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|                                  
|----------------------------------
|UNITED STATES                     
|SECURITIES AND EXCHANGE COMMISSION
|Washington, D.C. 20549            
|                                  
|FORM 10-K                         

|                                                        |                                                                                          
|------------------------------------------------------- | -----------------------------------------------------------------------------------------
|(Mark
 one)                                            
|x                                                       | ANNUAL
 REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934    
|For the fiscal year ended February 28, 2009            
|OR                                                     
|o                                                       | TRANSITION
 REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
|                                                        |                                                                                          
|Commission
 file number 1-8546                         
|                                                       
|SYMS CORP                                              
|(Exact
 name of registrant as specified in its charter)

| |                                                                  |  |                                      
| | ---------------------------------------------------------------- |  | -------------------------------------
| | NEW JERSEY                                                       |  | No. 22-2465228                       
| | (State or Other
 Jurisdiction of
 Incorporation or Organization) |  | (I.R.S.
 Employer Identification No.)
| |                                                                  |  |                                      
| | One Syms
 Way, Secaucus, New Jersey                              |  | 07094                                
| | (Address of Principal
 Executive Offices)                        |  | (Zip
 Code)                          

Registrants telephone number, including area code (201) 902-9600

Securities registered pursuant to Section 12(b) of the
Act:

|                                                                   |  |                                            
|------------------------------------------------------------------ |  | -------------------------------------------
|Title
 of Each class                                               |  | Name
 of Each Exchange on
 Which Registered
|                                                                   |  |                                            
|                                                                  
|Common Stock, $0.05 Par
 Value Per Share                           |  | NASDAQ                                     
|                                                                   |  |                                            
|Securities registered pursuant to Section 12 (g) of the
 Act: None
|                                                                   |  |                                            
|                                                                  

|                                                                                                                                                                                                                                                                                                                                                              
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Indicate by check mark if
 the registrant is a well-known seasoned issuer, as defined in Rule 405 of the
 Securities Act                                                                                                                                                                                                                                      
|Yes
 o          No
 þ                                                                                                                                                                                                                                                                                                                                         
|Indicate by check mark if
 the registrant is not required to file reports pursuant to Section 13 or
 Section 15(d) of the Act.                                                                                                                                                                                                                                
|Yes
 o          No
 þ                                                                                                                                                                                                                                                                                                                                         
|Indicate by check mark
 whether the registrant: (1) has filed all reports required to be filed by
 Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
 preceding 12 months (or for such shorter period that the registrant was
 required to file such reports), and (2) has been subject to such filing
 requirements for the past 90 days.
|Yes
 o          No
 þ                                                                                                                                                                                                                                                                                                                                         
|Indicate by check mark if
 disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not
 contained herein, and will not be contained, to the best of registrants
 knowledge, in definitive proxy or information statements incorporated by
 reference in Part III of this Form 10-K or any amendment to this Form 10-K.
           o        

|                                                                                                                                                                                                                                                                                                       |                      |                          |  |                            
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | -------------------- | ------------------------ |  | ---------------------------
|Indicate by check mark
 whether the registrant is a large accelerated filer, an accelerated filer, a
 non-accelerated filer or a smaller reporting company. See the definitions of
 large accelerated filer, accelerated filer and smaller reporting
 company in Rule 12b-2 of the Exchange Act:
|Large
 Accelerated Filer o                                                                                                                                                                                                                                                                             | Accelerated
 Filer þ | Non-Accelerated
 Filer o |  | Smaller Reporting Company o
|(Do
 not check if smaller reporting company)                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                      
|Indicate by check mark
 whether the registrant is a shell company (as defined in Rule 12b-2 of the
 Exchange Act).                                                                                                                                                                                    
|Yes
 o          No
 þ                                                                                                                                                                                                                                                                                 

The aggregate market value of the voting and non-voting common equity held by
non-affiliates of the registrant was approximately $109,187,000 based upon the
closing market price of $16.39 per share of the Common Stock on the New York
Stock Exchange as of August 30, 2008, the last business day of the registrants
most recently completed second fiscal quarter.


As of
April 20, 2009, 14,587,592 shares of Common Stock were outstanding.

DOCUMENTS INCORPORATED BY
REFERENCE

Portions of the
registrants Proxy Statement for the 2009 Annual Meeting of Shareholders are
incorporated by reference into Part III of this Annual Report.

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PART I

|        |         
|------- | --------
|Item 1. | BUSINESS

General

Syms Corp
(the Company or Syms) operates a chain of thirty-two off-price retail
stores located in the United States throughout the Northeastern and Middle
Atlantic regions and in the Midwest, Southeast and Southwest. Each Syms store
offers a broad range of first quality, in-season merchandise bearing nationally
recognized designer or brand-name labels for men, women and children at prices
substantially lower than those generally found in department and specialty
stores. Syms directs its merchandising efforts at predominantly middle income,
fashion-minded and price conscious customers.

Since the
first Syms store opened in New York City in 1959, the Company has expanded to
32 stores and the aggregate amount of selling space in Syms stores has
increased from approximately 2,000 square feet to approximately 1,642,000
square feet. The Company maintains a 311,000 square foot distribution center
and executive headquarters in Secaucus, New Jersey.

The Company
was incorporated in New Jersey in 1983. The Company maintains its executive
offices at Syms Way, Secaucus, New Jersey 07094, telephone (201) 902-9600.
Unless otherwise noted, references to the Company, we, our or Syms
relate to Syms Corp. Our fiscal year ends on the Saturday closest to the last
day of February each year. Fiscal 2008 ended on February 28, 2009; fiscal 2007
ended on March 1, 2008 and fiscal 2006 ended on March 3, 2007.

Description of Business

The Syms
chain of 32 apparel stores offers a broad range of off-price first quality,
in-season merchandise consisting primarily of mens tailored clothing and
haberdashery, womens dresses, suits and separates, childrens apparel and
mens, womens and childrens shoes. Syms stores emphasize better quality,
nationally recognized designer and brand name merchandise at prices
substantially below those generally charged by department and specialty stores.
Syms carries a wide selection of sizes and styles of mens, womens and
childrens wear.

Syms
operates in a single industry segment and has no foreign operations. No
material part of the Companys revenues is received from a single customer or
group of customers. Please refer to Note 1 of the Financial Statements for
information on segment reporting.

Merchandise

For fiscal
2008, net sales were generated by the following categories:

|                                                  |  |  |     |  
|------------------------------------------------- |  |  | --- | -
|Mens tailored clothes and haberdashery           |  |  | 53  | %
|Womens dresses, suits, separates and accessories |  |  | 29  | %
|Shoes                                             |  |  | 8   | %
|Childrens wear                                   |  |  | 7   | %
|Luggage, domestics and fragrances                 |  |  | 3   | %
|                                                  |  |  |     |  
|                                                  |  |  | 100 | %

Most of the
items sold by the Company consist of nationally recognized fashions and
brand-name merchandise. Merchandise is displayed by department, class and size
on conveniently arranged racks or counters. No emphasis is placed on any
particular label or brand. The stores generally offer minor alterations for
an additional charge.

Purchasing

The Company
purchases first quality, in-season, brand-name merchandise directly from
manufacturers on terms it believes are more favorable than those generally
obtained by department and specialty stores. Syms estimates that approximately
200 brand-name manufacturers of apparel are represented in its stores. The
Company does not maintain large out-of-season inventories. However, Syms
occasionally buys certain basic clothing which does not change in style from
year to year at attractive prices for storage until the following season. Purchasing
is performed by a buying staff in conjunction with Merchandise Managers.

Distribution

The Company
owns a facility located at One Syms Way, Secaucus, New Jersey. The facility
contains approximately 277,000 square feet of warehouse and distribution space,
34,000 square feet of office space and 29,000 square feet of store space. The
facility is located on an 18.6 acre parcel of land for which the Company holds
a ground lease for a remaining term of 267 years. Most merchandise is received
from manufacturers at the distribution center where it is inspected, ticketed
and allocated to particular stores.

1

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Marketing

The
Companys pricing policy is to affix a ticket to each item displaying Syms
selling price as well as the price the Company regards as the traditional full
retail price of that item at department or specialty stores. All garments are
sold with the brand-name as affixed by the manufacturer. Because womens
dresses are susceptible to considerable style fluctuation, Syms has long
utilized an automatic markdown pricing policy to promote movement of
merchandise. The date of placement on the selling floor of each womens dress
is stamped on the back of the price ticket. The front of each ticket contains
what the Company believes to be the nationally advertised price, the initial
Syms price and three reduced prices. Each reduced price becomes effective after
the passage of fourteen selling days. For fiscal 2008, womens dresses
represented approximately 3.9% of net sales. The Company also offers dividend
prices consisting of additional price reductions on various types of
merchandise at various times.

Syms has as
its tag line An Educated Consumer is Our Best Customerâ, one of the best known in retail
advertising. The
Company advertises principally on radio and periodically on television. The
Company also utilizes print and billboard ads, as well as direct mail and
electronic media including e-mail communication to registered customers.

The Company
sells its merchandise for cash, checks, national credit cards, and its own Syms
credit card. Syms sells its own credit card receivables on a non-recourse basis
to a third party for a fee. Merchandise purchased from the Company may be
returned generally within sixty days. The Company does not offer cash refunds
for purchases, but issues credits toward the Syms charge card and other major
credit cards or store merchandise credits which may be used toward the purchase
of other merchandise.

Trademarks

Various
trademarks including: Symsâ, An
Educated Consumer is Our Best Customerâ, Names You Must Knowâ, The More You Know About Clothing, the Better it
is for Symsâ and Rediscover Syms. Off price - On styleâ have been registered with the United States Patent
and Trademark Office.

Competition

The retail
apparel business is highly competitive, and the Company accounts for only a
small fraction of the total market for mens, womens and childrens apparel.
The Companys stores compete with discount stores, specialty apparel stores,
department stores, manufacturer-owned factory outlet stores and others. Many of
the stores with which the Company competes are units of large national or
regional chains that have substantially greater resources than the Company.
Retailers having substantially greater resources than the Company have entered
or have indicated their intention to enter the off-price apparel business,
and the off-price apparel business itself has become increasingly
competitive, especially with respect to the increased use by manufacturers of
their own factory outlets and the use of on-line sites by other retailers. At
various times of the year, department store chains and specialty shops offer
brand-name merchandise at substantial markdowns.

Operations and
Control Systems

The Company
has a merchandise control system which tracks a product from its purchase to
its ultimate sale in the Companys stores. The system tracks the product by
store in approximately 350 categories. All the information regarding the
product is transmitted daily to the Companys database at its executive
headquarters. Each week the Companys executives receive detailed reports
regarding sales and inventory levels in units and retail dollars on a
store-by-store basis.

Management
of the Company visit stores on a regular basis to, among other things,
coordinate with the store managers and train employees in loss prevention
methods. Stores have some combination of on-premises security personnel and
various theft prevention systems during normal hours and security systems after
hours.

Employees

At
February 28, 2009, the Company had approximately 1,400 employees, of which
approximately 700 work on a part time basis. Approximately 30 to 100 persons,
consisting mostly of sales personnel, are employed at each Syms retail
location. The Company has collective bargaining agreements with Local 1102 and
Local 108, both of the Retail, Wholesale Department Store Workers Union whose
agreements expired on March 31, 2009 or will expire on and May 31, 2009,
respectively. The Company also has a collective bargaining agreement with Local
400 of the United Food and Commercial Workers Union which expires April 30,
2009. Combined, the three local unions represent approximately 1,100 hourly
employees. The Company believes its relationships with its unions are good. The
Company is actively involved in negotiations of all three of its collective
bargaining agreements and believes that
there will be no disruptions to the Companys operations and the outcome of
such negotiations will be at mutually acceptable terms.

2

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Available Information

The
Company makes available on its web site at www.syms.com under Investor Info -
Press Releases/Financial Reports, free of charge, its annual reports on Form
10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and
amendments to those reports as soon as reasonably practicable after the Company
electronically files such material with, or furnishes such material to, the
Securities and Exchange Commission (SEC). On the website, the Company also
offers a link to all of the Companys Securities and Exchange Commission
filings and to all beneficial ownership reports filed by the Companys
directors and executive officers, via the SECs EDGAR filing system.

|         |             
|-------- | ------------
|Item 1A. | RISK FACTORS

The following risk factors and other
information included in this Annual Report on Form 10-K should be carefully
considered. The risks and uncertainties described below are not the only ones
we face. Additional risk and uncertainties not presently known to us or that we
currently deem immaterial also may impair our business operations. If any of
the following risks occur, our business, financial condition, operating results
and cash flows could be materially adversely affected.

We
have had a history of losses and may not be profitable in the future

We
have had a net profit in some fiscal quarters and net losses in other fiscal
quarters. We have also had a history of both profits and losses in recent
fiscal years and cannot assure that we will be profitable in the future. Even
if we are able to generate profits in the future, we may not be able to
maintain or increase profitability on a quarterly or annual basis.

The
recent deterioration in general economic conditions and the impact on consumer
confidence and consumer spending could materially and adversely impact our
results of operations in future periods.

Consumer
spending habits, including spending for our merchandise, are affected by, among
other things, prevailing market conditions, levels of employment, salary and
wage rates, prevailing interest rates, income tax rates and policies, consumer
confidence and consumer perception of general economic conditions. Recently, as
a result of the significant deterioration in economic conditions worldwide,
consumer confidence and consumer spending have been negatively impacted and
could remain depressed for an extended period of time. Consumer purchases of
discretionary items, including our merchandise, can be expected to decline
during periods when disposable income is adversely affected or there is
economic uncertainty.

We
may be unable to compete favorably in our highly competitive markets

The
retail apparel business is highly competitive and we only account for a small
fraction of the total market for mens, womens and childrens apparel. We
compete against discount stores, specialty apparel stores, department stores,
manufacturer-owned factory outlet stores and others. Our success depends on our
ability to remain competitive with respect to style, price, brand availability
and customer service. The performance of our competitors, as well as changes in
their pricing policies, marketing activities and other business strategies,
could have an adverse effect on our business, financial condition, results of
operations and our market share.

If
we are unable to meet certain financial covenants in our credit facility, our
ability to borrow could be constrained

While
we currently have no borrowings under our existing credit agreement, the
facility does contain financial covenants with respect to consolidated tangible
net worth, as well as other financial ratios. If in the future we borrow monies
under the facility and fail to meet these covenants or obtain appropriate
waivers, our lender may terminate the credit facility or accelerate any
then-existing debt.

Our
sales and operating results depend on consumer preferences and fashion trends

Our sales and
operating results depend in part upon our ability to anticipate and respond to
product and fashion trends as well as to anticipate, gauge and react to
changing consumer demands in a timely manner. There can be no assurance that
the merchandise on hand or on order will correspond to changes in taste and
demand or that we will be able to successfully secure and market merchandise
that is responsive to such trends. Consumer demand requires us to anticipate
and respond to numerous and fluctuating variables in fashion trends and other
conditions in the markets in which our stores are situated. A variety of
factors may affect our ability to maintain the proper mix of products in each
store, including without limitation: variations in local, regional or national
economic conditions which could affect our customers discretionary

3

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spending,
unanticipated fashion trends, our success in distributing merchandise to our
stores in an efficient manner and changes in weather patterns, which in turn
may affect consumer demand and preferences. If we misjudge the market for our
products, or if we are unable to anticipate and fulfill the merchandise needs
of each region, we may experience decreases in our sales, realize significant
excess inventories for some products and we may be forced to increase markdowns
in relation to slow-moving merchandise, which could have a material adverse
effect on our business, financial condition and results of operations.

If
we are unable to renew or enter into new leases on favorable terms, our revenue
growth may decline

Eleven
of our 32 stores are located in leased premises and the leases for nine of
these eleven stores expire by 2010 and are subject to extension or renewal. If
the cost of leasing existing stores increases, we cannot assure that we will be
able to maintain our existing store locations as leases expire. In addition, we
may not be able to enter into new leases on favorable terms or at all, or we
may not be able to locate suitable alternative sites or additional new sites
for new stores in a timely manner. Our revenues and earnings may decline if we
fail to maintain existing store locations, enter into more costly new leases,
locate alternative sites on more expensive terms or fail to find suitable
additional sites for new stores.

Our
results of operations depend on keeping our expenses at an appropriate level

Our
performance depends on appropriate management of our expense structure,
including our selling, general and administrative costs. If we fail to meet our
expense goals or appropriately reduce expenses during a weak sales season or
period, our results of operations could be adversely affected.

Our
relationships with vendors can change

We
currently purchase first-quality, in-season designer and brand name merchandise
from more than 200 vendors at prices believed to be below those generally
available to major department and specialty stores. Although we have maintained
long-term business relationships with many of these vendors, there can be no
assurance that we will be able to continue to purchase first-quality, in-season
merchandise from these vendors in the same breadth of styles and sizes, in the
same or greater volumes and at prices as favorable as those currently available
to us. If we fail to maintain our relations with our existing vendors, or to
enhance the quality of merchandise they supply us or if we cannot maintain
existing sources of supply or attract new vendors of in-season brand name and
designer merchandise, our ability to obtain a sufficient amount and variety of
merchandise at favorable prices may be limited, which could have a significant
negative impact on our competitive position and our results of operations could
be materially and adversely affected.

Our
ability to manage inventory can affect our business

The
fashion-oriented nature of our products and the rapid changes in customer
preferences leave us vulnerable to an increased risk of inventory obsolescence.
Our ability to manage inventories properly is an important factor in our
operations. Inherent in our management and valuation of inventories are certain
significant judgments and estimates, including, among others, initial
merchandise markup and subsequent markups and markdowns which significantly
impact the ending inventory valuation at retail as well as the resulting cost
complement. While management believes that these methods provide an inventory
valuation which reasonably approximates cost, if market conditions are less
favorable than those projected, additional markdowns may be required. Our
inability to effectively manage inventory could have a materially adverse
effect on our business, financial condition and results of operations.

Our
failure to retain our existing senior management and to continue to attract
qualified new personnel could adversely affect our business

Our
success will depend on our ability to retain our key personnel and attract and
retain talented, highly qualified executives. If we were to lose the benefit of
the experience, efforts and abilities of any of our key executive and buying
personnel, our business could be adversely affected. Furthermore, our success
is also dependent on our ability to hire and train qualified retail management
and associates. We are also subject to risks associated with any significant
disruptions in our relationship with our employees, including union employees
and any work stoppages by our employees, including union employees.

We
are subject to potential uninsured losses and/or claims

We
are subject to the possibility of uninsured losses from risks such as
terrorism, earthquakes or floods, for which no, or limited, insurance coverage
is maintained. We are also subject to risk of losses which may arise from
adverse litigation results or other claims.

4

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We
may be required to recognize additional impairment charges

Pursuant
to accounting principles generally accepted in the United States, we are
required to periodically assess our long-lived assets to determine if they are
impaired. Business disruptions, protracted economic weakness, declines in
operating results and other factors may result in asset impairments. During the
annual impairment testing for the fiscal year ended February 28, 2009, the
carrying amount of certain real estate holdings exceeded the implied fair
values and as a result the Company recognized an impairment charge of $530,000.
In fiscal 2007 we recorded an impairment charge of $745,000. In light of
current economic conditions, additional impairments could occur in future
periods whether or not connected to the current impairment analysis. Future
impairment charges could materially affect our reported earnings in the periods
of such charges and could materially and adversely affect our financial
condition and results of operations.

