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

FORM 10-K

ý

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended January 29, 2011oro

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period
from                                  to


Commission File Number: 1-4365

OXFORD INDUSTRIES, INC.(Exact name of registrant as specified in its charter)

Georgia(State or other jurisdiction of incorporation or organization)

58-0831862(I.R.S. Employer Identification No.)222 Piedmont Avenue, N.E., Atlanta, Georgia 30308(Address of principal executive offices) (Zip Code)Registrant's telephone number, including area code: (404) 659-2424Securities registered pursuant to Section 12(b) of the Act:




Title of each class

Name of each exchange on which registeredCommon Stock, $1 par value

New York Stock ExchangeSecurities 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 ý

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 ý

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past
90 days. Yes ý No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files). Yes o No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of 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 ý

Non-accelerated filer o (Do not check if a
smaller reporting company)

Smaller reporting company o


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

As of July 30, 2010, which is the last business day of the registrant's most recently completed second fiscal quarter, the aggregate market value of the
voting stock held by non-affiliates of the registrant (based upon the closing price for the common stock on the New York Stock Exchange on that date) was approximately $310,525,883. For
purposes of this calculation only, shares of voting stock directly and indirectly attributable to executive officers, directors and holders of 10% or more of the registrant's voting stock (based on
Schedule 13G filings made as of or prior to July 31, 2010) are excluded. This determination of affiliate status and the calculation of the shares held by any such person are not
necessarily conclusive determinations for other purposes.

Indicate
the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date.

Title of Each Class

Number of Shares Outstanding as of March 25, 2011Common Stock, $1 par value

16,525,566


Documents Incorporated by Reference

Portions of our proxy statement to be filed with the Securities and Exchange Commission pursuant to
Regulation 14A relating to the Annual Meeting of Shareholders of Oxford Industries, Inc. to be held on June 15, 2011 are incorporated by reference in Part III of this
Form 10-K.



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Table of Contents



PagePART IItem 1.

Business

5Item 1A.

Risk Factors

21Item 1B.

Unresolved Staff Comments

32Item 2.

Properties

33Item 3.

Legal Proceedings

33Item 4.

Reserved

34PART IIItem 5.

Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

34Item 6.

Selected Financial Data

35Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations

37Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

70Item 8.

Financial Statements and Supplementary Data

72Item 9.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

127Item 9A.

Controls and Procedures

127Item 9B.

Other Information

131PART IIIItem 10.

Directors, Executive Officers and Corporate Governance

131Item 11.

Executive Compensation

132Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

132Item 13.

Certain Relationships and Related Transactions, and Director Independence

132Item 14.

Principal Accountant Fees and Services

132PART IVItem 15.

Exhibits and Financial Statement Schedules

132Signatures

136


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CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS

Our SEC filings and public announcements may include forward-looking statements about future events. Generally, the words "believe,"
"expect," "intend," "estimate," "anticipate," "project," "will" and similar expressions identify forward-looking statements, which generally are not historical in nature. We intend for all
forward-looking statements contained herein, in our press releases or on our website, and all subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf,
to be covered by the safe harbor provisions for forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and the provisions of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (which Sections were adopted as part of the Private Securities Litigation Reform Act of 1995). Important
assumptions relating to these forward-looking statements include, among others, assumptions regarding the impact of economic conditions on consumer demand and spending, demand for our products, timing
of shipments requested by our wholesale customers, expected pricing levels, competitive conditions, the timing and cost of planned capital expenditures, costs of products and raw materials we
purchase, costs of labor, access to capital and/or credit markets, acquisition and disposition activities, expected outcomes of pending or potential litigation and regulatory actions and disciplined
execution by key management. Forward-looking statements reflect our current expectations, based on currently available information, and are not guarantees of performance. Although we believe that the
expectations reflected in such forward-looking statements are reasonable, these expectations could prove inaccurate as such statements involve risks and uncertainties, many of which are beyond
our ability to control or predict. Should one or more of these risks or uncertainties, or other risks or uncertainties not currently known to us or that we currently deem to be immaterial,
materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. Important factors relating to these risks and
uncertainties include, but are not limited to, those described in Part I, Item 1A. Risk Factors and elsewhere in this report and those described from time to time in our future reports
filed with the SEC.

We
caution that one should not place undue reliance on forward-looking statements, which speak only as of the date on which they are made. We disclaim any intention, obligation or duty
to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

DEFINITIONS

Unless the context requires otherwise, the following terms, or words of similar import, have the following meanings:

Our,
us or we: Oxford Industries, Inc. and its consolidated subsidiaries

U.S.
Revolving Credit Agreement: Our $175 million revolving credit facility, as described in Part II, Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations in this report

U.K.
Revolving Credit Agreement: Our £7 million revolving credit facility, as described in Part II, Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operations in this report

113/8%
Senior Secured Notes: Our 11.375% senior secured notes due 2015, as described in Part II, Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations in this report

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87/8%
Senior Unsecured Notes: Our 8.875% senior unsecured notes due 2011, which were satisfied and discharged in June 2009, as described in Part II, Item 7.
Management's Discussion and Analysis of Financial Condition and Results of Operations in this report



The
terms listed below reflect the respective period noted:

Fiscal 2011

52 weeks ending January 28, 2012Fiscal 2010

52 weeks ended January 29, 2011Fiscal 2009

52 weeks ended January 30, 2010Fiscal 2008

52 weeks ended January 31, 2009Eight-month transition period ended February 2, 2008

35 weeks and one day ended February 2, 2008Fiscal 2007

52 weeks ended June 1, 2007Fiscal 2006

52 weeks ended June 2, 2006Fourth quarter fiscal 2010

13 weeks ended January 29, 2011Third quarter fiscal 2010

13 weeks ended October 30, 2010Second quarter fiscal 2010

13 weeks ended July 31, 2010First quarter fiscal 2010

13 weeks ended May 1, 2010Fourth quarter fiscal 2009

13 weeks ended January 30, 2010Third quarter fiscal 2009

13 weeks ended October 31, 2009Second quarter fiscal 2009

13 weeks ended August 1, 2009First quarter fiscal 2009

13 weeks ended May 2, 2009


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PART I

Item 1.Business

BUSINESS AND PRODUCTS

Overview

We are an international apparel design, sourcing and marketing company featuring a diverse portfolio of owned lifestyle brands,
featuring Tommy Bahama®, Lilly Pulitzer® and Ben Sherman®, as well as owned and licensed brands of tailored clothing and golf apparel. We distribute our owned
lifestyle branded products through a variety of upscale department stores and specialty stores as well as company owned retail stores and e-commerce websites. Additionally, we operate
Tommy Bahama restaurants, which are generally adjacent to certain of our Tommy Bahama retail stores. Our branded and private label tailored clothing products are distributed through department stores,
specialty stores, national chains, specialty catalogs, mass merchants and Internet retailers. Originally founded in 1942, we have undergone a transformation as we migrated from our historical domestic
manufacturing roots towards a focus on designing, sourcing and marketing apparel products bearing prominent trademarks owned by us. During fiscal 2010, approximately 85% of our net sales, excluding
sales of our discontinued operations, were from products bearing brands that we own. We anticipate that this percentage will increase in the future with our acquisition of Sugartown
Worldwide, Inc., or Sugartown, which owns the Lilly Pulitzer brand and operations, in December 2010 and as we continue to develop our owned brands.

A
key component of our business strategy is to develop and market compelling lifestyle brands and products that are "fashion right" and evoke a strong emotional response from our target
consumers. As part of this strategy, we strive to exploit the potential of our existing brands and products domestically and internationally and, as suitable opportunities arise, to acquire additional
lifestyle brands that we believe fit within our business model. We consider "lifestyle" brands to be those brands that have a clearly defined and targeted point of view inspired by an appealing
lifestyle or attitude, such as the Tommy Bahama, Lilly Pulitzer and Ben Sherman brands. We believe that by generating an emotional connection with our target consumer, lifestyle brands can command
higher price points at retail, resulting in higher earnings. We also believe a successful lifestyle brand can provide opportunities for branded retail operations as well as licensing opportunities in
product categories beyond our core business.

Our
strategy of emphasizing owned lifestyle branded apparel products is driven in part by the continued consolidation in the retail industry and the increasing concentration of apparel
manufacturing in a relatively limited number of offshore markets. We believe that these two trends will continue to make the branded apparel business model more appealing than a business focused on
private label apparel, which we define as products sold exclusively to one customer under a brand name that is owned by or licensed to such customer and not owned by the seller.

Significant
steps we have undertaken to accomplish this transition towards our brand-focused strategy have included the June 2003 acquisition of the Tommy Bahama brand and operations;
the July 2004 acquisition of the Ben Sherman brand and operations; the June 2006 divestiture of our former Womenswear Group operations, which produced private label women's sportswear, primarily for
mass merchants; and the closing of all but one of our manufacturing facilities. In fiscal 2010, we took two
very important additional steps in continuing our transition with our December 21, 2010 acquisition of the Lilly Pulitzer brand and operations and the January 3, 2011 divestiture of
substantially all of the operations and assets of our former Oxford Apparel Group, which produced a mix of private label and branded sportswear, primarily for department stores, mass merchants,
national chains and discount retailers. In the future, we may add additional lifestyle brands to our portfolio, if we identify appropriate lifestyle brands which meet our investment criteria.

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Since
acquiring the Tommy Bahama brand and operations and the Ben Sherman brand and operations, we have invested significant resources in those brands through various methods including
increasing their full-price retail store footprints, developing and enhancing their e-commerce websites and funding marketing initiatives which increase the visibility of the
brands. We anticipate further investments in Tommy Bahama, Lilly Pulitzer and Ben Sherman to increase the retail store footprint of the brands, further enhance the brands' e-commerce
operations, and expand Tommy Bahama to markets outside of North America. We believe our strong balance sheet and liquidity coupled with positive cash flow from operations will provide us ample
liquidity to fund these investments, while at the same time allowing us to maintain the financial flexibility to opportunistically enhance our capital structure and pursue desirable acquisitions, if
any.

We
distribute our products through several wholesale distribution channels, including department stores, specialty stores, national chains, specialty catalogs, mass merchants and
Internet retailers. Approximately 90% of our consolidated net sales in fiscal 2010 were to customers located in the United States, with the remaining net sales primarily being sales of our Ben Sherman
products in the United Kingdom and Europe. Our ten largest customers represented approximately 32% of our consolidated net sales for fiscal 2010, with no individual customer representing more than 10%
of our consolidated net sales. We also operate retail stores, restaurants and Internet websites for some of our brands. During fiscal 2010, direct to consumer sales from our retail stores, restaurants
and Internet websites accounted for approximately 48% of our consolidated net sales.

Our
business is primarily operated through four operating groups consisting of:



Generally,
each operating group is differentiated by its own distinctive brands or products, product styling, pricing strategies, distribution channels and target consumers. Each
operating group is managed to maximize the long-term sustainable return on capital invested and to develop its brands and operations in coordination with our overall strategic plans.

