Annual Information Form contains certain
forward-looking statements, which are based on Gildans current expectations,
estimates, projections and assumptions and were made by Gildan in light of its
experience and its perception of historical trends. Results indicated in
forward-looking statements may differ materially from the actual results. Please
refer to the cautionary statement on pages 22 and 23 of this Annual Information
Form for further explanation.

1.

CORPORATE STRUCTURE

1.1

Name, Address
and Incorporation

We were incorporated on May 8, 1984 pursuant to the Canada
Business Corporations Act under the name of Textiles Gildan Inc. At our
inception, we focused our activities on the manufacture of textiles and produced
and sold finished fabric as a principal product-line. In 1992, we redefined our
operating strategy and, by 1994, our operations focused exclusively on the
manufacture and sale of activewear in the screenprint channel. In March 1995, we
changed our name to Gildan Activewear Inc./Les Vêtements de Sports Gildan Inc.
In 2005, we changed our French name to Les Vêtements de Sport Gildan Inc.

In June 1998, in conjunction with a planned initial public
offering, we filed Articles of Amendment to, among other things, remove the
private company restrictions contained in our charter documents and change the
structure of our authorized share capital. On June 17, 1998, we completed our
initial public offering of an aggregate of 3,000,000 Class A Subordinate Voting
shares at Cdn$10.29 per share, on a pre-split basis, for total gross proceeds of
Cdn$30,880,500.

On February 2, 2005, we filed Articles of Amendment in order
to, among other things, (i) create a new class of common shares (the Common
Shares), (ii) change each of the issued and outstanding Class A Subordinate
Voting shares into one of the newly-created Common Shares, and (iii) remove the
Class B Multiple Voting shares and the Class A Subordinate Voting shares as well
as the rights, privileges, restrictions and conditions attaching thereto.

Our principal executive offices and registered office are
located at 600 de Maisonneuve Boulevard West, 33rdFloor, Montreal,
Québec, Canada H3A 3J2, and our telephone number at that address is (514)
735-2023.

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1.2

Intercorporate Relationships

The following table indicates our principal subsidiaries, their
jurisdiction of incorporation and the percentage of voting securities that we
beneficially own or over which we exercise direct or indirect control:

|                                                              |                               | Percentage of Voting Securities or
|------------------------------------------------------------- | ----------------------------- | ----------------------------------
|                                                              |                               | Partnership Interests that Gildan 
|Subsidiary                                                    | Jurisdiction of Incorporation | held as at                        
|                                                              |                               | December 9, 2009                  
|Gildan Activewear SRL                                         | Barbados                      | 100%                              
|Gildan USA Inc.                                               | Delaware                      | 100%                              
|Gildan Choloma Textiles, S. de R.L.                           | Honduras                      | 100%                              
|Gildan Activewear Dominican Republic Textile Company Inc.     | Barbados                      | 100%                              
|Gildan Activewear Honduras Textiles
      Company, S. de R.L. | Honduras                      | 100%                              
|Gildan Honduras Hosiery Factory, S. de R.L.                   | Honduras                      | 100%                              
|Gildan Activewear Properties (Dominican
      Republic) Inc.  | Barbados                      | 100%                              
|Gildan Activewear (Eden) Inc.                                 | North Carolina                | 100%                              
|Gildan Activewear (UK) Limited                                | United Kingdom                | 100%                              
|V.I. Prewett & Son, Inc.                                      | Alabama                       | 100%                              

The subsidiaries that have been omitted do not represent
individually more than 10% of the consolidated assets and 10% of the
consolidated sales and operating revenues of Gildan, or in the aggregate more
than 20% of the total consolidated assets and the consolidated sales and
operating revenues as at and for the year ended October 4, 2009.

2.

GENERAL
DEVELOPMENT OF THE BUSINESS

The following section describes how our business has evolved in
the last three completed financial years and lists key events that have
influenced the development of our business.

2.1

Recent Developments

Acquisition of New
Distribution Centre

On November 17, 2009, the Company completed the acquisition of
a state-of-the-art distribution centre and office building in Charleston, South
Carolina, for approximately $20 million. This facility will be utilized to
support the Companys retail strategy, and is also expected to generate cost
reductions and efficiencies as a result of consolidating existing distribution
capacity.

New Retail Programs for Fiscal 2010

The Company has continued to build on the successful
performance of its private label sock programs and has been awarded a major
strategic underwear program as well as a smaller underwear program and three
further sock programs, which are all expected to begin shipment in the second
quarter of fiscal 2010. The Company is currently in active discussions to secure
further opportunities with mass retailers for new programs during fiscal 2010.
The annualized full year incremental sales revenue from the additional new
mass-market retail programs already obtained by the Company in fiscal 2010 is
currently estimated to be approximately U.S. $70 million. In addition, the
Company is continuing to achieve further penetration with its Gildan branded
products in regional retail chains.

2

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2.2

Developments in Fiscal 2009

Economic
Environment

- During fiscal 2009, the severe downturn in the overall economic
  environment resulted in a dramatic curtailment of consumer and corporate
  spending which  negatively impacted demand for our products in the U.S. and other
  international screenprint markets, and also resulted in significant inventory
  destocking at the U.S. distributor level. Weaker demand and customer inventory
  reductions also occurred in the mass-market retail channel.
- During fiscal 2009, we took a number of steps in response to the downturn
  in the economy, in order to prudently manage our receivables, inventory levels
  and capital expenditures. We experienced a significantly higher than usual
  build-up of activewear inventories in the first half of fiscal 2009 due to the
  decline in our sales combined with the reduction of inventories at the
  customer level. As a result, we took production downtime at most of our
  production facilities in order to better align our inventory levels with
  projected sales demand. We also achieved significant reductions in our sock
  inventories, as planned, due in part to improved supply chain efficiencies. We
  managed our credit risk cautiously, as we balanced short-term market share
  considerations in relation to increased customer credit exposure, including
  carefully managing our customer accounts and promotional programs, such as our
  decision not to replenish our largest wholesale distributor during the second
  quarter of fiscal 2009 as it underwent a process to restructure its debt
  financing. In addition, we reduced the use of extended payment terms that we
  typically offer for certain seasonal products in the second half of our fiscal
  year. The Company decided to proceed cautiously on capacity expansion projects
  previously announced and delayed the completion of its Rio Nance 4 sock
  facility and deferred the construction of its third activewear facility (Rio
  Nance 5) in Honduras until the economic outlook in support of further major
  capacity expansion became clearer.
- The Company is currently planning for fiscal 2010 on the basis of the
  continuation of weak macro economic conditions.

Growth Strategy

- In spite of the challenging economic environment in fiscal 2009, we
  continued to increase our leading market share in all of the product
  categories in which we compete in the U.S. wholesale distributor channel and
  increased our sales in international and other screenprint markets,
  particularly in Western Europe, the U.K., Asia/Pacific and Mexico.
- For the first nine months of calendar 2009, we increased our overall
  market share in the U.S. screenprint channel to 56.6%. In calendar 2008, our
  overall market share in this channel was 51.9%.

Manufacturing and Distribution Cost Reductions

- During fiscal 2009 we continued to consolidate our manufacturing
  operations in our manufacturing hub in Central America as we transitioned our
  U.S. sock finishing operations, which were purchased as part of the V.I.
  Prewett & Son, Inc. (Prewett) acquisition, to a leased sock finishing
  facility in Honduras.
- During fiscal 2010 the Company expects to complete its second sock
  manufacturing facility in Honduras, Rio Nance 4, which was delayed during
  fiscal 2009, as a result of the weak economic environment, as discussed under
  the heading Economic Environment. The facility is expected to begin
  operations by the end of fiscal 2010. During this fiscal year we started to
  construct a biomass steam generation system in the Dominican Republic which is
  expected to contribute to the reduction of our energy consumption and related
  costs. The facility is expected to be operational by February 2010.

3

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- In early fiscal 2009 we were granted a business license by the Chinese
  government to operate as Gildan (China) Trading Co., Ltd. This corporation has
  been established to import and sell Gildan products to customers in mainland
  China. In fiscal 2009, we moved our distribution activities from Shenzhen,
  China to a new distribution centre in China near Shanghai to better service
  the initial customer base predominantly located in the Northern provinces of
  China. Gildan is focusing on building its brand in both the retail and
  screenprint channels in China.

Tax

- In the third quarter of fiscal 2009 the Canada Revenue Agency (CRA)
  completed its audit of the 2004, 2005 and 2006 taxation years and there were
  no significant adjustments to the Companys income tax returns.

2.3

Developments
in Fiscal 2008

Acquisition
of U.S. Sock Manufacturer

- On October 15, 2007, we acquired 100% of the common shares of Prewett, a
  large U.S. supplier of basic family socks to U.S. mass-market and regional
  retailers. Prewetts corporate headquarters are located in Fort Payne,
  Alabama. The aggregate purchase price was $128 million, which was comprised of
  cash consideration of $125.3 million, a deferred payment of $1.2 million
  disbursed in fiscal 2009 and transaction costs of $1.5 million. The purchase
  agreement provided for an additional purchase consideration of up to $10
  million contingent on specified future events, which was paid into escrow by
  the Company. The purchase price was paid in cash at closing and was financed
  out of our revolving long-term credit facility. With this acquisition, we are
  now one of the leading suppliers of socks in the U.S. mass-market retail
  channel.

Growth Strategy

- We continued to achieve market share gains in the U.S. screenprint market.
- We also made progress in our plans to penetrate the U.S. mass retail
  market for high-volume, basic, frequently replenished, non-fashion family
  apparel. Our acquisition of Prewett further strengthened our positioning as a
  supplier of socks for the retail channel.
- During fiscal 2008, we began shipments under our first underwear program
  with a U.S. national mass-market retailer.

Tax

- The CRA completed its audit of our income tax returns for our 2000, 2001,
  2002 and 2003 fiscal years, the scope of which included a review of transfer
  pricing and the allocation of income between the Companys Canadian legal
  entity and its foreign subsidiaries. On December 10, 2008, the Company reached
  a final agreement with the CRA which resulted in a tax reassessment related to
  the restructuring of our international wholesale business and the related
  transfer of our assets to our Barbados subsidiary, which occurred in fiscal
  1999. The terms of the agreement were accounted for in the fourth quarter of
  fiscal 2008 through a charge to income tax expense of $26.9 million, including
  a provision for provincial taxes, and a reclassification of $17.3 million of
  future income tax liabilities to income taxes payable. There were no penalties
  assessed as part of the agreement and there were no other significant income
  tax adjustments to reported taxable income for the years under audit.

Manufacturing Operations

- In fiscal 2008, we completed the ramp up of our second activewear facility
  and of our integrated sock manufacturing facility, both located in Rio Nance,
  Honduras.

4

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Distribution

- In connection with our acquisition of Prewett in fiscal 2008, two Prewett
  facilities, located in Fort Payne, Alabama, were added to our distribution
  network. These two Prewett facilities also service our sock distribution in
  the retail channel.
- In May 2008, the Company announced its intention to build a new
  distribution centre in Honduras to support our growth, handle value-added
  labour intensive activities for mass-market retail customers and to support
  direct shipments to some of our markets.

Corporate Office

- In fiscal 2008, we moved our corporate head office to leased premises
  located in Montreal, Québec.

2.4

Developments
in Fiscal 2007

Growth Strategy

- We continued to achieve market share gains in the U.S. screenprint market.
- We also made progress in our plans to penetrate the U.S. mass retail
  market for high-volume, basic, frequently replenished, non-fashion family
  apparel. Our acquisition of Kentucky Derby Hosiery Co., Inc. (Kentucky
  Derby) in fiscal 2006 provided us with enhanced distribution to major U.S.
  mass-market retailers, and permitted us to achieve our first national branded
  sock program for mens and boys socks with a U.S. national retailer.
- We began shipments of a major private label sock program to a U.S.
  national mass-market retailer.

Manufacturing Operations

- We announced the restructuring of our Canadian and U.S. manufacturing
  operations, which included the closure of our two remaining textile facilities
  in Montreal and our cutting facility in Bombay, New York, and announced the
  closure of two sock facilities in Mount Airy, North Carolina. We also
  announced the closure of our two sewing facilities in Mexico, which had been
  supplied with fabric from our Canadian textile operations.
- We began production at a new integrated manufacturing facility in Rio
  Nance, Honduras for the large- scale production of socks, and announced plans
  for a second sock facility in Honduras to support our projected continuing
  growth in sales.
- We also began production at our second large-scale integrated textile
  manufacturing facility for the production of activewear in Rio Nance,
  Honduras.