Changes
in governmental regulation could adversely affect our operations

Laws
and regulations at both state and federal levels frequently change and the
ultimate cost of compliance cannot be precisely estimated. In addition, we
cannot predict the impact that may result from the changes in governmental
regulation under different political administrations. Changes in regulations,
the imposition of additional regulations, or the enactment of new legislation
that impacts employment, labor, trade, transportation or logistics, health
care, tax or environmental issues could have a material adverse impact on our
financial condition or results of operations.

A
privacy breach could adversely affect or business

The
protection of customer, employee and company data is critical. The regulatory
environment surrounding information security and privacy is demanding, with the
frequent imposition of new and changing requirement. In addition, customers
have a high expectation that we will adequately protect their personal
information. A significant breach of customer, employee or company data could
damage our reputation, result in lost sales, fines or lawsuits or have a
material adverse impact on our financial condition or results of operations.

Other
factors could affect our results of operations and our ability to grow

Other
factors that could cause actual results to differ materially from those
predicted and that may adversely affect our ability to grow include: possible
disruptions in our computer or telephone systems, increases in labor costs,
higher than anticipated store closings or relocation costs, increases in energy
costs, higher interest rates, potential disruptions in the supply of or
restrictions on imported merchandise and unanticipated increases in merchandise
or occupancy costs.

|         |                          
|-------- | -------------------------
|Item 1B. | UNRESOLVED STAFF COMMENTS

None.

5

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|        |           
|------- | ----------
|Item 2. | PROPERTIES

At
February 28, 2009 the Company has 32 operating locations. In addition, there is
a new lease in Falls Church, VA which will succeed the current lease
terminating in August, 2009. These locations include both owned and leased
properties and include retail stores and ancillary operations (consisting of
receiving, inspection and administrative functions), warehouse and offices,
plus additional space incidental to core operations which is, whenever
practicable, leased to third parties. The following table is a listing of
operating locations and square footage usage:

|                     |  |               |  |                |  |                      |  |                     |  |                   |     | 
|-------------------- |  | ------------- |  | -------------- |  | -------------------- |  | ------------------- |  | ----------------- | --- | 
|Location             |  | Lease
 or Own |  | Total
 Sq Feet |  | Retail
 &
 Ancillary |  | Warehouse
 & Office |  | Additional
 Space |    
|                     |  |               |  |                |  |                      |  |                     |  |                   |    
|                    
|Fairfield,
 CT       |  | Own (1)       |  | 43,000         |  | 43,000               |  |                    |  |                  |     | 
|Hartford, CT         |  | Lease         |  | 38,000         |  | 38,000               |  |                    |  |                  |     | 
|Ft
 Lauderdale, FL   |  | Own           |  | 55,000         |  | 55,000               |  |                    |  |                  |     | 
|Kendall, FL          |  | Lease         |  | 40,000         |  | 40,000               |  |                    |  |                  |     | 
|Miami, FL            |  | Own           |  | 53,000         |  | 53,000               |  |                    |  |                  |     | 
|Tampa, FL            |  | Own           |  | 77,000         |  | 48,000               |  |                    |  | 29,000            | (a) | 
|West Palm,
 FL       |  | Own           |  | 112,000        |  | 54,000               |  |                    |  | 58,000            | (b) | 
|Atlanta, GA          |  | Own           |  | 69,000         |  | 69,000               |  |                    |  |                  |     | 
|Marietta, GA         |  | Own           |  | 113,000        |  | 48,000               |  |                    |  | 65,000            | (b) | 
|Addison, IL          |  | Own           |  | 68,000         |  | 68,000               |  |                    |  |                  |     | 
|Niles, IL            |  | Lease         |  | 37,000         |  | 37,000               |  |                    |  |                  |     | 
|Rockville,
 MD       |  | Own           |  | 71,000         |  | 71,000               |  |                    |  |                  |     | 
|Towson, MD           |  | Lease         |  | 50,000         |  | 50,000               |  |                    |  |                  |     | 
|Norwood, MA          |  | Lease         |  | 43,000         |  | 43,000               |  |                    |  |                   |     | 
|Peabody, MA          |  | Lease         |  | 43,000         |  | 43,000               |  |                    |  |                  |     | 
|Southfield,
 MI      |  | Own           |  | 60,000         |  | 50,000               |  |                    |  | 10,000            | (c) | 
|Cherry Hill,
 NJ     |  | Own           |  | 150,000        |  | 66,000               |  | 39,000              |  | 45,000            | (a) | 
|Paramus, NJ          |  | Own           |  | 77,000         |  | 73,000               |  |                    |  | 4,000             | (d) | 
|Secaucus, NJ         |  | Own (2)       |  | 340,000        |  | 29,000               |  | 311,000             |  |                  |     | 
|Woodbridge,
 NJ      |  | Lease         |  | 36,000         |  | 36,000               |  |                    |  |                  |     | 
|Buffalo, NY          |  | Own           |  | 102,000        |  | 46,000               |  |                    |  | 56,000            | (a) | 
|Commack, NY          |  | Own           |  | 45,000         |  | 45,000               |  |                    |  |                  |     | 
|Elmsford, NY         |  | Own (3)       |  | 143,000        |  | 59,000               |  |                    |  | 84,000            | (d) | 
|New York, NY         |  | Lease         |  | 64,000         |  | 64,000               |  |                    |  |                  |     | 
|New York, NY         |  | Own           |  | 57,000         |  | 57,000               |  |                    |  |                  |     | 
|Westbury, NY         |  | Own           |  | 92,000         |  | 92,000               |  |                    |  |                  |     | 
|King of
 Prussia, PA |  | Own           |  | 69,000         |  | 55,000               |  |                    |  | 14,000            | (a) | 
|Cranston, RI         |  | Lease         |  | 36,000         |  | 36,000               |  |                    |  |                  |     | 
|Houston, TX          |  | Own           |  | 42,000         |  | 42,000               |  |                    |  |                  |     | 
|Hurst, TX            |  | Own           |  | 71,000         |  | 45,000               |  |                    |  | 26,000            | (c) | 
|Plano, TX            |  | Lease         |  | 40,000         |  | 40,000               |  |                    |  |                  |     | 
|Falls
 Church, VA    |  | Lease (4)     |  | 47,000         |  | 47,000               |  |                    |  |                  |     | 
|                     |  |               |  |                |  |                      |  |                     |  |                   |     | 
|                     |  |               |  | 2,383,000      |  | 1,642,000            |  | 350,000             |  | 391,000           |     | 
|                     |  |               |  |                |  |                      |  |                     |  |                   |     | 

|    |                                                                                                                                                                                 
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Ground lease dated June 2,
 2003 expiring November 3, 2036.                                                                                                                     
|    |                                                                                                                                                                                 
|(2) | Ground lease dated June 1,
 1977 expiring May 31, 2276.                                                                                                                         
|    |                                                                                                                                                                                 
|(3) | Ground lease dated January
 1, 1969 & 1970 expiring May 31, 2068 & December 31, 2068.                                                                                           
|    |                                                                                                                                                                                 
|(4) | A new lease for similar
 square footage at another location commences June, 2009 and will be
 operational in August, 2009.                                                      
|    |                                                                                                                                                                                 
|(a) | Additional space within
 building currently leased to third parties.                                                                                                            
|    |                                                                                                                                                                                 
|(b) | Additional space consists
 of a retail strip mall with various tenants in various stages of lease life,
 including vacant space which is actively marketed by property managers.
|    |                                                                                                                                                                                 
|(c) | Additional space currently
 vacant and available for rent.                                                                                                                      
|    |                                                                                                                                                                                 
|(d) | Additional space consists
 of third party building on company land pursuant to ground lease.                                                                                    

Syms
stores are typically free-standing or located in shopping centers and have
available adequate free parking except for two New York, NY stores which are
located conveniently to mass transit. Syms suburban locations are usually near
major highways or thoroughfares in localities of at least 1,000,000 people. In
some higher population densities, Syms has more than one store in the same
vicinity.

6

---



Lease Terms

Eleven
of the Companys 32 stores are leased from unrelated third parties on varying
remaining terms with varying option periods. Certain option periods may be
based on formulas contained in existing leases or may be based on negotiations
between the parties. The following table summarizes the number of leases
expiring in each calendar period; the number of such leases with renewal
options; and the number of years of each option period.

|                   |  |                |  |                              |   |                                   |  |         | 
|------------------ |  | -------------- |  | ---------------------------- | - | --------------------------------- |  | ------- | 
|                   |  |                |  |                              |   |                                   | 
|Calendar
 Period   |  | Expiring
 Year |  | Leases with
 Renewal Options |   | Range in Years
 of Option Periods | 
|                   |  |                |  |                              |   |                                   | 
|                  
|2009               |  | 2              |  |                              | 2 |                                   |  | 5 years | 
|2010               |  | 4              |  |                              | 3 |                                   |  | 5 years | 
|2011               |  | 2              |  |                              | 2 |                                   |  | 5 years | 
|2012               |  | 1              |  |                              | 1 |                                   |  | 5 years | 
|2013               |  |               |  |                              |  |                                   |  |        | 
|2014 &
 thereafter |  | 3              |  |                              | 1 |                                   |  |        | 

Store
leases provide for a base rental of between $4.51 and $44.39 per square foot.
In addition, under the net terms of all leases, the Company pays maintenance
expenses, real estate taxes and other charges. One lease provides for rent
payment based on a percentage of sales above certain thresholds. Minimum rental
payments for leased locations aggregated approximately $6,581,000 and
$6,683,000 for fiscal 2008 and 2007, respectively.

Whenever
practicable, space incidental to Company operations is offered for rent. Of the
ten operating locations with available rental space, six are fully rented, two
(which are multi-tenant strip malls) are partially rented and two are currently
vacant. Rental income for tenanted locations, net of administrative and
operating expenses of $512,000 and $372,000 in fiscal 2008 and 2007, respectively,
was $2,026,000 and $3,006,000 for fiscal 2008 and 2007 respectively. Tennant
leases expire at various dates during 2011 through 2047 with various option
terms and periods extending to 2097.

Store Openings/Closings

In
fiscal 2008, the Company closed a store in Troy, Michigan. No new stores were
opened during fiscal 2008. A new lease, replacing our space in Falls Church,
Virginia was executed with an inception date of June, 2009.

|        |                  
|------- | -----------------
|Item 3. | LEGAL PROCEEDINGS

The
Company is a party to routine litigation incident to its business. Some of the
actions to which the Company is a party are covered by insurance and are being
defended or reimbursed by the Companys insurance carriers.

In
December 2007, the Company announced its decision to voluntarily delist its
common stock from trading on the New York Stock Exchange (NYSE) and, given
that there were fewer than 300 holders of record of its common shares,
simultaneously deregister its common stock under federal securities laws. The Companys
decision to deregister with the Securities and Exchange Commission (SEC) and
delist from NYSE was principally motivated by the desire to minimize the
financial and administrative burdens associated with being an SEC reporting
company and further minimize or eliminate the compliance obligations incident
to the Sarbanes-Oxley Act of 2002. In January 2008 certain institutional
investors commenced a campaign to cause certain shareholders to register shares
individually and simultaneously brought two actions seeking injunctive relief
from the aforementioned deregistration and delisting, counsel fees and
unspecified damages. Although the Company believes that its actions were
appropriate, the Company determined that the costs and expenses associated with
protracted litigation could not be justified and, in February 2008,
reregistered its common stock and listed its shares for trading on NASDAQ. The
costs associated with this litigation were substantially covered by insurance.
All litigation associated with these matters has either been dismissed in the
Companys favor or settled within the limits of the Companys insurance
policies, less a nominal deductible.

|        |                                                    
|------- | ---------------------------------------------------
|Item 4. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

There
were no matters submitted to a vote of security holders during the fourth
quarter of the fiscal year covered by this Annual Report.

7

---



PART II

|        |                                                                                                              
|------- | -------------------------------------------------------------------------------------------------------------
|Item 5. | MARKET FOR REGISTRANTS COMMON EQUITY, RELATED SHAREHOLDER MATTERS
 AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information

During
the fiscal year ended March 3, 2007 and from the period March 4, 2007 through
December 21, 2007 during the fiscal year ended March 1, 2008 the common stock
of the Company (the Common Stock) was listed for trading on the New York
Stock Exchange (NYSE) under the symbol SYM. During the period December 22,
2007 through February 27, 2008, the Common Stock was listed for trading on The
Pink Sheets under the symbol SYMZ and during the period since February 28,
2008, the Common Stock has been listed on NASDAQ under the symbol SYMS. The
following table sets forth the high and low sales prices for the Companys
Common Stock as reported by NYSE and the high and low bid information reported
on the Pink Sheets and by NASDAQ, as the case may be for each quarter of the
past two fiscal years.

|                |  |                              |       |                          |   |       |  |     |       |  |   |       | 
|--------------- |  | ---------------------------- | ----- | ------------------------ | - | ----- |  | --- | ----- |  | - | ----- | 
|                |  | Year ended February 28, 2009 |       | Year ended March 1, 2008 |  
|                |  |                              |       |                          |  
|                |  | High                         |       | Low                      |   | High  |  | Low |      
|                |  |                              |       |                          |   |       |  |     |      
|First
 Quarter  |  | $                            | 16.48 |                          | $ | 10.38 |  | $   | 21.59 |  | $ | 17.05 | 
|Second
 Quarter |  |                              | 17.86 |                          |   | 12.33 |  |     | 22.08 |  |   | 13.14 | 
|Third
 Quarter  |  |                              | 17.24 |                          |   | 7.30  |  |     | 16.75 |  |   | 12.17 | 
|Fourth
 Quarter |  |                              | 10.80 |                          |   | 5.38  |  |     | 17.38 |  |   | 9.25  | 

Holders

As
of April 16, 2009, there were 330 record holders of the Companys Common Stock.

Dividends

During
fiscal 2007, the Board of Directors of the Company declared a cash dividend of
$.60 per share to shareholders of record on July 26, 2007. The aggregate
dividend paid was approximately $8,820,000. No dividends were paid in fiscal
2008. Payment of dividends is within the discretion of the Companys Board of
Directors and depends upon various factors including the earnings, capital
requirements and financial condition of the Company (see Note 4 to Notes to
Financial Statements regarding covenants in the Companys revolving credit
agreement).

Issuer Purchases of Equity Securities

There
were no repurchases of the Companys equity securities during the fourth
quarter of fiscal 2008.

Performance Graph

Below
is a graph comparing the cumulative total shareholders return on the Companys
common stock for the last six fiscal years (beginning February 28, 2004 and
ending February 27, 2009, the last trading day for Fiscal 2008) with the
cumulative total return of the Wilshire 5000 Index and the S&P Retail
Composite Index over the same period (assuming (i) the investment of $100 on
March 2, 2003 in the Companys common stock and in each of these two Indexes,
(ii) reinvestment of all dividends and (iii) no payment of brokerage or other
commissions or fees).

(LINE GRAPH)

8

---



Equity Plan Compensation Information

The
following table provides information as of February 28, 2009, about the shares
of our common stock that may be issued upon exercise of options granted to
employees or members of our Board under all of our existing equity compensation
plans, including our 2005 stock option plan.

|                                                            |  |                                                              |  |                                                         |  |                                                                                                                                      |  |   |       |  |  |  |  |   |  | 
|----------------------------------------------------------- |  | ------------------------------------------------------------ |  | ------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------ |  | - | ----- |  |  |  |  | - |  | 
|                                                            |  | COLUMN (A)                                                   |  | COLUMN (B)                                              |  | COLUMN (C)                                                                                                                           | 
|                                                            |  |                                                              |  |                                                         |  |                                                                                                                                      | 
|                                                            |  | Securities to be issued upon
 exercise of outstandingOptions |  | Weighted average exercise
 price of outstanding options |  | Securities remaining available for future issuances under
 equity compensation plans
 (excluding securities reflected
 in Column (A) | 
|                                                            |  |                                                              |  |                                                         |  |                                                                                                                                      | 
|Plan Category:                                              |  |                                                              |  |                                                         |  |                                                                                                                                      |  |   |       | 
|Equity compensation plans approved by security holders      |  |                                                              |  | 111,112                                                 |  |                                                                                                                                      |  | $ | 13.81 |  |  |  |  |  |  | 
|Equity compensation plans not approved by
 security holders |  |                                                              |  |                                                        |  |                                                                                                                                      |  |   |      |  |  |  |  |  |  | 
|                                                            |  |                                                              |  |                                                         |  |                                                                                                                                      |  |   |       |  |  |  |  |   |  | 
|Total                                                       |  |                                                              |  | 111,112                                                 |  |                                                                                                                                      |  | $ | 13.81 |  |  |  |  |  |  | 
|                                                            |  |                                                              |  |                                                         |  |                                                                                                                                      |  |   |       |  |  |  |  |   |  | 

|        |                        
|------- | -----------------------
|Item 6. | SELECTED FINANCIAL DATA

The
selected financial data presented below has been derived from the Companys
audited financial statements for the fiscal years ended February 28, 2009,
March 1, 2008, March 3, 2007, February 25, 2006 and February 26, 2005. The
selected financial data presented below should be read in conjunction with such
financial statements and notes thereto.

|                                      |  |                                          |         |                |   |                |  |                    |         |                   |   |         |  |   |         | 
|------------------------------------- |  | ---------------------------------------- | ------- | -------------- | - | -------------- |  | ------------------ | ------- | ----------------- | - | ------- |  | - | ------- | 
|                                      |  | Fiscal Year Ended                        |        
|                                      |  |                                          |        
|                                      |  | February 28,
 2009                       |         | March 1,
 2008 |   | March 3,
 2007 |  | February 25,
 2006 |         | February 26
 2005 |  
|                                      |  |                                          |         |                |   |                |  |                    |         |                   |  
|                                      |  | (in thousands, except per share amounts) |        
|Income statement data:                |  |                                          |         |                |   |                |  |                    |         |                   |   |         |  |   |         | 
|Net sales                             |  | $                                        | 242,000 |                | $ | 267,149        |  | $                  | 281,178 |                   | $ | 280,389 |  | $ | 283,567 | 
|Net (loss) income                     |  |                                          | (3,423  | )              |   | 807            |  |                    | 9,548   |                   |   | 3,436   |  |   | 2,177   | 
|Net (loss) income per share  basic   |  |                                          | (0.23   | )              |   | 0.06           |  |                    | 0.66    |                   |   | 0.23    |  |   | 0.14    | 
|Dividends paid                        |  |                                          |        |                |   | 8,820          |  |                    |        |                   |   | 15,028  |  |   |        | 
|Net (loss) income per share  diluted |  |                                          | (0.23   | )              |   | 0.05           |  |                    | 0.65    |                   |   | 0.23    |  |   | 0.14    | 
|Balance sheet data:                   |  |                                          |         |                |   |                |  |                    |         |                   |   |         |  |   |         | 
|Working capital                       |  | $                                        | 43,215  |                | $ | 57,090         |  | $                  | 67,431  |                   | $ | 81,832  |  | $ | 92,428  | 
|Total assets                          |  |                                          | 215,123 |                |   | 229,629        |  |                    | 239,559 |                   |   | 239,119 |  |   | 253,491 | 
|Other long-term liabilities           |  |                                          | 840     |                |   | 1,178          |  |                    | 1,548   |                   |   | 1,520   |  |   | 1,610   | 
|Shareholdersequity                   |  |                                          | 186,043 |                |   | 192,135        |  |                    | 202,069 |                   |   | 210,534 |  |   | 224,596 | 

|        |                                                                                       
|------- | --------------------------------------------------------------------------------------
|Item 7. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
 RESULTS OF OPERATIONS

Special Note Regarding Forward-Looking
Statements

This
Annual Report (including but not limited to factors discussed below, in the
Managements Discussion and Analysis of Financial Condition and Results of
Operations, as well as those discussed elsewhere in this Annual Report on Form
10-K) may include certain forward-looking statements (within the meaning of
Sections 27A of the Securities Act of 1933 and 21E of the Securities Exchange
Act of 1934) and information relating to the Company that are based on the
beliefs of the management of the Company as well as assumptions made by and
information currently available to the management of the Company. When used in
this Annual Report, the words anticipate, believe, estimate, expect,
intend, plan, and similar expressions, as they relate to the Company or the
management of the Company, identify forward-looking statements. Such statements
reflect the current views of the Company with respect to future events, the
outcome of which is subject to certain risks, including among others; general
economic and market conditions, decreased consumer demand for the Companys
products, possible disruptions in the Companys

9

---



computer or
telephone systems, possible work stoppages, or increases in labor costs,
effects of competition, possible disruptions or delays in the opening of new
stores or inability to obtain suitable sites for new stores, higher than
anticipated store closings or relocation costs, higher interest rates,
unanticipated increases in merchandise or occupancy costs and other factors
which may be outside the Companys control, including risk factors disclosed in
Item 1A of this Annual Report on Form 10-K. Should one or more of these risks
or uncertainties materialize, or should underlying assumptions prove incorrect,
actual results or outcomes may vary materially from those described herein as
anticipated, believed, estimated, expected, intended or planned. Subsequent
written and oral forward-looking statements attributable to the Company or
persons acting on its behalf are expressly qualified in their entirety by the
cautionary statements in this paragraph and elsewhere described in this Annual
Report and other reports filed with the Securities and Exchange Commission.