We
believe that maintaining and growing our owned and licensed brands are critical to our success. Our owned brands include the following:

Tommy Bahama®

Lilly Pulitzer®

Ben Sherman®Billy London®

Oxford Golf®

Nickelson®Arnold Brant®


We
currently hold licenses to produce and sell certain categories of apparel products under the following brands:

Kenneth Cole®

Dockers®

Geoffrey Beene®


Sales
of products using licensed brands accounted for approximately 8% of our net sales in fiscal 2010. In addition to their branded sales, Lanier Clothes also sells private label
products, which comprised approximately 7% of our consolidated net sales in fiscal 2010.

We
operate in highly competitive domestic and international markets in which numerous U.S.-based and foreign apparel firms compete. Additionally, the apparel industry is
cyclical and dependent upon the overall level of discretionary consumer spending, which changes as regional, domestic and international economic conditions change. Often, negative economic conditions
have a longer and more severe impact on the apparel and retail industry than the conditions have on other

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industries.
The weak global economic conditions that began in fiscal 2008 continued to impact each of our operating groups through fiscal 2010, although we did observe some signs of recovery. We
continue to focus on minimizing inventory markdown risk and promotional pressure, but at the same time we anticipate purchasing inventory more aggressively in 2011 if economic conditions continue to
show improvement. We believe that fiscal 2011 will be impacted by pricing pressures on raw materials, fuel, transportation and other costs necessary for the production and sourcing of apparel
products.

In
addition to the impact of competition and economic factors, our operations are subject to certain other risks, many of which are beyond our ability to control or predict. Important
factors relating to certain risks which could impact our business include, but are not limited to, those described in Part I, Item 1A. Risk Factors of this report.

Operating Groups

Our business is primarily operated through four operating groups: Tommy Bahama, Lilly Pulitzer, Ben Sherman and Lanier Clothes. We
identify our operating groups based on the way our management organizes the components of our business for purposes of allocating resources and assessing performance. All amounts included in this
report and in our consolidated financial statements reflect our changes in operating groups during fiscal 2010 including (1) the acquisition of the Lilly Pulitzer brand and operations,
resulting in the creation of our Lilly Pulitzer operating group,
(2) the sale of substantially all of the operations and assets of our former Oxford Apparel operating group, which are now classified as discontinued operations, (3) the reclassification
of our Oxford Golf business and our Lyons, Georgia distribution center operations into Corporate and Other, as these activities were previously included in Oxford Apparel, but will continue to be
operated by us, and (4) the reclassification of certain corporate service costs from Oxford Apparel, where they were previously allocated, to Corporate and Other, as there is uncertainty in
whether there will be a reduction in those costs as a result of the Oxford Apparel sale. The tables below present certain financial information about our operating groups (in thousands).

Fiscal 2010

Fiscal 2009Net SalesTommy Bahama

$
398,510

$
363,084Lilly Pulitzer(1)


5,959


Ben Sherman


86,920


102,309Lanier Clothes


103,733


114,542Corporate and Other(2)


8,825


5,371Total

$
603,947

$
585,306Operating Income (Loss)Tommy Bahama(3)

$
51,081

$
37,515Lilly Pulitzer(1)


(372
)

Ben Sherman(4)


(2,664
)

(8,616
)Lanier Clothes


14,316


12,389Corporate and Other(2)


(21,699
)

(22,378
)Total

$
40,662

$
18,910


(1)Lilly
Pulitzer's operating results are included in our consolidated operating results from the date of acquisition, December 21, 2010, through
January 29, 2011. Lilly Pulitzer's operating results were negatively impacted by $0.8 million of charges included in cost of goods sold associated with the write-up of
inventory from cost to fair value and $0.2 million of changes in fair value of contingent consideration arrangements associated


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with
the Lilly Pulitzer acquisition pursuant to the purchase method of accounting for acquisitions. (2)Corporate
and Other is a reconciling category for reporting purposes and includes our corporate offices, substantially all financing activities, LIFO
inventory accounting adjustments and other costs that are not allocated to our operating groups. Corporate and Other also includes the operations of our Oxford Golf business and our Lyons, Georgia
distribution center, which were previously included in Oxford Apparel, but were not sold, and certain corporate service costs which were previously allocated to Oxford Apparel. Therefore, the
Corporate and Other net sales and operating income (loss) do not equal amounts previously reported. Fiscal 2010 included $3.8 million of LIFO accounting charges and $0.8 million of
transaction costs associated with the acquisition of the Lilly Pulitzer brand and operations, which were partially offset by the impact of a $2.2 million reduction in an existing environmental
reserves liability, while fiscal 2009 included LIFO accounting charges of $4.9 million.(3)Tommy
Bahama's operating results included charges of $0.5 million in fiscal 2009 related to certain fixed asset impairment charges.(4)Ben
Sherman's operating results included restructuring and other charges of $3.2 million and $2.0 million in fiscal 2010 and fiscal 2009,
respectively. The fiscal 2010 charges primarily related to charges associated with the termination of certain retail store leases in the United Kingdom and fixed asset impairment charges, while the
fiscal 2009 charges primarily related to Ben Sherman's exit from its footwear, kids' and women's operations and other streamlining initiatives.


January 29,
2011

January 30,
2010AssetsTommy Bahama

$
274,140

$
256,759Lilly Pulitzer


79,476


Ben Sherman


67,478


69,775Lanier Clothes


35,530


39,213Corporate and Other


44,102


3,062Assets related to Discontinued Operations


57,745


56,365Total

$
558,471

$
425,174




Total
assets for Corporate and Other include a LIFO reserve of $46.0 million and $44.4 million as of January 29, 2011 and January 30, 2010, respectively. The
increase in Corporate and Other from January 30, 2010 to January 29, 2011 is primarily due to the accumulation of cash on hand during fiscal 2010. Assets related to discontinued
operations primarily consist of receivables and inventories associated with our former Oxford Apparel Group, which, net of any outstanding liabilities associated with the discontinued operations, we
expect to be converted to cash during the first half of fiscal 2011. For more details on each of our operating groups, see Note 10 of our consolidated financial statements and Part II,
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations, both included in this report. For financial information about geographic areas, see Note 10
of our consolidated financial statements, included in this report.



Tommy Bahama designs, sources and markets men's and women's sportswear and related products that are intended to define casually
elegant island living consistent with Tommy Bahama's aspirational lifestyle. Tommy Bahama's products can be found in our own retail stores, on our e-commerce site,

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www.tommybahama.com,
and in certain department stores and independent specialty stores throughout the United States. The target consumers of Tommy Bahama are affluent 35 and older men and women who
embrace a relaxed and casual approach to daily living.

A
key component of our Tommy Bahama strategy is to operate our own retail stores and e-commerce website, which we believe permits us to develop and build brand awareness by
presenting our products in a setting specifically designed to evoke the lifestyle on which they are based. The marketing of our Tommy Bahama brand also uses print, catalogs, correspondence with loyal
customers, email and Internet advertising and tradeshow initiatives. We also provide point-of-sale materials and signage to our wholesale customers to enhance the presentation
of our Tommy Bahama products at their retail locations. We employ cooperative advertising programs with certain Tommy Bahama wholesale customers.



We believe the quality and design of Tommy Bahama products are critical to the continued success of the Tommy Bahama brand. Tommy
Bahama products are designed by product specific teams who focus on the target consumer. The design process includes feedback from buyers, consumers and sales agents, along with market trend research.
Our Tommy Bahama apparel products generally incorporate fabrics made of cotton, silk, linen, nylon, leather, tencel or blends including one or more of these fiber types.

We
operate a buying office located in Hong Kong to manage the production and sourcing of substantially all of our Tommy Bahama products. Tommy Bahama products are generally acquired by
us as package purchases of finished goods, which are manufactured to our specifications. We typically do not take title to the goods until they are shipped by the manufacturer to us. During fiscal
2010, we utilized approximately 150 suppliers, which are primarily located in China, to manufacture our Tommy Bahama products on an order-by-order basis. The largest ten
suppliers of Tommy Bahama products provided approximately 60% of the products acquired during fiscal 2010.

Activities
at our Tommy Bahama distribution center in Auburn, Washington include receiving finished goods from suppliers, inspecting the products and shipping the products to our
wholesale customers, our Tommy Bahama retail stores and our e-commerce customers. We seek to maintain sufficient levels of Tommy Bahama inventory at the distribution center to support
pre-booked orders and anticipated sales volume of our wholesale customers and our direct to consumer operations.



The components of our Tommy Bahama direct to consumer strategy include retail store, restaurant and e-commerce operations
and represented approximately 65% of Tommy Bahama's net sales in fiscal 2010. Retail store, restaurant and e-commerce net sales accounted for approximately 46%, 13% and 6%, respectively,
of Tommy Bahama's net sales in fiscal 2010.

Continued
growth and development of our retail store operations is a critical part of our overall strategy for the Tommy Bahama brand. This strategy includes locating retail stores in
upscale malls, lifestyle shopping centers and resort destinations. Generally, we seek malls and shopping areas with high-profile or luxury consumer brands. Our retail stores carry a wide
range of
merchandise, including apparel, home products and accessories, all presented in an island-inspired atmosphere designed to be comfortable and distinct.

Our
Tommy Bahama full-price retail stores allow us the opportunity to present Tommy Bahama's full line of current season products, including many licensed products. We
believe these retail stores provide high visibility for the Tommy Bahama brand and products and also enable us to stay close to the needs and preferences of our consumers. We believe our presentation
of products and our strategy

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to
limit promotional sales in our own retail stores are good for the Tommy Bahama brand and, in turn, enhance business with our wholesale customers. Our Tommy Bahama outlet stores serve an important
role in overall inventory management by allowing us to sell discontinued and out-of-season products at better prices than are otherwise available from outside parties, while
helping us to protect the integrity of the Tommy Bahama brand through controlled distribution.

The
table below details the number and average square feet of Tommy Bahama retail stores operated by us as of January 29, 2011.

Restaurant-retail
Locations

Full-Price
Stores

Outlet Stores

TotalCalifornia

3

15

4

22Florida

4

13

2

19Hawaii

2

4

1

7Texas

1

4

2

7Nevada

1

3

1

5Arizona

1

2



3Virginia



2

1

3Other

1

17

5

23Total

13

60

16

89Average square feet(1)

11,600

3,600

5,500


(1)Average
square feet for restaurant-retail locations include average retail space and restaurant space of 4,000 and 7,600 square feet, respectively.