Distribution

- We completed the consolidation of Kentucky Derbys distribution facilities
  into our retail distribution centre located in Martinsville, Virginia.
- We began operations at a new third-party distribution centre in Shenzhen,
  China.

Stock Split

- Our Board of Directors approved a two-for-one stock split effected in the
  form of a stock dividend. The split was applicable to all shareholders of
  record on May 18, 2007. The Common Shares commenced trading on a post-split
  basis on May 16, 2007 on the Toronto Stock Exchange and on May 28, 2007 on the
  New York Stock Exchange.

5

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FLA Accreditation

- In June 2007, the Fair Labor Association (the FLA), a leading labour
  rights organization, accorded us accreditation status on our labour compliance
  program following an extensive three-year review of our compliance with its
  workplace code of conduct requirements. We became the first
  vertically-integrated manufacturer of basic activewear apparel to receive this
  accreditation, which is the FLAs most advanced recognition of a companys
  labour compliance program.

3.

DESCRIPTION
OF THE BUSINESS

3.1

Business
Overview

We are a marketer and vertically-integrated globally
cost-competitive manufacturer of basic, non-fashion apparel products for
customers requiring an efficient supply chain and consistent product quality for
high-volume replenishment programs. We sell activewear products to screenprint
markets in North America, Europe and other international markets. Gildan is the
leading supplier of activewear for the screenprint channel in the U.S. and
Canada, and also a leading supplier for this market in Europe and Mexico. We
sell socks and underwear, in addition to our activewear products, to mass market
and regional retailers in North America. In the U.S. mass-market retail channel,
Gildan is one of the leading suppliers of socks. The Company operates in one
business segment, being high-volume, basic, frequently replenished, non-fashion
apparel.

The Companys net sales for fiscal 2009 reached $1,038.3
million.

Strategy and ObjectivesOur growth strategy
comprises the following initiatives:

|1. | Maximize screenprint market penetration and
      opportunities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   | While we have achieved a leadership position in the
      screenprint channel in the U.S. and in Canada, we believe we can continue
      to further solidify our position in the North American screenprint channel
      and expand our presence in international screenprint markets. In recent
      years, we have further developed our integrated manufacturing hubs in
      Central America and the Caribbean Basin, which we expect will allow us to
      allocate capacity to service product categories and geographical locations
      where our growth was previously constrained by capacity availability. We
      are currently planning to invest further in capacity expansions within our
      existing manufacturing hubs.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | U.S. Screenprint Market                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   | During fiscal 2009, we further increased our leading
      market share position in the U.S. screenprint channel in all of our
      product categories as reported in the S.T.A.R.S. report produced by
      ACNielsen Market Decisions. Our overall total market share in this channel
      increased to 56.6% for the nine months ended September 30, 2009 compared
      to 51.9% for the same period last year. We intend to continue gaining
      market share in all of the product categories that we serve within the
      U.S. screenprint channel, namely T-shirts, sport shirts and fleece,
      through our continued focus on delivering consistent high quality
      products, reliable customer service and competitive pricing. In addition,
      the introduction of new products such as softer T-shirts and sport shirts
      made of ring-spun cotton and new styles tailored for women, should enable
      us to further increase our market share by serving certain niches of the
      screenprint channel in which we previously did not participate. We also
      intend to grow our private label activewear business to provide
      undecorated products to large branded apparel companies and retailers
      which
      sell imprinted activewear and  are currently not supplied by our
      existing U.S. wholesale distributors.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | International Markets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | We expect to pursue further market penetration primarily
      within our existing screenprint channels in Europe, Mexico and the
      Asia/Pacific region. We continue to seek opportunities for growth in
      Europe, having expanded our product-lines, including the introduction of
      ring-spun cotton activewear products. In Mexico, we intend to grow our
      presence in the screenprint channel by building on the sales and
      distribution infrastructure that we have recently established in the
      country. In addition, in fiscal 2007, we began selling our products in Japan in both the
      screenprint and retail channels and during fiscal 2008, we established a
      sales office in China to position Gildan to service both the screenprint
      and retail channels in that country. The Company is continuing to evaluate
      opportunities to further develop its presence in its target markets in
      China.                                                                                                                                                                                                                                                                                                                                                                                                               

6

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|2. | Leverage our successful business model to further
      penetrate the mass-market retail channel                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   | The acquisitions of Kentucky Derby in fiscal 2006 and of
      Prewett at the beginning of fiscal 2008, combined with the addition of new
      branded and private label sock programs, have positioned us as a leading
      supplier of basic family socks in the U.S. mass-market retail channel. We
      have begun to build on our significant market position in socks to
      establish a significant presence in the mass-market retail channel with
      our activewear and underwear product lines. We are leveraging our existing
      core competencies, successful business model and competitive strengths.
      Our value proposition in the retail channel as in the screenprint channel
      combines consistent quality, competitive pricing and fast and flexible
      replenishment, due to our geographical proximity to our markets, as well
      as our leadership in corporate social responsibility and environmental
      sustainability. During fiscal 2009, we strengthened our position with
      mass-market retailers by positioning ourselves as a strategic private
      label supplier to mass retailers seeking to consolidate their supply chain
      with fewer, larger manufacturers.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | We have continued to build on the successful performance
      of our private label sock programs and have been awarded a major strategic
      underwear program as well as a smaller underwear program and three further
      sock programs, which are all expected to begin shipment in the second
      quarter of fiscal 2010. We are currently in active discussions to secure
      further opportunities with mass retailers for new programs during fiscal
      2010. The annualized full year incremental sales revenue from the
      additional new mass market retail programs already obtained by the Company
      in fiscal 2010 is currently estimated to be approximately $70 million.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | We have also pursued a strategy of selling our products
      with the Gildan brand to regional retailers. During fiscal 2009, we
      continued to further penetrate this channel by adding to our customer base
      and expanding Gildan branded products with regional retailer chains. We
      currently sell Gildan branded products in more than 1,700 retail
      stores.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|3. | Continue to generate manufacturing and distribution
      cost reductions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | We seek to continuously improve our manufacturing and
      distribution processes and cost structure by developing and investing in
      cost-reduction initiatives. In addition to our continuing consolidation of
      our manufacturing operations in our Central American and Caribbean Basin
      hubs, we are implementing other cost reduction initiatives which include,
      among others, our plans to install biomass facilities as an alternate
      source of natural renewable energy in order to reduce our reliance on
      high-cost fossil fuels and further reduce our environmental footprint. We
      are also planning to achieve further efficiencies in operating our
      distribution activities.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | During fiscal 2009, we continued to consolidate our
      manufacturing operations in our manufacturing hub in Central America as we
      transitioned our U.S. sock finishing operations, which were purchased as
      part of the Prewett acquisition, to sock finishing facilities in Honduras.
      During fiscal 2010, the Company plans to complete the construction of Rio
      Nance 4, its second sock manufacturing facility in Honduras and begin
      operating the facility during fiscal 2010.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | During fiscal 2009, we began construction of a biomass
      steam generation system in the Dominican Republic, which is expected to
      contribute to the reduction of our energy consumption and related costs.
      The biomass steam generation system is expected to be operational by
      February 2010. Our current plans for fiscal 2010 also include the
      initiation of similar biomass steam generation projects at our sock
      manufacturing facilities in Honduras. We are also planning to implement
      similar systems for our two textile facilities in Honduras in the
      future.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   | In November 2009, we completed the acquisition of a
      state-of-the-art distribution centre and office building in Charleston,
      South Carolina. This facility will be utilized to support our retail
      growth strategy and is also expected to generate cost reductions and
      improved efficiencies as a result of consolidating existing distribution capacity.
      Furthermore, we plan to build a new distribution centre in Rio Nance,
      Honduras to handle value-added labour intensive activities for mass-market
      retail customers and to support direct shipments to some of our
      markets.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

7

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|4. | Re-invest and/or redistribute cash flow                                                                                                                                                                                                                                                                                                                                                                                                                                
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   | We will evaluate opportunities to reinvest our cash flows
      generated from operations. Our primary use of cash will continue to be to
      finance our working capital and capital expenditure requirements to
      support our organic growth, but at the same time we will be open to
      evaluating complementary strategic acquisition opportunities which meet
      our return on investment criteria, based on our risk- adjusted cost of
      capital.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | In addition, we will opportunistically consider share
      repurchases if management and the Board at any time believe that our
      shares are undervalued, and we also intend, as we have done periodically
      in the past, to discuss with our Board the possible introduction of a
      dividend.                                                                                                                                                            

Our Products and MarketsWe have built our
core business by manufacturing and selling activewear products through wholesale
distributors servicing the screenprint market. Today we sell activewear products
to this channel in North America, Europe and other international markets. In
more recent years we made our entry into the North American retail channel, with
the addition of socks and underwear to our activewear product-line for sale to
large mass-market and regional retailers. In fiscal 2006 we acquired Kentucky
Derby and in the first quarter of fiscal 2008 we acquired Prewett, two
U.S.-based sock manufacturers of basic family socks which provided us with
enhanced distribution to major U.S. mass-market retailers.

Our activewear products, namely T-shirts, fleece and sport
shirts under the Gildan brand, are sold in large quantities to wholesale
distributors as undecorated blanks, which are subsequently sold to
screenprinters and embroiderers who decorate the products with designs and
logos. Screenprinters then sell the imprinted activewear to a highly diversified
range of end-use markets, including educational institutions, athletic dealers,
event merchandisers, promotional product distributors, charity organizations,
entertainment promoters, and travel and tourism venues. Our activewear products
are used in a variety of daily activities by individuals, including work and
school uniforms and athletic team wear, and for various other purposes to convey
individual, group and team identity. We are also growing our private label
activewear business to provide undecorated products to large branded apparel
companies and retailers which sell imprinted activewear and are currently not
supplied by our existing U.S. wholesale distributors. In the North American
mass-market and regional retailer channel, we sell a variety of styles of socks,
and mens and boys underwear, in addition to our undecorated activewear
products, under various retailer private labels and under the Gildan brand.

All of our products are made of 100% cotton or of blends of
cotton and synthetic fibres. Our products are characterized by low-fashion risk
compared to other apparel categories since these products are basic, frequently
replenished, and since logos and designs for the screenprint market are not
imprinted or embroidered by Gildan. Our value proposition combines consistent
quality, competitive pricing and fast and flexible replenishment, due to our
geographical proximity to our markets, as well as our leadership in corporate
social responsibility and environmental sustainability. As a
vertically-integrated manufacturer, Gildan is able to provide premium products
to customers in a broad range of sizes, colours and styles with enhanced product
features, such as pre-shrunk fabrics, and a selection of fabric weights, blends
and construction. Innovations in the manufacturing process of our activewear
products have allowed us to ensure colour/shade consistency and high performance
of the garments. In addition, innovations in the sock manufacturing process,
such as higher needle count machines and seamless toe closing operations have
allowed Gildan to deliver enhanced sock product features at lower prices,
further improving the value proposition of our activewear and sock products to
our customers.

Activewear and underwear represented 77% of our sales in both
fiscal 2009 and fiscal 2008. Socks represented 23% of our sales in both fiscal
2009 and fiscal 2008.

Competitive EnvironmentThe apparel market
for our products is highly competitive. Competition is generally based upon
price, with reliable quality and service also being critical requirements for
success. Our competitive strengths include our expertise in building and
operating large-scale, vertically-integrated offshore manufacturing hubs which
allows us to offer competitive pricing, consistent product quality, and a supply
chain which efficiently services replenishment programs with short production/delivery cycle times. Our
investments and commitment to our corporate social responsibility programs are
also increasingly becoming important factors for our customers. We are focused
on providing a more socially and environmentally responsible supply chain for
our customers by employing progressive hiring and employment practices in good
working conditions, minimizing our environmental footprint and contributing to
communities in the countries in which we operate.

8

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Gildan is the leading supplier of activewear products for the
screenprint channel in the U.S. and Canada, and also a leading supplier for this
market in Europe and Mexico. In the U.S. mass-market retail channel Gildan is
one of the leading suppliers of socks. Our primary competitors in North America
are the major manufacturers for the screenprint and retail channels, such as
Hanesbrands Inc., Berkshire Hathaway Inc. through its subsidiaries Fruit of the
Loom, Inc. and Russell Corporation, and smaller U.S.-based manufacturers,
including Anvil Knitwear Inc. We also compete with Alstyle Apparel, a division
of Ennis Corp., and Delta Apparel Inc. The competition in the European
screenprint channel is similar to that in North America, as we compete primarily
with the European divisions of the major U.S.-based manufacturers mentioned
above. We also face the threat of increasing global competition. In Europe, we
also have large competitors that do not have integrated manufacturing operations
and source products from suppliers in Asia. In addition, many of Gildans U.S.
competitors servicing the retail apparel industry currently source products from
Asia.