The
Company does not assume the obligation to update any forward-looking statement.
Shareholders should carefully evaluate such statements in light of factors,
including risk factors, described in the Companys filings with the SEC,
especially on Forms 10-K, 10-Q and 8-K. In Item 1A., Risk Factors of this
Annual Report on Form 10-K, the Company discusses in more detail various
important risk factors that could cause actual results to differ from expected
or historic results. The Company notes these factors for readers as permitted
by the Private Securities Litigation Reform Act of 1995. Shareholders should
understand that it is not possible to predict or identify all such factors.
Consequently, shareholders should not consider any such list to be a complete
statement of all potential risks or uncertainties.

Executive Overview

Syms
is an off-price retailer which operates a chain of thirty-two apparel stores
located in the United States throughout the Northeastern and Middle Atlantic
regions and in the Midwest, Southeast and Southwest. Each Syms store offers a
broad range of first quality, in-season merchandise bearing nationally
recognized designer or brand-name labels in mens, womens and childrens
apparel.

The
Company experienced lower sales and profits in fiscal 2008 compared to fiscal
2007. Total store sales decreased approximately 9.4%, and comparable store
sales declined 7.9% compared to fiscal 2007. The Companys continued focus on
improving gross margin levels resulted in the gross profit percentage
increasing from 41.2% to 41.5%, an increase of 0.3%. Selling, general and
administrative expenses (SG&A) and occupancy costs declined approximately
$1,035,000 in fiscal 2008 reflective of cost reduction strategies involving
substantially all aspects of Company operations. In fiscal 2009, we anticipate
continuing to focus on sales maximization, expense control and inventory
management designed to maintain or improve our cash position and minimize our
debt.

Critical Accounting
Policies and Estimates

The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires the appropriate
application of certain accounting policies, many of which require us to make
estimates and assumptions about future events and their impact on amounts
reported in the financial statements and related notes. Since future events and
their impact cannot be determined with certainty, the actual results will
inevitably differ from our estimates. Such differences could be material to our
financial statements.

The
Company believes its application of accounting policies, and the estimates
inherently required by the policies, are reasonable. These accounting policies
and estimates are periodically reevaluated, and adjustments are made when facts
and circumstances dictate a change. Historically, the Company has found the
application of accounting policies to be appropriate, and actual results have
not differed materially from those determined using necessary estimates.

The
Companys accounting policies are more fully described in Note 1 to the
Financial Statements, located in this Annual Report. The Company has also
identified certain critical accounting policies that are described below.

Merchandise
Inventory  Inventory is stated at the lower of cost of
market, FIFO retail method. Inventory cost and the resulting gross margins are
calculated by applying a cost to retail ratio between the costs of goods
available for sale and the retail value of inventories. The significant
estimates used are for markdowns and shrinkage.

Factors
considered by the Company in the determination of permanent markdowns include
current and anticipated demand, customer preferences, season and age of the
merchandise, fashion trends and weather conditions. In addition, inventory is
also evaluated against corporate pre-determined historical markdown trends.
When a decision is made to permanently markdown merchandise, the resulting
gross margin reduction is recognized in the period the markdown is recorded.
The timing of the decision, particularly when close to the balance sheet date,
can have a significant effect on the results of operations.

10

---



Shrinkage
is estimated as a percentage of sales for the period from the date of the last
physical inventory to the end of the fiscal year. Physical inventories are
taken at least annually for all stores, at dates close to fiscal years end and
inventory records are adjusted accordingly. The shrinkage rate from the most
recent physical inventory, in combination with historical experience, is used
as the standard for the shrinkage accrual following the physical inventory.

The
Company has found the use of these estimates to be appropriate and actual
results have not differed materially. However, the Company is subject to
certain risks and uncertainties that could cause its future estimates to differ
materially from past experience.

Long-lived Assets- In evaluating the carrying value of
long-lived assets the Company considers the related future benefits by
performing an analysis of the anticipated undiscounted future net cash flows of
the related long-lived assets. If the carrying value of the related asset
exceeds the undiscounted cash flows, the Company reduces the carrying value to
its estimated fair value, which is generally calculated using discounted cash
flows. Various factors including future sales growth and profit margins are
included in this analysis. To the extent these future projections or our
strategies change, the conclusion regarding impairment may change in the
future.

Deferred
Tax Valuation Allowance  The Company has
considered future taxable income and ongoing prudent and feasible tax planning
strategies that could produce additional future taxable income in assessing the
need for a valuation allowance. Should the Company determine that it will not
be able to realize all or part of our net deferred tax asset in the future, an
adjustment to the deferred tax asset will be charged to income in the period
such determination is made.

Results of Operations

The
following discussion compares the fiscal years ended February 28, 2009, March
1, 2008 and March 3, 2007. The fiscal years ended February 28, 2009 and March
1, 2008 were comprised of 52 weeks and the fiscal year ended March 3, 2007 was
comprised of 53 weeks.

Fiscal
Year Ended February 28, 2009 (Fiscal 2008) Compared to Fiscal Year Ended March
1, 2008 (Fiscal 2007)

Net
sales for Fiscal 2008 were $242,000,000, a decrease of $25,149,000 (9.4%) as
compared to net sales of $267,149,000 for Fiscal 2007. The decrease in sales is
largely attributable to reductions in store traffic, especially in the latter
half of Fiscal 2008, as general economic conditions resulted in lower retail
sales across most markets. Comparable store sales in Fiscal 2008 decreased 7.9%
or approximately $20.5 million, reflective of previously mentioned retail reductions.
In our comparable store computation, we only include locations that were open
for a period of at least twelve months and stores that were open during both
fiscal years. We opened no new locations in Fiscal 2008 and there was no
expansion in square footage in existing stores.

Gross
profit for Fiscal 2008 was $100,525,000 or 41.5% of net sales compared with
$109,981,000 or 41.2% of net sales for the prior year, a decrease of $9,456,000
or 8.6%. Gross profit percentage increased 0.3% in Fiscal 2008 primarily
reflective of improved physical controls over inventory coupled with reductions
in mark-downs reflective of changes in inventory mix. The Companys gross
profit may not be comparable to those of other entities that include all of the
costs related to their distribution network in cost of goods sold because the
Company excludes a portion of those costs from gross profit. Instead, the
Company includes such costs in other items such as selling, general and
administrative (SG&A) costs and/or occupancy costs.

SG&A
expense for Fiscal 2008 was $74,690,000 or 30.9% of net sales compared with
$76,959,000 or 28.8% of net sales for the prior year, a decrease of $2,269,000
or 2.9%. SG&A expenses decreased primarily as a result of costs cut in the
face of declining sales with the greatest reductions in costs realized in
payroll related expenses offset by increases in health insurance, union and
certain other insurance costs.

Advertising
expense for Fiscal 2008 was $6,339,000 or 2.6% of net sales compared with
$8,561,000 or 3.2% of net sales for the prior year, a decrease of $2,222,000 or
25.9% due primarily to general reductions in advertising across all lines of
media coupled with higher concentration in electronic and direct to consumer
promotions which tend to be lower cost.

Occupancy
costs for Fiscal 2008 were $15,557,000 or 6.4% of net sales compared with
$14,323,000 or 5.4% of net sales for the prior year, an increase of $1,234,000
or 8.6%. The increase in occupancy costs is largely attributable to higher
common area charges at leased locations and higher utility costs. In addition,
increased vacancy from tenancy in owned buildings resulted in the Company
offsetting occupancy costs with net rental income of $2,026,000 in fiscal 2008
compared to $3,006,000 in fiscal 2007.

Depreciation
and amortization expense for Fiscal 2008 was $8,003,000 or 3.3% of net sales
compared with $7,659,000 or 2.9% of net sales for the prior year. Depreciation
and amortization expense increased $344,000 or 4.5% largely as a result of
capital improvements such as roofing and HVAC upgrades at various retail
locations as well as in our distribution center.

11

---



During
Fiscal 2008 the Company recorded an impairment charge of $530,000 related to
estimated impairments in carrying values of two retail locations and a gain of
$548,000 from the sale of a small parcel of realty. During Fiscal 2007 the
Company recorded an impairment charge of $745,000 relating to the closure of a
store in Cleveland, Ohio in July 2007. No sales of Company properties occurred
in Fiscal 2007.

Net
loss before the recovery of income taxes for Fiscal 2008 was $4,031,000 or
(1.7%) of net sales compared with net income before income taxes of $3,136,000
or 1.2% of net sales for the prior year, a decrease of $7,167,000. The decline
in operating results before income taxes resulted from the factors discussed
above.

For
Fiscal 2008 the effective income tax rate was 15.1% as compared to 74.3% for
Fiscal 2007. The decrease in the effective tax rate for Fiscal 2008 reflects
the impact of permanent differences of certain expense items not deductible for
tax purposes.

Fiscal Year Ended
March 1, 2008 (Fiscal 2007) Compared to Fiscal Year Ended March 3, 2007 (Fiscal
2006)

Net
sales for Fiscal 2007 were $267,149,000, a decrease of $14,029,000 (5%) as
compared to net sales of $281,178,000 for Fiscal, 2006. The decrease in sales
was largely attributable to the closure of four locations in the prior fiscal
period and a concomitant reduction in sales attributable to those location
coupled with the loss of one week of sales in the 2007 fiscal year (52 weeks in
Fiscal 2007 vs. 53 weeks in Fiscal 2006) with one weeks sales averaging
approximately $5.1 million. Comparable store sales in Fiscal 2007 were down
less than .9% or approximately $2.3 million, reflective of reductions in sales
across most retail locations. In our comparable store computation, we only
include stores that have been open for a period of at least twelve months and
stores that were open during both fiscal years. We opened no new locations in
Fiscal 2007 and there was no expansion in square footage in existing stores in
Fiscal 2007 and 2006.

Gross
profit for Fiscal 2007 was $109,981,000 or 41.2% of net sales compared with
$113,289,000 (40.3% as a percentage of net sales) for Fiscal 2006, a decrease
of $3,308,000 or 2.9%. Gross profit percentage increased .88% in Fiscal 2007
primarily reflective of improved physical controls over inventory coupled with
reductions in mark-downs reflective of changes in inventory mix. The Companys
gross profit may not be comparable to those of other entities, which include
all of the costs related to their distribution network in cost of goods sold because
the Company excludes a portion of those costs from gross profit. Instead, the
Company includes such costs in other items, such as SG&A and occupancy
costs.

SG&A
expense for Fiscal 2007 was $76,959,000 or 28.8% of net sales compared with $77,841,000
or 27.7% of net sales for the prior year, a decrease of $882,000 or 1.1%.
SG&A expenses decreased primarily as a result of the reduction in number of
retail locations in Fiscal 2007 compared to Fiscal 2006 along with reductions
in office payroll offset by reductions in royalty income due to fewer
revenue-generating licensing agreements and increased professional fees.

Advertising
expense for Fiscal 2007 was $8,561,000 or 3.2% of net sales compared to
$8,118,000 or 2.9% of net sales for the prior year, an increase of $443,000 or
5.5% due primarily to greater penetration across substantially all lines of
media.

Occupancy
costs for Fiscal 2007 were $14,323,000 or 5.4% of net sales compared to
$15,688,000 or 5.6% of net sales for the prior year, a decrease of $1,365,000
or 8.7%. The decrease in occupancy costs was largely attributable to the
reduction in the number of retail locations in Fiscal 2007 offset by higher
common area charges at leased locations coupled with higher utility costs. In
addition, decreased vacancy from tenancy in owned buildings resulted in the
Company offsetting occupancy costs with net rental income of $3,006,000 in
fiscal 2007 compared to $2,149,000 in fiscal 2006.

Depreciation
and amortization expense for Fiscal 2007 was $7,659,000 compared to $8,205,000
for the prior year, both amounts at 2.9% of net sales during both fiscal years.
Depreciation expense declined $546,000 or 6.7% largely as a result of the
reduction in number of retail locations in Fiscal 2007 and the correlated
reduction in assets employed.

During
Fiscal 2007 the Company recorded an impairment charge of $745,000 related to
the closure of a store in Cleveland, Ohio. In Fiscal 2006 the Company recorded
a gain of $10,424,000 from the sale of properties in Rochester, New York and
Dallas, Texas. No sales of Company properties occurred in Fiscal 2007.

Net
income before taxes for Fiscal 2007 was $3,136,000 or 1.2% of net sales
compared with $15,951,000 or 5.7% of net sales for the prior year, a decrease
of $12,815,000. However, $10,424,000 of that decrease was attributable to the
sale of properties in Fiscal 2006 that did not recur in Fiscal 2007. Excluding
the gain from the sale of properties, net income before taxes in Fiscal 2006
was $5,527,000 or 1.9% of net sales as a result of the factors discussed above.

For Fiscal 2007 the effective income tax rate was 74.3% as compared to 44.5%
for Fiscal 2006. The increase in effective tax rate in Fiscal 2007 reflects the
unfavorable impact of permanent differences of certain expense items not
deductible for tax purposes and an adjustment of a prior year under-accrual.

12

---



Liquidity and Capital
Resources

Working
capital at February 28, 2009 was $43,215,000, a decrease of $13,875,000 from
March 1, 2008, and the ratio of current assets to current liabilities was 2.53
to 1 as compared to 2.57 to 1 at March 1, 2008. The Companys merchandise inventory was $13,606,000 lower at fiscal
year-end primarily due to the Companys efforts to reduce inventory in the face
of reduced store traffic in the current economic environment. Accounts
receivable at February 28, 2009 decreased $856,000 from March 1, 2008 due
principally to credit card payment timing differences. Accounts payable
decreased $10,674,000 from March 1, 2008 primarily due to lower purchases in
the face of lower store traffic and sales. The overall decrease in working
capital is largely attributable to the changes enumerated above resulting from
lower store traffic and sales, especially during the latter half of Fiscal 2008
as well as lower cash balances partially attributable to the acquisition of
long lived assets in Fiscal 2008.

Net
cash provided by operating activities totaled $3,215,000 for Fiscal 2008 as
compared to $4,276,000 for Fiscal 2007. This decrease is primarily due to the
decline in operating results in net income of $807,000 in Fiscal 2007 to a net
loss of $3,423,000 in Fiscal 2008 and the reduction of accounts payable
partially offset by decreased inventories as planned by management and
decreased accounts receivable.

Net cash used in investing activities was $12,778,000 for Fiscal 2008 as
compared to net cash used in investing activities of $9,770,000 for Fiscal
2007. This increase resulted primarily from the purchase, in Fiscal 2008, of a
building and related air rights adjacent to the Companys property at Trinity
Place in New York City. Purchases of property and equipment totaled $7,667,000
and $6,687,000 for Fiscal years 2008 and 2007, respectively. Property and
equipment expenditures were primarily for store remodeling, distribution
facility upgrades and information technology investment.

Net
cash used in financing activities was $519,000 for Fiscal 2008 as compared to
net cash used of $10,514,000 for Fiscal 2007. For Fiscal 2008 this reflects the
purchase of treasury shares of $2,817,000 offset in substantial part by
proceeds from options exercises of $2,148,000. For Fiscal 2007, this amount
included the payment of dividends of $8,820,000 and the purchase of treasury
shares for an aggregate of $1,703,000. No dividends were paid in Fiscal 2008.

The
Company has a revolving credit agreement with a bank for a line of credit not
to exceed $40,000,000 through May 1, 2011. The agreement contains financial
covenants with respect to consolidated tangible net worth as defined, working
capital and maximum capital expenditures, including dividends (defined to
include cash repurchases of capital stock), as well as other financial ratios.
The Company is in compliance with all covenants except for that related to
working capital for which it has received a waiver. During Fiscal 2008 and 2007
the Company satisfied all of its operating and capital expenditure requirements,
including those for the operations of stores, from internally generated funds.
For Fiscal 2008 and Fiscal 2007, there were no borrowings under the revolving
credit agreement. At February 28, 2009 and March 1, 2008, the Company had
$741,000 and $869,000, respectively, in outstanding letters of credit under the
revolving credit agreement.

Capital
expenditures, which amounted to approximately $7,667,000 in Fiscal 2008, are
expected to range from $7 million to $8 million for Fiscal 2009. Although some
of the anticipated expenditures are discretionary, we believe that they are
necessary to maintain efficient, orderly and safe operating environments. We
expect to fund these expenditures from cash generated by operations and the
Companys existing credit facilities.

On
July 12, 2007 the Companys Board of Directors authorized the declaration of a
cash dividend of $.60 per share to all shareholders of record on July 26, 2007,
resulting in an aggregate payment of $8,820,000. On June 5, 2006, the Companys
Board of Directors authorized the repurchase by the Company through June 1,
2008 of up to 2,900,000 shares of common stock at prevailing market prices.
During Fiscal 2008, the Company acquired 216,000 treasury shares at a total
cost of $2,817,000 on the exercise of stock options which were paid with the
Companys common stock. During Fiscal 2007, the Company purchased 114,000
shares at a total cost of $1,703,000.