For
Tommy Bahama's full-price retail stores and restaurant-retail locations operating for the full fiscal 2010 year, sales per square foot, excluding restaurant sales
and restaurant space, were approximately $580 during fiscal 2010, compared to $520 for stores operating for the full fiscal 2009 year. We expect to open seven to ten retail locations in fiscal
2011, although the specific locations and timing have not been finalized yet. We currently anticipate maintaining this level of new store openings in future years as well. The operation of retail
stores and restaurant-retail locations requires a greater amount of capital investment than wholesale operations. Based on our anticipated build out costs for Tommy Bahama retail stores, outlet stores
and restaurant-retail locations, we estimate that we will spend approximately $1.6 million, $0.6 million and $5.0 million on average in connection with the build-out
of a full-price retail store, outlet store and restaurant-retail location, respectively, although individual locations will differ from this depending on a variety of factors. Often, the
landlord provides certain incentives to fund a portion of these capital expenditures.

In
addition to our retail stores, our direct-to-consumer approach includes the tommybahama.com website, which represented approximately 6% of Tommy Bahama's net
sales during fiscal 2010. The website allows consumers to buy Tommy Bahama products directly from us via the Internet. This website has also enabled us to significantly increase our database of
customer contacts which allows us to communicate directly and frequently with consenting consumers.



To complement our direct-to-consumer operations and have access to a larger group of consumers, we continue to
maintain our wholesale operations for Tommy Bahama. Wholesale sales for Tommy Bahama accounted for approximately 35% of Tommy Bahama's net sales in fiscal 2010. We believe that the integrity and
continued success of the Tommy Bahama brand is dependent in part upon careful selection of the retailers through which Tommy Bahama products are sold. Part of our wholesale strategy is to control the
distribution of our Tommy Bahama products in a manner intended to protect

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and
grow the value of the brand. During fiscal 2010, substantially all of Tommy Bahama's sales were to customers within the United States, and approximately 10% of Tommy Bahama's net sales were to its
largest customer, Nordstrom.

We
maintain Tommy Bahama apparel sales offices and showrooms in several locations, including New York and Seattle, to facilitate sales to our wholesale customers. Our Tommy Bahama
wholesale operations utilize a sales force primarily consisting of independent commissioned sales representatives.



We believe licensing is an attractive business opportunity for the Tommy Bahama brand. Once a brand is established, licensing typically
requires modest additional investment for us but can yield high-margin income. It also affords the opportunity to enhance overall brand awareness and exposure. In evaluating a licensee for
Tommy Bahama, we typically consider the candidate's experience, financial stability, sourcing expertise and marketing ability. We also evaluate the marketability and compatibility of the proposed
licensed products with other Tommy Bahama products.

Our
agreements with Tommy Bahama licensees are for specific geographic areas and expire at various dates in the future, and in limited cases include contingent renewal options.
Generally, the agreements require minimum royalty payments as well as royalty payments and, in some cases, advertising payments and/or obligations based on specified percentages of the licensee's net
sales of the licensed products. Our license agreements generally provide us the right to approve all products, advertising and proposed channels of distribution.

Third
party license arrangements for our Tommy Bahama products include the following product categories:

Men's and women's watches

Ceiling fans

Indoor furnitureMen's and women's eyewear

Rugs

Outdoor furnitureMen's belts and socks

Wallcoverings

Bedding and bath linensMen's and women's fragrances

Luggage

Table top accessoriesShampoo, soap and bath amenities

Sleepwear


In
addition to our licenses for the specific product categories listed above, we have also entered into certain international license agreements which allow those licensees to distribute
certain Tommy Bahama branded products in Canada, the United Arab Emirates, Australia, New Zealand and South Africa. In addition to selling Tommy Bahama goods to wholesale accounts, the licensees have
opened retail stores in their respective geographic regions. As of January 29, 2011, our licensees operated 13 retail stores in Canada, Australia and the United Arab Emirates.



Lilly Pulitzer is a designer, marketer and distributor of upscale collections of women's and girl's dresses, sportswear and other
products. Lilly Pulitzer was originally created in the late 1950's and is an affluent brand with a heritage and aesthetic based on the Palm Beach resort lifestyle. The brand is somewhat unique among
women's brands in that it has demonstrated multi-generational appeal. The brand targets three distinct groups of women: young women recently graduated from college; young mothers and their daughters;
and women who are not tied to the academic calendar. Lilly Pulitzer products can be found in our owned Lilly Pulitzer stores, in Lilly Pulitzer Signature Stores, as described below, and on our Lilly
Pulitzer website, www.lillypulitzer.com, as well as in certain department stores and a variety of independent specialty stores. We also license the Lilly Pulitzer name for various product categories.

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We acquired the Lilly Pulitzer brand on December 21, 2010 and anticipate growth opportunities in the brand's retail, e-commerce, wholesale and
licensing operations in the future. We believe that there is significant opportunity to expand the reach of the brand, while at the same time maintaining the exclusive distribution that Lilly Pulitzer
has historically maintained. Net sales for Lilly Pulitzer for the 2010 calendar year, which is not directly comparable to our fiscal year, were approximately $72 million. Of the
$72 million in net sales, approximately 55%, 35% and 10% of the net sales were through the wholesale, retail and e-commerce distribution channels, respectively. Only the portion of
Lilly Pulitzer's net sales and operating results subsequent to the date of acquisition in fiscal 2010 are included in our consolidated financial statements.

The
Lilly Pulitzer brand is marketed through print, moving media, Internet marketing and tradeshow initiatives. Lilly Pulitzer provides point-of-sale materials
and signage to wholesale customers to enhance the presentation of Lilly Pulitzer products at third party retail locations. Lilly Pulitzer also employs cooperative advertising programs with certain
wholesale customers.



We believe product quality and design are critical to the continued success of the Lilly Pulitzer brand. Lilly Pulitzer's products are
developed by our dedicated design teams located at the Lilly Pulitzer headquarters in King of Prussia, Pennsylvania. Our Lilly Pulitzer design teams focus on the target consumer, and the design
process combines feedback from buyers, consumers and our sales force, along with market trend research. Lilly Pulitzer apparel products are designed to incorporate various fiber types, including
cotton, silk, linen and other natural and man-made fibers or blends of two or more of these materials.

Lilly
Pulitzer utilizes a combination of in-house employees in our King of Prussia offices and a number of third party buying agents primarily based in Asia to manage the
production and sourcing of the majority of the Lilly Pulitzer apparel products. Through its buying agents and direct sourcing, Lilly Pulitzer used approximately 30 suppliers located primarily in
China, Hong Kong and Macau to manufacture the Lilly Pulitzer products on an order-by-order basis during the 2010 calendar year. The largest ten suppliers provided approximately
75% of the Lilly Pulitzer products acquired during the 2010 calendar year. Substantially all of the Lilly Pulitzer products are package purchases of finished goods, which are manufactured to our
specifications. Lilly Pulitzer typically does not take title to the goods until the goods are shipped by the manufacturer.

Lilly
Pulitzer operates a distribution center in King of Prussia, Pennsylvania for the Lilly Pulitzer operations. Distribution center activities include receiving finished goods from
suppliers, inspecting the products and shipping the products to wholesale customers and the Lilly Pulitzer retail stores. We seek to maintain sufficient levels of inventory to support
pre-booked orders and anticipated sales volume.



Part of our strategy is to maintain controlled distribution to protect and grow the Lilly Pulitzer brand. During the 2010 calendar
year, which is not directly comparable to our fiscal year, approximately 55% of Lilly Pulitzer's net sales were sales to wholesale customers.

During
calendar year 2010, which is not directly comparable to our fiscal year, approximately 47% of Lilly Pulitzer's wholesale sales were to certain wholesale customers, which we refer
to as Lilly Pulitzer Signature Stores. For these stores, we enter into agreements whereby we grant the other party the right to operate a store as a Lilly Pulitzer Signature Store within a specified
geographic area, subject to certain conditions, including designating a portion of the store specifically for Lilly Pulitzer products, the purchase of reasonable quantities of Lilly Pulitzer products,
and adhering to certain brand appropriate specifications. These agreements are generally for one- or two-year period, renewable at the option of Lilly Pulitzer. As of
January 29, 2011, there were approximately 70 Lilly Pulitzer

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Signature
Stores. The remaining 53% of wholesale sales were to specialty stores and a limited number of select Belk, Dillard's, Bloomingdale's, Lord & Taylor and Saks Fifth Avenue stores. No
single wholesale customer of Lilly Pulitzer accounted for more than 10% of Lilly Pulitzer's wholesale sales during calendar year 2010.

We
maintain Lilly Pulitzer apparel sales offices and showrooms in several locations, including King of Prussia, Pennsylvania and New York. Our wholesale operations for Lilly Pulitzer
utilize a sales force consisting primarily of salaried sales employees.



The components of Lilly Pulitzer's direct to consumer strategy include retail store and e-commerce operations and
represented approximately 45% of Lilly Pulitzer's net sales for the 2010 calendar year.

A
key element of our direct to consumer strategy is e-commerce. The ability to effectively communicate the Lilly Pulitzer brand message to targeted consumers through social
media and other methods of digital marketing is a significant factor in the success of the Lilly Pulitzer brand. The Lilly Pulitzer e-commerce business is developing rapidly and we believe
it is a key element of the Lilly Pulitzer business.

Our
direct to consumer strategy for the Lilly Pulitzer brand also includes locating retail stores in higher-end malls and brand-appropriate street locations. Each retail
store carries a wide range of merchandise, including apparel, footwear and accessories, all presented in a manner intended to enhance the Lilly Pulitzer image. Our full-price Lilly
Pulitzer retail stores allow the opportunity to present Lilly Pulitzer's full line of current season products, including licensees' products. We believe our Lilly Pulitzer retail stores provide high
visibility for the brand and products and also enable us to stay close to the needs and preferences of consumers. We believe the presentation of these
products in our Lilly Pulitzer retail stores helps build brand awareness and acceptance and thus enhances Lilly Pulitzer's business with our wholesale customers.

The
table below provides additional information regarding Lilly Pulitzer retail stores as of January 29, 2011.

Number
of Stores

Average
Square FeetFlorida

5

3,300New York

3

3,000Pennsylvania

2

4,600Texas

2

3,200Other

4

3,600Total

16

3,500


Retail
store sales per square foot for the 2010 calendar year were approximately $345 for the continuing Lilly Pulitzer stores open for the full 2010 calendar year. At this time, we do
not have any plans to open any new Lilly Pulitzer stores during fiscal 2011, but we are relocating one store to a smaller location within the same mall during the first quarter of fiscal 2011. The
operation of retail stores requires a greater amount of capital investment than wholesale operations. We anticipate that future stores will occupy a smaller footprint than the average of our existing
stores.



We license the Lilly Pulitzer trademark to a variety of licensees in categories beyond Lilly Pulitzer's core product categories. We
believe licensing is an attractive business opportunity for the Lilly Pulitzer brand. Once a brand is established, licensing requires modest additional investment for us but

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can
yield high-margin income. It also affords the opportunity to enhance overall brand awareness and exposure. In evaluating a potential Lilly Pulitzer licensee, we typically consider the
candidate's experience, financial stability, manufacturing performance and marketing ability. We also evaluate the marketability and compatibility of the proposed products with other Lilly Pulitzer
brand products.