CustomersIn fiscal 2009, we sold our products in the
United States, Canada and Europe and other international markets, which
accounted for 91%, 3% and 6% of total sales, respectively. For a breakdown of
our total sales by geographic market for each of the last three financial years,
reference is made to Note 21 to the 2009 Financial Statements, which note is
incorporated herein by reference. Our customer base is composed of a relatively
small number of significant customers. We currently sell our products to
approximately 200customers. In fiscal 2009, our largest customer
accounted for 18.6% of our total sales, and our top ten customers accounted for
67.8% of our total sales in the retail and screenprint channels.

The large majority of total sales in fiscal 2009 continued to
be made in the screenprint channel through our wholesale distributors. Although
we have long-term ongoing relationships with many of our customers, our
contracts with our customers do not require them to purchase a minimum quantity
of our products. Instead, we assess their projected requirements and then plan
our production and marketing strategy accordingly.

Our FacilitiesTextile and Sock ManufacturingTo support our sales in the various markets, we have built modern
manufacturing facilities located in Central America and the Caribbean Basin
where we manufacture T-shirts, fleece, sport shirts, socks and underwear. Our
largest manufacturing hub in Central America includes our first
vertically-integrated knitting, bleaching, dyeing, finishing and cutting textile
facility (Rio Nance 1) to produce activewear fabric and, more recently,
underwear fabric. This facility, located in Rio Nance, Honduras, became
operational in fiscal 2002. During fiscal 2007, we expanded our operations in
Rio Nance to include a new integrated textile facility for the production of
activewear fabric (Rio Nance 2) and a new integrated sock manufacturing facility
(Rio Nance 3). We have also established a vertically-integrated Caribbean Basin
manufacturing hub with a textile facility for the production of activewear
fabric in Bella Vista, Dominican Republic, which became operational in fiscal
2005. The Company is also planning further textile capacity expansion in its
existing manufacturing hubs in the Dominican Republic and Central America.

In addition to our integrated sock manufacturing facility
located in our Central America hub, we operate U.S. sock knitting facilities in
Fort Payne, Alabama, purchased as part of the Prewett acquisition in fiscal
2008. During fiscal 2009, we transitioned our U.S. sock finishing operations,
which were purchased as part of the Prewett acquisition, to leased sock
finishing facilities in Honduras. During fiscal 2010, the Company plans to complete
the construction of a second sock manufacturing facility (Rio Nance 4) in Rio
Nance, which is expected to begin operations by the end of fiscal 2010. Rio
Nance 4 will serve to further consolidate the sock finishing operations and to
support our future sales growth in this product category.

Sewing FacilitiesOur sewing facilities for
activewear and underwear are strategically located in close proximity to our
textile manufacturing facilities. We operate sewing facilities in Honduras and
Nicaragua to support our textile manufacturing hub in Central America. To support our
vertically-integrated production in the Dominican Republic, we utilize
third-party contractors in Haiti, and we have established a new sewing facility
in the Dominican Republic, which began operating during the second quarter of
fiscal 2009.

9

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Yarn-SpinningCanAm Yarns, LLC (CanAm), our
joint-venture company with Frontier Spinning Mills, Inc. (Frontier), operates
yarn-spinning facilities in Georgia and North Carolina. CanAms yarn-spinning
operations, together with supply agreements currently in place with Frontier and
other third-party yarn providers, serve to meet our yarn requirements.

Sales, Marketing and DistributionOur global
sales and marketing office, which employs approximately 145 full-time employees,
is located in St. Michael, Barbados and is responsible for customer-related
functions, including sales management, marketing, customer service, credit
management, sales forecasting, and inventory control and logistics. The Company
also employs a sales group in the U.S. to service its retail customers.

We distribute our activewear products for the screenprint
channel primarily out of our distribution centre in Eden, North Carolina, and
also use third-party warehouses in the western United States, Canada, Mexico,
Europe and Asia to service our customers in these markets. Shipments are also
made directly from our third party contractors in Haiti and from our facilities
in Honduras. To service the mass-market retail channel, we operate a
distribution centre in Martinsville, Virginia. In addition, with our acquisition
of Prewett in fiscal 2008, we have two distribution facilities in Fort Payne,
Alabama. On November 17, 2009, the Company completed the acquisition of a
state-of-the-art distribution centre and office building in Charleston, South
Carolina, for approximately $20 million. This facility will be utilized to
support the Companys retail strategy, and is also expected to generate cost
reductions and efficiencies as a result of consolidating existing distribution
capacity.

Raw MaterialsCotton and polyester fibres are the
main raw materials used in the manufacturing of our products. Cotton is used in
the manufacturing of 100% cotton yarn, while polyester is added in the
manufacturing of cotton-polyester blend yarn. Polyester pricing is negotiated on
an annual basis, while cotton fibre is typically purchased for future delivery
at pre-determined prices under contracts as deemed appropriate by management.

During fiscal 2009, most of our yarn requirements for the
production of our product-lines were met by our long-term supply agreements with
third-party suppliers, as well as by our jointly owned CanAm yarn-spinning
facilities in Cedartown, Georgia and Clarkton, North Carolina. We expect that
most of our yarn requirements will continue to be met by these sources.

The two primary sources of energy consumed in our manufacturing
facilities are electricity, which is used to power production equipment, and
bunker fuel, which is used to generate steam required in the production process.
The electricity requirements at our two main production complexes are provided
by a public utility in Honduras and from a private supplier in the Dominican
Republic. Electricity rates are variable and are in part related to underlying
oil prices. The bunker fuel used in our operations is supplied from local
third-party suppliers, and the pricing is highly dependant on international
market prices for bunker fuel. During this fiscal year we began construction of
a biomass steam generation system in the Dominican Republic, which is expected
to contribute to the reduction of our energy consumption and related costs. The
facility is expected to be operational by February 2010. Our current plans for
fiscal 2010 also include the initiation of similar biomass steam generation
projects at our sock manufacturing facilities in Honduras. We are also planning
to implement similar systems for our two textile facilities in Honduras in the
future.

We also purchase chemicals, dyestuffs and trims through a
variety of suppliers. These products have historically been available in
sufficient supply.

Management Information SystemsOur Enterprise
Resource Planning (ERP) system supports the majority of our operations in the
areas of finance, manufacturing and customer service. This system is centralized
and is accessed from all of our locations through secure networks. Our ERP
system is linked to servers supporting both local processes and specialized
applications, including payroll and distribution. We continue to leverage our
existing ERP system by adding new functionality in the areas of supply chain
planning, demand forecasting and business intelligence. Due to our increasing dependence on the availability of our computer
systems to support our operations, we plan to continue, in fiscal 2010, to
implement initiatives to enhance our information technology (IT) processes and
infrastructure based on the Information Technology Infrastructure Library, a
framework of best practices approaches intended to facilitate the delivery of
high quality IT services.

10

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Seasonality and Other Factors Affecting the Variability of
ResultsOur results of operations for interim periods and for full
fiscal years are impacted by the variability of certain factors, including, but
not limited to changes in end-use demand and customer demand, including our
customers decision to increase or decrease their inventory levels, changes in
our sales mix, and fluctuations in selling prices. While our products are sold
on a year-round basis, our business experiences seasonal changes in demand which
result in quarterly fluctuations in operating results. Typically, demand for our
T-shirts is highest in the third quarter of each fiscal year, when distributors
purchase inventory for the peak summer selling season, and lowest in the first
quarter of each fiscal year. Demand for fleece is typically highest, in advance
of the Fall and Winter seasons, in the third and fourth quarters of each fiscal
year. For our sock products, demand is typically highest in the first and fourth
quarters of each fiscal year, stimulated largely by the cooler weather and the
need to support requirements for the back-to-school period and the holiday
season. Historically, we have operated our mature facilities at full capacity
throughout the year in order to be cost efficient. Consequently, with the
seasonal sales trends of our business, we experience fluctuations in our
inventory levels throughout the year, in particular a buildup of inventory
levels in the first half of the year. In the last three quarters of fiscal 2009,
we took some production downtime in order to align our inventory levels with
sales demand, in the context of the weak economic conditions during the fiscal
year.

Our results are also impacted by the fluctuations in the price
of raw materials and other input costs. Cotton and polyester fibres are the
primary raw materials used in the manufacture of our products. We also use
chemicals, dyestuffs and trims which we purchase from a variety of suppliers, at
prices that are correlated with the price of cotton and polyester fibres. Cotton
prices, which directly affect the cost of the cotton fibres we purchase, are
affected by weather, consumer demand, speculation on the commodities market, the
relative valuations and fluctuations of the currencies of producer versus
consumer countries and other factors that are generally unpredictable. While we
enter into contracts in advance of delivery to establish firm prices for cotton
and cotton yarn, our realized cotton costs can fluctuate significantly between
interim and annual reporting periods. Our results of operations are also
affected by fluctuations in crude oil and petroleum prices, which can also
influence transportation costs and the cost of related items used in our
business, such as polyester fibres, chemicals, dyestuffs and trims.

Management decisions to consolidate or reorganize operations,
including closing facilities, may also result in significant restructuring and
other charges in an interim or annual period. In addition, the effect of asset
writedowns, including provisions for bad debts and slow moving inventories, can
affect the variability of our results.

Trade RegulationAs a multinational corporation, we
are exposed to international trade legislation and bilateral trade agreements in
the countries in which we operate and source products. Although the textile and
apparel industries of developed countries such as Canada, the United States and
the European communities have historically received a relatively higher degree
of trade protection than other industries, trade liberalization has diminished
this protection in recent years. In order to remain globally competitive, we
have situated our manufacturing facilities in strategic locations to leverage
the benefits of the trade liberalization climate. Furthermore, management
continuously monitors new developments and risks relating to duties, tariffs and
quotas in our approach to global manufacturing and sourcing and makes
adjustments as needed.

The United States, Canada, and Mexico have implemented several
free trade agreements and trade preference programs to enhance trade with their
trading partners. There exist a number of regional trade agreements and
preference programs, such as the Caribbean Basin Trade Partnership Act, the
Dominican Republic-Central America-United States Free Trade Agreement
(CAFTA-DR) and the Haitian Hemispheric Opportunity through Partnership
Encouragement Act (HOPE), which allow qualifying textiles and apparel from
participating countries duty-free access to certain developed countries
markets.

The United States adopted two of the newest programs, CAFTA-DR
and HOPE (as amended by HOPE II legislation in 2008), to strengthen and develop
U.S. economic relations with Central America, the Dominican Republic and Haiti. Most trade agreements, such as CAFTA-DR,
provide for the application of safeguards in the form of reinstatement of normal
duties if increased imports cause or threaten to cause substantial injury to a
domestic industry. In 2008, the United States imposed such a safeguard under
CAFTA-DR against socks imported from Honduras. The safeguard was in the form of
a 5% duty on socks imported from Honduras from July through December 2008, which
affected our imports of socks from our integrated Honduran sock facility. The
socks safeguard is no longer in effect, and the United States has agreed with
Honduras not to extend or reimpose the socks safeguard beyond 2008. Under the
provisions of the CAFTA-DR agreement, a safeguard, upon expiration, cannot be
renewed.

11

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Proposed legislation in the U.S. Congress would, if adopted,
extend duty-free treatment to qualifying apparel imported from lesser developed
countries, including Bangladesh and Cambodia, extend duty-free or reduced duty
treatment to certain qualifying apparel imported from the Philippines, and
extend duty-free treatment to certain apparel manufactured in reconstruction
opportunity zones in Afghanistan and Pakistan. Any of these proposals could
negatively affect our competitive position in the United States. Furthermore,
U.S. domestic industry groups have threatened to seek section 337 trade
remedies against apparel imports from China under the terms of the U.S.-China
WTO accession agreement, which could result in higher duty rates or tariff rate
quotas for Chinese apparel and improve our competitive position in affected
product classifications. The likelihood that any of these measures will be
adopted and the extent of their impact on our business cannot be determined with
certainty.