Management
believes that existing cash, internally generated funds, trade credit and funds
available from the revolving credit agreement will be sufficient for working
capital and capital expenditure requirements for Fiscal 2009.

Impact of Inflation
and Changing Prices

Although
the Company cannot accurately determine the precise effect of inflation on its
operations, it does not believe inflation has had a material effect on sales or
results of operations for its last three fiscal years.

13

---



Contractual
Obligations and Commercial Commitments

To
facilitate an understanding of our contractual obligations and commercial
commitments, the following data is provided:

|                                    |  |                        |            |                   |   |           |  |           |           |                    |   |           |  |   |            | 
|----------------------------------- |  | ---------------------- | ---------- | ----------------- | - | --------- |  | --------- | --------- | ------------------ | - | --------- |  | - | ---------- | 
|                                    |  | Payments Due by Period |           
|                                    |  |                        |           
|                                    |  | Total                  |            | Less than
 1 year |   | 2-3 years |  | 4-5 years |           | More than
 5 years |  
|                                    |  |                        |            |                   |   |           |  |           |           |                    |  
|Contractual
 Obligations            |  |                        |            |                   |   |           |  |           |           |                    |   |           |  |   |            | 
|Operating
 Leases                   |  | $                      | 31,432,000 |                   | $ | 6,092,000 |  | $         | 8,470,000 |                    | $ | 3,288,000 |  | $ | 13,582,000 | 
|                                    |  |                        |            |                   |   |           |  |           |           |                    |   |           |  |   |            | 
|Total
 Contractual Cash Obligations |  | $                      | 31,432,000 |                   | $ | 6,092,000 |  | $         | 8,470,000 |                    | $ | 3,288,000 |  | $ | 13,582,000 | 
|                                    |  |                        |            |                   |   |           |  |           |           |                    |   |           |  |   |            | 

|                              |  |                                            |         |                |   |           |  |           |   |                |  |   |  |  |   | 
|----------------------------- |  | ------------------------------------------ | ------- | -------------- | - | --------- |  | --------- | - | -------------- |  | - |  |  | - | 
|                              |  | Amount of Commitment Expiration Per Period |        
|                              |  |                                            |        
|                              |  | Total 
 Amounts
 Committed                 |         | Within
 1 year |   | 2-3 years |  | 4-5 years |   | After 5
 Years | 
|                              |  |                                            |         |                |   |           |  |           |   |                | 
|Other
 Commercial Commitments |  |                                            |         |                |   |           |  |           |   |                |  |   |  |  |   | 
|Lines of
 Credit              |  | $                                          |        |                | $ |          |  |           |  |                |  |  |  |  |  | 
|Letters of
 Credit            |  |                                            | 741,000 |                |   | 741,000   |  |           |  |                |  |  |  |  |  | 
|                              |  |                                            |         |                |   |           |  |           |   |                |  |   |  |  |   | 
|Total
 Commercial Commitments |  | $                                          | 741,000 |                | $ | 741,000   |  |           |  |                |  |  |  |  |  | 
|                              |  |                                            |         |                |   |           |  |           |   |                |  |   |  |  |   | 

We took into account the material nature of operating agreements and
lines of credit for merchandise in determining whether to include these items
in contractual obligations and commercial commitments.

Off Balance Sheet
Arrangements

The Company
has no off-balance sheet arrangements (as defined in Item 303 of Regulation
S-K).

Recent Accounting
Pronouncements

See Note 1
of the Financial Statements for a full description of the Recent Accounting
Pronouncements, including the respective dates of adoption and the effects on
our results of operations and financial condition.

|         |                                                            
|-------- | -----------------------------------------------------------
|Item 7A. | QUANTITATIVE AND QUALITATIVE DISCLOSURES
 ABOUT MARKET RISK

The
Company has exposure to interest rates under its unsecured revolving credit
facility. Interest on individual advances is payable quarterly at the banks
base rate, except that at the time of advance, the Company has the option to
select an interest rate based upon one of two other alternative calculations,
with such rate to be fixed for a period not to exceed 90 days. The average
daily unused portion is subject to a commitment fee of 0.25 of 1% per annum.

|        |                                            
|------- | -------------------------------------------
|Item 8. | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The
information required by this Item in incorporated herein by reference to the
financial statements and supplementary data set forth in Item 15  Exhibits
and Financial Statement Schedules of this Annual Report on Form 10-K.

|         |                                                                                              
|-------- | ---------------------------------------------------------------------------------------------
|Item 9.  | CHANGES IN AND DISAGREEMENTS WITH
 ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
 DISCLOSURE - None
|         |                                                                                              
|Item 9A. | CONTROLS
 AND PROCEDURES                                                                     

Under
the supervision and with the participation of our management, including Marcy
Syms, the Chief Executive Officer of the Company, and Philip A. Piscopo, the
Chief Financial Officer of the Company, we have evaluated the effectiveness of
our disclosure controls and procedures as required by Rule 13a-15(b) of the
Securities Exchange Act of 1934, as amended (the Exchange Act), as of the end
of the period covered by this report. Based on that evaluation, the Chief
Executive Officer and the Chief Financial Officer have concluded that these
disclosure controls and procedures are effective. Notwithstanding the
foregoing, a control system, no matter how well designed and operated, can
provide only reasonable, not absolute, assurance that it will detect or uncover
failures within the Company to disclose information otherwise required to be
set forth in the Companys periodic reports.

14

---



MANAGEMENTS REPORT ON INTERNAL CONTROL OVER
FINANCIAL REPORTING

May 1, 2009

To the
Shareholders of Syms Corp.

The
management of Syms Corp. is responsible for the preparation, integrity,
objectivity and fair presentation of the financial statements and other
financial information presented in this report. The financial statements have
been prepared in conformity with accounting principles generally accepted in
the United States of America and reflect the effects of certain judgments and
estimates made by management.

In
order to ensure that our internal control over financial reporting is
effective, management regularly assesses such controls and did so most recently
for our financial reporting as of February 28, 2009. This assessment was based
on criteria for effective internal control over financial reporting described
in Internal Control - Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission, referred to as COSO. Our
assessment included the documentation and understanding of our internal control
over financial reporting. We have evaluated the design effectiveness and tested
the operating effectiveness of internal controls to form our conclusion.

Our
internal control over financial reporting is a process designed to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
generally accepted accounting principles. Our internal control over financial
reporting includes those policies and procedures that pertain to maintaining
records that, in reasonable detail, accurately and fairly reflect transactions
and dispositions of assets, providing reasonable assurance that transactions are
recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, assuring that
receipts and expenditures are being made in accordance with authorizations of
our management and directors and providing reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use or disposition
of assets that could have a material effect on our financial statements.

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

Based
on this assessment, the undersigned officers concluded that our internal
controls and procedures are effective in timely alerting them to material
information required to be included in our periodic SEC filings and that
information required to be disclosed by us in these periodic filings is
recorded, processed, summarized and reported within the time periods specified
in the SECs rules and forms and that our internal controls are effective to
provide reasonable assurance that our financial statements are fairly presented
in conformity with generally accepted accounting principles.

The
Audit Committee of our Board of Directors, which consists of independent,
non-executive directors, meets regularly with management, the internal auditors
and the independent registered public accountants to review accounting,
reporting, auditing and internal control matters. The Committee has direct and
private access to both internal and external auditors.

BDO
Seidman, LLP, the independent registered public accounting firm who audits our
financial statements, has audited internal control over financial reporting as
of February 28, 2009 and has expressed an unqualified opinion thereon.

/s/ Marcy Syms
Marcy Syms
Chief Executive Officer

/s/ Philip A.
Piscopo
Philip A. Piscopo
Chief Financial Officer

(c)
Internal Control Over Financial Reporting - There have not been any changes in
the Companys internal control over financial reporting (as such term is
defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the
Companys most recently completed fiscal quarter that have materially affected,
or are reasonably likely to materially affect the Companys internal control over
financial reporting.

15

---



REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM

Board of
Directors and the Shareholders
Syms Corp
Secaucus, New Jersey

We have
audited Syms Corps Internal Control Over Financial Reporting, as of February
28, 2009, based on criteria established in Internal Control  Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission (COSO). Syms Corps management is responsible for maintaining
effective internal control over financial reporting and for its assessment of
the effectiveness of internal control over financial reporting included in the
accompanying Managements Report on Internal Control Over Financial Reporting.
Our responsibility is to express an opinion on the effectiveness of the
Companys internal control over financial reporting based on our audit.

We conducted
our audit in accordance with the standards of the Public Company Accounting
Oversight Board (United States). Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether effective
internal control over financial reporting was maintained in all material
respects. Our audit also included obtaining an understanding of internal
control over financial reporting, assessing the risk that a material weakness
exists and evaluating managements assessment, testing and evaluating the
design and operating effectiveness of internal control based on the assessed
risk. Our audit also included performing such other procedures as we considered
necessary in the circumstances. We believe that our audit provides a reasonable
basis for our opinion.

A companys
internal control over financial reporting is a process designed to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
generally accepted accounting principles. A companys 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 the assets of the company; (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 receipts and expenditures of the
company are being made only in accordance with authorizations of management and
directors of the company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use, or disposition
of the companys assets that could have a material effect on the financial
statements.

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

In our
opinion, Syms Corp maintained, in all material respects, effective internal
control over financial reporting as of February 28, 2009, based on the criteria
established in Internal Control - Integrated Framework issued by the Committee
of Sponsoring Organizations of the Treadway Commission (COSO).

We have also
audited, in accordance with the standards of the Public Company Accounting
Oversight Board (United States), the balance sheets of Syms Corp as of February
28, 2009 and March 1, 2008 and the related statements of operations,
shareholders equity, and cash flows for each of the three years in the period
ended February 28, 2009 and our report dated May 1, 2009 expressed an
unqualified opinion thereon.

/s/ BDO
Seidman, LLP

BDO Seidman,
LLP
New York, New York
May 1, 2009

16

---



|         |                                                       
|-------- | ------------------------------------------------------
|Item 9B. | OTHER INFORMATION - None.                             
|         |                                                       
|Item 10. | DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The Company
maintains a code of ethics applicable to the Companys chief executive officer
and senior financial and professional personnel (including the Companys chief
financial officer, principal accounting officer or controller and persons
performing similar functions). The Company has posted a copy of such code of
ethics on its website. The internet address for such code of ethics is
http://www.syms.com/pressreleases/corp_gov.asp.

In
accordance with General Instruction G(3) of the General Instructions to Form
10-K, the other information called for by Item 10 is omitted from this Annual
Report and is incorporated by reference to the definitive Proxy Statement to be
filed by the Company pursuant to Regulation 14A of the General Rules and
Regulations under the Securities Exchange Act of 1934, as amended, which the
Company will file not later than 120 days after the end of the fiscal year
covered by this Annual Report.

|         |                       
|-------- | ----------------------
|Item 11. | EXECUTIVE COMPENSATION

In
accordance with General Instruction G(3) of the General Instructions to Form
10-K, the information called for by Item 11 is omitted from this Annual Report
and is incorporated by reference to the definitive Proxy Statement to be filed
by the Company pursuant to Regulation 14A of the General Rules and Regulations
under the Securities Exchange Act of 1934, as amended, which the Company will
file not later than 120 days after the end of the fiscal year covered by this
report.

|         |                                                                                                
|-------- | -----------------------------------------------------------------------------------------------
|Item 12. | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
 OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS

In
accordance with General Instruction G(3) of the General Instructions to Form
10-K, the other information called for by Item 12 is omitted from this Annual
Report and is incorporated by reference to the definitive Proxy Statement to be
filed by the Company pursuant to Regulation 14A of the General Rules and
Regulations under the Securities Exchange Act of 1934, as amended, which the
Company will file not later than 120 days after the end of the fiscal year
covered by this Annual Report.

|         |                                                                       
|-------- | ----------------------------------------------------------------------
|Item 13. | CERTAIN RELATIONSHIPS, RELATED TRANSACTIONS
 AND DIRECTOR INDEPENDENCE

In
accordance with General Instruction G(3) of the General Instructions to Form
10-K, the information called for by Item 13 is omitted from this Annual Report
and is incorporated by reference to the definitive Proxy Statement to be filed
by the Company pursuant to Regulation 14A of the General Rules and Regulations
under the Securities Exchange Act of 1934, as amended, which the Company will
file not later than 120 days after the end of the fiscal year covered by this
Annual Report.

|         |                                       
|-------- | --------------------------------------
|Item 14. | PRINCIPAL ACCOUNTANT FEES AND SERVICES

In
accordance with General Instruction G(3) of the General Instructions to Form
10-K, the information called for by Item 14 is omitted from this Annual Report
and is incorporated by reference to the definitive Proxy Statement to be filed
by the Company pursuant to Regulation 14A of the General Rules and Regulations
under the Securities Exchange Act of 1934, as amended, which the Company will
file not later than 120 days after the end of the fiscal year covered by this
report.

17

---



PART IV

|         |                                           
|-------- | ------------------------------------------
|Item 15. | EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

|       |                                                            |                                                         |  |            
|------ | ---------------------------------------------------------- | ------------------------------------------------------- |  | -----------
|       |                                                            |                                                         |  | PAGE
NUMBER
|(a)(1) | Financial
 Statements filed as part of this Annual Report: |                                                         | 
|       |                                                            |                                                         |  |            
|       |                                                            | Report of Independent Registered Public Accounting Firm |  | F-1        
|       |                                                            | Balance Sheets                                          |  | F-2        
|       |                                                            | Statements of Operations                                |  | F-3        
|       |                                                            | Statements of Shareholders Equity                      |  | F-4        
|       |                                                            | Statements of Cash Flows                                |  | F-5        
|       |                                                            | Notes to Financial Statements                           |  | F-6        

|       |                                                                            
|------ | ---------------------------------------------------------------------------
|(a)(2) | List of
 Financial Statement Schedules filed as part of this Annual Report:
|      
|       | Report of
 Independent Registered Public Accounting Firm on Schedule II.   
|      
|       | Schedule II:
 Valuation and qualifying accounts                            

Schedules,
other than those listed above, are omitted because they are not applicable, or
not required, or because the required information is included in the financial
statements or notes thereto.

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                             
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a)(3)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | List of
 Exhibits:                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                             
|The
 following exhibits which are marked with an asterisk are filed as part of
 this Annual Report and the other exhibits set forth below are incorporated by
 reference from (i) the Companys Registration Statement on Form S-1 under the
 Securities Act of 1933 (Registration No. 2-85554) filed August 2, 1983 and
 declared effective September 23, 1983 or (ii) where indicated, the Companys
 reports on Form 8-K, Form 10-Q or Form 10-K or the Companys Proxy Statement
 (Commission File No. 1-8564).
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|3.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | Certificate
 of Incorporation of Syms Corp, as amended                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                             
|3.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | Amended and
 Restated By-laws of Syms Corp (exhibit 3.1 to Current Report on Form 8-K
 dated January 12, 2009).                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                             
|4.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | Specimen
 Certificate of Common stock                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                             
|10.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | Ground Lease
 at One Emerson Lane, Township of Secaucus, Hudson County, New Jersey
 Assignment and Assumption of Ground Lease, dated May 8, 1986, to Registrant
 (exhibit 28.1 to Current Report on Form 8-K dated May 1986)
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                             
|10.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | Credit
 Program Agreement, dated January 27, 2000 between Syms Corp and Conseco Finance
 Corp (exhibit 10.39 to Annual Report on Form 10-K for fiscal year ended
 February 26, 2000)                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                             
|10.3                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | Loan
 Agreement, dated as of November 5, 2003, between Syms Corp and Israel
 Discount Bank of New York (exhibit 10.50 to Quarterly Report on Form 10Q for
 fiscal quarter ended November 29, 2003)                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                             
|10.3.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | First
 Amendment to Loan Agreement, dated April 7, 2005, between Syms Corp and
 Israel Discount Bank of New York (exhibit 99.1 to Current Report on Form 8-K
 dated April 8, 2005.)                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                             
|10.3.2*                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | Second
 Amendment to Loan Agreement, dated April 1, 2006, between Syms Corp and
 Israel Discount Bank of New York                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                             
|10.3.3*                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | Third
 Amendment to Loan Agreement, dated April 1, 2008, between Syms Corp and
 Israel Discount Bank of New York                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                             
|10.4                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | Syms Corp
 2005 Stock Option Plan, as amended (exhibit 10.4 to Current Report on Form
 8-K dated August 5, 2005)                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                             
|10.4.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | Form of
 Nonqualified Stock Option Award Agreement for 2005 Stock Option Plan (exhibit
 10.1 to Current Report on Form 8-K dated August 5, 2005)                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                             
|10.4.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | Form of
 Incentive Option Award for 2005 Stock Option Plan (exhibit 10.2 to Current
 Report on Form 8-K dated August 5, 2005)                                                                                               

18

---



|       |                                                                                                                                                                                                                       
|------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.4.3 | Form of
 Restricted Stock Award for 2005 Stock Option Plan (exhibit 10.3 to Current
 Report on Form 8-K dated August 5, 2005)                                                                                         
|       |                                                                                                                                                                                                                       
|10.5   | Contract of
 Sale  Office, Commercial and Multi-Family Residential Premises, dated as of
 December 21, 2006 (exhibit 10.56 to Current Report on Form 8-K dated December
 21, 2006)                                   
|       |                                                                                                                                                                                                                       
|21*    | List of
 Subsidiaries                                                                                                                                                                                                 
|       |                                                                                                                                                                                                                       
|23.1*  | Consent of
 BDO Seidman, LLP                                                                                                                                                                                          
|       |                                                                                                                                                                                                                       
|31.1*  | Certification
 of Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities
 and Exchange Act of 1934, as adopted pursuant to Section 302 of the
 Sarbanes-Oxley Act of 2002                            
|       |                                                                                                                                                                                                                       
|31.2*  | Certification
 of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities
 and Exchange Act of 1934, as adopted pursuant to Section 302 of the
 Sarbanes-Oxley Act of 2002                            
|       |                                                                                                                                                                                                                       
|32.1*  | Certification
 of Chief Executive Officer pursuant to Rule 13a-14(b) under the Securities
 and Exchange Act of 1934 and
 18.U.S.C. Section 1350, as adopted pursuant to Section 906 of the
 Sarbanes-Oxley Act of 2002
|       |                                                                                                                                                                                                                       
|32.2*  | Certification
 of Chief Financial Officer pursuant to Rule 13a-14(b) under the Securities
 and Exchange Act of 1934 and 18.U.S.C. Section 1350, as adopted pursuant to
 Section 906 of the Sarbanes-Oxley Act of 2002 

19

---



SIGNATURES

Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

SYMS CORP

|    |                                      | 
|--- | ------------------------------------ | 
|By: | /s/ Marcy
 Syms                      | 
|    |                                      | 
|    | Marcy Syms                           | 
|    | Chief
 Executive Officer / President | 

Date: May 1,
2009

Pursuant
to the requirements of the Securities Exchange Act of 1934, this Annual Report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.

|                          |  |                                                                                                     |  |            
|------------------------- |  | --------------------------------------------------------------------------------------------------- |  | -----------
|Signature                 |  | Title                                                                                               |  | Date       
|                          |  |                                                                                                     |  |            
|                         
|/s/ Sy Syms               |  | Chairman of
 the Board
 and Director                                                                |  | May 1, 2009
|                          |  |                                                                                                     | 
|Sy Syms                   |  |                                                                                                     | 
|                          |  |                                                                                                     |  |            
|/s/ Marcy
 Syms           |  | Chief
 Executive Officer/President
 and Director 
 (Principal executive officer)                    |  | May 1, 2009
|                          |  |                                                                                                     | 
|Marcy Syms                |  |                                                                                                     | 
|                          |  |                                                                                                     |  |            
|/s/ Philip
 A. Piscopo    |  | Vice
 President, Chief Financial Officer, 
 Secretary
 (Principal financial and accounting officer) |  | May 1, 2009
|                          |  |                                                                                                     | 
|Philip A.
 Piscopo        |  |                                                                                                     | 
|                          |  |                                                                                                     |  |            
|/s/ Bernard
 H. Tenenbaum |  | Director                                                                                            |  | May 1, 2009
|                          |  |                                                                                                     |  |            
|Bernard H.
 Tenenbaum     |  |                                                                                                     |  |            
|                          |  |                                                                                                     |  |            
|/s/ Thomas
 E. Zanecchia  |  | Director                                                                                            |  | May 1, 2009
|                          |  |                                                                                                     |  |            
|Thomas E.
 Zanecchia      |  |                                                                                                     |  |            
|                          |  |                                                                                                     |  |            
|/s/ Henry M.
 Chidgey     |  | Director                                                                                            |  | May 1, 2009
|                          |  |                                                                                                     |  |            
|Henry M.
 Chidgey         |  |                                                                                                     |  |            

20

---



Report of Independent Registered Public
Accounting Firm

Board of
Directors and Shareholders
Syms Corp
Secaucus, New Jersey

The audits
referred to in our report dated May 1, 2009 relating to the financial
statements of Syms Corp, which is contained in Item 15 of this Form 10-K also
included the audit of the financial statement schedule listed in the
accompanying index. This financial statement schedule is the responsibility of
the Companys management. Our responsibility is to express an opinion on this
financial statement schedule based on our audits.