Our
agreements with Lilly Pulitzer licensees are for specific geographic areas and expire at various dates in the future. Generally, the agreements require minimum royalty payments as
well as royalty and advertising payments based on specified percentages of the licensee's net sales of the licensed products. Our license agreements generally provide us the right to approve all
products, advertising and proposed channels of distribution.

Third
party license arrangements for Lilly Pulitzer products include the following product categories:

Furniture

Stationery

Wedding gownsBedding and home fashions

Eyewear




Ben Sherman is a London-based designer, marketer and distributor of men's branded sportswear. Ben Sherman was established in 1963 as an
edgy, "Mod"-inspired shirt brand and has evolved into a British lifestyle brand of apparel targeted at style conscious men ages 25 to 40 in multiple markets throughout the world. During fiscal 2010,
approximately 53% and 29% of Ben Sherman's net sales occurred in the United Kingdom and United States, respectively, with the remaining 18% of net sales occurring primarily in Europe. Our Ben Sherman
products can be found in certain department stores and a variety of independent specialty stores, as well as in our own Ben Sherman retail stores and on certain websites.

Ben
Sherman products are sold to our wholesale customers, as well as in our owned and licensed retail stores located in numerous countries throughout the world. In recent years, we have
implemented certain initiatives to elevate our wholesale distribution to attain higher price points for our Ben Sherman men's products, design one Ben Sherman apparel collection consistent throughout
the world, reduce our infrastructure and license certain of our non-core businesses to third parties to allow us to focus our resources on our core businessmen's sportwear. We
believe that these initiatives have been critical steps in improving the operating results of Ben Sherman. We anticipate that these initiatives will continue to offer continuing improvement in
existing opportunities.

We
market the Ben Sherman brand through print, moving media, promotional programs, Internet marketing and tradeshow initiatives. We provide point-of-sale
materials and signage to wholesale customers to enhance the presentation of our Ben Sherman products at third party retail locations. We also employ cooperative advertising programs with certain Ben
Sherman wholesale customers.

In
addition to the Ben Sherman trademark, we also own the Nickelson trademark and sell Nickelson products in the United Kingdom. Nickelson is a British urban brand aimed at a target
market of 18- to 30-year olds with a specific slant on the streetwear-influenced youth market. The Nickelson brand gives our customers a lower-priced alternative to our Ben
Sherman brand in the United Kingdom. During fiscal 2010, approximately 5% of the net sales of Ben Sherman were sales of Nickelson products.



We believe product quality and design are critical to the continued success of the Ben Sherman brand. Ben Sherman men's apparel
products are developed by our dedicated design teams located at the Ben Sherman headquarters in London, England. Our Ben Sherman design teams focus on the

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target
consumer, and the design process combines feedback from buyers, consumers and our sales force, along with market trend research. We design our Ben Sherman apparel products to incorporate
various fiber types, including cotton, wool or other natural fibers, synthetics, or blends of two or more of these materials.

We
primarily utilize a large third party buying agent based in Hong Kong to manage the production and sourcing of the majority of our Ben Sherman apparel products in China and other
countries in Asia. Through this buying agent and a sourcing office we operate in India, during fiscal 2010 we used approximately 125 suppliers primarily located in China, Thailand and India to
manufacture our Ben Sherman products on an order-by-order basis. The largest ten suppliers provided approximately 55% of the Ben Sherman products acquired during fiscal 2010.
Substantially all of our Ben Sherman products were package purchases of finished goods, which are manufactured to our specifications. We typically do not take title to the goods until they are shipped
by the manufacturer to us.

We
use a third party distribution center in the United Kingdom for our Ben Sherman products sold in the United Kingdom and Europe. In the United States, distribution services are
performed for Ben Sherman at our owned distribution center in Lyons, Georgia. Distribution center activities include receiving finished goods from suppliers, inspecting the products and shipping the
products to wholesale customers and our Ben Sherman retail stores. We seek to maintain sufficient levels of inventory to support pre-booked orders and anticipated sales volume.



Part of our strategy is to maintain controlled distribution to protect and grow the Ben Sherman brand. During fiscal 2010,
approximately 70% of Ben Sherman's net sales were sales to wholesale customers and international distributors. During fiscal 2010, approximately 11% of Ben Sherman's net sales were to its largest
customer, Debenhams, which operates retail stores in the United Kingdom, and approximately 28% of Ben Sherman's net sales were to its five largest wholesale
customers. In the United States, Ben Sherman's products can be located in specialty stores as well as Macy's, Nordstrom, Lord & Taylor and other department stores.

We
maintain Ben Sherman apparel sales offices and showrooms in several locations, including London, New York and Dusseldorf, among others. Our wholesale operations for Ben Sherman
utilize a sales force consisting of salaried sales employees and independent commissioned sales representatives.



Our direct to consumer strategy for the Ben Sherman brand includes locating retail stores in higher-end malls and
brand-appropriate street locations. Each retail store carries a wide range of merchandise, including apparel, footwear and accessories, all presented in a manner intended to enhance the Ben Sherman
image. Our full-price Ben Sherman retail stores allow the opportunity to present Ben Sherman's full line of current season products, including licensees' products. We believe our Ben
Sherman retail stores provide high visibility of the brand and products and also enable us to stay close to the needs and preferences of consumers. We believe the presentation of these products in our
Ben Sherman retail stores helps build brand awareness and acceptance and thus enhances business with our wholesale customers. Our outlet stores in the United Kingdom serve an important role in the
overall inventory management by allowing us to sell discontinued and out-of-season products at better prices than are generally otherwise available from outside parties, while
helping us protect the Ben Sherman brand by controlling the distribution of such products.

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The
table below provides additional information regarding Ben Sherman retail stores as of January 29, 2011.

Number
of Stores

Average
Square FeetUnited States Full-Price Stores

5

3,800United Kingdom Full-Price Stores

4

2,600Germany Full-Price Stores

2

2,100United Kingdom Outlet Stores

4

1,600Total

15

2,700


During
fiscal 2010, approximately 27% of Ben Sherman's net sales were from owned retail store operations. Retail sales per square foot were approximately $595 for our
full-price Ben Sherman stores open throughout fiscal 2010 compared to $560 for the full-price Ben Sherman stores open throughout fiscal 2009. Although we have not agreed to any
retail store openings for fiscal 2011 at this time, we continue to evaluate potential locations and may open retail stores in fiscal 2011 if we identify locations which meet our investment criteria.
The operation of our retail stores requires a greater amount of capital investment than wholesale operations. Based on recent store openings, we have spent approximately $0.9 million of capital
expenditures on average to build out a Ben Sherman full-price retail store. Often, the landlord provides certain incentives to fund a portion of these capital expenditures.

Another
component of our direct to consumer strategy is operating certain concession arrangements, whereby we operate Ben Sherman shops within department or other stores. The inventory
at these locations is owned by us until sold to the consumer, at which time we recognize the full retail sales price. In these arrangements, we are responsible for the cost of the Ben Sherman employee
responsible for the area and also pay a commission to the department store to cover occupancy and certain other
costs associated with using the space. As of January 29, 2011, we operated 10 concession locations in the United Kingdom.



We license the Ben Sherman trademark to a variety of licensees in categories beyond Ben Sherman's core product categories, including
footwear and kids apparel. We believe licensing is an attractive business opportunity for the Ben Sherman brand. Once a brand is established, licensing requires modest additional investment for us but
can yield high-margin income. It also affords the opportunity to enhance overall brand awareness and exposure. In evaluating a potential Ben Sherman licensee, we typically consider the
candidate's experience, financial stability, manufacturing performance and marketing ability. We also evaluate the marketability and compatibility of the proposed products with other Ben Sherman brand
products.

Our
agreements with Ben Sherman licensees are for specific geographic areas and expire at various dates in the future. Generally, the agreements require minimum royalty payments as well
as royalty and advertising payments based on specified percentages of the licensee's net sales of the licensed products. Our license agreements generally provide us the right to approve all products,
advertising and proposed channels of distribution.

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Third
party license arrangements for Ben Sherman products include the following product categories:

Footwear

Kid's apparelMen's backpacks and travel bags

Men's tailored clothes and dress shirtsMen's and boys' watches and jewelry

Men's and boys' underwear, socks and sleepwearMen's and women's eyewear

Men's gift productsMen's fragrances and toiletries

Men's and women's accessories, wallets and small leather goodsMen's neckwear and pocket squares

Men's hats, caps, scarves and glovesMen's and boys' belts


In
addition to the license agreements for the specific product categories listed above, we have also entered into certain international license/distribution agreements which allow our
partners the opportunity to distribute Ben Sherman products in certain geographic areas around the world, including Australia, Asia, South Africa, Europe and Canada. The majority of the products
distributed by these partners are acquired from us or other product licensees and are typically identical to the products sold in the United Kingdom and United States. We believe there is potential
for further penetration into these and other markets for the Ben Sherman brand. In most markets, our license/distribution partners are required to open retail stores in their respective geographic
regions. As of January 29, 2011, our license/distribution partners operated 20 retail stores located in Australia, Asia, South Africa and Europe.



Lanier Clothes designs and markets branded and private label men's suits, sportcoats, suit separates and dress slacks across a wide
range of price points. Our Lanier Clothes branded products are sold under certain licensed trademarks including Kenneth Cole, Dockers and Geoffrey Beene. Additionally, we design and market products
for our owned Billy London, and Arnold Brant brands. Billy London is a modern, British-inspired fashion brand geared towards the value-oriented consumer. Arnold Brant is an upscale tailored brand that
is intended to blend modern elements of style with affordable luxury. In addition to the branded businesses, we design and source certain private label tailored clothing products. We believe that this
private label business complements our branded tailored clothing businesses. Significant private label brands for which we produce tailored clothing include Stafford, Lands' End, Alfani, Structure,
and Kenneth Roberts. Sales of branded products represented approximately 64% and 50% of Lanier Clothes' net sales during fiscal 2010 and fiscal 2009, respectively.

Our
Lanier Clothes products are sold to national chains, department stores, specialty stores, specialty catalog retailers and discount retailers throughout the United States. In Lanier
Clothes, we have long-standing relationships with some of the United States' largest retailers, including JCPenney, Macy's, Sears, Men's Wearhouse and Kohl's, representing approximately
22%, 14%, 11%, 10% and 10%, respectively, of Lanier Clothes' net sales during fiscal 2010. Sales to Lanier Clothes' 10 largest customers represented more than 85% of Lanier Clothes' net sales in
fiscal 2010.