Imports into the Mexican market may qualify for trade
preferences from various free trade agreements such as the Mexico-Nicaragua Free
Trade Agreement, and the Mexico-Northern Triangle Regional Trade Agreement,
which includes El Salvador, Guatemala and Honduras as member countries. In
addition to free trade arrangements among the individual countries within the
European Union, the European Union also has preferential trade agreements with
other European countries and with countries outside of Europe, such as the free
trade agreement between the European Union and Mexico. Furthermore, the European
Union also enacted a Generalized System of Preferences (GSP) and the
Africa-Caribbean-Pacific programs that allow duty-free and quota-free entry into
the European Union of qualifying articles, including apparel, from developing
countries and least developed countries such as Honduras, Nicaragua and Haiti.
However, discussions are ongoing at the European Union level regarding the
reform of certain of the GSP rules of origin.

U.S. safeguards imposing quotas on annual imports of certain
categories of Chinese originating textiles and apparel expired at the end of
2008, although ordinary import duties remain in effect.

Product Safety RegulationWe are subject to consumer
product safety laws and regulations that could affect our business. In the
United States, we are subject to the Consumer Product Safety Act, as
amended by the Consumer Product Safety Improvement Act of 2008, to the
Flammable Fabrics Act, and to the rules and regulations promulgated
pursuant to such statutes. Although enforcement of certain requirements is
currently stayed, these laws and regulations include requirements for testing
and certification for flammability of wearing apparel, for lead content and lead
in surface coatings in childrens products, and for phthalate content in
childrens sleepwear. Such laws provide for substantial penalties for
non-compliance.

In Canada, we are subject to similar laws and regulations, the
most significant of which is the Hazardous Products Act. In the European
Union, we are also subject to product safety regulations, the most significant
of which are imposed pursuant to the General Product Safety Directive. We are
also subject to similar laws and regulations in the other jurisdictions in which
our products are sold.

We believe that we are in compliance in all material respects
with applicable product safety laws and regulations in the jurisdictions in
which we operate.

Intellectual PropertyWe own several registered
trademarks including, among others, the Gildan trademark in Canada and the
United States and Gildan Activewear in Canada and many countries in Europe,
Central America, South America and Asia, as well as in Australia. Applications
for the registration of the Gildan trademark are also pending in certain
countries. We have and intend to continue to maintain our trademarks and the
relevant registrations, and will actively pursue the registration of trademarks
in Canada, the United States and abroad.

12

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Environmental RegulationWe are subject to various
federal, state and local environmental laws and regulations in the jurisdictions
in which we operate concerning, among other things, wastewater discharges, storm
water flows, and solid waste disposal. Our manufacturing plants generate small
quantities of hazardous waste, which are either recycled or disposed of
off-site. As part of our Corporate Environmental Policy, we monitor, control and
manage environmental issues through policies including, but not limited to, the
recycling and creation of measures for waste prevention, minimization, recovery
and treatment at all stages of the production cycle including the off-site
disposal of any hazardous waste. We believe that we are in compliance in all
material respects with the regulatory requirements of those jurisdictions in
which our facilities are located.

In line with our commitment to the environment as well as to
the health and safety of our employees we incur capital and other expenditures
each year that are aimed at achieving compliance with current environmental
standards. For fiscal 2009, the requirements with regard to environmental
protection did not have a significant financial or operational impact on the
Company's capital expenditures, earnings and competitive position. Although we
do not expect that the amount of these expenditures in the future will have a
material adverse effect on our operations, financial condition or liquidity,
there can be no assurance that future changes in federal, state, or local
regulations, interpretations of existing regulations or the discovery of
currently unknown problems or conditions will not require substantial additional
environmental remediation expenditures or manufacturing interruption that could
have a material adverse effect on our business. Similarly, the extent of our
liability, if any, for past failures to comply with laws, regulations and
permits applicable to our operations cannot be reasonably determined.

Labour PracticesWe seek to provide favourable
working conditions for all employees. We have implemented internal and external
monitoring programs that permit us to verify compliance with local labour laws,
as well as with internationally recognized labour standards. In addition to
having our own Code of Conduct, which is available on our website at
www.gildan.com, we have obtained Worldwide Responsible Apparel Production
(WRAP) re-certification for all our Gildan-owned sewing facilities, with the
exception of a new facility in San Miguel, Honduras, which is the result of a
consolidation of three previously WRAP certified Gildan-owned facilities that is
now required to obtain a new certification. Three quarters of the facilities of
our sewing contractors located in Haiti are also WRAP certified. All of our
third-party sewing contractors are contractually required to follow prescribed
employment policies as well as our Code of Conduct.

In November 2003, we joined the FLA as a Participating
Company. The FLA is internationally recognized and respected as a non-profit
organization whose goal is to promote adherence to international labour
standards and to improve working conditions for employees worldwide. In fiscal
2007, the FLA accorded accreditation status to our labour compliance program.

Until 2007, the majority of our social compliance monitoring
was performed by external third-party auditors. In fiscal 2007, we successfully
began internal monitoring audits that complement these external independent
audits. Independent third party monitors also regularly audit our plants,
announced or unannounced. During fiscal 2008 and 2009, 107 audits were performed
in our facilities and those of our third-party contractors. Over 30% of these
audits were carried out by third-party auditors, half of which were mandated by
our customers.

3.2

Risk Factors

Please see the Financial Risk Management and the Risks and
Uncertainties sections of our 2009 Annual MD&A beginning on page 21 and
page 32, respectively, which are incorporated herein by reference.

3.3

Employees

As at October 4, 2009, we employed 19,532 full-time employees
worldwide. We consider our relations with our employees to be good and, as of
the date hereof, we have not experienced any work stoppages that have had a
material impact on our operations.

13

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4.

DIVIDEND
POLICY

We do not currently, and have not in the past three years, paid
dividends because we have chosen to retain all of our earnings to maximize our
financing capacity to develop and expand our business. The Board of Directors
periodically reviews the Companys policy towards paying dividends. Although our
revolving term credit facility requires compliance with lending covenants in
order to pay dividends, these covenants are not currently, and are not expected
to be, a constraint to the future payment of dividends.

5.

CAPITAL STRUCTURE

First Preferred SharesIssuance in Series

The First Preferred shares are issuable in series and the Board
of Directors has the right, from time to time, to fix the number of, and to
determine the designation, rights, privileges, restrictions and conditions
attaching to, the First Preferred shares of each series subject to the
limitations, if any, set out in the Articles of the Company.

Rank

The First Preferred shares rank senior to the Second Preferred
shares and the Common Shares with respect to the payment of dividends, return of
capital and the distribution of assets in the event of the liquidation,
dissolution or winding-up of Gildan. The First Preferred shares in each series
rank equally with the First Preferred shares of any other series.

Voting Rights

Unless the Articles otherwise provide with respect to any
series of the First Preferred shares, the holders of the First Preferred shares
are not entitled to receive any notice of or attend any meeting of the
shareholders of Gildan and are not entitled to vote at any such meeting.

Second Preferred SharesIssuance in Series

The Second Preferred shares are issuable in series and the
Board of Directors has the right, from time to time, to fix the number of, and
to determine the designation, rights, privileges, restrictions and conditions
attaching to, the Second Preferred shares of each series subject to the
limitations, if any, set out in the Articles of the Company.

Rank

The Second Preferred shares are subject and subordinate to the
rights, privileges, restrictions and conditions attaching to the First Preferred
shares. The Second Preferred shares rank senior to the Common Shares with
respect to payment of dividends, return of capital and distribution of assets in
the event of the liquidation, dissolution or winding-up of Gildan. The Second
Preferred shares in each series rank equally with the Second Preferred shares of
any other series.

Voting Rights

Unless the Articles otherwise provide with respect to any
series of the Second Preferred shares, the holders of the Second Preferred
shares are not entitled to receive any notice of or attend any meeting of the
shareholders of Gildan and are not entitled to vote at any such meeting.

Common Shares

Following the conversion of all of the Companys Class B
Multiple Voting shares into Class A Subordinate Voting shares, the Companys
shareholders approved a special resolution on February 2, 2005 to amend the
Companys Articles in order to change each of the issued and outstanding Class A
Subordinate Voting shares into one newly-created Common Share and to remove the Class B Multiple Voting
shares and the Class A Subordinate Voting shares.

14

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The Common Shares are subject and subordinate to the rights,
privileges, restrictions and conditions attaching to the First Preferred shares
and the Second Preferred shares. Each holder of Common Shares shall have the
right to receive any dividend declared by the Company and the right to receive
the remaining property and assets of the Company on dissolution.

Each holder of Common Shares is entitled to receive notice of
and to attend all meetings of shareholders of the Company, except meetings of
which only holders of another particular class or series shall have the right to
vote. Each Common Share entitles the holder thereof to one vote.

6.

MARKET FOR
SECURITIES

The Common Shares are listed on the New York Stock Exchange
(the NYSE) and the Toronto Stock Exchange (the TSX) under the symbol GIL.
The Class A Subordinate Voting shares (now the Common Shares), which were issued
at an offering price of $0.88 (Cdn$1.29), on a post-split basis, began trading
on the TSX, the Montreal Exchange (the ME) and the American Stock Exchange
(AMEX) on June 17, 1998. Prior to that date, there was no public market for
the Class A Subordinate Voting shares. We delisted such shares from AMEX on
August 31, 1999. On September 1, 1999, the Class A Subordinate Voting shares
(now the Common Shares) commenced trading on the NYSE. As a result of a
restructuring of Canadas stock exchanges, which took effect on December 7,
1999, we are no longer listed on the ME.

The table below shows the monthly price range per share and the
trading volume of the Common Shares for the fiscal year ended October 4, 2009 on
the TSX (in Cdn$) and on the NYSE (in US$).

|COMMON SHARES               
|----------------------------
|Toronto Stock Exchange (TSX)
|                            
|Month                       
|                            
|October 6 to 31, 2008       
|November 2008               
|December 2008               
|January 2009                
|February 2009               
|March 2009                  
|April 2009                  
|May 2009                    
|June 2009                   
|July 2009                   
|August 2009                 
|September 2009              
|October 1 to 4, 2009        

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7. DIRECTORS AND OFFICERS

Listed below is certain information about the current directors
of Gildan. The directors have served in their respective capacities since their
election and/or appointment and will continue to serve until the next annual
meeting of shareholders or until a successor is duly elected.

|Name and
      Municipality of Residence | Principal Occupation                                        | Director Since
|---------------------------------------- | ----------------------------------------------------------- | --------------
|                                         |                                                             |               
|Robert M. Baylis (2)(3)(4)               |                                                             |               
|Darien, Connecticut, United States       | Corporate Director                                          | February 1999 
|                                         |                                                             |               
|Glenn J. Chamandy                        |                                                             |               
|Westmount, Québec, Canada                | President and Chief Executive Officer of the
      Company  | May 1984      
|                                         |                                                             |               
|William D. Anderson(1)(3)                |                                                             |               
|Toronto, Ontario, Canada                 | Corporate Director                                          | May 2006      
|                                         |                                                             |               
|George Heller(1)(3)                      |                                                             |               
|Toronto, Ontario, Canada                 | Corporate Director                                          | December 2009 
|                                         |                                                             |               
|Sheila OBrien (2)(3)                    |                                                             |               
|Calgary, Alberta, Canada                 | Corporate Director and Business Advisor                     | June 2005     
|                                         |                                                             |               
|Pierre Robitaille(1)(2)                  |                                                             |               
|St-Lambert, Québec, Canada               | Corporate Director and Business Advisor                     | February 2003 
|                                         |                                                             |               
|James R. Scarborough(2)(3)               |                                                             |               
|Wolfeboro, New Hampshire, United States  | Chairman of Stage Stores, Inc.                              | December 2009 
|                                         | (specialty department store retailer)                       |               
|                                         |                                                             |               
|Richard P. Strubel (1)(3)                |                                                             |               
|Chicago, Illinois, United States         | Corporate Director                                          | February 1999 
|                                         |                                                             |               
|Gonzalo F. Valdes-Fauli(1)(2)            |                                                             |               
|Key Biscayne, Florida, United States     | Chairman of BroadSpan Capital LLC (investment banking firm) | October 2004  

|    |                                                                 | 
|--- | --------------------------------------------------------------- | 
|(1) | Member of the Audit and Finance Committee.                     
|(2) | Member of the Corporate Governance Committee.                  
|(3) | Member of the Human Resources and Compensation
      Committee.
|(4) | Chairman of the Board.                                         

Listed below is certain information about the executive
officers of Gildan in office as of the date hereof.

|Name
      and Municipality of Residence | Position Held Within the Company and Principal
      Occupation           
|---------------------------------------- | --------------------------------------------------------------------------
|                                         |                                                                           
|Glenn J. Chamandy (1)                    |                                                                           
|Westmount, Québec, Canada                | President, Chief Executive Officer and Director                           
|                                         |                                                                           
|Laurence G. Sellyn (1)                   |                                                                           
|Beaconsfield, Québec, Canada             | Executive Vice-President, Chief Financial and
      Administrative Officer
|                                         |                                                                           
|Michael R. Hoffman                       |                                                                           
|St. James, Barbados                      | President, Gildan Activewear SRL                                          
|                                         |                                                                           
|Georges Sam Yu Sum (1)                   |                                                                           
|Hampstead, Québec, Canada                | Executive Vice-President, Operations                                      
|                                         |                                                                           
|Benito Masi (1)                          |                                                                           
|Laval, Québec, Canada                    | Executive Vice-President, Manufacturing                                   
|                                         |                                                                           
|Eric R. Lehman(1)                        | Executive Vice-President, Supply Chain,
      Information Technology and  
|Montreal, Québec, Canada                 | Operational Excellence                                                    
|                                         |                                                                           
|(1)     Officer of the Company.          |                                                                           

16

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Glenn J. Chamandyis one of the founders of the Company
and has devoted his business career to leading the development of Gildan into an
industry leader. Prior to February 2004, Mr. Chamandy held the position of
President and Chief Operating Officer. He was then named President and Co-Chief
Executive Officer and, in August 2004, he was appointed to the position of
President and Chief Executive Officer.