In our opinion
such financial statement schedule, when considered in relation to the basic
financial statements taken as a whole, presents fairly, in all material
respects, the information set forth therein.

/s/ BDO
Seidman, LLP

BDO Seidman,
LLP
New York, New York
May 1, 2009

SCHEDULE II

|                                                                     
|---------------------------------------------------------------------
|SYMS CORP                                                            
|Valuation and qualifying accounts                                    
|Fiscal years ended February 28, 2009, March 1, 2008 and March 3, 2007
|                                                                     

|                                   |  |                                  |           |                                                   |           |                            |  |            |   |                           |   |            |   |  |           | 
|---------------------------------- |  | -------------------------------- | --------- | ------------------------------------------------- | --------- | -------------------------- |  | ---------- | - | ------------------------- | - | ---------- | - |  | --------- | 
|                                   |  |                                  |           |                                                   | Additions |                            |  |            |   |                           |   |           
|                                   |  |                                  |           |                                                   |           |                            |  |            |   |                           |   |           
|                                   |  | Balance at
 beginning of
 period |           | Charged against
 revenues or to
 costs & expenses |           | Charged to
 other accounts |  | Deductions |   | Balance at end
 of period |  
|                                   |  |                                  |           |                                                   |           |                            |  |            |   |                           |  
|                                   |  |                                  |           |                                                   |           |                            |  |            |   |                           |  
|Reserve for inventory obsolescence |  |                                  |           |                                                   |           |                            |  |            |   |                           |   |            |   |  |           | 
|                                   |  |                                  |           |                                                   |           |                            |  |            |   |                           |   |            |   |  |           | 
|Fiscal 2006                        |  |                                  | 6,521,000 |                                                   |           |                           |  |            |  |                           |   | (2,320,000 | ) |  | 4,201,000 | 
|Fiscal 2007                        |  |                                  | 4,201,000 |                                                   |           |                           |  |            |  |                           |   | (1,381,000 | ) |  | 2,820,000 | 
|Fiscal 2008                        |  |                                  | 2,820,000 |                                                   |           |                           |  |            |  |                           |   | (624,000   | ) |  | 2,196,000 | 
|                                   |  |                                  |           |                                                   |           |                            |  |            |   |                           |   |            |   |  |           | 
|Deferred tax valuation allowance   |  |                                  |           |                                                   |           |                            |  |            |   |                           |   |            |   |  |           | 
|                                   |  |                                  |           |                                                   |           |                            |  |            |   |                           |   |            |   |  |           | 
|Fiscal 2006                        |  |                                  | 1,000,000 |                                                   |           |                           |  |            |  |                           | $ | (1,000,000 | ) |  |          | 
|Fiscal 2007                        |  |                                  |          |                                                   |           |                           |  |            |  |                           |   |           |   |  |          | 
|Fiscal 2008                        |  |                                  |          |                                                   |           |                           |  |            |  |                           |   |           |   |  |          | 

21

---



Report of Independent Registered Public
Accounting Firm

Board of
Directors and Shareholders
SYMS Corp
Secaucus, New Jersey

We have
audited the accompanying balance sheets of Syms Corp as of February 28, 2009
and March 1, 2008 and the related statements of operations, shareholders
equity and cash flows for each of the three fiscal years in the period ended
February 28, 2009. These financial statements are the responsibility of
management. Our responsibility is to express an opinion on these financial statements
based on our audits.

We conducted
our audits in accordance with the standards of the Public Company Accounting
Oversight Board (United States). Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free from material misstatement. An audit also includes
examining, on a test basis, evidence supporting the amount and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by managements, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Syms Corp at February 28, 2009 and
March 1, 2008, and the results of its operations and its cash flows for each of
the three fiscal years in the period ended February 28, 2009, in conformity
with accounting principles generally accepted in the United States of America.

We have also
audited, in accordance with the standards of the Public Accounting Oversight
Board (United States), Syms Corps internal control of financial reporting as
of February 28, 2009, based on criteria established in Internal Control  Integrated Framework
issued by the Committee of Sponsoring Organizations of the Treadway Commission
(COSO), and our report dated May 1, 2009 expressed an unqualified opinion
thereon.

/s/ BDO
Seidman, LLP

BDO Seidman,
LLP
New York, New York
May 1, 2009

F  1

---



|                                        
|----------------------------------------
|SYMS CORP                               
|BALANCE
 SHEETS                         
|                                        
|(In thousands, except per share amounts)

|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------ | ------- | -------------- | - | ------- | -
|                                                                                                                                                                                                                                         |  | February 28,
 2009 |         | March 1,
 2008 |  
|                                                                                                                                                                                                                                         |  |                    |         |                |  
|ASSETS                                                                                                                                                                                                                                   |  |                    |         |                |   |         |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|CURRENT ASSETS:                                                                                                                                                                                                                          |  |                    |         |                |   |         |  
|Cash and cash equivalents                                                                                                                                                                                                                |  | $                  | 1,822   |                | $ | 11,904  |  
|Receivables                                                                                                                                                                                                                              |  |                    | 1,589   |                |   | 2,445   |  
|Merchandise inventories                                                                                                                                                                                                                  |  |                    | 52,480  |                |   | 66,086  |  
|Deferred income taxes                                                                                                                                                                                                                    |  |                    | 3,045   |                |   | 3,248   |  
|Assets held for sale                                                                                                                                                                                                                     |  |                    | 7,202   |                |   | 5,576   |  
|Prepaid expenses and other current assets                                                                                                                                                                                                |  |                    | 5,317   |                |   | 4,147   |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|Total current assets                                                                                                                                                                                                                     |  |                    | 71,455  |                |   | 93,406  |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|PROPERTY AND EQUIPMENT  NET                                                                                                                                                                                                             |  |                    | 95,956  |                |   | 98,815  |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|DEFERRED INCOME TAXES                                                                                                                                                                                                                    |  |                    | 15,209  |                |   | 12,882  |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|BUILDING AIR RIGHTS                                                                                                                                                                                                                      |  |                    | 9,134   |                |   | 3,100   |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|OTHER ASSETS                                                                                                                                                                                                                             |  |                    | 23,369  |                |   | 21,426  |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|TOTAL ASSETS                                                                                                                                                                                                                             |  | $                  | 215,123 |                | $ | 229,629 |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|LIABILITIES AND SHAREHOLDERS EQUITY                                                                                                                                                                                                     |  |                    |         |                |   |         |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|CURRENT LIABILITIES:                                                                                                                                                                                                                     |  |                    |         |                |   |         |  
|Accounts payable                                                                                                                                                                                                                         |  | $                  | 14,936  |                | $ | 25,610  |  
|Accrued expenses                                                                                                                                                                                                                         |  |                    | 9,012   |                |   | 6,263   |  
|Obligations to customers                                                                                                                                                                                                                 |  |                    | 4,292   |                |   | 4,443   |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|Total current liabilities                                                                                                                                                                                                                |  |                    | 28,240  |                |   | 36,316  |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|OTHER LONG TERM LIABILITIES                                                                                                                                                                                                              |  |                    | 840     |                |   | 1,178   |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|COMMITMENTS AND CONTINGENCIES                                                                                                                                                                                                            |  |                    |         |                |   |         |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|SHAREHOLDERS EQUITY:                                                                                                                                                                                                                    |  |                    |         |                |   |         |  
|Preferred stock, par value $100 per share 
 authorized 1,000 shares; none outstanding                                                                                                                                                   |  |                    |        |                |   |        |  
|Common stock, par value $0.05 per share 
 authorized 30,000 shares; 14,590 shares outstanding as of February 28, 2009
 (net of 4,298 treasury shares) and 14,588 shares outstanding as of March 1,
 2008 (net of 4,082 treasury shares) |  |                    | 800     |                |   | 789     |  
|Additional paid-in capital                                                                                                                                                                                                               |  |                    | 21,560  |                |   | 19,273  |  
|Treasury stock                                                                                                                                                                                                                           |  |                    | (45,903 | )              |   | (43,086 | )
|Accumulated other comprehensive (loss)
 income                                                                                                                                                                                           |  |                    | (2,127  | )              |   | 23      |  
|Retained earnings                                                                                                                                                                                                                        |  |                    | 211,713 |                |   | 215,136 |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|Total shareholders equity                                                                                                                                                                                                               |  |                    | 186,043 |                |   | 192,135 |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  
|TOTAL LIABILITIES AND SHAREHOLDERS EQUITY                                                                                                                                                                                               |  | $                  | 215,123 |                | $ | 229,629 |  
|                                                                                                                                                                                                                                         |  |                    |         |                |   |         |  

See Notes to
Financial Statements

F  2

---



|                                        
|----------------------------------------
|SYMS CORP                               
|STATEMENTS
 OF OPERATIONS               
|                                        
|(In thousands, except per share amounts)

|                                              |  |                    |         |                |   |                |   |   |         |  
|--------------------------------------------- |  | ------------------ | ------- | -------------- | - | -------------- | - | - | ------- | -
|                                              |  | Fiscal Year Ended  |        
|                                              |  |                    |        
|                                              |  | February 28,
 2009 |         | March 1,
 2008 |   | March 3,
 2007 |  
|                                              |  |                    |         |                |   |                |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|NET SALES                                     |  | $                  | 242,000 |                | $ | 267,149        |   | $ | 281,178 |  
|Cost of goods sold                            |  |                    | 141,475 |                |   | 157,168        |   |   | 167,889 |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|Gross profit                                  |  |                    | 100,525 |                |   | 109,981        |   |   | 113,289 |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|EXPENSES:                                     |  |                    |         |                |   |                |   |   |         |  
|Selling, general and administrative           |  |                    | 74,690  |                |   | 76,959         |   |   | 77,841  |  
|Advertising                                   |  |                    | 6,339   |                |   | 8,561          |   |   | 8,118   |  
|Occupancy                                     |  |                    | 15,557  |                |   | 14,323         |   |   | 15,688  |  
|Depreciation and amortization                 |  |                    | 8,003   |                |   | 7,659          |   |   | 8,205   |  
|Asset impairment charge                       |  |                    | 530     |                |   | 745            |   |   |        |  
|(Gain)/Loss on sale of assets                 |  |                    |        |                |   |               |   |   | 31      |  
|Other income                                  |  |                    | (53     | )              |   | (491           | ) |   | (234    | )
|Gain on sale of real estate                   |  |                    | (548    | )              |   |               |   |   | (10,424 | )
|                                              |  |                    |         |                |   |                |   |   |         |  
|Total expenses - net                          |  |                    | 104,518 |                |   | 107,756        |   |   | 99,225  |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|(Loss)/income from operations                 |  |                    | (3,993  | )              |   | 2,225          |   |   | 14,064  |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|Interest expense                              |  |                    | 170     |                |   | 171            |   |   | 219     |  
|Interest income                               |  |                    | (132    | )              |   | (1,082         | ) |   | (2,106  | )
|                                              |  |                    |         |                |   |                |   |   |         |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|(Loss)/income before income taxes             |  |                    | (4,031  | )              |   | 3,136          |   |   | 15,951  |  
|Income tax (recovery)/provision               |  |                    | (609    | )              |   | 2,329          |   |   | 6,403   |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|NET (LOSS)/INCOME                             |  | $                  | (3,423  | )              | $ | 807            |   | $ | 9,548   |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|Net (Loss)/income Per Share  basic           |  | $                  | (0.23   | )              | $ | 0.06           |   | $ | 0.66    |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|Weighted Average Shares Outstanding  Basic   |  |                    | 14,589  |                |   | 14,659         |   |   | 14,574  |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|Net (Loss)/income Per Share  diluted         |  | $                  | (0.23   | )              | $ | 0.05           |   | $ | 0.65    |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|                                              |  |                    |         |                |   |                |   |   |         |  
|Weighted Average Shares Outstanding  Diluted |  |                    | 14,589  |                |   | 14,760         |   |   | 14,703  |  
|                                              |  |                    |         |                |   |                |   |   |         |  

See Notes to
Financial Statements

F  3

---



|                                   
|-----------------------------------
|SYMS CORP                          
|STATEMENTS
 OF SHAREHOLDERS EQUITY
|                                   
|(In
 thousands)                    

|                                                                            |  |              |        |                              |   |                |                    |   |        |                                             |  |        |       |   |         |   |   |         |   |   |        |   |   |         |  
|--------------------------------------------------------------------------- |  | ------------ | ------ | ---------------------------- | - | -------------- | ------------------ | - | ------ | ------------------------------------------- |  | ------ | ----- | - | ------- | - | - | ------- | - | - | ------ | - | - | ------- | -
|                                                                            |  |              |        |                              |   |                |                    |   |        | Accumulated
 Other Com-
 prehensive
 Income |  |        |      
|                                                                            |  | Common Stock |        | Additional
 Paid-in
 Capital |   | Treasury Stock |                    |   |        |                                             |  |       
|                                                                            |  |              |        |                              |   |                | Retained
 Earnings |   |        |                                             | 
|                                                                            |  | Shares       |        | Amount                       |   |                | Shares             |   | Amount |                                             |  |        | Total |  
|                                                                            |  |              |        |                              |   |                |                    |   |        |                                             |  |        |       |   |         |   |  
|                                                                           
|BALANCE AS OFFebruary 25, 2006                                              |  |              | 18,262 |                              | $ | 769            |                    | $ | 16,656 |                                             |  | (3,328 | )     | $ | (29,649 | ) | $ | 222,758 |   | $ |       |   | $ | 210,534 |  
|                                                                            |  |              |        |                              |   |                |                    |   |        |                                             |  |        |       |   |         |   |   |         |   |   |        |   |   |         |  
|Exercise of options                                                         |  |              | 407    |                              |   | 20             |                    |   | 2,254  |                                             |  |       |       |   |        |   |   |        |   |   |       |   |   | 2,274   |  
|Tax benefit derived from exercise of options                                |  |              |       |                              |   |               |                    |   | 354    |                                             |  |       |       |   |        |   |   |        |   |   |       |   |   | 354     |  
|Stock buyback                                                               |  |              |       |                              |   |               |                    |   |       |                                             |  | (640   | )     |   | (11,734 | ) |   |        |   |   |       |   |   | (11,734 | )
|Related party purchase adjustment for purchase of real estate (net of
 tax) |  |              |       |                              |   |               |                    |   |       |                                             |  |       |       |   |        |   |   | (8,907  | ) |   |       |   |   | (8,907  | )
|Net income                                                                  |  |              |       |                              |   |               |                    |   |       |                                             |  |       |       |   |        |   |   | 9,548   |   |   |       |   |   | 9,548   |  
|                                                                            |  |              |        |                              |   |                |                    |   |        |                                             |  |        |       |   |         |   |   |         |   |   |        |   |   |         |  
|                                                                            |  |              |        |                              |   |                |                    |   |        |                                             |  |        |       |   |         |   |   |         |   |   |        |   |   |         |  
|BALANCE AS OF March 3, 2007                                                 |  |              | 18,669 |                              | $ | 789            |                    | $ | 19,264 |                                             |  | (3,968 | )     | $ | (41,383 | ) | $ | 223,399 |   | $ |       |   | $ | 202,069 |  
|                                                                            |  |              |        |                              |   |                |                    |   |        |                                             |  |        |       |   |         |   |   |         |   |   |        |   |   |         |  
|Exercise of options                                                         |  |              | 1      |                              |   |               |                    |   | 4      |                                             |  |       |       |   |        |   |   |        |   |   |       |   |   | 4       |  
|Tax benefit derived from exercise of options                                |  |              |       |                              |   |               |                    |   | 5      |                                             |  |       |       |   |        |   |   |        |   |   |       |   |   | 5       |  
|Stock buyback                                                               |  |              |       |                              |   |               |                    |   |       |                                             |  | (114   | )     |   | (1,703  | ) |   |        |   |   |       |   |   | (1,703  | )
|Payment of dividends                                                        |  |              |       |                              |   |               |                    |   |       |                                             |  |       |       |   |        |   |   | (8,820  | ) |   |       |   |   | (8,820  | )
|FIN 48 reserve                                                              |  |              |       |                              |   |               |                    |   |       |                                             |  |       |       |   |        |   |   | (250    | ) |   |       |   |   | (250    | )
|Comprehensive income:                                                       |  |              |        |                              |   |                |                    |   |        |                                             |  |        |       |   |         |   |   |         |   |   |        |   |   |         |  
|Net income                                                                  |  |              |       |                              |   |               |                    |   |       |                                             |  |       |       |   |        |   |   | 807     |   |   |       |   |   | 807     |  
|Deferred pension gain                                                       |  |              |       |                              |   |               |                    |   |       |                                             |  |       |       |   |        |   |   |        |   |   | 23     |   |   | 23      |  
|                                                                            |  |              |        |                              |   |                |                    |   |        |                                             |  |        |       |   |         |   |   |         |   |   |        |   |   |         |  
|Total comprehensive income                                                  |  |              |       |                              |   |               |                    |   |       |                                             |  |       |       |   |        |   |   |        |   |   |       |   |   | 830     |  
|                                                                            |  |              |        |                              |   |                |                    |   |        |                                             |  |        |       |   |         |   |   |         |   |   |        |   |   |         |  
|                                                                            |  |              |        |                              |   |                |                    |   |        |                                             |  |        |       |   |         |   |   |         |   |   |        |   |   |         |  
|BALANCE AS OF March 1, 2008                                                 |  |              | 18,670 |                              | $ | 789            |                    | $ | 19,273 |                                             |  | (4,082 | )     | $ | (43,086 | ) | $ | 215,136 |   | $ | 23     |   | $ | 192,135 |  
|                                                                            |  |              |        |                              |   |                |                    |   |        |                                             |  |        |       |   |         |   |   |         |   |   |        |   |   |         |  
|Exercise of options                                                         |  |              | 218    |                              |   | 11             |                    |   | 2,137  |                                             |  |       |       |   |        |   |   |        |   |   |       |   |   | 2,148   |  
|Tax benefit derived from exercise of options                                |  |              |       |                              |   |               |                    |   | 150    |                                             |  |       |       |   |        |   |   |        |   |   |       |   |   | 150     |  
|Stock buyback                                                               |  |              |       |                              |   |               |                    |   |       |                                             |  | (216   | )     |   | (2,817  | ) |   |        |   |   |       |   |   | (2,817  | )
|Comprehensive income:                                                       |  |              |        |                              |   |                |                    |   |        |                                             |  |        |       |   |         |   |   |         |   |   |        |   |   |         |  
|Net (loss)                                                                  |  |              |       |                              |   |               |                    |   |       |                                             |  |       |       |   |        |   |   | (3,423  | ) |   |       |   |   | (3,423  | )
|Deferred pension (loss)                                                     |  |              |       |                              |   |               |                    |   |       |                                             |  |       |       |   |        |   |   |        |   |   | (2,150 | ) |   | (2,150  | )
|                                                                            |  |              |        |                              |   |                |                    |   |        |                                             |  |        |       |   |         |   |   |         |   |   |        |   |   |         |  
|Total comprehensive (loss)                                                  |  |              |       |                              |   |               |                    |   |       |                                             |  |       |       |   |        |   |   |        |   |   |       |   |   | (5,682  | )
|                                                                            |  |              |        |                              |   |                |                    |   |        |                                             |  |        |       |   |         |   |   |         |   |   |        |   |   |         |  
|                                                                            |  |              |        |                              |   |                |                    |   |        |                                             |  |        |       |   |         |   |   |         |   |   |        |   |   |         |  
|BALANCE AS OF February 28, 2009                                             |  |              | 18,888 |                              | $ | 800            |                    | $ | 21,560 |                                             |  | (4,298 | )     | $ | (45,903 | ) | $ | 211,713 |   | $ | (2,127 | ) | $ | 186,043 |  
|                                                                            |  |              |        |                              |   |                |                    |   |        |                                             |  |        |       |   |         |   |   |         |   |   |        |   |   |         |  