We
market our branded tailored clothing products on a brand-by-brand basis, targeting distinct consumer demographics and lifestyles. Our advertising programs are
an integral part of the branded product offerings. For certain tailored clothing products, we employ cooperative advertising programs.



We believe that superior customer service and supply chain management, as well as the design of quality products, are all integral
components of our strategy in the branded and private label tailored clothing market. Our Lanier Clothes' design teams, which are located in New York, focus on the target

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consumer
for each brand. The design process combines feedback from buyers and sales agents along with market trend research.

During
fiscal 2010, Lanier Clothes acquired the majority of its products on a package purchase of finished goods basis from third party producers outside of the United States, primarily
in China. As the ability and willingness of third party manufacturers to finance raw materials continues to increase, we anticipate that Lanier Clothes will continue to increase the percentage of
goods acquired as package purchases of finished goods rather than CMT purchases. CMT purchases are purchases whereby we supply the fabric and purchase cut, sew and finish labor (or "cut, make, trim")
from our third party producers. For CMT purchases, we procure and retain ownership of the fabric which we purchased throughout the manufacturing and finishing process. Lanier Clothes manages
production in Asia and Latin America through a combination of efforts from our Lanier Clothes offices in Atlanta, Georgia and third party buying agents. Lanier Clothes purchased goods from
approximately 125 suppliers in fiscal 2010. The ten largest suppliers of Lanier Clothes provided more than 85% of the products Lanier Clothes acquired from third parties during fiscal 2010. In
addition to purchasing products from third parties, Lanier Clothes also operates a manufacturing facility, located in Merida, Mexico, which produced approximately 17% of our Lanier Clothes products
during fiscal 2010.

Our
various Lanier Clothes products are manufactured from a variety of fibers, including wool, silk, linen, cotton and other natural fibers, as well as synthetics and blends of these
materials. The majority of the materials used in Lanier Clothes' manufacturing operations are purchased in the form of woven finished fabrics directly from various offshore fabric mills.

For
Lanier Clothes, we utilize a distribution center located in Toccoa, Georgia, where we receive goods from our suppliers, inspect those products and ship the goods to our customers. We
seek to maintain
sufficient levels of inventory to support programs for pre-booked orders and to meet increased customer demand for at-once ordering. For certain standard tailored clothing
product styles, we maintain in-stock replenishment programs, providing shipment to customers within just a few days of receiving the order. These types of programs generally require higher
inventory levels. Disposal of excess prior- season inventory is an ongoing part of our business.

We
maintain apparel sales offices and showrooms for our Lanier Clothes products in several locations, including New York, Dallas and Atlanta. We employ a sales force for Lanier Clothes
primarily consisting of salaried employees.



Corporate and Other is a reconciling category for reporting purposes and includes our corporate offices, substantially all financing
activities, LIFO inventory accounting adjustments and other costs that are not allocated to our operating groups. Corporate and Other also includes the operating results of our Oxford Golf business
and our Lyons, Georgia distribution center, both of which were previously reported as part of our former Oxford Apparel operating group, prior to the disposal of substantially all of the operations
and assets of Oxford Apparel on January 3, 2011.

The
Oxford Golf brand is designed to appeal to a sophisticated golf apparel consumer with a preference for high quality and classic styling. Our Oxford Golf products are designed by a
team located in New York and are primarily acquired on a package purchase, finished goods basis from third party producers outside of the United States. Oxford Golf seeks to maintain sufficient levels
of inventory to support programs for pre-booked orders and at-once ordering. Oxford Golf maintains an apparel sales office in New York, while employing a sales force consisting
primarily of commissioned sales agents.

Our
Lyons, Georgia distribution center receives finished goods from suppliers, inspects those products and ships the products to customers for our U.S. Ben Sherman operations and our
Oxford Golf business.

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TRADEMARKS

As discussed above, we own trademarks, several of which are very important to our business. Generally, our significant trademarks are
subject to registrations and pending applications throughout the world for use on a variety of items of apparel and, in some cases, apparel-related products, accessories, home furnishings and beauty
products, as well as in connection with retail services. We continue to expand our worldwide usage and registration of certain of our trademarks. In general, trademarks remain valid and enforceable as
long as the trademarks are used in connection with our products and services and the required registration renewals are filed. Our significant trademarks are discussed within each operating group
description. Important factors relating to risks associated with our trademarks include, but are not limited to, those described in Part I, Item 1A. Risk Factors.

COMPETITION

We sell our products in highly competitive domestic and international markets in which numerous United States-based and foreign apparel
firms compete. No single apparel firm or small group of apparel firms dominates the apparel industry and our direct competitors vary by operating group and distribution channel. We believe that the
principal competitive factors in the apparel industry are design, brand image, consumer preference, price, quality, marketing and customer service. We believe our ability to compete successfully in
styling and marketing is related to our ability to foresee changes and trends in fashion and consumer preference, and to present appealing products for consumers. In some instances, particularly with
respect to our private label businesses, a retailer that is our customer may compete directly with us by sourcing its products directly. Important factors relating to risks associated with competitive
factors in our industry include, but are not limited to, those described in Part I, Item 1A. Risk Factors.

SEASONAL ASPECTS OF BUSINESS AND ORDER BACKLOG

Although our various product lines are sold on a year-round basis, the demand for specific products or styles may be
seasonal. For example, the demand for Tommy Bahama and Lilly Pulitzer products in our principal markets is generally higher in the spring season and lower in the fall season. Typically, our wholesale
products are sold prior to each of the retail selling seasons, including spring, summer, fall and holiday. As the timing of product shipments and other events affecting the retail business may vary,
we do not believe that results for any particular quarter are necessarily indicative of results for the full fiscal year. In addition, we do not believe that the fiscal 2010 distribution of net sales
and operating income is necessarily indicative of the expected distribution in future years as the information below does not reflect a full year's operations of Lilly Pulitzer and individual quarters
may be impacted by certain unusual or non-recurring items, economic conditions or other factors. The following table presents the percentage of net sales and operating income by quarter
(unaudited) for fiscal 2010:

First
Quarter

Second
Quarter

Third
Quarter

Fourth
QuarterNet sales

27%

24%

23%

26%Operating income

37%

27%

16%

20%


Order Backlog

As of January 29, 2011 and January 30, 2010, we had booked orders for our continuing operations totaling
$165.1 million and $129.4 million, respectively, substantially all of which we expect will be or were shipped within six months after each such date. Once we receive a specific purchase
order, the dollar value of such order is included in our booked orders. A portion of our business consists of at-once EDI "Quick Response" programs with large retailers. Replenishment
shipments under these

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programs
generally have such an abbreviated order life that they are excluded from the order backlog completely. We do not believe that this backlog information is necessarily indicative of sales to
be
expected for future periods as the timing of customer orders, and therefore the order backlog can be impacted by a variety of factors.

IMPORT RESTRICTIONS AND OTHER GOVERNMENT REGULATIONS

We are exposed to certain risks as a result of our international operations. Almost all of our merchandise is manufactured by foreign
suppliers. During fiscal 2010, we sourced approximately 75% of our products acquired as part of our continuing operations from China. We do not currently expect this concentration of sourcing from
China to be materially impacted in the future solely as a result of Lilly Pulitzer's operations. Our imported products are subject to customs, trade and other laws and regulations governing their
entry into the United States and other countries where we sell our products. From time to time and in the ordinary course of business, we become subject to claims by the United States Customs Service
and similar government authorities in other countries for duties and related fees.

Substantially
all of the merchandise we acquire is subject to duties which are assessed on the value of the imported product. Duty rates vary depending on the type of garment and its
fiber content. During fiscal 2010, cotton products represented approximately one-half of our total imported products and were subject to an average duty rate of approximately 17%, while
silk and linen products represented approximately 20% of our total imported products and were subject to an average duty rate of approximately 2%. Duty rates are subject to change in future periods.

Quotas
on apparel and textiles among the World Trade Organization's member nations were eliminated effective January 1, 2008 and resulted in the continued shift of sourcing and
manufacturing from the Western hemisphere to Asia. Although China's accession agreement for membership in the WTO resulted in the elimination of quotas on Chinese-made textile and apparel
products into WTO countries, the United States and European countries are still allowed in certain circumstances to unilaterally impose "anti-dumping" duties in response to a particular
product being imported (from China or other countries) in such increased quantities as to cause, or threaten to cause, serious damage to the comparable domestic industry. In addition, "countervailing"
duties are other duties which can be imposed by the United States in cases where it finds that subsidies are being provided by a foreign government to its manufacturers and where this subsidized
merchandise causes or threatens to cause damage to the comparable domestic U.S. industry. Additionally, there have been some recent legislative proposals which, if adopted, would treat manipulation by
China of the value of its currency as actionable under the anti-dumping or countervailing duty laws. The imposition of anti-dumping or countervailing duty on products that we
import would increase the cost of those products to us and we may not be able to pass on any such cost increases to our customers.

In
January 2010, the United States Customs Service began enforcement of a regulation requiring importer security filings. The regulation requires us to submit additional cargo details
before the cargo
is loaded onto an ocean vessel bound for the United States. We could become subject to penalties and/or delays in obtaining our products from the United States Customs Service if we fail to comply
with these existing or future regulations. Similar customs import regulations went into effect on January 1, 2011 in the European Union, where a significant majority of Ben Sherman's net sales
are generated.

In
addition, apparel and other products sold by us are subject to increasingly stringent and complex product performance and safety standards, laws and other regulations, including the
Consumer Product Safety Improvement Act of 2008, California Proposition 65 and those adopted by the Federal Trade Commission. These regulations relate principally to product labeling, licensing
requirements and certification of product safety. We believe that we are in compliance with those regulations. Our

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licensed
products and licensing partners are also subject to regulation. Our agreements require our licensing partners to operate in compliance with all laws and regulations, and we are not aware of
any violations which could reasonably be expected to have a material effect on our business or results of operations.

Although
we have not been materially inhibited from doing business in desired markets in the past, we cannot assure that significant impediments will not arise in the future as we expand
product offerings and brands and enter into new markets. Our management regularly monitors proposed regulatory changes and the existing regulatory environment, including any impact on our operations
or on our ability to import products from China and other countries.

Important
factors relating to risks associated with government regulations include, but are not limited to, those described in Part I, Item 1A. Risk Factors.

EMPLOYEES

As of January 29, 2011, we employed approximately 4,000 persons, of whom approximately 75% were employed in the United States.
Approximately 55% of our employees were retail store and restaurant employees. We believe our employee relations are good.

AVAILABLE INFORMATION

Our Internet address is www.oxfordinc.com. Under "Investor Info" on the home page of our website, we have provided a link to the SEC's
website where, among other things, our annual report on Form 10-K, proxy statement, quarterly reports on Form 10-Q and current reports on
Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, are generally available
free of charge, once we electronically file such material with, or furnish it to, the SEC. Additionally, our Corporate Governance Guidelines, as well as the charters of our Audit Committee and
Nominating, Compensation & Governance Committee of our Board of Directors, are available under "Corporate Governance" on the home page of our website.