Robert M. Baylis, Chairman of the Board of the Company,
serves as a director of two large corporations, including the New York Life
Insurance Company (life insurance provider) and Host Hotels & Resorts,
Inc.(luxury hotels and resorts) where he is Lead Director. He is also a
trustee and chairman of the executive committee of the Rubin Museum of Art in
New York City, a trustee of the Woods Hole Oceanographic Institution and an
overseer of the University of Pennsylvania Museum. He was formerly a director of
Covance Inc. (drug development), Partner Re Limited (reinsurance), Gryphon
Holdings, Inc. (insurance company) and of the Wharton International Forum, an
executive education program. Mr. Baylis retired from Credit Suisse First Boston
as Vice-Chairman in 1996, after thirty-three years with this investment banking
firm and its associated corporations, including a term as the Chairman and Chief
Executive Officer of Credit Suisse First Boston (Pacific). Mr. Baylis was
educated at Princeton University and Harvard Business School and is a chartered
financial analyst.

William D. Anderson has had a career as a business
leader in Canada spanning over thirty years. Mr. Anderson joined the Bell Canada
organization in 1992, where from 1998 to 2001 he served as Chief Financial
Officer of BCE Inc., Canadas largest telecommunications company. From 2001 to
2005, Mr. Anderson served as President of BCE Ventures (the strategic investment
unit of BCE Inc.) and he was previously, from 2001 to 2007, the Chairman and
Chief Executive Officer of Bell Canada International Inc. (a subsidiary of BCE
that was formed to invest in telecommunications operations outside Canada).
Prior to joining the Bell Canada organization, Mr. Anderson was in public
practice for nearly twenty years with the accounting firm KPMG, where he was a
partner for eleven years. Mr. Anderson also serves on the boards of directors of
TransAlta Corporation (power generation and energy marketing firm) and MDS Inc.
(global life sciences company). Mr. Anderson was educated at the University of
Western Ontario and is a member of the Institute of Chartered Accountants of
Ontario.

George Heller has had a career as a business leader in
the retail sector that spans over forty years. From 1999 to 2006, Mr. Heller
served as President and Chief Executive Officer of the Hudsons Bay Company,
Canadas largest diversified general merchandise retailer, operating more than
600 retail outlets in Canada under four banners: the Bay, Zellers, Home
Outfitters and Fields. Prior to that, Mr. Heller was President and Chief
Executive Officer of Zellers, the mass merchandise retailer of the Hudsons Bay
Company and a leading Canadian mass merchandise department store. Mr. Heller has
also held a number of other key positions in the retail industry, including as
President and Chief Executive Officer of Kmart Canada (discount department
stores), President, North America & Europe of Bata Industries Ltd.
(international footwear manufacturer) and Executive Vice-President of Woodwards
Department Stores (department store chain). Mr. Heller also served as President
and Chief Executive Officer of the Victoria Commonwealth Games. He currently
serves as President of the Commonwealth Games of Canada Foundation (fundraiser
for amateur athletes) and is a member of its board of directors. Mr. Heller also
serves on the boards of directors of the Asia Pacific Foundation of Canada
(not-for-profit think-tank on Canadas relations with Asia) and Sport BC
(advocate for amateur sports in British Columbia). Mr. Heller has received
Honorary Doctorates from Ryerson University and University of Victoria.

Sheila OBrien,CM is President of Belvedere 1
Investments Ltd., a private investment company, and is also a business advisor
and corporate director. She has had a thirty-year career as a senior executive
in the oil and gas and petrochemical sectors in the areas of human resources,
investor relations and public and government relations. Prior to 2004, Ms.
OBrien was Senior Vice-President, Human Resources, Public Affairs, Investor and
Government Relations at NOVA Chemicals Corporation, a producer of commodity
plastics and chemicals, where she was the architect of a corporate restructuring
practice that was designated a worldwide best practice by Watson Wyatt
Consulting Firm. She has also been active on the boards of directors of over
thirty public sector and not-for-profit organizations and was awarded the Order
of Canada for her community leadership in 1998. Ms. OBrien also serves on the
boards of directors of MaRS (Medical and Related Sciences) (biotechnology
accelerator), Advantage Energy Income Fund (oil and gas royalty trust) and Skye
Resources Inc. (nickel mining company), which merged with Hudbay Minerals in
August 2008. In addition to her corporate career, she has acted as a special
advisor to the president at the University of Calgary. She is a graduate of the
MTC program at the University of Western Ontario and completed a one-year
sabbatical on creativity and innovation at various U.S. schools in 1990.

Pierre Robitaille is a business advisor and a corporate
director. Mr. Robitaille previously pursued his career at SNC-Lavalin Group
Inc., a global engineering-construction firm, where he was Executive
Vice-President and Chief Financial Officer from 1990 to 1998. Prior to this, Mr. Robitaille was in public practice for more than twenty years with the public
accounting and management consulting firm of Ernst & Whinney, where he held
the positions of Managing Partner of the Montreal office, President of the firm
in Québec, and member of its national board of directors. Mr. Robitaille also
serves on the boards of directors of Nav Canada (civil air navigation services
provider), Swiss Re Holdings (Canada) Inc. and Swiss Re Life & Health Co.
Canada (reinsurance companies). Mr. Robitaille is a Fellow member of the Québec
Order of Chartered Accountants. He was educated at HEC-Montreal and McGill
Business School.

17

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James R. Scarborough is the Chairman of the Board of
Stage Stores, Inc., a U.S.-based specialty department store retailer that
operates over 730 department stores in thirty-eight states under four banners:
Bealls, Palais Royal, Peebles and Stage. Mr. Scarborough has had a career as a
business leader in the retail sector that spans over thirty-five years. Mr.
Scarborough joined Stage Stores in 2000 as President and Chief Executive
Officer, and held this position until his retirement in 2008. Mr. Scarborough
previously held other senior positions in the retail sector, including President
and Chief Executive Officer of Busy Body, Inc. (a fitness equipment distributor)
and Seattle Lighting Fixtures Co. (a supplier of lighting fixtures to the
homebuilder and retail markets) as well as President and Chief Operating Officer
of Enstar Specialty Retail, Inc. (a footwear and womens apparel retailer) and
its subsidiary AMRET, Inc. Mr. Scarborough also serves on the board of directors
of Charming Charlie, Inc. (a womens fashion accessories house). Mr. Scarborough
was educated at St. Michaels College.

Richard P. Strubel is a corporate director. Prior to
2008, he was Vice-Chairman of the Board of Cardean Learning Group (formerly
known as Unext), a provider of advanced education over the Internet, where from
1999 to 2004 he served as President and Chief Operating Officer. From 1990 to
1999, Mr. Strubel was Managing Director of Tandem Partners, Inc., a
privately-held management services firm, and from 1984 to 1994, he served as
President and Chief Executive Officer of Microdot, Inc. Prior to that, Mr.
Strubel served as President of Northwest Industries, then a NYSE-listed company,
which included Fruit of the Loom and BVD among its operating entities. Mr.
Strubel also serves on the boards of directors of the mutual funds of Goldman
Sachs & Co. and Goldman Sachs Hedge Fund Partners, and is Chairman of the
Board of the Mutual Funds of The Northern Trust. Mr. Strubel is also Trustee of
the University of Chicago and Chairman of its Audit Committee. He was educated
at Williams College and Harvard Business School.

Gonzalo F. Valdes-Fauli is Chairman of the Board of
BroadSpan Capital LLC, an investment banking firm specializing in financial
advisory services. Mr. Valdes-Fauli retired from Barclays Bank PLC (major
UK-based global bank) in 2001, where he held the position of Vice-Chairman,
Barclays Capital, and Group CEO, Latin America. Mr. Valdes-Fauli also serves on
the board of directors of Blue Cross Shield of Florida (health insurance
provider), where he is Lead Director. Mr. Valdes-Fauli also served as Chairman
of the Board of Republic Bank of Dominican Republic (financial services
provider) until November 2007. He is also Trustee Emeritus of the University of
Miami and Spring Hill College in Mobile, Alabama. Mr. Valdes-Fauli holds a
Masters Degree in international finance from Thunderbird Graduate School for
International Management.

Laurence G. Sellynwas appointed to the position of
Executive Vice-President, Chief Financial and Administrative Officer of the
Company in November 2005. He joined Gildan as Executive Vice-President, Finance
and Chief Financial Officer of the Company in April 1999. Prior to joining
Gildan, Mr. Sellyn served as Senior Vice-President, Finance and Corporate
Development and Chief Financial Officer of Wajax Limited, an industrial
distribution company, where he was employed from October 1992 to March 1999.
Prior to joining Wajax, he was employed by Domtar Inc., where he held various
positions, including Corporate Controller and Vice-President, Business Planning
and Development. Mr. Sellyn is a Fellow of the Institute of Chartered
Accountants of England and Wales and a graduate of Oxford University. Since June
2008, Mr. Sellyn has been on the advisory board of Héritage Montréal. He was the
Chairman of its 2008 Fundraising Campaign and is acting as Co-Chairman of the
Campaign in 2009.

Michael R. Hoffman joined Gildan in October 1997. He
served as Vice-President, Sales and Marketing for the international division
until his appointment as President of Gildan Activewear SRL in February 2001.
Prior to joining Gildan, Mr. Hoffman was employed by Fruit of the Loom, Inc.,
where he last served as Divisional Vice-President of the Activewear Division.

Georges Sam Yu Sum has been Executive Vice-President,
Operations of the Company since 2000. From 1998 to 2000, he served as
Vice-President, Operations of the Company and from 1995 to 1998, he served as
Director of Operations of the Company. Prior to joining Gildan in 1995, Mr. Sam
Yu Sum spent sixteen years with Dominion Textiles, where he served in various
managerial capacities, from manufacturing to sales.

18

---

Benito Masi has been involved in apparel manufacturing
in North America for over twenty-five years. He joined Gildan in 1986, where he
held various positions. He was appointed Vice-President, Apparel Manufacturing
in February 2001 and his title was changed to Vice-President, Corporate Apparel
Operations in September 2003. In August 2004, he was appointed Executive
Vice-President, Apparel Manufacturing and was appointed Executive
Vice-President, Manufacturing in January 2005.

Eric R. Lehman joined the Company in December 2006 as
Executive Vice-President, Supply Chain. In November 2008, Mr. Lehmans
responsibilities were expanded to include information technology and operational
excellence and his title changed to Executive Vice-President, Supply Chain,
Information Technology and Operational Excellence. He has over twenty years of
experience in the supply chain function with major national apparel brands.
Prior to joining Gildan, Mr. Lehman was employed by Russell Corporation, where
he last served as Vice President of Supply Chain. Prior to that, he held senior
supply chain planning positions at both Fruit of the Loom, Inc. and the Hanes
Division of Sara Lee Corporation.

As at December 9, 2009, the executive officers and directors of
the Company as a group own 10,505,528 Common Shares, which represents 8.7% of
the voting rights attached to all Common Shares.

8.

AUDIT COMMITTEE DISCLOSURE

Mandate of the
Audit and Finance Committee

The mandate of the Audit and Finance Committee is included
herewith as Appendix A.