See Notes to Financial
Statements

F  4

---



|                         
|-------------------------
|SYMS CORP                
|STATEMENTS
 OF CASH FLOWS
|                         
|(In
 thousands)          

|                                                       |  |                   |         |                |   |                |   |   |         |  
|------------------------------------------------------ |  | ----------------- | ------- | -------------- | - | -------------- | - | - | ------- | -
|                                                       |  | Fiscal Year Ended |        
|                                                       |  |                   |        
|                                                       |  | February 28,2009  |         | March 1,
 2008 |   | March 3,
 2007 |  
|                                                       |  |                   |         |                |   |                |  
|                                                       |  |                   |         |                |   |                |  
|CASH FLOWS FROM OPERATING ACTIVITIES:                  |  |                   |         |                |   |                |   |   |         |  
|Net (loss)/income                                      |  | $                 | (3,423  | )              | $ | 807            |   | $ | 9,548   |  
|                                                       |  |                   |         |                |   |                |   |   |         |  
|Adjustments to reconcile net (loss)/income to net cash |  |                   |         |                |   |                |   |   |         |  
|Provided by operating activities:                      |  |                   |         |                |   |                |   |   |         |  
|Depreciation and amortization                          |  |                   | 8,003   |                |   | 7,659          |   |   | 8,205   |  
|Asset impairment                                       |  |                   | 530     |                |   | 745            |   |   |        |  
|Deferred income taxes                                  |  |                   | (615    | )              |   | (497           | ) |   | 2,125   |  
|Gain/(loss) on sale of property and
equipment          |  |                   | (503    | )              |   | 10             |   |   | (10,393 | )
|(Increase)/decrease in operating expenses:             |  |                   |         |                |   |                |   |   |         |  
|Receivables                                            |  |                   | 856     |                |   | (719           | ) |   | 852     |  
|Merchandise inventories                                |  |                   | 13,606  |                |   | (2,277         | ) |   | (6,340  | )
|Prepaid expenses and other current assets              |  |                   | (1,170  | )              |   | 907            |   |   | 1,002   |  
|Other assets                                           |  |                   | (1,995  | )              |   | (2,152         | ) |   | (1,295  | )
|Increase/(decrease) in operating liabilities:          |  |                   |         |                |   |                |   |   |         |  
|Accounts payable                                       |  |                   | (10,674 | )              |   | 3,932          |   |   | 6,762   |  
|Accrued expenses                                       |  |                   | (262    | )              |   | (2,522         | ) |   | 2,362   |  
|Obligations to customers                               |  |                   | (151    | )              |   | 485            |   |   | 333     |  
|Other long term liabilities                            |  |                   | (338    | )              |   | (370           | ) |   | 28      |  
|Income taxes                                           |  |                   | (940    | )              |   | (1,732         | ) |   |        |  
|                                                       |  |                   |         |                |   |                |   |   |         |  
|Net cash provided by operating activities              |  |                   | 3,215   |                |   | 4,276          |   |   | 13,189  |  
|                                                       |  |                   |         |                |   |                |   |   |         |  
|                                                       |  |                   |         |                |   |                |   |   |         |  
|CASH FLOWS FROM INVESTING ACTIVITIES:                  |  |                   |         |                |   |                |   |   |         |  
|Purchase of property and equipment                     |  |                   | (7,667  | )              |   | (6,687         | ) |   | (7,629  | )
|Proceeds from sale of property and equipment           |  |                   | 923     |                |   | 17             |   |   | 16,296  |  
|Investment in building and air rights                  |  |                   | (6,034  | )              |   | (3,100         | ) |   |        |  
|                                                       |  |                   |         |                |   |                |   |   |         |  
|Net cash (used in)/provided by investing
activities    |  |                   | (12,778 | )              |   | (9,770         | ) |   | 8,667   |  
|                                                       |  |                   |         |                |   |                |   |   |         |  
|                                                       |  |                   |         |                |   |                |   |   |         |  
|CASH FLOWS FROM FINANCING ACTIVITIES:                  |  |                   |         |                |   |                |   |   |         |  
|Related party purchase adjustment of real estate       |  |                   |        |                |   |               |   |   | (14,845 | )
|Payment of dividend                                    |  |                   |        |                |   | (8,820         | ) |   |        |  
|Purchase of treasury shares                            |  |                   | (2,817  | )              |   | (1,703         | ) |   | (11,734 | )
|Exercise of options                                    |  |                   | 2,148   |                |   | 4              |   |   | 2,274   |  
|Tax benefit of options                                 |  |                   | 150     |                |   | 5              |   |   | 354     |  
|                                                       |  |                   |         |                |   |                |   |   |         |  
|Net cash used in financing activities                  |  |                   | (519    | )              |   | (10,514        | ) |   | (23,951 | )
|                                                       |  |                   |         |                |   |                |   |   |         |  
|NET (DECREASE) IN CASH AND CASH EQUIVALENTS            |  |                   | (10,082 | )              |   | (16,008        | ) |   | (2,095  | )
|CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD         |  |                   | 11,904  |                |   | 27,912         |   |   | 30,007  |  
|                                                       |  |                   |         |                |   |                |   |   |         |  
|CASH AND CASH EQUIVALENTS, END OF PERIOD               |  | $                 | 1,822   |                | $ | 11,904         |   | $ | 27,912  |  
|                                                       |  |                   |         |                |   |                |   |   |         |  
|                                                       |  |                   |         |                |   |                |   |   |         |  
|SUPPLEMENTAL CASH FLOW INFORMATION:                    |  |                   |         |                |   |                |   |   |         |  
|Cash paid during the period for:                       |  |                   |         |                |   |                |   |   |         |  
|Interest                                               |  | $                 | 170     |                | $ | 166            |   | $ | 216     |  
|                                                       |  |                   |         |                |   |                |   |   |         |  
|Income taxes paid, net of refunds received             |  | $                 | 506     |                | $ | 4,292          |   | $ | 3,693   |  
|                                                       |  |                   |         |                |   |                |   |   |         |  

See Notes to Financial
statements

F  5

---



|                                                                      
|----------------------------------------------------------------------
|SYMS CORP                                                             
|NOTES TO FINANCIAL STATEMENTS                                         
|                                                                      
|FISCAL YEARS ENDED FEBRUARY 28, 2009, MARCH 1,
 2008 AND MARCH 3, 2007

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                          
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|a. | Principal Business - Syms Corp (the
 Company) operates a chain of thirty-two off-price retail stores located
 in the United States throughout the Northeastern and Middle Atlantic regions
 and in the Midwest, Southeast and Southwest. Each Syms store offers a broad
 range of first-quality, in-season merchandise bearing nationally recognized
 designer or brand-name labels for men, women and children.                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                          
|b. | Principles of Consolidation - The financial
 statements include the accounts of the Company and its wholly-owned inactive
 subsidiary.                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                          
|c. | Accounting Period - The fiscal years ended February
 28, 2009 and March 1, 2008 were comprised of 52 weeks; the fiscal year ended
 March 3, 2007 was comprised of 53 weeks.                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                          
|d. | Reclassifications Certain
 reclassifications have been applied to prior year amounts to conform to
 current year presentation. Occupancy expenses for fiscal 2008 and 2007 have
 been reduced by net rental income of $2,026,000 and $3,006,000, respectively
 from real estate holdings incidental to the Companys retail operations. In
 prior reports, the Company reduced general and administrative expense by net
 rental income.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                          
|e. | Cash and Cash Equivalents- Cash and cash
 equivalents include securities with original maturities of three months or
 less.                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                          
|f. | Concentrations of Credit Risk
  The Companys financial instruments that are exposed to concentrations of
 credit risk consist primarily of cash. The Company has substantially all of
 its cash in banks. Such cash balances at times exceed federally-insured
 limits. The Company has not experienced any losses in such accounts.                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                          
|g. | Receivables  Receivables represent third
 party credit card receivables.                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                          
|h. | Merchandise Inventories - Merchandise
 inventories are stated at the lower of cost or market on a first-in first-out
 (FIFO) basis, as determined by the retail inventory method.                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                          
|i. | Property and Equipment- Property and
 equipment are stated at cost. Depreciation and amortization are principally
 determined by the straight-line method over the following estimated useful
 lives:                                                                                                                                                                                                                                    

|                            |                                              
|--------------------------- | ---------------------------------------------
|Buildings
 and improvements | 15 - 39
 years                               
|Machinery
 and equipment    | 4 - 7 years                                  
|Furniture
 and fixtures     | 7-10 years                                   
|Leasehold
 improvements     | Lesser of
 life of the asset or life of lease
|Computer
 software          | 3 years                                      

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   | The
 Companys policy is to amortize leasehold improvements over the original
 lease term and not include any renewal terms. The Companys policy is to
 capitalize costs incurred during the application-development stage for
 software bought and further customized by outside vendors for the Companys
 use. Computer software is included in property, plant and equipment  net on
 the balance sheet.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|j. | Impairment of Long-Lived Assets  The
 Company periodically reviews long-lived assets for impairment whenever
 changes in circumstances indicate that the carrying amount of the assets may
 not be fully recoverable. The Company considers relevant cash flow,
 managements strategic plans, significant decreases in the market value of
 the asset and other available information in assessing whether the carrying
 value of the assets can be recovered. When such events occur, the Company
 compares the carrying amount of the assets to undiscounted expected future
 cash flows from the use and eventual disposition of the asset. If this
 comparison indicates an impairment, the carrying amount would then be
 compared to the estimated fair value of the long-lived asset. An impairment
 loss would be measured as the amount by which the carrying value of the
 long-lived asset exceeds its estimated fair value. The difference would be
 recorded as an impairment of assets.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

F  6

---



|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|k. | Deferred Income Taxes -Deferred income taxes reflect the future
 tax consequences of differences between the tax bases of assets and
 liabilities and their financial reporting amounts at year end.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|l. | Other Assets The cash surrender value of officers life insurance policies is
 classified on the balance sheet as a non-current asset. The Company adjusts
 the carrying value of these contracts to the cash value (which is considered
 fair value) at the end of each reporting period. Such periodic adjustment is
 included in selling, general and administrative expenses. Subsequent to year
 end, the Company withdrew $16 million of cash surrender values to enhance
 liquidity.                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|m. | Accrued Expenses Accrued expenses include accrued payroll of $1,468,000 and $1,607,000
 in fiscal 2008 and fiscal 2007, respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|n. | Obligation to Customers - Obligations to
 customers represent credits issued for returned merchandise as well as gift
 certificates. When the Company sells a gift certificate to a customer, it is
 recorded as a liability in the period the sale occurred. When the customer
 redeems the gift certificate for the purchase of merchandise, a sale is
 recorded and the liability reduced. The Companys policy is that these
 credits do not expire.                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|o. | Use of Estimates - The preparation of
 financial statements in conformity with accounting principles generally
 accepted in the United States of America requires management to make
 estimates and assumptions that affect the reported amounts of assets and
 liabilities and disclosure of contingent assets and liabilities at the date
 of the financial statements and the reported amounts of revenues and expenses
 during the reporting period. Significant estimates include inventory
 provisions, sales returns, self-insurance accruals, deferred tax valuation
 allowances, any estimated impairment and the useful lives of long-lived
 assets. Actual results could differ from those estimates.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|p. | Revenue Recognition The
 Company recognizes revenue at the point of sale. Allowance for sales
 returns is recorded as a component of net sales in the period in which the
 related sales are recorded.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|q. | Comprehensive Income  Comprehensive income
 was equivalent to the Companys net income for fiscal years 2008, 2007 and
 2006.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|r. | Segment Reporting - Statement of Financial
 Accounting Standards (SFAS) No. 131, Disclosures about Segments of an
 Enterprise and Related Information establishes standards for reporting
 information about a companys operating segments. It also establishes
 standards for related disclosures about products and services, geographic
 areas and major customers. The Company operates in a single operating segment
 - the operation of off-price retail stores. Revenues from external customers
 are derived from merchandise sales. The Companys merchandise sales mix by
 product category for the last three fiscal years was as follows:                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

|                                                   |  |             |     |      |  |      |   |  |     |  
|-------------------------------------------------- |  | ----------- | --- | ---- |  | ---- | - |  | --- | -
|                                                   |  | Fiscal Year |    
|                                                   |  |             |    
|                                                   |  | 2008        |     | 2007 |  | 2006 |  
|                                                   |  |             |     |      |  |      |  
|Mens
 tailored clothes and haberdashery           |  |             | 53  | %    |  | 53   | % |  | 54  | %
|Womens
 dresses, suits, separates and accessories |  |             | 29  | %    |  | 29   | % |  | 28  | %
|Shoes                                              |  |             | 8   | %    |  | 8    | % |  | 8   | %
|Childrens wear                                    |  |             | 7   | %    |  | 7    | % |  | 7   | %
|Luggage,
 domestics and fragrances                 |  |             | 3   | %    |  | 3    | % |  | 3   | %
|                                                   |  |             |     |      |  |      |   |  |     |  
|                                                   |  |             | 100 | %    |  | 100  | % |  | 100 | %

|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   | The Company
 does not rely on any major customers as a source of revenue.                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|s. | Gross Profit - The Companys gross profit may not be
 comparable to those of other entities, since other entities may include all
 of the costs related to their distribution network in cost of goods sold and
 others, like the Company, exclude a portion of those costs from gross profit
 and instead, include them in other items, such as selling, general and
 administrative expenses and occupancy costs.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|t. | Computer Software Costs  The Company
 capitalizes the cost of software developed or purchased for internal use.                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|u. | Other Assets  Other assets include
 $22,032,000 and $20,549,000 of cash surrender value of officers life
 insurance, and $1,337,000 and $878,000 of other miscellaneous assets such as
 security deposits, step rent receivables and deferred lease acquisition costs
 at February 28, 2009 and March 1, 2008, respectively.                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                    
|v. | Advertising Costs
  Advertising and sales promotion costs are expensed at the time the
 advertising occurs. Advertising and sales promotion costs were $6,339,000,
 $8,561,000 and $8,118,000 in fiscal 2008, 2007 and 2006,                                                                                                                                                                                      

F  7

---



|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   | respectively.
 The Company does not receive any allowances or credits from vendors in
 connection with the purchase or promotion of the vendors product, such as
 co-operative advertising and other considerations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|w. | Accounting for Stock-Based Compensation
 The Company accounts for stock-based compensation costs in accordance with
 Statement of Financial Accounting Standards No. 123(R), Share-Based Payment
 (FAS123(R)). Under FAS123(R), share-based compensation cost is measured at
 grant date, based on the estimated fair value of the award, and is recognized
 as expense over the requisite service period. Because the Company previously
 adopted only the pro forma disclosure provisions of SFAS 123, it will
 recognize compensation cost relating to the unvested portion of awards
 granted prior to the date of adopting FAS 123(R) using the same estimate of
 the grant-date fair value and the same attribution method used to determine the
 pro forma disclosures under SFAS 123, except that forfeitures rates will be
 estimated for all options, as required by FAS123(R).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | The fair
 value of each option award is estimated on the date of grant using a
 Black-Scholes option valuation model. Expected volatility is based on the
 historical volatility of the price of the Companys stock. The risk-free
 interest rate is based on U.S. Treasury issues with a term equal to the
 expected life of the option. The Company uses historical data to estimate expected
 dividend yield, expected life and forfeiture rates. There were no options
 granted during the fiscal years ended February 28, 2009 or March 1, 2008 and
 all options previously issued were fully vested in prior years. Accordingly,
 there was no effect of adopting FAS 123(R). FAS 123(R) requires that excess
 tax benefits related to stock option exercises be reflected as financing cash
 inflows instead of operating cash inflows. As of February 28, 2009, there was
 no unrecognized stock-based compensation cost related to options granted
 under our plans that will be recognized in future periods.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|x. | New Accounting Pronouncements -In
 February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial
 Assets and Financial Liabilities - Including an amendment of FASB Statement
 No. 115, which permits an entity to measure certain financial
 assets and liabilities at fair value. The statements objective is to improve
 financial reporting by allowing entities to mitigate volatility in reported
 earnings caused by measurement of related assets and liabilities using
 different attributes without having to apply complex hedge accounting
 provisions. This statement became effective for fiscal years beginning after
 November 15, 2007 and is to be applied prospectively. This statement did not
 have a material effect on the Companys financial statements for fiscal 2008.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | In February
 2007, the FASB issued SFAS No. 157, Fair Value Measurements (SFAS 157)
 which establishes a framework for measuring fair value in generally accepted
 accounting principles and expands disclosures about fair value measurements.
 SFAS 157 also creates a fair value hierarchy in order to increase the
 consistency and comparability of fair value measurements and details the
 disclosures that are required for items measured at fair value. SFAS 157
 defines fair value as the price that would be received to sell an asset or
 paid to transfer a liability in an orderly transaction between market
 participants at the measurement date. SFAS 157 is effective for financial
 statements issued for fiscal years beginning after November 15, 2007. In
 February 2008 the FASB provided a one-year deferral for the implementation of
 SFAS 157 for non-financial assets and liabilities recognized or disclosed in
 the financial statements on a non-recurring basis. Our financial assets and
 liabilities are measured using inputs from the three defined levels of
 hierarchy: Level 1 inputs which are unadjusted quoted prices in
 active markets for identical assets or liabilities; Level 2 inputs which
 include quoted prices for similar assets or liabilities in markets that are
 inactive, inputs that are observable such as interest rates or yield curves
 or Level
 3 inputs which are unobservable inputs reflective of assumptions
 that market participants would use in pricing assets or liabilities. The
 adoption of SFAS 157 in 2008 did not have a material impact on our results of
 operations or our financial position. For fiscal 2009, the Company believes
 that SFAS 157 will not have a material impact.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | In June
 2006, the FASB issued Interpretation No. 48, Accounting for Uncertainty in Income
 Taxes, an Interpretation of SFAS No. 109 (FIN 48). FIN 48
 clarifies the accounting for uncertainty in income taxes recognized in an
 enterprises financial statements in accordance with SFAS 109. A more
 complete discussion of FIN 48 may be found in Note 3, Income Taxes, of
 these notes to financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