In
addition, we will provide, at no cost, copies of this report, excluding exhibits, and other filings made with the SEC. Requests should be directed to our principal executive offices
at:



The
information on the website listed above is not and should not be considered part of this Annual Report on Form 10-K and is not incorporated by reference in this
document.

Item 1A.Risk Factors

Our business faces many risks, many of which are outside of our control. The following factors, as well as factors described elsewhere
in this report or in our other filings with the SEC that could materially affect our business, financial condition or operating results, should be carefully considered. The risks and uncertainties
described below are not the only risks we face. Additional risks and uncertainties not presently known to us or that we currently consider immaterial may also impact our business operations or
financial results. If any of the following risks actually occur, our business, financial condition or operating results may be adversely affected.

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Our business is and will continue to be heavily influenced by economic trends and general economic conditions, which may be exacerbated by global political or economic
uncertainty resulting from recent events, and a deterioration or worsening of consumer confidence or consumer purchases of discretionary products may adversely affect our business, financial condition
and results of operations.

The apparel industry is cyclical and dependent upon the overall level of discretionary consumer spending, which changes as regional,
domestic and international economic conditions change. Often, the apparel industry experiences longer periods of recession and greater declines than the general economy. Overall economic conditions
that affect discretionary consumer spending include, but are not limited to, employment levels, recessions, energy costs, interest rates, tax rates, personal debt levels, housing prices and stock
market volatility. Uncertainty about the future may also impact the level of consumer confidence or discretionary consumer spending or result in shifts in consumer spending to products other than
apparel. Any deterioration in general economic or political conditions, acts of war or terrorism or other factors that create uncertainty or alter the discretionary consumer habits in our key markets,
particularly the United States and the United Kingdom, could reduce our sales, increase our costs of goods sold or require us to significantly modify our current business practices and, consequently,
adversely affect our business, financial condition and results of operations. These and other events that impact our operating results could also result in adverse consequences to our business, such
as our inability to comply with financial covenants under our debt instruments.

The
economies of the United States, United Kingdom and other parts of the world weakened as a result of the global economic crisis which commenced in 2008 and continued through 2009. We
saw intermittent signs of stabilization in economic conditions in the United States and globally during fiscal 2010, but there are no assurances that the global economy will continue to recover. Those
recessionary conditions have adversely impacted retail sales of apparel and other consumer products, and have impacted our business. In addition, concerns regarding acts of terrorism, the wars in Iraq
and Afghanistan, political unrest throughout the Middle East and the March 2011 earthquake in Japan, among other events, have created significant global economic and political uncertainties that may
affect consumer demand for our products in the United States and other parts of the world, as well as result in disruptions to sourcing of our products from Asian markets. These or similar factors
could consequently reduce our sales and/or increase our costs of goods sold.

Additionally,
significant changes in the operations or liquidity for any of the parties with which we conduct our business, including suppliers, customers, trademark licensees and
lenders, among others, now or in the future, or in the access to capital markets for us or any such parties, could result in lower demand for our products, lower sales, higher costs or other
disruptions in our business.

Our success depends on the reputation and value of our owned and licensed brand names, including, in particular, Tommy Bahama, Lilly Pulitzer and Ben Sherman, and actions by
us, our wholesale customers, licensees or others who have interests in our brands could diminish the reputation or value of our brands and adversely affect our business operations.

The success of our business depends on the reputation and value of our owned and licensed brand names. The value of our brands could be
diminished by actions taken by us, for instance by becoming overly promotional, or by our wholesale customers or others, including marketing partners, who have interests in the brands. We cannot
always control the marketing and promotion of our products by our wholesale customers or other third parties and actions by such parties that are inconsistent with our own marketing efforts or that
otherwise adversely affect the appeal of our products could diminish the value or reputation of one or more of our brands and have an adverse effect on our sales and business operations.

In
addition, we license certain of our brands, such as Tommy Bahama, Lilly Pulitzer and Ben Sherman, to third party licensees. While we take significant steps to ensure the reputation of
our

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brands
is maintained through our license agreements, there can be no guarantee our brands will not be negatively impacted through our association with products outside of our core apparel products or
due to the actions of a licensee. The improper or detrimental actions of a licensee could significantly impact the perception of our brands.

The apparel industry is subject to rapidly evolving fashion trends, and we must continuously offer innovative and market appropriate products to maintain and grow our
existing businesses. Failure to offer innovative and market appropriate products may adversely affect our sales and lead to excess inventory, markdowns and/or dilution of our brands.

We believe that the principal competitive factors in the apparel industry are design, brand image, consumer preference, price, quality,
marketing and customer service. Although certain of our products carry over from season to season, the apparel industry in general is subject to rapidly changing fashion trends and shifting consumer
demands. In particular, we believe that our lifestyle branded Tommy Bahama, Lilly Pulitzer and Ben Sherman products may be more susceptible to
changing fashion trends and consumer preferences than apparel products generally. Accordingly, we must anticipate, identify and capitalize upon emerging fashion trends. We believe that our success
depends on our ability to continuously develop, source, market and deliver a wide variety of innovative, fashionable and desirable brands and products. These products must be offered at appropriate
price points in their respective distribution channels. Sales growth from our brands will depend largely upon our ability to continue to maintain and enhance the distinctive brand identities.

Due
to the competitive nature of the apparel industry, there can be no assurance that the demand for our products will not decline or that we will be able to successfully evaluate and
adapt our products to align with consumers' preferences, fashion trends and changes in consumer demographics. As is typical with new products, market acceptance of new price points and designs is
subject to uncertainty. The introduction or repositioning of new lines and products often requires substantial costs in design, marketing and advertising, which may not be recovered if the products
are not successful. Any failure on our part to develop appealing products and update core products could result in lower sales and/or harm the reputation and desirability of our brands. Additionally,
since we generally make decisions regarding product designs several months in advance of the time when consumer acceptance can be measured, such a failure could leave us with a substantial amount of
unsold excess inventory, which we may be forced to sell at lower price points. Any of these factors could result in a deterioration of the appeal of our brands and products, adversely affecting our
business, financial condition and operating results.

Our business is subject to legal, regulatory, political and economic risks, including risks relating to the importation of our products, and our products may become less
competitive as a result of adverse changes affecting our operations.

As we source substantially all of our products from foreign countries, including approximately 75% of our product purchases from China
during fiscal 2010, we are exposed to risks associated with changes in the laws and regulations governing the importing and exporting of apparel products into and from the countries in which we
operate.

Some
of the risks associated with importing our products from foreign countries include quotas imposed by countries in which our products are manufactured or countries into which our
products are imported, which limit the amount and type of goods that may be imported annually from or into these countries; changes in social, political, labor and economic conditions or terrorist
acts that could result in the disruption of trade from the countries in which our manufacturers are located; the imposition of additional or new duties, tariffs, taxes or other charges and shifts in
sourcing patterns as a result of such charges; significant fluctuations in the cost of raw materials; significant delays in the delivery of our products, due to security considerations; rapid
fluctuations in sourcing costs, including costs for raw

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materials
and labor; the imposition of antidumping or countervailing duties; fluctuations in the value of the dollar against foreign currencies; and restrictions on the transfer of funds to or from
foreign countries. The imposition of a quota arrangement between the United States and China on our products, or the elimination of duty-free treatment or our inability to qualify for such
benefits, would adversely impact our business by increasing our cost of goods sold.

In
addition, our products are subject to increasingly stringent and complex product performance and safety standards, laws and other regulations, such as the Consumer Product Safety
Improvement Act of 2008 and California Proposition 65, particularly given the concentration of our retail stores in the State of California. Failure to comply with such regulations could result in a
delay, non-delivery or mandated destruction of inventory shipments during key seasons, financial penalties and/or harm to our reputation and business relationships, and compliance with
existing and future regulations could increase our cost of goods sold.

Our,
or any of our suppliers', failure to comply with customs or similar laws or any other applicable regulations could restrict our ability to import products or lead to fines,
penalties or adverse publicity, and future regulatory actions or trade agreements may provide our competitors with a material advantage over us or materially increase our costs.

Significant fluctuations and volatility in the price of raw materials and freight may materially increase our costs, some or all of which we may be unable to pass on to our
customers.

Most of the products we purchase from third-party producers are package purchases, and we and our third-party suppliers rely on the
availability of raw materials at reasonable prices. The principal fabrics used in our business are cotton, linens, wools, silk, other natural fibers, synthetics and blends of these materials. The
prices paid for these fabrics depend on the market price for raw materials used to produce them. We have seen a sustained increase in the costs of raw materials, particularly cotton, as a result of
rising demand from the economic recovery, weather-related supply disruptions, significant declines in U.S. inventory and a sharp rise in the futures market for cotton, which has been compounded by
increased costs of transportation of our products as a result of sustained increases in oil prices. In addition, the cost of the materials that are used in our
manufacturing process, such as oil-related commodity prices and other raw materials, such as dyes and chemicals, and other costs, can fluctuate. We historically have not entered into any
futures contracts to hedge commodity prices. Any significant increase in the price of raw materials or freight may materially increase our costs, some or all of which we may be unable to pass on to
our customers.

We are dependent upon the ability of our third-party producers, substantially all of whom are located in foreign countries, to meet our requirements; any failures by these
producers to meet our requirements, or the unavailability of suitable producers at reasonable prices may negatively impact our ability to deliver quality products to our customers on a timely basis or
result in higher costs or reduced net sales.

We source substantially all of our products from non-exclusive, third-party producers located in foreign countries.
Although we place a high value on long-term relationships with our suppliers, generally we do not have long-term contracts but, instead, conduct business on an
order-by-order basis. Therefore, we compete with other companies for the production capacity of independent manufacturers. We regularly depend upon the ability of third-party
producers to secure a sufficient supply of raw materials, adequately finance the production of goods ordered and maintain sufficient manufacturing and shipping capacity. Although we monitor production
in third- party manufacturing locations, we cannot be certain that we will not experience operational difficulties with our manufacturers, such as the reduction of availability of production capacity,
errors in complying with product specifications, insufficient quality control, failures to meet production deadlines or increases in manufacturing costs. Such difficulties may negatively impact our
ability to deliver quality products to

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our
customers on a timely basis, which may, in turn, have a negative impact on our customer relationships and result in lower net sales.

We
also require third-party producers to meet certain standards in terms of working conditions, environmental protection and other matters before placing business with them. As a result
of costs relating to compliance with these standards, we may pay higher prices than some of our competitors for products. In addition, failure by us or our independent manufacturers to adhere to labor
or other laws or business practices accepted as ethical, and the potential litigation, negative publicity and political pressure relating to any of these events, could disrupt our operations or harm
our reputation.