Composition of the Audit and Finance Committee

The Audit and Finance Committee is composed of five independent
and financially literate directors, as those terms are defined in the rules of
the Canadian Securities Administrators and the U.S. Securities and Exchange
Commission as well as the standards of the NYSE. Their education and experience
that are relevant to the performance of their responsibilities as members of the
Audit and Finance Committee are as follows:

William D. Anderson  Mr. Anderson, the Chairman
of the Audit and Finance Committee, is a chartered accountant and has had a
business career spanning over thirty years. From 1998 to 2001, he served as
Chief Financial Officer of BCE Inc., Canadas largest telecommunications
company. Most recently, Mr. Anderson served as President of BCE Ventures (the
strategic investment unit of BCE Inc.) and previously he was the Chairman and
Chief Executive Officer of Bell Canada International Inc. (a subsidiary of BCE
that was formed to invest in telecommunications operations outside Canada).
Prior to joining the Bell Canada organization in 1992, Mr. Anderson was in
public practice for nearly twenty years with the accounting firm KPMG, where he
was a partner for eleven years. Mr. Anderson was educated at the University of
Western Ontario and is a member of the Institute of Chartered Accountants of
Ontario.

Pierre Robitaille  Mr. Robitaille is a business
advisor and corporate director. He is retired from SNC-Lavalin Group Inc., a
global engineering-construction firm, where he was Executive Vice-President and
Chief Financial Officer from 1990 to 1998. Prior to this, Mr. Robitaille was in
public practice for more than twenty years with the public accounting and
management consulting firm of Ernst & Whinney, where he held the positions
of Managing Partner of the Montreal office, President of the firm in Québec and
member of the firms national board of directors. Over the course of his career,
Mr. Robitaille has acquired competence in the audit of major public and private
companies and a familiarity with internal controls and financial reporting
procedures. Mr. Robitaille is a Fellow member of the Québec Order of Chartered
Accountants. He was educated at HEC-University of Montreal and McGill Business
School.

Richard P. Strubel  Mr. Strubel is a corporate
director. Prior to 2008, he was Vice-Chairman of the Board of Cardean Learning
Group, a provider of advanced education over the Internet, where he previously
served as President and Chief Operating Officer. Prior to that, Mr. Strubel
served as Managing Director of Tandem Partners, Inc., a privately-held
management services firm, and from 1984 to 1994, he served as President and
Chief Executive Officer of Microdot, Inc. and President of Northwest Industries,
then a NYSE-listed company which included Fruit of the Loom and BVD among its
operating entities. Mr. Strubel also serves on the boards of directors of the
mutual funds of Goldman Sachs & Co., and Goldman Sachs Hedge Fund Partners
and is Chairman of the Board of the Mutual Funds of The Northern
Trust. Mr. Strubel is also Trustee of the University of Chicago and Chairman of
its Audit Committee. He was educated at Williams College and Harvard Business
School.

19

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Gonzalo F. Valdes-Fauli  Mr. Valdes-Fauli is a
retired Vice-Chairman of Barclays Capital, the investment banking division of
Barclays Bank, London, England. Mr. Valdes-Fauli served as a member of the
management committee of Barclays Capital from 1988 to 2001. He was Group CEO of
Barclays Bank Latin America from 1988 to 2001. He is Chairman of BroadSpan
Capital LLC, an investment banking firm, and served as Chairman of the Board of
Republic Bank of Dominican Republic until November 2007. Mr. Valdes-Fauli has
more than thirty years of experience in finance and holds a Masters Degree in
international finance from Thunderbird Graduate School for International
Management.

George Heller  Mr. Heller is the retired
President and Chief Executive Officer of the Hudsons Bay Company, Canadas
largest diversified general merchandise retailer, a position he held from 1998
to 2006. Mr. Hellers career in the retail sector spans over forty years and he
has held a number of key executive positions in that industry, including as
President and Chief Executive Officer of Zellers, the mass merchandise retailer
of the Hudsons Bay Company, President and Chief Executive Officer of Kmart
Canada (discount department stores), President, North America & Europe of
Bata Industries Ltd. (international footwear manufacturer) and Executive
Vice-President of Woodwards Department Stores (department store chain).

Pre-Approval of Non-Audit Services

In accordance with the Code of Ethics of Chartered Accountants
of Quebecs independence standards for auditors, the Sarbanes-Oxley Act of
2002 and rules of the U.S. Securities and Exchange Commission, the Company
is restricted from engaging its external auditor to provide certain non-audit
services to the Company and its subsidiaries, including bookkeeping or other
services related to the accounting records or financial statements, information
technology services, valuation services, actuarial services, internal audit
services, corporate finance services, management functions, human resources
functions, legal services and expert services unrelated to the audit. The
Company does engage its external auditor from time to time to provide certain
non-audit services other than the restricted services. All non-audit services
must be specifically pre-approved by the Audit and Finance Committee.

External Auditor Service Fees

The aggregate fees billed by KPMG LLP (KPMG), the Companys
external auditor, for various audit-related and non-audit services rendered for
the fiscal years 2009 and 2008 were as follows:

Audit Fees The aggregate audit fees billed by KPMG for
professional services rendered for the annual audit of the Companys
consolidated financial statements, quarterly reviews of the Companys financial
statements and services provided in connection with statutory and regulatory
filings or engagements were Cdn$1,373,897 for fiscal 2009 and Cdn$1,289,028 for
fiscal 2008. The audit fees include fees relating to KPMGs audit of the
effectiveness of the Companys internal control over financial reporting.

Audit-Related Fees The aggregate audit-related fees
billed by KPMG were Cdn$118,500 for fiscal 2009 and Cdn$114,400 for fiscal 2008.
These services consisted of miscellaneous assurance services.

Tax Fees  The aggregate tax fees billed by KPMG were
Cdn$261,474.44 for fiscal 2009 and Cdn$484,817 for fiscal 2008. These services
consisted of tax compliance, including the review of tax returns, assistance
regarding income, capital and sales tax audits, the preparation of annual
transfer pricing studies, tax advisory services relating to domestic and
international taxation.

All Other Fees The aggregate fees billed by KPMG for
all other professional services rendered were nil for fiscal 2009 and nil for
fiscal 2008.

20

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9.

LEGAL
PROCEEDINGS

With the exception of the legal proceedings mentioned below,
the Company is only a party to claims and litigation arising in the normal
course of its operations. While we cannot predict the final outcome of the
claims and litigation arising in the normal course of its operations, management
does not currently expect the resolution of these matters to have a material
adverse effect on the consolidated financial position or results of operations
of Gildan.

As of the date hereof, the claims with respect to which Gildan
was a party to or involved in, for damages in excess of 10% of its current
assets, are the following:

Canadian Class Action Suits

On June 12, 2008, a proposed class action lawsuit on behalf of
persons who acquired Common Shares between August 2, 2007 and April 29, 2008 was
filed in the Ontario Superior Court of Justice alleging negligence and
negligent/reckless misrepresentation in respect of the Companys prior
statements concerning its financial guidance for the 2008 fiscal year and
comments regarding the scale of production of its Dominican Republic facility.
The claim further proposes to seek leave from the Ontario court to bring
statutory misrepresentation civil liability claims under Ontarios Securities
Act. A motion, along with affidavit evidence, for leave to pursue such
statutory liability claims and class certification have been filed by the
plaintiff. No date has been set yet for the hearing of that motion. The Ontario
suit claims damages of Cdn$500 million, punitive damages of Cdn$5 million and
other monetary relief.

A motion has also been filed on June 17, 2008 before the Québec
Superior Court for authorization to commence a class proceeding on behalf of
persons who acquired Common Shares between August 2, 2007 and April 29, 2008. It
makes similar allegations as the Ontario Action and alleges negligence and
negligent/reckless misrepresentation. No date has been set yet for the hearing
of that motion. The Québec motion seeks to proceed with a claim for unspecified
damages and other monetary relief.

Both Canadian proceedings have yet to be certified as class
actions by their respective courts. The Company strongly contests the basis upon
which these actions are predicated and intends to vigorously defend its
position. However, due to the inherent uncertainties of litigation, it is not
possible to predict the final outcome of these lawsuits or determine the amount
of any potential losses, if any.

United States Class Action Suits

On June 9, 2008, Gildan and certain of its senior officers were
named as defendants in several proposed class action lawsuits filed in the
United States District Court for the Southern District of New York on behalf of
persons who purchased or otherwise acquired Common Shares between August 2, 2007
and April 29, 2008. The lawsuits allege violations of United States federal
securities laws and assert that the Company issued a series of materially false
and misleading statements concerning the Companys financial performance and
prospects. These U.S. lawsuits have been consolidated, and a consolidated
amended complaint was filed on November 17, 2008. The claims in the U.S. suit
are for unspecified damages.

On July 1, 2009, the United States District Court granted the
motion by Gildan and other defendants to dismiss the action in its entirety,
holding that the consolidated amended complaint failed to adequately allege the
essential elements of a claim under the applicable provisions of the United
States federal securities laws, including the existence of a material
misstatement and fraudulent intent. On July 17, 2009, plaintiffs filed a motion
seeking reconsideration of this decision only insofar as it declined to grant
plaintiffs an opportunity to file a second amended complaint. On July 31, 2009,
Gildan and the other defendants filed a response to plaintiffs motion seeking
reconsideration. On December 4, 2009, plaintiffs motion seeking reconsideration
was denied.

The U.S. proceeding has yet to be certified as a class action
by the court. The Company strongly contests the basis upon which these actions
are predicated and intends to vigorously defend its position. However, due to
the inherent uncertainties of litigation, it is not possible to predict the
final outcome of these lawsuits or determine the amount of any potential losses,
if any.

21

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10.

TRANSFER
AGENT AND REGISTRAR

The transfer agent and registrar of the Company is
Computershare Investor Services Inc., having offices in Montreal and Toronto at
which the register of transfer of the Common Shares is held. The co-transfer
agent and co-registrar of the Company is Computershare Trust Company, N.A.,
having an office in Golden, Colorado.

11.

MATERIAL
CONTRACTS

Other than the agreements entered into the normal course of
business, the only material agreement entered into in fiscal 2009, or before
fiscal 2009 and which is still in force is the Shareholder Rights Plan Agreement
approved by the Board of Directors on December 1, 2004 and subsequently ratified
by the Companys shareholders on February 2, 2005. This agreement was filed
through SEDAR on December 2, 2004.

12.

INTERESTS OF
EXPERTS

KPMG, the external auditor of the Company, reported on the 2009
Financial Statements, which were filed with the securities regulatory
authorities. We are advised that, as at the date hereof, the members of KPMG are
independent in accordance with the Code of Ethics of the Ordre des Comptables
agréés du Québec. These rules are equivalent or similar to Rules of
Professional Conduct applicable to chartered accountants in the other provinces
of Canada.

13.

FORWARD 
LOOKING STATEMENTS

Certain statements included in this Annual information Form
constitute forward-looking statements within the meaning of the U.S.
Private Securities Litigation Reform Act of 1995 and Canadian securities
legislation and regulations, and are subject to important risks, uncertainties
and assumptions. This forward-looking information includes, amongst others,
information with respect to our objectives and the strategies to achieve these
objectives, as well as information with respect to our beliefs, plans,
expectations, anticipations, estimates and intentions. Forward-looking
statements generally can be identified by the use of conditional or
forward-looking terminology such as may, will, expect, intend,
estimate, project, assume, anticipate, plan, foresee, believe or
continue or the negatives of these terms or variations of them or similar
terminology. We refer you to the Companys filings with the Canadian securities
regulatory authorities and the U.S. Securities and Exchange Commission, as well
as the Financial Risk Management section beginning on page 21 of the 2009 Annual
MD&A, and the risks described under the section Risks and Uncertainties
beginning on
page 32 of the 2009 Annual MD&A for a discussion of the various
factors that may affect the Companys future results. Material factors and
assumptions that were applied in drawing a conclusion or making a forecast or
projection are also set out throughout this document.