F  8

---



NOTE 2 - PROPERTY AND EQUIPMENT

Property and
equipment consists of:

|                                                 |  |                    |                |                |   |         | 
|------------------------------------------------ |  | ------------------ | -------------- | -------------- | - | ------- | 
|                                                 |  | February 28,
 2009 |                | March 1,
 2008 |  
|                                                 |  |                    |                |                |  
|                                                 |  |                    | (in thousands) |               
|Land                                             |  | $                  | 42,125         |                | $ | 42,125  | 
|Buildings
 and building improvements             |  |                    | 112,011        |                |   | 112,859 | 
|Leasehold
 and leasehold improvements            |  |                    | 28,531         |                |   | 29,066  | 
|Machinery
 and equipment                         |  |                    | 23,212         |                |   | 22,858  | 
|Furniture
 and fixtures                          |  |                    | 19,721         |                |   | 22,680  | 
|Construction
 in progress                        |  |                    | 1,933          |                |   | 1,901   | 
|Computer
 software                               |  |                    | 14,521         |                |   | 13,507  | 
|                                                 |  |                    |                |                |   |         | 
|                                                 |  |                    | 242,054        |                |   | 244,996 | 
|Less:
 accumulated depreciation and amortization |  |                    | 146,098        |                |   | 146,181 | 
|                                                 |  |                    |                |                |   |         | 
|                                                 |  | $                  | 95,956         |                | $ | 98,815  | 
|                                                 |  |                    |                |                |   |         | 

In addition to
the above, the Company has three properties, in Ohio, Pennsylvania and New York
that are held for sale. In conjunction with the above, the Company recorded
impairment charges in fiscal 2008 of $530,000 and $745,000 in fiscal 2007.

The Company
purchased from Sy Syms (its Chairman) a property in Westchester, New York and
Addison, Illinois for approximately $18,521,500 in fiscal 2006. Since Mr. Syms
is a major shareholder of the Company, the property was recorded by the Company
at its historical cost basis. The amount paid for the property in excess of
this cost basis was recorded, net of deferred taxes of $5.9 million, as a
charge to retained earnings.

NOTE 3 - INCOME TAXES

The provision (benefit) for income taxes is
as follows:

|                                       |  |                    |      |                |   |                |   |   |       | 
|-------------------------------------- |  | ------------------ | ---- | -------------- | - | -------------- | - | - | ----- | 
|                                       |  | Fiscal Year Ended  |     
|                                       |  |                    |     
|                                       |  | February 28,
 2009 |      | March 1,
 2008 |   | March 3,
 2007 |  
|                                       |  |                    |      |                |   |                |  
|                                       |  | (in thousands)     |     
|Current:                               |  |                    |      |                |   |                |   |   |       | 
|Federal                                |  | $                  | (437 | )              | $ | 3,154          |   | $ | 3,906 | 
|State                                  |  |                    | 197  |                |   | (328           | ) |   | 372   | 
|                                       |  |                    |      |                |   |                |   |   |       | 
|                                       |  |                    | (240 | )              |   | 2,826          |   |   | 4,278 | 
|                                       |  |                    |      |                |   |                |   |   |       | 
|Deferred:                              |  |                    |      |                |   |                |   |   |       | 
|Federal                                |  | $                  | (55  | )              | $ | (1,790         | ) | $ | 1,731 | 
|State                                  |  |                    | (313 | )              |   | 1,293          |   |   | 394   | 
|                                       |  |                    |      |                |   |                |   |   |       | 
|                                       |  |                    | (368 | )              |   | (497           | ) |   | 2,125 | 
|                                       |  |                    |      |                |   |                |   |   |       | 
|(Recovery)/provision
 for income taxes |  | $                  | (608 | )              | $ | 2,329          |   | $ | 6,403 | 
|                                       |  |                    |      |                |   |                |   |   |       | 

F  9

---



The following
is a reconciliation of income taxes computed at the U.S. Federal statutory rate
to the (recovery)/provision for income taxes:

|                                                       |  |                    |                   |                |  |                |   |  |      |  
|------------------------------------------------------ |  | ------------------ | ----------------- | -------------- |  | -------------- | - |  | ---- | -
|                                                       |  |                    | Fiscal Year Ended |               
|                                                       |  |                    |                   |                |  |                |  
|                                                       |  | February 28,
 2009 |                   | March 1,
 2008 |  | March 3,
 2007 |  
|                                                       |  |                    |                   |                |  |                |  
|                                                       |  |                    | (in thousands)    |               
|Statutory
 Federal income tax rate                     |  |                    | 35.0              | %              |  | 35.0           | % |  | 35.0 | %
|State taxes1                                           |  |                    | 3.8               |                |  | 20.0           |   |  | 7.3  |  
|Non-deductible
 insurance premiums                     |  |                    | (18.6             | )              |  | 23.2           |   |  | 4.2  |  
|Change of
 valuation allowance                         |  |                    |                  |                |  |               |   |  | (6.3 | )
|Effect on
 deferred taxes for change in state tax rate |  |                    |                  |                |  | (6.7           | ) |  |     |  
|Other                                                  |  |                    | (5.1              | )              |  | 2.8            |   |  | (0.1 | )
|                                                       |  |                    |                   |                |  |                |   |  |      |  
|Effective
 income tax rate                             |  |                    | 15.1              | %              |  | 74.3           | % |  | 40.1 | %
|                                                       |  |                    |                   |                |  |                |   |  |      |  

1 Includes adjustment in fiscal 2007 of prior
year accrual and true-up of state net operating losses.The composition of the
Companys deferred tax assets and liabilities is as follows:

|                                                    |  |                    |        |                |   |        | 
|--------------------------------------------------- |  | ------------------ | ------ | -------------- | - | ------ | 
|                                                    |  | Fiscal Year Ended  |       
|                                                    |  |                    |       
|                                                    |  | February 28,
 2009 |        | March 1,
 2008 |  
|                                                    |  |                    |        |                |  
|                                                    |  | (in thousands)     |       
|Deferred tax
 assets:                               |  |                    |        |                |   |        | 
|Capitalization
 of inventory costs                  |  | $                  | 979    |                | $ | 1,234  | 
|Pension cost                                        |  |                    | 16     |                |   | 91     | 
|Reserves not
 currently deductible for tax purposes |  |                    | 2,450  |                |   | 1,944  | 
|Net
 operating loss carryforwards                   |  |                    | 390    |                |   | 336    | 
|Depreciation                                        |  |                    | 12,877 |                |   | 12,185 | 
|Step rent                                           |  |                    | 78     |                |   | 319    | 
|Other                                               |  |                    |       |                |   | 37     | 
|SFAS 158
 adjustment                                |  |                    | 1,464  |                |   |       | 
|                                                    |  |                    |        |                |   |        | 
|Total
 deferred tax assets                          |  | $                  | 18,254 |                | $ | 16,146 | 
|                                                    |  |                    |        |                |   |        | 
|Deferred tax
 liabilities:                          |  |                    |        |                |   |        | 
|Other                                               |  |                    |       |                |   | 16     | 
|Total
 deferred tax liabilities                     |  |                    |       |                |   | 16     | 
|                                                    |  |                    |        |                |   |        | 
|Net deferred
 tax assets                            |  | $                  | 18,254 |                | $ | 16,130 | 
|                                                    |  |                    |        |                |   |        | 
|                                                    |  |                    |        |                |   |        | 
|Current
 deferred tax assets                        |  | $                  | 3,045  |                | $ | 3,248  | 
|Long term
 deferred tax assets                      |  |                    | 15,209 |                |   | 12,882 | 
|                                                    |  |                    |        |                |   |        | 
|Total
 deferred tax assets                          |  | $                  | 18,254 |                | $ | 16,130 | 
|                                                    |  |                    |        |                |   |        | 

At February
28, 2009, the Company had state net operating loss carry forwards of
$5,469,000. These net operating losses expire in years through 2024.

Based on
managements assessment it is more likely than not that deferred tax assets
will be realized by future taxable income or tax planning strategies.

Effective
March 4, 2007, we adopted FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes
(FIN 48), which requires the use of a two-step approach for recognizing and
measuring tax benefits taken or expected to be taken in a tax return and
disclosures regarding uncertainties in income tax positions. The first step is
recognition: we determine whether it is more likely than not that a tax
position will be sustained upon examination, including resolution of any
related appeals or litigation processes, based on the technical merits of the
position. In evaluating whether a tax position has met the more-likely-than-not
recognition threshold, we presume that the position will be examined by the
appropriate taxing authority that has full knowledge of all relevant
information. The second step is measurement: a tax position that meets the
more-likely-than-not recognition threshold is measured to determine the amount
of benefit to recognize in the financial statements. The tax position is
measured at the largest amount of benefit that is greater than 50 percent
likely of being realized upon ultimate settlement. Differences between tax
positions taken in a tax return and amounts recognized in the

F  10

---



financial
statements will generally result in one or more of the following: an increase
in a liability for income taxes payable, a reduction of an income tax refund
receivable, a reduction in a deferred tax asset, or an increase in a deferred
tax liability.

The Company
classifies income tax-related interest expense and penalties as part of its
provision for income taxes based upon applicable federal and state
interest/underpayment percentages. As a result of the adoption of FIN 48, the
Company recorded as a cumulative effect adjustment, $250,000 in interest in its
balance sheet as of March 4, 2007. Interest was computed on the difference
between the provision for income taxes recognized in accordance with FIN 48 and
the benefit previously taken or expected to be taken in the Companys federal,
state and local income tax returns.

Examinations
by federal tax authorities have been completed through fiscal 2000. State
examinations occur at various dates covering various periods one of the larger
of which, the State of New Jersey, has concluded its examination through fiscal
2005. The Companys uncertain tax positions aggregated approximately $260,000
as of February 28, 2009 and March 1, 2008.

NOTE 4 - BANK CREDIT FACILITIES

The Company
has a revolving credit agreement with a bank for a line of credit not to exceed
$40,000,000 through May 1, 2011. The agreement contains financial covenants,
with respect to consolidated tangible net worth, as defined, working capital
and maximum capital expenditures, dividends (defined to include cash
repurchases of capital stock), as well as other financial ratios. The Company
is in compliance with all covenants except for that related to working capital
for which it has received a waiver. During fiscal 2008, the Company satisfied
its operating and capital expenditure requirements, including those for the
operations of stores, from internally generated funds. For fiscal 2008 and 2007
there were no borrowings under the revolving credit agreement. At February 28,
2009 and March 1, 2008, the Company had $741,000 and $869,000, respectively, in
outstanding letters of credit under the Revolving Credit Agreement. The
outstanding letters of credit for fiscal 2008 and 2007 are part of the
unsecured line of credit.

Total interest
charges incurred for fiscal 2008, fiscal 2007 and fiscal 2006 were $171,000,
$171,000, and $219,000, respectively. There was no capitalized interest for
fiscal 2008, 2007 or 2006.

NOTE 5 - FAIR VALUE DISCLOSURES

The Companys
financial instruments include cash, cash surrender value of officers life
insurance policies, accounts receivable, accounts payable, long-term debt and
letters of credit. The carrying value of the aforementioned financial
instruments approximates their fair values at February 28, 2009 and March 1,
2008 due to the short term maturities thereof, and in the case of letters of
credit, their underlying purpose and market rates.

NOTE 6 - PENSION AND PROFIT SHARING PLANS

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|a. | Pension Plan -The Company has a defined
benefit pension plan for all employees other than those covered under
collective bargaining agreements through December 31, 2006. This Pension Plan
was frozen effective December 31, 2006.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|  
|   | The benefits
are based on years of service and the employees highest average pay during any
five consecutive years within the ten-year period prior to retirement. Pension
plan costs are funded annually. Contributions are intended to provide not only
for benefits attributed to service to date, but also for those expected to be
earned in the future.                                                                                                                                                                                                                                                                                                                                                                             
|  
|   | The investment
strategy objectives of the plan are continued growth and income. All plan
assets are managed by outside investment managers. Asset allocations are
reviewed on a regular basis by the investment management company. Equities are
primarily S&P 500 securities which make up approximately 51% of plan
assets. Fixed income securities make up the remaining approximate 49% and consist
primarily of securities in the Barclays Capital Aggregate (formerly the Lehman
Aggregate) and Merrill Lynch 1-3 year Government Corporate indexes. The
measurement date used for fiscal 2008 is February 28, 2009. For fiscal 2007 and
prior, the measurement date used was December 31 immediately prior to each
fiscal year end.

F  11

---



Presented
below is financial information relating to this plan for the fiscal years
indicated:

|                                                 |  |                    |        |                |   |       |  
|------------------------------------------------ |  | ------------------ | ------ | -------------- | - | ----- | -
|                                                 |  | February 28,
 2009 |        | March 1,
 2008 |  
|                                                 |  |                    |        |                |  
|                                                 |  | (in thousands)     |       
|CHANGE IN BENEFIT OBLIGATION:                    |  |                    |        |                |   |       |  
|Net benefit obligation  beginning of
 period    |  | $                  | 9,736  |                | $ | 9,738 |  
|Interest cost                                    |  |                    | 682    |                |   | 551   |  
|Actuarial loss/(gain)                            |  |                    | 153    |                |   | (24   | )
|Gross benefits paid                              |  |                    | (537   | )              |   | (529  | )
|                                                 |  |                    |        |                |   |       |  
|Net benefit obligation  end of
period           |  | $                  | 10,034 |                | $ | 9,736 |  
|                                                 |  |                    |        |                |   |       |  
|                                                 |  |                    |        |                |   |       |  
|CHANGE IN PLAN ASSETS:                           |  |                    |        |                |   |       |  
|Fair value of plan assets  beginning of
 period |  | $                  | 9,723  |                | $ | 9,496 |  
|Gross benefits paid                              |  |                    | (537   | )              |   | (529  | )
|Actual (loss)/return on plan assets              |  |                    | (2,848 | )              |   | 756   |  
|                                                 |  |                    |        |                |   |       |  
|Fair value of plan assets  end of
period        |  | $                  | 6,338  |                | $ | 9,723 |  
|                                                 |  |                    |        |                |   |       |  
|                                                 |  |                    |        |                |   |       |  
|Funded status at year end                        |  | $                  | (3,696 | )              | $ | (13   | )
|                                                 |  |                    |        |                |   |       |  

Pension
expense (benefit) includes the following components:

|                                           |  |                    |        |                |   |                |   |   |        |  
|------------------------------------------ |  | ------------------ | ------ | -------------- | - | -------------- | - | - | ------ | -
|                                           |  | February 28,
 2009 |        | March 1,
 2008 |   | March 3,
 2007 |  
|                                           |  |                    |        |                |   |                |  
|                                           |  | (in thousands)    
|COMPONENTS OF NET PERIODIC (BENEFIT) COST: |  |                    |        |                |   |                |   |   |        |  
|Service cost                               |  | $                  |       |                | $ |               |   | $ | 659    |  
|Interest cost                              |  |                    | 682    |                |   | 544            |   |   | 633    |  
|Return on assets                           |  |                    | 2,848  |                |   | (756           | ) |   | (1,045 | )
|Amortization of (gain) loss                |  |                    | (3,577 | )              |   | 24             |   |   | 410    |  
|                                           |  |                    |        |                |   |                |   |   |        |  
|Net periodic (benefit) cost                |  | $                  | (47    | )              | $ | (188           | ) | $ | (657   | )
|                                           |  |                    |        |                |   |                |   |   |        |  
|                                           |  |                    |        |                |   |                |   |   |        |  
|WEIGHTED-AVERAGE ASSUMPTIONS USED:         |  |                    |        |                |   |                |   |   |        |  
|Discount rate                              |  |                    | 6.3    | %              |   | 5.8            | % |   | 5.8    | %
|Rate of compensation increase              |  |                    |       |                |   | 4.5            | % |   | 4.5    | %

The expected
long-term rate of return on plan assets was 8.0% for all years.