The apparel industry is highly competitive, and we face significant competitive threats to our business from various third parties that could reduce our sales, increase our
costs, reduce price points for our products, and/or decrease margins.

The highly competitive apparel industry includes numerous domestic and foreign apparel designers, manufacturers, distributors,
importers, licensors and retailers, some of which may also be our customers and some of whom are significantly larger and have significantly greater financial resources than we do. The level and
nature of our competition varies, and the number of our direct competitors and the intensity of competition may increase as we expand into other markets or product lines or as other companies expand
into our markets or product lines. Some of our competitors may be able to adapt to changes in consumer demand more quickly, to devote greater resources to establishing brand recognition or to adopt
more aggressive pricing policies than we can. Additionally, certain of our competitors offer apparel for sale at significant discounts, particularly in response to weak economic conditions, which
results in more pressure to reduce prices or the risk that our products may not be as desirable as lower priced products. These competitive factors within the apparel industry may result in reduced
sales, increased costs, lower prices for our products and/or decreased margins.

Our concentration of retail stores and wholesale customers for certain of our products exposes us to certain regional risks.

Our retail locations are heavily concentrated in certain geographic areas in the United States, including Florida and California for
our Tommy Bahama retail stores, Florida for our Lilly Pulitzer retail stores and the United Kingdom for our Ben Sherman retail stores. As of January 29, 2011, 41 out of our 89 Tommy Bahama
retail stores were located in these two U.S. states, five out of our 16 Lilly Pulitzer retail stores were located in Florida and more than half of our owned Ben Sherman retail stores, including
outlets, were located in the United Kingdom. Additionally, a significant portion of our wholesale sales for Tommy Bahama and Ben Sherman products are concentrated in the same geographic areas as our
own retail store locations for these brands. Due to this concentration, we have heightened exposure to factors that impact these regions, including general economic conditions, weather patterns,
natural disasters, changing demographics and other factors.

We depend on a group of key customers for a significant portion of our wholesale sales. A significant adverse change in a customer relationship or in a customer's financial
position could negatively impact our net sales and profitability.

We generate a significant percentage of our wholesale sales from a few major customers. During fiscal 2010, sales to our five largest
customers accounted for approximately 46% of our consolidated wholesale sales and sales to our largest wholesale customer represented approximately 16% of our consolidated wholesale sales. A decrease
in the number of stores that carry our products, restructuring of our customers' operations, more centralized purchasing decisions, direct sourcing and greater leverage by customers, as a result of
further consolidation in the retail industry or
otherwise could result in lower prices, realignment of customer affiliations or other factors which could negatively impact our net sales and profitability.

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We generally do not have long-term contracts with any of our customers. Instead, we rely on long-standing relationships with these
customers and our position within the marketplace. As a result, purchases generally occur on an order-by-order basis, and each relationship can generally be terminated by
either party at any time. A decision by one or more major customers to terminate its relationship with us or to reduce its purchases from us, whether motivated by competitive considerations, quality
or style issues, financial difficulties, economic conditions or otherwise, could adversely affect our net sales and profitability, as it would be difficult to immediately, if at all, replace this
business with new customers or increase sales volumes with other existing customers.

In
addition, due to long product lead times, several of our product lines are designed and manufactured in anticipation of orders for sale. We make commitments for fabric and production
in connection with these lines. These commitments can be made up to several months prior to the receipt of firm orders from customers, and if orders do not materialize or are canceled, we may incur
expenses to terminate our fabric and production commitments or to dispose of excess inventories.

We
also extend credit to several of our key customers without requiring collateral, which results in a large amount of receivables from just a few customers. During the past several
years, companies in the apparel industry, including some of our customers, have had financial difficulties and have experienced tightened credit markets and declining sales and profitability on a
comparable store basis. If one or more of our key customers experiences significant problems in the future, including as a result of general weakness in the apparel industry, our sales may be reduced,
and the risk associated with
extending credit to these customers may increase. A significant adverse change in a customer's financial position could cause us to limit or discontinue business with that customer, require us to
assume greater credit risk relating to that customer's receivables or limit our ability to collect amounts related to previous shipments to that customer. These or other events related to our
significant customers could adversely affect our net sales and profitability.

The acquisition of new businesses, such as our recent acquisition of the Lilly Pulitzer brand and operations, has certain inherent risks, including, for example, strains on
our management team, unexpected acquisition costs, and, in some instances, contingent payments.

One component of our business strategy is the acquisition of new businesses or product lines as and when appropriate investment
opportunities are available. Consistent with this strategy, in December 2010, we acquired the Lilly Pulitzer brand and operations.

In
connection with our acquisition of the Lilly Pulitzer brand and operations, or in any future acquisitions, we may become responsible for unexpected liabilities that we failed or were
unable to discover in the course of performing due diligence. Although we have required the selling shareholders of Sugartown to indemnify us against undisclosed liabilities, we cannot assure you that
the indemnification, even if obtained, will be enforceable, collectible or sufficient in amount, scope or duration to fully offset the possible liabilities associated with the business or assets
acquired. Any of these liabilities, individually or in the aggregate, could have a material adverse effect on our business, financial condition and results of operations.

In
addition, integrating acquired businesses is a complex, time-consuming and expensive process. The integration process for newly acquired businesses, including the Lilly
Pulitzer brand and operations, could create for us a number of challenges and adverse consequences associated with the integration of product lines, employees, sales teams and outsourced
manufacturers; employee turnover, including key management and creative personnel of the acquired and existing businesses; disruption in product cycles for newly acquired product lines; maintenance of
acceptable standards, controls, procedures and policies; and the impairment of relationships with customers of the acquired and existing businesses. Further, we may not be able to manage the combined
operations and assets effectively or realize the anticipated benefits of the acquisition.

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In
connection with our acquisition of the Lilly Pulitzer brand and operations, we entered into a contingent consideration agreement with the selling shareholders that may require us to
pay up to $20 million in performance-based contingent payments to those shareholders over the next four years.
Although we will only be required to make these payments if the acquired business is successful, the contingent payments are payable based on that business achieving earnings targets. If the acquired
Sugartown business is successful but the rest of our business is not successful, we may have difficulty making the contingent payments. The principal shareholders of Sugartown from whom we acquired
the business are key members of management of our Lilly Pulitzer Group. It is possible that their interests with respect to the contingent payments will differ from our interests or those of our
shareholders.

Our operations are reliant on information technology, and any interruption or other failure in our information technology systems, including disruptions at any of our
principal distribution facilities, may impair our ability to compete effectively in the apparel industry, including our ability to provide services to our customers and meet the needs of management.

The efficient operation of our business is dependent on information technology. Information systems are used in all stages of our
operations from design to distribution and as a method of communication with our customers and suppliers. Additionally, certain of our operating groups utilize e-commerce websites to sell
goods directly to consumers. Our management also relies on information systems to provide relevant and accurate information in order to allocate resources and forecast and report our operating
results. Service interruptions may occur as a result of a number of factors, including computer viruses, hacking or other unlawful activities by third parties, disasters, or failures to properly
install, upgrade, integrate, protect, repair or maintain our systems and e-commerce websites. Any material disruption in our information technology systems, or any failure to timely,
efficiently and effectively integrate new systems, could have an adverse affect on our business or results of operations.

In
addition, our ability to meet customer expectations, manage inventory and achieve objectives for operating efficiencies depends on the proper operation of our primary distribution
facilities, some of which are owned and others of which are operated by third parties. Finished garments from our contractors are inspected and stored at these distribution facilities. If any of these
distribution facilities were to shut down or otherwise become inoperable or inaccessible for any reason, or if the goods in the distribution center were otherwise unavailable for shipment, as a result
of a technology failure or otherwise, we could experience a reduction in sales, a substantial loss of inventory or higher costs and longer lead times associated with the distribution of our products
during the time it takes to reopen or replace the facility or to restore the technological capabilities of the facility. This could negatively affect our operating results and our customer
relationships.

Compliance with privacy and information laws and requirements could be costly, and a breach of information security or privacy could adversely affect our business.

The regulatory environment governing our use of individually identifiable data of customers, employees and others is complex and a
matter of growing public concern. Privacy and information security laws and requirements change frequently, and compliance with them may require us to incur costs to make necessary systems changes and
implement new administrative
processes. If a data security breach occurs, our reputation could be damaged and we could experience lost sales, fines or lawsuits.

Our business could be harmed if we fail to maintain proper inventory levels.

We schedule production from third party manufacturers based on our expectations for the demand for our products. However, various
factors could result in variances from our forecasts. As a result, we may be unable to sell the products we have ordered in advance from manufacturers or that we have in our inventory, which may
result in inventory markdowns or the sale of excess inventory at discounted prices. These events could significantly harm our operating results and impair the image of our brands.

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Conversely,
we may not be in a position to order quality products from our manufacturers in a timely manner and/or we may experience inventory shortages as demand for our products increases, which
might result in unfilled orders, negatively impact customer relationships, diminish brand loyalty and result in lost revenues, any of which could harm our business.

We operate in various countries with differing laws and regulations, which may impair our ability to maintain compliance with regulations and laws.

Although we attempt to abide by the laws and regulations in each jurisdiction in which we operate, the complexity of the laws and
regulations to which we are subject, including customs regulations, labor laws, competition laws, consumer protection laws and domestic and international tax legislation, makes it difficult for us to
ensure that we are currently, or will be in the future, compliant with all laws and regulations. We may be required to make significant expenditures or modify our business practices to comply with
existing or future laws or regulations, and unfavorable resolution to litigation or a violation of applicable laws and regulations may increase our costs and materially limit our ability to operate
our business.

We may not be successful in identifying locations and negotiating appropriate lease terms for retail stores and restaurants.

An integral part of our strategy has been to develop and operate retail stores and restaurants for certain of our lifestyle brands. Net
sales from retail stores and restaurants were approximately 43% of our consolidated net sales during fiscal 2010.

Successful
operation of our retail stores and restaurants depends, in part, on the overall ability of the retail location to attract a consumer base sufficient to make store sales volume
profitable. If we are unable to identify new locations with consumer traffic sufficient to support a profitable sales level, retail growth may consequently be limited. Further, if existing retail
stores and restaurants do not maintain a sufficient customer base that provides a reasonable sales volume, it could have a negative impact on our sales, gross margin, and results of operations. From
time to time, we seek to downsize or close some of our retail store or restaurant operations, which may require a modification or termination of an existing lease; such actions may require payment of
exit fees and/or result in fixed asset impairment charges, the amounts of which could be material.

In
addition, there has been some recent consolidation among commercial real estate developers, mall operators and/or shopping center managers. Significant consolidation within the
commercial real estate development, operation and/or management industries impacting locations where we might operate retail stores and/or restaurants or that we might otherwise consider desirable
could reduce our leverage with such parties, thereby materially adversely affecting the terms of future leases for our retail stores and restaurants or making entering into long-term
commitments with such parties cost prohibitive.