Forward-looking information is inherently uncertain and the
results or events predicted in such forward-looking information may differ
materially from actual results or events. Material factors, which could cause
actual results or events to differ materially from a conclusion, forecast or
projection in such forward-looking information, include, but are not limited to:

- our ability to implement our growth strategies and plans, including
  achieving market share gains, implementing cost reduction initiatives and
  completing and successfully integrating acquisitions;
- the intensity of competitive activity and our ability to compete
  effectively;
- adverse changes in general economic and financial conditions globally or
  in one or more of the markets we serve;
- our reliance on a small number of significant customers;
- the fact that our customers do not commit contractually to minimum
  quantity purchases;
- our ability to anticipate changes in consumer preferences and trends;
- our ability to manage inventory levels effectively in relation to changes
  in customer demand;
- fluctuations and volatility in the price of raw materials used to
  manufacture our products, such as cotton and polyester fibres;
- our dependence on key suppliers and our ability to maintain an
  uninterrupted supply of raw materials;
- the impact of climate, political, social and economic risks in the
  countries in which we operate, including the current political instability in
  Honduras;

22

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- disruption to manufacturing and distribution activities due to labour
  disruptions, political instability, bad weather, natural disasters and other
  unforeseen adverse events;
- changes to international trade legislation that the Company is currently
  relying on in conducting its manufacturing operations or the application of
  safeguards thereunder;
- factors or circumstances that could increase our effective income tax
  rate, including the outcome of any tax audits or changes to applicable tax
  laws or treaties;
- compliance with applicable environmental, tax, trade, employment, health
  and safety, and other laws and regulations in the jurisdictions in which we
  operate;
- our significant reliance on computerized information systems for our
  business operations;
- changes in our relationship with our employees or changes to domestic and
  foreign employment laws and regulations;
- negative publicity as a result of violation of labour laws or unethical
  labour or other business practices by the Company or one of its third-party
  contractors;
- our dependence on key management and our ability to attract and retain key
  personnel;
- changes to and failure to comply with consumer product safety laws and
  regulations, including the recently enacted U.S. Consumer Product Safety
  Improvement Act;
- changes in accounting policies and estimates; and
- exposure to risks arising from financial instruments, including credit
  risk, liquidity risk, foreign currency risk and interest rate risk.

These factors may cause the Companys actual performance and
financial results in future periods to differ materially from any estimates or
projections of future performance or results expressed or implied by such
forward-looking statements. Forward-looking statements do not take into account
the effect that transactions or non-recurring or other special items announced
or occurring after the statements are made, may have on the Companys business.
For example, they do not include the effect of business dispositions,
acquisitions, other business transactions, asset write-downs or other charges
announced or occurring after forward-looking statements are made. The financial
impact of such transactions and non-recurring and other special items can be
complex and necessarily depends on the facts particular to each of them.

We believe that the expectations represented by our
forward-looking statements are reasonable, yet there can be no assurance that
such expectations will prove to be correct. The purpose of the forward-looking
statements is to provide the reader with a description of managements
expectations regarding the Companys fiscal 2010 financial performance and may
not be appropriate for other purposes. Furthermore, unless otherwise stated, the
forward-looking statements contained in this Annual Information Form are made as
of the date hereof, and we do not undertake any obligation to update publicly or
to revise any of the included forward-looking statements, whether as a result of
new information, future events or otherwise unless required by applicable
legislation or regulation. The forward-looking statements contained in this
Annual Information Form are expressly qualified by this cautionary statement.

14.

ADDITIONAL
INFORMATION

Additional information, including directors and officers
remuneration and indebtedness, principal holders of the Companys securities and
securities authorized for insurance under the Companys equity compensation
plans is contained in the Circular. Additional financial information is provided
in the 2009 Financial Statements and the 2009 Annual MD&A for its most
recently completed financial year, both of which are incorporated herein by
reference.

Copies of these documents and additional information relating
to Gildan may be found on the SEDAR website at www.sedar.com and the EDGAR
website at www.sec.gov and may also be obtained upon request to the Secretary of
Gildan at the following address:

600 de Maisonneuve Boulevard West,
33rd FloorMontreal, Québec H3A 3J2 Telephone: (514)
735-2023

The documents mentioned above, as well as Gildans news
releases, are also available on the Companys website at www.gildan.com.

23

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APPENDIX A - MANDATE OF THE AUDIT AND FINANCE
COMMITTEE

The following description of the mandate of the Audit and
Finance Committee of the Company complies with applicable Canadian laws and
regulations, such as the rules of the Canadian Securities Administrators, and
with the disclosure and listing requirements of the Toronto Stock Exchange
(collectively, the Canadian Corporate Governance Standards), as they
exist on the date hereof. In addition, this mandate complies with applicable
U.S. laws, such as the Sarbanes-Oxley Act of 2002,and rules and
regulations adopted thereunder, and with the New York Stock Exchanges corporate
governance standards (collectively, the US Corporate Governance
Standards), as they exist on the date hereof. The mandate of the Audit and
Finance Committee of the Company (the Audit Committee) shall be
reviewed annually by the Board in order to ensure on-going compliance with such
standards.

1.

Membership
and Quorum

- a minimum of three directors;
- only independent (as contemplated by Canadian Corporate Governance
  Standards and US Corporate Governance Standards) directors shall be appointed,
  the whole as determined by the Board; no affiliate of the Company or any of
  its subsidiaries (including any person who, directly or indirectly, controls
  or is controlled by, or is under common control with the Company, or any
  director, executive officer, partner, member, principal or designee of such
  affiliate) may serve on the Audit Committee; a member of the Audit Committee
  shall receive no compensation from the Company or any of its affiliates other
  than compensation as a director and committee member of the Company;
  prohibited compensation includes fees paid, directly or indirectly, for
  services as a consultant or as legal or financial advisor, regardless of the
  amount;
- each member must be financially literate (as contemplated by Canadian
  Corporate Governance Standards and US Corporate Governance Standards), as
  determined by the Board;
- at least one member must be an audit committee financial expert (as
  contemplated by US Corporate Governance Standards), as determined by the
  Board;
- members of the Audit Committee shall be appointed annually by the Board
  upon recommendation of the Companys Corporate Governance Committee; such
  members may be removed or replaced, and any vacancies on the Audit Committee
  shall be filled by the Board upon recommendation of the Companys Corporate
  Governance Committee; membership on the Audit Committee shall automatically
  end at such time the Board determines that a member ceases to be independent
  as determined in the manner set forth above;
- quorum of majority of members.

2.

Frequency and
Timing of Meetings

- normally contemporaneously with the Companys Board meetings;
- at least four times a year and as necessary.

3.

Mandate

The responsibilities of the Audit Committee include the
following:

| | (a) | Overseeing financial
reporting
| | --- | ------------------------------

- monitoring the integrity and quality of the Companys accounting and
  financial reporting process, disclosure controls and procedures, and systems
  of internal control, through independent discussions with management, the
  external auditors and the internal auditors;

24

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- reviewing, with management and the external auditors, the annual audited
  statements as well as the report of the auditors thereon to be included in the
  Annual Report of the Company, including the Companys MD&A disclosure and
  annual earnings press release, prior to their release, filing and
  distribution;
- reviewing, with management and the external auditors, quarterly
  consolidated financial statements of the Company and accompanying information,
  including the Companys MD&A disclosure and quarterly earnings press
  release, prior to their release, filing and distribution;
- reviewing, with management and external auditors, the financial
  information contained in prospectuses, offering memoranda, Annual Information
  Forms, Management Proxy Circulars, Forms 6-K (including Supplemental
  Disclosure) and 40-F and any other document required to be disclosed or filed
  by the Company before their public disclosure or filing with regulatory
  authorities in Canada or the United States of America;
- reviewing, with management, the level and type of financial information
  (including earnings guidance and other material forward-looking information)
  provided from time to time to analysts, investors, rating agencies and other
  stakeholders;
- reviewing, with management, that adequate procedures are in place for the
  review of the Companys disclosure of financial information extracted or
  derived from the Companys financial statements, such as annual reports and
  investor presentations, and periodically assessing the adequacy of those
  procedures;
- reviewing, with the external auditors and management, the quality,
  appropriateness and disclosure of the Companys accounting principles and
  policies, underlying assumptions and reporting practices, and any proposed
  changes thereto;
- reviewing any analysis or other written communications prepared by
  management, the internal auditors or external auditors setting forth
  significant financial reporting issues and judgments made in connection with
  the preparation of the financial statements, including analyses of the effect
  of alternative generally accepted accounting principles methods;
- reviewing the external auditors quarterly review engagement report;
- overseeing the procedures to review management certifications filed with
  applicable securities regulators;
- reviewing the potential impact of any litigation, claim or other
  contingency and any regulatory or accounting initiatives that could have a
  material effect upon the financial position or operating results of the
  Company and the appropriateness of the disclosure thereof in the documents
  reviewed by the Audit Committee;
- overseeing the procedures to monitor the public disclosure of information
  by the Company;
- reviewing at least annually the Companys disclosure policy;
- reviewing the results of the external audit, any significant problems
  encountered in performing the audit, and management's response and/or action
  plan related to any Management Letter issued by the external auditors and any
  significant recommendations contained therein.

25

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| |     |                                                       
| | --- | ------------------------------------------------------
| | (b) | Monitoring risk management and internal
      controls

- receiving periodically managements report assessing the adequacy and
  effectiveness of the Companys disclosure controls and procedures and systems
  of internal control over financial reporting;

- reviewing insurance coverage (annually and as may otherwise be
  appropriate);
- overseeing the processes in place to identify business risks and
  opportunities and overseeing the implementation of processes to manage these
  risks and opportunities;
- reviewing policies and their parameters regarding such items as interest
  rate, foreign exchange risks, commodity purchases and any similar transactions
  where the Company enters into derivatives contracts;
- assisting the Board with the oversight of the Companys compliance with,
  and reviewing the Companys processes for complying with, applicable legal and
  regulatory requirements;
- overseeing the confidential, anonymous procedures for the receipt,
  retention and treatment of complaints or concerns received by the Company
  regarding accounting, internal accounting controls or auditing matters or
  employee concerns regarding accounting or auditing matters;
- requesting the performance of any specific audit, as required.

| | (c) | Monitoring internal
auditors
| | --- | ----------------------------

- ensuring that the head of internal audit has a functional reporting
  relationship with the Audit Committee;
- overseeing the access by internal auditors to all levels of management in
  order to carry out their duties;
- regularly monitoring the internal audit functions performance, its
  responsibilities, staffing and budget;
- approving the appointment and termination of the Companys chief internal
  auditor;
- ensuring the ongoing accountability of the internal audit function to the
  Audit Committee and to the Board.

| | (d) | Monitoring external
auditors
| | --- | ----------------------------

- recommending the retention and, if appropriate, the removal of external
  auditors (both subject to shareholder approval), their compensation, as well
  as evaluating and monitoring their qualifications, performance and
  independence;
- overseeing all relationships between the external auditors and the Company
  including, determining which non-audit services the external auditors are
  prohibited from providing, approving, or pre-approving policies defining audit
  and permitted non-audit services provided by the external auditors, overseeing
  the disclosure of all audit and permitted non-audit services provided by the
  external auditors, and reviewing the total amount of fees paid by the Company
  to the external auditors for all audit and non-audit services;
- overseeing the direct reporting and accountability of the external
  auditors to the Audit Committee and to the Board;
- directly overseeing the external auditors and discussing with them the
  quality and not just the acceptability of the Companys accounting principles,
  including (i) critical accounting policies and practices used, (ii)
  alternative treatments of financial information that have been discussed with
  management, the ramification of their use and the treatment preferred by the
  external auditors, as well as (iii) other material written communications
  between the Company and the external auditors (including any disagreement with
  management and the resolution thereof);
- reviewing at least annually, representations by the external auditors
  describing their internal quality-control procedures, as well as significant
  results arising from regulatory and professional quality-control examinations;
- reviewing at least annually, the external auditors representations as to
  independence and holding discussions with the external auditors as to any
  relationship or services that may impact their objectivity or independence;
- reviewing hiring policies for employees or former employees of the
  Companys firm of external auditors;
- overseeing the rotation of lead, concurring and other audit partners, to
  the extent required by Canadian and U.S. securities law standards.

26

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| | (e) | Reviewing financings
| | --- | --------------------

- reviewing the adequacy of the Companys financing, including terms and
  conditions of all new material financing arrangements.

| | (f) | Evaluating the performance of the Audit
      Committee
| | --- | -------------------------------------------------------

- overseeing the existence of processes to annually evaluate the performance
  of the Audit Committee.

Because of the Audit Committees
demanding role and responsibilities, the Board chair, together with the
Corporate Governance Committee chair, reviews any invitation to Audit Committee
members to join the audit committee of another publicly-listed entity. Where a
member of the Audit Committee simultaneously serves on the audit committee of
more than three public companies, including the Company, the Board determines
whether such simultaneous service impairs the ability of such member to
effectively serve on the Audit Committee and either requires a correction to the
situation or discloses in the Companys Management Proxy Circular that there is
no such impairment.