As of February
28, 2009 the benefits expected to be paid in the next five fiscal years and in
the aggregate for the five fiscal years thereafter are as follows:

|2009      |  | $ | 563   | 
|--------- |  | - | ----- | 
|2010      |  |   | 582   | 
|2011      |  |   | 587   | 
|2012      |  |   | 580   | 
|2013      |  |   | 604   | 
|2014-2018 |  | $ | 3,441 | 

The asset
allocation for the Companys pension plan at the end of fiscal 2008 and 2007
and the target allocation for fiscal 2009, by asset category, are as follows:

|                         |  |                                    |   |                       |     |                         |  |     |   | 
|------------------------ |  | ---------------------------------- | - | --------------------- | --- | ----------------------- |  | --- | - | 
|Asset Category           |  | Range of Target 
 Asset Allocation |   | % of Plan Assets 2008 |     | % of Plan Assets 
 2007 | 
|                         |  |                                    |   |                       |     |                         | 
|                         |  |                                    |   |                       |     |                         |  |     |   | 
|Equity
 Securities       |  | 45% to 55                          | % |                       | 51  | %                       |  | 54  | % | 
|Fixed Income
 Securities |  | 45% to 55                          | % |                       | 49  | %                       |  | 46  | % | 
|                         |  |                                    |   |                       |     |                         |  |     |   | 
|Total                    |  |                                    |   |                       | 100 | %                       |  | 100 | % | 
|                         |  |                                    |   |                       |     |                         |  |     |   | 

F - 12

---



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Company
 adopted SFAS 158 for fiscal 2006. Under the provisions of SFAS 158, the
 Company is required to recognize in its consolidated balance sheet the funded
 status of a benefit plan. This is measured as the difference between plan
 assets at fair value and the projected benefit obligation. For the Pension
 Plan, this is equal to the accumulated benefit obligation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | In addition,
 SFAS 158 requires the Company to recognize as a component of other
 comprehensive income, net of tax, the gains or losses and prior service costs
 or credits that arise during the period but are not recognized as components
 of net periodic benefit cost. Gains or losses represent changes in the amount
 of either the projected benefit obligations or plan assets resulting from
 changes in assumptions, actuarial gains/losses and actual investment returns.
 SFAS 158 did not change the recognition of pension income or expense in the
 statement of operations. Since the Company has recognized the funded status
 of its defined benefit pension plans since its adoption of the Accelerated
 Method, the adoption of SFAS 158 did not have a material effect on the
 Companys reported pension liability or pension expense in any period
 presented. Effective with fiscal 2008, the measurement date for the plan
 coincides with the fiscal year end date.
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | b.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | Profit-Sharing and 401(k) Plan- The Company has a profit-sharing plan
 and 401(k) plan for all employees other than those covered under collective
 bargaining agreements. In 1995, the Company established a defined
 contribution savings plan 401(k) for substantially all of its eligible
 employees. Employees may contribute a percentage of their salary to the plan
 subject to statutory limits. The Company made contributions to this plan of
 $450,000 in fiscal 2007 and $225,000 in fiscal 2006. No contributions were
 made in fiscal 2008.

NOTE 7 - COMMITMENTS

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|a. | Leases- The
 Company has various operating leases for its retail stores, with terms
 expiring between 2009 and 2031. Under most lease agreements, the Company pays
 real estate taxes, maintenance and other operating expenses. Certain store
 leases also provide for additional contingent rentals based upon a percentage
 of sales in excess of certain minimum amounts. Future minimum lease payments
 under operating leases as of February 28, 2009 for each of the next five
 years and in the aggregate are as follows (in thousands):

|            |  |   |        | 
|----------- |  | - | ------ | 
|Fiscal 2009 |  | $ | 6,092  | 
|Fiscal 2010 |  |   | 5,001  | 
|Fiscal 2011 |  |   | 3,469  | 
|Fiscal 2012 |  |   | 1,671  | 
|Fiscal 2013 |  |   | 1,617  | 
|Thereafter  |  |   | 13,582 | 
|            |  |   |        | 
|Total       |  | $ | 31,432 | 
|            |  |   |        | 

Rent
expense for operating leases (in thousands) is as follows:

|                            |  |                    |       |                |   |                |   |   |       |  
|--------------------------- |  | ------------------ | ----- | -------------- | - | -------------- | - | - | ----- | -
|                            |  | Fiscal Year Ended  |      
|                            |  |                    |      
|                            |  | February 28,
 2009 |       | March 1,
 2008 |   | March 3,
 2007 |  
|                            |  |                    |       |                |   |                |  
|Minimum
 rentals due        |  | $                  | 6,581 |                | $ | 6,683          |   | $ | 7,445 |  
|Escalation
 rentals accrued |  |                    | (338  | )              |   | (369           | ) |   | (228  | )
|Sublease
 rentals           |  |                    | (250  | )              |   | (250           | ) |   | (250  | )
|                            |  |                    |       |                |   |                |   |   |       |  
|Total                       |  | $                  | 5,993 |                | $ | 6,064          |   | $ | 6,967 |  
|                            |  |                    |       |                |   |                |   |   |       |  

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|b. | Employment Agreement- The Company terminated its employment
 contract with one executive in January, 2007. This termination triggered a
 one-time payment of one and one half years salary within 90 days of the
 termination date, which totaled $675,000 and was accrued at March 3, 2007 and
 subsequently paid.                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|c. | Legal Proceedings -The
 Company is a party to routine litigation incident to its business. Some of
 the actions to which the Company is a party are covered by insurance and are
 being defended or reimbursed by the Companys insurance carriers.                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | In December
 2007, the Company announced its decision to voluntarily delist its common
 stock from trading on the New York Stock Exchange (NYSE) and, given that
 there were fewer than 300 holders of record of its common shares,
 simultaneously deregister its common stock under federal securities laws. The
 Companys decision to deregister with the Securities and Exchange Commission
 (SEC) and delist from NYSE was principally motivated by

F  13

---



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | the desire
 to minimize the financial and administrative burdens associated with being an
 SEC reporting company and further minimize or eliminate the compliance
 obligations incident to the Sarbanes-Oxley Act of 2002. In January 2008
 certain institutional investors commenced a campaign to cause certain
 shareholders to register shares individually and simultaneously brought two
 actions seeking injunctive relief from the aforementioned deregistration and
 delisting, counsel fees and unspecified damages. Although the Company
 believes that its actions were appropriate, the Company determined that the
 costs and expenses associated with protracted litigation could not be
 justified and, in February 2008, reregistered its common stock and listed its
 shares for trading on NASDAQ. The costs associated with this litigation were
 substantially covered by insurance. All litigation associated with these
 matters has either been dismissed in the Companys favor or settled within
 the limits of the Companys insurance policies, less a nominal deductible.

NOTE 8 - PREFERRED STOCK

The Company is
authorized to issue up to 1,000,000 shares of preferred stock, in one or more
series of preferred stock. The Board of Directors is authorized to establish
the number of shares to be included in each such series, and to fix the
designation, relative rights, preferences, qualifications and limitations of
the shares of each such series. No such shares have been issued or are
outstanding.

NOTE 9 - STOCK OPTION PLAN

The Companys
Amended and Restated Stock Option and Appreciation Plan allows for the granting
of incentive stock options, as defined in Section 422A of the Internal Revenue
Code of 1986 (as amended), non-qualified stock options or stock appreciation
rights. The plan requires that incentive stock options be granted at an
exercise price not less than the fair market value of the Common Stock on the
date the option is granted. The exercise price of the option for holders of
more than 10% of the voting rights of the Company must be not less than 110% of
the fair market value of the Common Stock on the date of grant. Non-qualified
options and stock appreciation rights may be granted at any exercise price. The
Company has reserved 1,500,000 shares of common stock for issuance thereunder.
The Company is no longer issuing options under its Amended and Restated Incentive
Stock Option and Appreciation Plan.

No option or stock appreciation rights may be
granted under the Amended and Restated Incentive Stock Option Plan after July
28, 2013. The maximum exercise period for any option or stock appreciation
right under the plan is ten years from the date the option is granted (five
years for any optionee who holds more than 10% of the voting rights of the
Company).

On July 14, 2005, at the annual meeting of
shareholders of the Company, the shareholders of the Company approved the 2005
Stock Option Plan (the 2005 Plan), which 2005 Plan was adopted by the Board
of Directors of the Company on April 7, 2005 subject to shareholder approval.
The 2005 Plan permits the grant of options, share appreciation rights,
restricted shares, restricted share units, performance units, performance
shares, cash-based awards and other share-based awards. Key employees,
non-employee directors, and third party service providers of the Company who
are selected by a committee designated by the Board of Directors of the Company
are eligible to participate in the 2005 Plan. The maximum number of shares
issuable under the Plan is 850,000, subject to certain adjustments in the event
of changes to the Companys capital structure.

The 2005 Plan requires that incentive stock
options be granted at an exercise price not less than the fair market value of
the Common Stock on the date the option is granted. The exercise price of such
options for holders of more than 10% of the voting stock of the Company must be
not less than 110% of the fair market value of the Common Stock on the date of
grant. The exercise price of non-qualified options and stock appreciation
rights must not be less than fair market value on the date such benefits are
granted.

The maximum
exercise period for any option or stock appreciation right under the 2005 Plan
is ten years from the date the option is granted (five years for any incentive
stock options issued to a person who holds more than 10% of the voting stock of
the Company).

The 2005 Plan
permits the Company to issue restricted shares, restricted share units,
performance units, cash-based awards and other share-based awards with such
terms and conditions (including applicable vesting conditions) as the Company
shall determine, subject to certain terms and conditions set forth in the 2005
Plan.

The fair value
of each option award is estimated on the date of grant using a Black-Scholes
option valuation model. Expected volatility is based on the historical
volatility of the price of the Companys stock. The risk-free interest rate is
based on U.S. Treasury issues with a term equal to the expected life of the
option. The Company uses historical data to

F  14

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estimate
expected dividend yield, expected life and forfeiture rates. The aggregate
intrinsic value of the outstanding and exercisable options during fiscal 2008
and fiscal 2007 was approximately $932,000 and $745,000, respectively. The
aggregate intrinsic values of options exercised during fiscal 2008 and fiscal
2007 were approximately $706,000 and $7,000.

The following
table summarizes stock option activity for each of the past three fiscal years:

|                                 |  |                                         |      |                                    |   |                      |   |                                    |      |                      |   |                                    |  |  |      |   |   |       | 
|-------------------------------- |  | --------------------------------------- | ---- | ---------------------------------- | - | -------------------- | - | ---------------------------------- | ---- | -------------------- | - | ---------------------------------- |  |  | ---- | - | - | ----- | 
|                                 |  | Fiscal Year Ended                       |     
|                                 |  |                                         |     
|                                 |  | (in thousands except per share amounts) |     
|                                 |  | February 28, 2009                       |      | March 1, 2008                      |   | March 3, 2007        |  
|                                 |  |                                         |      |                                    |   |                      |  
|                                 |  | Fiscal
 2005
 Shares                    |      | Weighted
 Average
 Exercise
 Price |   | Fiscal
 2005
 Shares |   | Weighted
 Average
 Exercise
 Price |      | Fiscal
 2005
 Shares |   | Weighted
 Average
 Exercise
 Price | 
|                                 |  |                                         |      |                                    |   |                      |   |                                    |      |                      |   |                                    | 
|FIXED
 OPTIONS                   |  |                                         |      |                                    |   |                      |   |                                    |      |                      |   |                                    |  |  |      |   |   |       | 
|Outstanding
  beginning of year |  |                                         | 329  |                                    | $ | 11.19                |   |                                    | 330  |                      | $ | 11.17                              |  |  | 739  |   | $ | 8.08  | 
|Exercised                        |  |                                         | (218 | )                                  |   | (9.81                | ) |                                    | (0.8 | )                    |   | 13.74                              |  |  | (408 | ) |   | 5.21  | 
|Cancelled                        |  |                                         |     |                                    |   |                     |   |                                    | (0.5 | )                    |   |                                   |  |  | (1   | ) |   | 5.21  | 
|                                 |  |                                         |      |                                    |   |                      |   |                                    |      |                      |   |                                    |  |  |      |   |   |       | 
|Outstanding
  end of year       |  |                                         | 111  |                                    | $ | 13.81                |   |                                    | 329  |                      | $ | 11.19                              |  |  | 330  |   | $ | 11.17 | 
|                                 |  |                                         |      |                                    |   |                      |   |                                    |      |                      |   |                                    |  |  |      |   |   |       | 
|                                 |  |                                         |      |                                    |   |                      |   |                                    |      |                      |   |                                    |  |  |      |   |   |       | 
|Options
 exercisable at year end |  |                                         | 111  |                                    | $ | 13.81                |   |                                    | 329  |                      | $ | 11.19                              |  |  | 330  |   | $ | 11.17 | 
|                                 |  |                                         |      |                                    |   |                      |   |                                    |      |                      |   |                                    |  |  |      |   |   |       | 

Note: During
October, 2008, stock options for 215,837 shares were exercised and 52,544
shares were simultaneously purchased by the Company and retired to treasury
shares.

NOTE 10 - NET (LOSS) INCOME PER SHARE

In accordance with SFAS 128, basic net (loss)
income per share has been computed based upon the weighted average common
shares outstanding. Diluted net (loss) income per share gives effect to
outstanding stock options, if they are dilutive.

Net (loss)
income per share has been computed as follows:

|                                                |  |                                         |        |             |   |             |  |   |        | 
|----------------------------------------------- |  | --------------------------------------- | ------ | ----------- | - | ----------- |  | - | ------ | 
|                                                |  | Fiscal 2008                             |        | Fiscal 2007 |   | Fiscal 2006 | 
|                                                |  |                                         |        |             |   |             | 
|                                                |  | (in thousands except per share amounts) |       
|                                                |  |                                         |        |             |   |             |  |   |        | 
|Basic and
 diluted net (loss) income per share: |  |                                         |        |             |   |             |  |   |        | 
|                                                |  |                                         |        |             |   |             |  |   |        | 
|Net (loss)
 income                              |  | $                                       | (3,423 | )           | $ | 807         |  | $ | 9,548  | 
|Average
 shares outstanding - basic             |  |                                         | 14,589 |             |   | 14,659      |  |   | 14,574 | 
|                                                |  |                                         |        |             |   |             |  |   |        | 
|Net (loss)
 income per share  basic            |  | $                                       | (0.23  | )           | $ | 0.06        |  | $ | 0.66   | 
|                                                |  |                                         |        |             |   |             |  |   |        | 
|Average
 shares outstanding  diluted           |  |                                         | 14,589 | *           |   | 14,760      |  |   | 14,703 | 
|                                                |  |                                         |        |             |   |             |  |   |        | 
|Net (loss)
 income per share  diluted          |  | $                                       | (0.23  | )           | $ | 0.05        |  | $ | 0.65   | 

*All outstanding options were anti-dilutive
for fiscal 2008

NOTE 11 - RELATED PARTY TRANSACTIONS

Included in
the Statements of Operations are the expenses relating to a real estate lease
with Sy Syms, Chairman of the Board of the Company, for the Elmsford, New York
store. During Fiscal 2006, the Company paid $640,198 to Mr. Syms in fixed rent.

On December
21, 2006, the Company entered into the transaction contemplated under the
Contract of Sale-Office, Commercial and Multi-Family Residential Premises (the
Sale Agreement). Under the Sale Agreement the Company purchased from Sy Syms,
the Chairman of the Board of the Company, (a) certain real property located at
295 Tarrytown Road, Elmsford, New York and the building situated thereon
(collectively, the Syms Property), (b) certain real property located at 395
Tarrytown Road, Elmsford, New York (the Elmsford Property) and (c) and
certain real property located at 18 West 570 North Avenue, Vila Park, Illinois
(the Addison Property). The Syms Property was leased to the Company and is
used by the Company for its Westchester store. The Elmsford Property was leased
to an entity called Elmsford 119

F  15

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Associates,
LLC, which subleases the Elmsford Property to Bed Bath & Beyond. Bed Bath
& Beyond is the owner of the improvements at the Elmsford Property used for
the Bed Bath & Beyond store. The total purchase price of $18,442,500 was
allocated as follows: (i) $13,516,000 to the Syms Property, (ii) $4,266,000 to
the Elmsford Property and (iii) $660,500 to the Addison Property. The
acquisition of the Syms Property and the Elmsford Property closed on December
21, 2006. The acquisition of the Addison Property closed in early January 2007.
The portion of the purchase price paid at the closing of the acquisition of the
Syms Property, the Elmsford Property and the Addison Property was paid in cash
utilizing internally generated cash.

In determining
the purchase price negotiated by the parties, the Company relied upon four
appraisals prepared by independent qualified appraisers. The Company and Mr.
Syms agreed to the purchase price equal to the average of the appraised values
set forth in the three independent appraisals relating to the Elmsford Property
plus the value established in the appraisal relating to the Addison Property.

NOTE 12 - UNAUDITED SELECTED QUARTERLY
FINANCIAL DATA

|                                       |  |                                          |        |        |   |        |   |        |        |   |   |        |  
|-------------------------------------- |  | ---------------------------------------- | ------ | ------ | - | ------ | - | ------ | ------ | - | - | ------ | -
|                                       |  | Quarter                                  |       
|                                       |  |                                          |       
|                                       |  | First                                    |        | Second |   | Third  |   | Fourth |       
|                                       |  |                                          |        |        |   |        |   |        |       
|                                       |  | (In thousands, except per share amounts) |       
|YEAR ENDED FEBRUARY 28, 2009           |  |                                          |        |        |   |        |   |        |        |   |   |        |  
|Net sales                              |  | $                                        | 64,588 |        | $ | 59,030 |   | $      | 64,330 |   | $ | 54,052 |  
|Gross profit
 (1)                      |  |                                          | 28,178 |        |   | 23,140 |   |        | 26,632 |   |   | 22,575 |  
|Net income
 (loss) (2) (3) (4)         |  | $                                        | 626    |        | $ | (1,271 | ) | $      | (891   | ) | $ | (1,887 | )
|Net income
 (loss) per share  basic   |  | $                                        | 0.04   |        | $ | (0.09  | ) | $      | (0.06  | ) | $ | (0.12  | )
|Net income
 (loss) per share  diluted |  | $                                        | 0.04   |        | $ | (0.09  | ) | $      | (0.06  | ) | $ | (0.12  | )
|                                       |  |                                          |        |        |   |        |   |        |        |   |   |        |  
|                                       |  | Quarter                                  |       
|                                       |  |                                          |       
|                                       |  | First                                    |        | Second |   | Third  |   | Fourth |       
|                                       |  |                                          |        |        |   |        |   |        |       
|                                       |  | (In thousands, except per share amounts) |       
|YEAR ENDED MARCH 1, 2008               |  |                                          |        |        |   |        |   |        |        |   |   |        |  
|Net sales                              |  | $                                        | 67,147 |        | $ | 61,384 |   | $      | 70,024 |   | $ | 68,594 |  
|Gross profit
 (1)                      |  |                                          | 28,290 |        |   | 22,530 |   |        | 29,548 |   |   | 29,613 |  
|Net income
 (loss) (2)                 |  | $                                        | 674    |        | $ | (1,422 | ) | $      | 1,298  |   | $ | 257    |  
|Net income
 (loss) per share  basic   |  | $                                        | 0.05   |        | $ | (0.10  | ) | $      | 0.09   |   | $ | 0.02   |  
|Net income
 (loss) per share  diluted |  | $                                        | 0.05   |        | $ | (0.10  | ) | $      | 0.09   |   | $ | 0.01   |  

| |     |                                                                                                                                                                                              
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (1) | Includes reversal
 of $2,741 and $2,406 in the fourth quarter of Fiscal 2008 and Fiscal 2007
 respectively, of reserves established for estimated shrinkage during each
 fiscal year.        
| |     |                                                                                                                                                                                              
| | (2) | Includes
 impairment charges of $530 and $745 in the fourth quarter of Fiscal 2008 and
 Fiscal 2007 respectively relating to certain leased properties or properties
 held for sale.         
| |     |                                                                                                                                                                                              
| | (3) | Includes
 adjustment for $209,000 in the fourth quarter of Fiscal 2008 reflecting
 accelerated depreciation for the anticipated closing of one store and the
 related tax effect of $109,000.
| |     |                                                                                                                                                                                              
| | (4) | Includes a
 $290,000 adjustment to the income tax payable account related to prior year
    taxes.                                                                                           

F  16

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