As appropriate, the Audit Committee may
obtain advice and assistance from outside legal, accounting or other advisors
and set and pay their compensation, and so advise the Board chair and, if
appropriate, the external auditors; the Audit Committee makes arrangements for
the appropriate funding for payment of the external auditors and any advisors
retained by it. In addition, the Company will provide appropriate funding for
the Audit Committee, including the payment of all outside legal, accounting and
other advisors retained by the Audit Committee.

The internal auditors and the external
auditors will have at all times a direct line of communication with the Audit
Committee. In addition, each meets separately with the Audit Committee, without
management, at least once a quarter, during which the Companys financial
statements and control environment must be discussed; the Audit Committee also
meets separately with management at least once a quarter, and more frequently as
required.

The Audit Committee reports annually to
the Board on the adequacy of its mandate. In addition, the chair of the Audit
Committee reports regularly to the Board on the business of the Audit Committee.

Nothing contained in the above mandate
is intended to transfer to the Audit Committee the Boards responsibility to
ensure the Companys compliance with applicable laws or regulations or to expand
applicable standards of liability under statutory or regulatory requirements for
the directors or the members of the Audit Committee. Even though the Audit
Committee has a specific mandate and its members may have financial experience,
they do not have the obligation to act as auditors or to perform auditing, or to
determine that the Companys financial statements are complete and accurate and
are in accordance with generally accepted accounting principles. Such matters
are the responsibility of management, the internal auditors and the external
auditors. Members of the Audit Committee are entitled to rely, absent knowledge
to the contrary, on (i) the integrity of the persons and organizationsfrom whom they receive information,
(ii) the accuracy and completeness of the information provided, and (iii)
representations made by management as to the non-audit services provided to the
Company by the external auditors. The Audit Committees oversight
responsibilities are not established to provide an independent basis to
determine that (i) management has maintained appropriate accounting and
financial reporting principles or appropriate internal controls and procedures,
or (ii) the Companys financial statements have been prepared and, if
applicable, audited in accordance with generally accepted accounting principles.

* * *

27

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A.

Undertaking

Gildan Activewear Inc. (the Registrant) undertakes to make available, in person or by telephone, representatives to respond to inquiries made by the staff of the Securities and Exchange Commission
(SEC), and to furnish promptly, when requested to do so by the SEC staff, information relating to the securities in relation to which the obligation to file an annual report on Form 40-F arises or transactions in said securities.

B.

Consent to Service of Process

The Registrant has previously filed with the SEC a written irrevocable consent and power of attorney on Form F-X in connection with the Class A Subordinate Voting Shares (now Common Shares).

C.

Evaluation of disclosure controls and procedures

Our disclosure controls and procedures are designed to ensure that information required to be disclosed in our reports filed with the SEC is recorded, processed, summarized and reported within the time periods specified
in the SECs rules and forms and is accumulated and communicated to our management, including our principal executive officer and our principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

An evaluation was carried out under the supervision of, and with the participation of, our management, including our principal executive officer and our principal financial officer, of the effectiveness of our disclosure controls and procedures
(as such term is defined in the Securities Exchange Act of 1934 (the Exchange Act), as amended, Rules 13a-15(e) and 15d-15(e)) as of the end of the period covered by this Annual Report on Form 40-F. Based on that evaluation, our
principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were effective as of the end of such period.

D.

Managements annual report on internal control over financial reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act.

Our internal control over financial reporting includes those policies and procedures that: (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of our assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and
expenditures are being made only in accordance with authorizations of our management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that
could have a material effect on the financial statements.

Under the supervision and with the participation of our principal executive officer and our principal financial officer, management conducted an evaluation of the effectiveness of our internal control over financial
reporting, as of October 4, 2009, based on the framework set forth inInternal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on its evaluation under this
framework, management concluded that our internal control over financial reporting was effective as of that date.

E.

Attestation report of the registered public accounting firm.

KPMG LLP (KPMG), an independent registered public accounting firm, that audited and reported on our financial statements attached as Exhibit 99.2 to this Annual Report on Form 40-F, has issued an attestation
report on the effectiveness of our internal control over financial reporting as of October 4, 2009. The attestation report is included on page 45 of the financial statements attached as Exhibit 99.2 to this Annual Report on Form 40-F.

F.

Changes in internal controls over financial reporting.

There have been no changes during fiscal year 2009 in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial
reporting.

---

The design of any system of controls and procedures is based in part upon certain assumptions about the likelihood of certain events. There can be no assurance that any design will succeed in achieving its stated goals
under all potential future conditions, regardless of how remote.

G.

Audit Committee Financial Experts

The Registrants board of directors has determined that it has at least three (3) audit committee financial experts serving on its audit committee. Mr. Pierre Robitaille, Mr. Gonzalo F. Valdes-Fauli and Mr. William
D. Anderson have been determined to be such audit committee financial experts and are independent, as that term is defined by the New York Stock Exchanges listing standards applicable to the Registrant. The SEC has indicated that the
designation of Mr. Robitaille, Mr. Valdes-Fauli and Mr. Anderson as audit committee financial experts does not make Mr. Robitaille, Mr. Valdes-Fauli and Mr. Anderson experts for any purpose, impose any duties, obligations or liability on
Mr. Robitaille, Mr. Valdes-Fauli and Mr. Anderson that are greater than those imposed on members of the audit committee and board of directors who do not carry this designation or affect the duties, obligations or liability of any other member of
the audit committee.

H.

Code of Ethics

The Registrant has adopted a Code of Ethics and Business Conduct (the Code of Ethics) that applies to all employees and officers, including its principal executive officer, principal financial officer and
principal accounting
officer. The Code of Ethics is available at the Registrants Internet website, www.gildan.com/corporate/IR/corporateGovernance.cfm, and is available, without charge, in print to any shareholder who requests
it.

I.

Principal Accountant Fees and Services

In addition to retaining KPMG to report upon the annual consolidated financial statements of the Registrant, the Registrant retained KPMG to provide various audit-related and non-audit services in fiscal 2009. The
aggregate fees billed for professional services by KPMG for each of the last two (2) fiscal years, were as follows:

Audit Fees The aggregate audit fees billed by KPMG for professional services rendered for the annual audit of the Registrants consolidated financial statements, quarterly reviews of the Registrants financial statements and
services provided in connection with statutory and regulatory filings or engagements were Cdn$1,373,897 for fiscal 2009 and Cdn$1,289,028 for fiscal 2008. The audit fees include fees relating to KPMGs audit of the effectiveness of the
Registrants internal control over financial reporting.

Audit-Related Fees The aggregate audit-related fees billed by KPMG were Cdn$118,500 for fiscal 2009 and Cdn$114,400 for fiscal 2008. These services consisted of miscellaneous assurance services.

Tax Fees  The aggregate tax fees billed by KPMG were Cdn$261,474 for fiscal 2009 and Cdn$484,817 for fiscal 2008. These services consisted of tax compliance, including the review of tax returns, assistance regarding income,
capital and sales tax audits, the preparation of annual transfer pricing studies, tax advisory services relating to domestic and international taxation and customs and duties.

All Other Fees The aggregate fees billed by KPMG for all other professional services rendered were nil for fiscal 2009 and nil for fiscal 2008.

All fees billed to the Registrant by KPMG in fiscal 2009 were pre-approved by the Registrants Audit and Finance Committee pursuant to the procedures and policies set forth in the Audit and Finance Committee
mandate and pursuant to applicable legislation. The mandate of the Audit and Finance Committee is available on the Registrants Internet website at www.gildan.com/corporate/IR/corporateGovernance.cfm.

J.

Off-Balance Sheet Arrangements

Operating leases and commitments

The Registrant has no commitments that are not reflected in its balance sheets except for operating leases and other purchase obligations, which are included in the table of contractual obligations on page
20 of its
MD&A (see Exhibit 99.1) . As disclosed in Note 13 to the Registrants Consolidated Financial Statements (see Exhibit 99.2), the
Registrant has issued standby letters of credit and corporate guarantees primarily from various servicing agreements amounting to $5.3 million at October 4, 2009.

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Derivative Financial Instruments

From time to time, the Registrant uses forward foreign exchange contracts to hedge cash flows related to sales and operating expenses in foreign currencies (non-U.S. dollar). A forward foreign exchange contract
represents an obligation to exchange a foreign currency with a counterparty at a predetermined rate. Credit risk exists in the event of failure by a counterparty to meet its obligations. The Registrants exposure to foreign currency
fluctuations is described in more detail in the Financial Risk Management section of its MD&A beginning on page 21 (see Exhibit 99.1) .

The Registrant does not use derivative financial instruments for speculative purposes. Forward foreign exchange contracts are entered into with maturities not exceeding twenty-four months.

For the years ended October 4, 2009 and October 5, 2008, net earnings included a recognized gain of $0.1 million and a recognized loss of $2.1 million, both relating to derivative financial instruments.

As at October 4, 2009 the Registrant had no outstanding derivative financial instruments relating to commitments to buy and sell foreign currencies through forward foreign exchange contracts.

The fair value of the forward foreign exchange contracts, determined using observable market inputs, was nil as at October 4, 2009 and $0.9 million as at October 5, 2008.

K.

Tabular Disclosure of Contractual Obligations

See page 20 of Exhibit 99.1.

L.

Corporate Governance Guidelines

The Registrant has adopted Corporate Governance Guidelines as well as mandates for its board of directors and each of its three committees which are available at the Registrants Internet website,
www.gildan.com/corporate/IR/corporateGovernance.cfm, and are available in print to any shareholder who requests them.

M.

Identification of the Audit Committee

The Registrant has a standing audit committee established in accordance with Section 3 (a) (58) (A) of the Exchange Act. The members of the Registrants audit committee are Pierre Robitaille, William D. Anderson, Richard P. Strubel and
Gonzalo F. Valdez-Fauli. See the Audit Committee Disclosure section of our Annual Information Form included herein for additional information.

N.

Summary of Significant Differences from NYSE Corporate Governance Rules

The Registrant is committed to adopting and adhering to corporate governance practices that either meet or exceed applicable Canadian and U.S. corporate governance standards. As a Canadian reporting issuer with
securities listed on the Toronto Stock Exchange (TSX) and the New York Stock Exchange (NYSE), the Registrant complies with all applicable rules adopted by the Canadian Securities Administrators as well as the rules of the U.S. Securities and
Exchange Commission giving effect to the provisions of the U.S. Sarbanes-Oxley Act of 2002.

Although many of the NYSE Corporate Governance Standards do not apply to the Registrant, it nevertheless voluntarily complies with most of the NYSE Standards. In fact, the Registrants corporate governance
practices differ significantly in only one respect from those required of U.S. domestic issuers under the NYSE Standards, which is with respect to the approval of equity compensation plans. The NYSE Standards require shareholder approval of all
equity compensation plans and material revisions to such plans, regardless of whether the securities to be delivered under such plans are newly issued or purchased on the open market, subject to a few limited exceptions. The TSX Rules, however, do
not require a shareholder approval in all those circumstances. Hence, only the creation or material amendments to equity compensation plans that provide for new issuances of securities are subject to shareholder approval. The Registrant has in place
plans which did not require the approval of its shareholders under the TSX Rules but which could have required the approval of its shareholders under the NYSE Standards as applicable to U.S. domestic issuers.

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SIGNATURES

Pursuant to the requirements of the Exchange Act, the Registrant certifies that it meets all of the requirements for filing on Form 40-F and has duly caused this annual report to be signed on its behalf by the
undersigned, thereto duly authorized.

DATED: December 10, 2009

GILDAN ACTIVEWEAR INC.

/s/ Lindsay MatthewsName: Lindsay Matthews 
Title: Director, Legal Services and Corporate
Secretary

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EXHIBIT INDEX

|Exhibit No. | Description                                                                                                                                           
|----------- | ------------------------------------------------------------------------------------------------------------------------------------------------------
|            |                                                                                                                                                       
|99.1        | Managements
    Discussion and Analysis of the Registrant for the year ended October 4, 2009                                                         
|            |                                                                                                                                                       
|99.2        | Audited comparative consolidated financial
      statements of the Registrant as at and for the year ended October 4, 2009                            
|            |                                                                                                                                                       
|99.3        | Consent of KPMG LLP                                                                                                                                   
|            |                                                                                                                                                       
|99.4        | Reconciliation to United States GAAP                                                                                                                  
|            |                                                                                                                                                       
|99.5        | Officers Certifications Required by Rule
      13a-14(a) or Rule 15d-14(a)                                                                           
|            |                                                                                                                                                       
|99.6        | Officers Certifications Required by Rule
      13a-14(b) or Rule 15d-14(b) and Section 1350 of Chapter 63 of Title 18 of
      the United States Code

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