Our business, in particular our retail and restaurant operations, is subject to state and local laws and regulations for health, safety, labor and similar operational
issues. The costs of compliance with, or the violation of, such laws and regulations could have an adverse effect on our costs or operations, and we may be adversely impacted by negative publicity
surrounding any of these issues.

We operate retail stores and restaurants in numerous jurisdictions. Our retail and restaurant operations are subject to comprehensive
state and local laws and regulations on a wide range of employment, safety and other matters. The complexity of these laws and regulations to which we are subject, which may vary widely by
jurisdiction, makes it difficult for us to ensure that we are currently, or will be in the future, compliant with all laws and regulations. We may be required to make significant expenditures or
modify our business practices to comply with existing or future laws or

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regulations,
and unfavorable resolution to litigation or a violation of applicable laws and regulations may increase our costs and materially limit our ability to operate our business.

In
addition, the restaurant industry is highly competitive and requires compliance with a variety of federal, state and local regulations. In particular, all of our Tommy Bahama
restaurants serve alcohol and, therefore, maintain liquor licenses. Our ability to maintain our liquor licenses depends on our compliance with applicable laws and regulations. The loss of a liquor
license would adversely affect the profitability of a restaurant. Additionally, as a participant in the restaurant industry, we face risks
related to food quality, food-borne illness, injury, health inspection scores and labor relations. Regardless of whether allegations related to these matters are valid or whether we become
liable, we may be materially affected by negative publicity associated with these issues. The negative impact of adverse publicity relating to one restaurant may extend beyond the restaurant involved
to affect some or all of the other restaurants, as well as the image of the Tommy Bahama brand as a whole.

We may be unable to protect our trademarks and other intellectual property or may otherwise have our brand names harmed.

We believe that our registered and common law trademarks and other intellectual property, as well as other contractual arrangements,
including licenses and other proprietary intellectual property rights, have significant value and are important to our continued success and our competitive position due to their recognition by
retailers and consumers. Approximately 85% of our net sales in fiscal 2010 were attributable to branded products for which we own the trademark. Therefore, our success depends to a significant degree
upon our ability to protect and preserve our intellectual property. We rely on laws in the United States and other countries to protect our proprietary rights. However, we may not be able to
sufficiently prevent third parties from using our intellectual property without our authorization, particularly in those countries where the laws do not protect our proprietary rights as fully as in
the United States. The use of our intellectual property or similar intellectual property by others could reduce or eliminate any competitive advantage we have developed, causing us to lose sales or
otherwise harm the reputation of our brands.

Additionally,
there can be no assurance that the actions that we have taken will be adequate to prevent others from seeking to block sales of our products as violations of proprietary
rights. Although we have not been materially inhibited from selling products in connection with trademark disputes, as we extend our brands into new product categories and new product lines and expand
the geographic scope of our marketing, including internationally, we could become subject to litigation based on allegations of the infringement of intellectual property rights of third parties. In
the event a claim of infringement against us is successful, we may be required to pay damages, royalties or license fees to continue to use intellectual property rights that we had been using, or we
may be unable to obtain necessary licenses from third parties at a reasonable cost or within a reasonable time. Litigation and other legal action of this type, regardless of whether it is successful,
could result in substantial costs to us and diversion of our management and other resources.

Our business depends on our senior management and other key personnel, and the unexpected loss of individuals integral to our business, our inability to attract and retain
qualified personnel in the future or our failure to successfully plan for and implement succession of our senior management and key personnel may have an adverse effect on our operations, business
relationships and ability to execute our strategies.

Our senior management has substantial experience and expertise in the apparel and related industries. Our success depends upon
disciplined execution at all levels of our organization, including the members of our senior management. Competition for qualified personnel in the apparel industry is intense, and we compete to
attract and retain these individuals with other companies which may have greater financial resources. In addition, we will need to plan for the succession of our senior management and successfully
integrate new members of management within our organization. This may

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include
situations in which individuals join our company as a result of acquisitions that we make, such as the recent employment of the principals of the Lilly Pulitzer brand and operations to lead
our Lilly Pulitzer Group, and may be more familiar with certain of the operational aspects of acquired businesses than other members of our management. The unexpected loss of any of our senior
management, or the unsuccessful integration of new leadership, could negatively affect our operations, business relationships and ability to execute our strategies.

Our foreign sourcing operations as well as the sale of products in foreign markets result in an exposure to fluctuations in foreign currency exchange rates.

As a result of our international operations, we are exposed to certain risks in conducting business outside of the United States.
Substantially all of our orders for the production of apparel in foreign countries are denominated in U.S. dollars. Purchase prices for our products may be impacted by fluctuations in the exchange
rate between the U.S. dollar and the local currencies of the contract manufacturers, either of which may have the effect of increasing our cost of goods sold in the future. If the value of the U.S.
dollar decreases relative to certain foreign currencies in the future, then the prices that we negotiate for products could increase, and it is possible that we would not be able to pass this increase
on to customers, which would negatively impact our margins. If the value of the U.S. dollar increases between the time a price is set and payment for a product, the price we pay may be higher than
that paid for comparable goods by competitors that pay for goods in local currencies, and these competitors may be able to sell their products at more competitive prices. Additionally, currency
fluctuations could also disrupt the business of our independent manufacturers that produce our products by making their purchases of raw materials more expensive and difficult to finance.

We
received U.S. dollars for approximately 90% of our product sales during fiscal 2010. The sales denominated in foreign currencies primarily relate to Ben Sherman sales in the United
Kingdom and Europe. An increase in the value of the U.S. dollar compared to these other currencies in which we have sales could result in lower levels of sales and earnings in our consolidated
statements of operations, although the sales in foreign currencies could be equal to or greater than amounts in prior periods. In addition, to the extent that the stronger U.S. dollar increases costs,
and the products are sold in another currency, but the additional cost cannot be passed on to our customers, our gross margins will be negatively impacted. We generally do not engage in hedging
activities with respect to our exposure to foreign currency risk except that, on occasion, we do purchase foreign currency forward exchange contracts for our goods purchased on U.S. dollar terms that
are expected to be sold in the United Kingdom and Europe.

We hold licenses for the use of other parties' brand names, and we cannot guarantee our continued use of such brand names or the quality or salability of such brand names.

We have entered into license and design agreements to use certain trademarks and trade names, such as Kenneth Cole, Dockers and
Geoffrey Beene, to market our products. Approximately 8% of our net sales during fiscal 2010 related to the products for which we license the use of the trademark for specific product categories.
These license and design agreements will expire at various dates in the future. We cannot guarantee that we will be able to renew these licenses on acceptable terms upon expiration or that we will be
able to acquire new licenses to use other popular trademarks. The termination or expiration of a license agreement will cause us to lose the sales and any associated profits generated pursuant to such
license and in certain cases could result in an impairment charge for related intangible assets.

In
addition to certain compliance obligations, all of our significant licenses provide minimum thresholds for royalty payments and advertising expenditures for each license year, which
we must pay regardless of the level of our sales of the licensed products. If these thresholds are not met, our licensors may be permitted contractually to terminate these agreements or seek payment
of minimum

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royalties
even if the minimum sales are not achieved. In addition, our licensors produce their own products and license their trademarks to other third parties, and we are unable to control the
quality of these goods that others produce. If licensors or others do not maintain the quality of these trademarks or if the brand image deteriorates, our sales and any associated profits generated by
such brands may decline.

We make use of debt to finance our operations, which exposes us to risks that could adversely affect our business, financial position and operating results.

Our levels of debt vary as a result of the seasonality of our business, investments in acquisitions and working capital and
divestitures. As of January 29, 2011, we had $150 million aggregate principal amount outstanding of our 113/8% Senior Secured Notes and no borrowings outstanding under our
U.S. Revolving Credit Agreement or our U.K. Revolving Credit Agreement. Our debt levels may increase in the future under our existing facilities or potentially under new facilities, or the terms or
forms of our financing arrangements in the future may change. There are no assurances that in the future we will be able to refinance our debt obligations on terms that are satisfactory to us.

Our
indebtedness includes, and any future indebtedness may include, certain obligations and limitations, including the periodic payment of principal and interest, maintenance of certain
covenants and certain other limitations related to additional debt, dividend payments, investments and dispositions of assets. Our ability to satisfy these obligations will be dependent upon our
business, financial condition and operating results. These obligations and limitations may increase our vulnerability to adverse economic and industry conditions, place us at a competitive
disadvantage compared to our competitors that are less leveraged and limit our flexibility in carrying out our business plan and planning for, or reacting to, changes in the industry in which we
operate.

In
addition, we have interest rate risk on indebtedness under our U.S. Revolving Credit Agreement and U.K. Revolving Credit Agreement. We generally do not engage in hedging activities
with respect to our interest rate risk, and an increase in interest rates may require us to pay a greater amount of our funds from operations towards interest, even if the amount of borrowings
outstanding remains the same. As a result, we may have to revise or delay our business plans, reduce or delay capital expenditures or otherwise adjust our plans for operations.

We may be unable to successfully execute a key component of our business strategy, which is to grow our business through organic growth and/or, if and when appropriate,
acquisitions of lifestyle brands that fit within our business model, and any failure to successfully execute this aspect of our business strategy may have a material adverse effect on our business,
financial condition, liquidity and results of operations.

One key component of our business strategy is to grow our business through organic growth and/or, if and when appropriate, acquisitions
of lifestyle brands that fit within our business model, such as our acquisition of the Lilly Pulitzer brand and operations in December 2010. Organic growth may be achieved by, among other things,
increasing our market share in existing markets, including to existing wholesale customers; selling our products in new markets, including international markets; increasing sales in our
direct-to-consumer channels; and increasing the product offerings within our various operating groups. Successful growth of our business through organic growth and/or
acquisitions is subject to, among other things, the ability of our management to implement plans for expanding our existing businesses and our ability to find suitable acquisition candidates at
reasonable prices in the future. We may not be successful in this regard, and our inability to grow our business may have a material adverse effect on our business, financial condition, liquidity and
results of operations.

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Divestitures of certain businesses or discontinuations of certain product lines may require us to find alternative uses for our resources.

As we did in fiscal 2010 with the sale of substantially all of the operations and assets of our former Oxford Apparel Group and as we
did during fiscal 2008 and fiscal 2009 with the restructuring of our operations at Ben Sherman, Lanier Clothes and our former Oxford Apparel Group, we may determine that it is appropriate to divest or
discontinue certain operations. Divestitures of certain businesses that do not align with our strategy or the discontinuation of certain product lines which may not provide the returns that we expect
or desire may result in underutilization of our resources in the event that the operations are not replaced with new lines of business either internally or through acquisition. There can be no
guarantee that if we divest certain businesses or discontinue certain product lines that we will be able to replace the sales and profits related to these businesses or appropriately utilize our
remaining resources, which may result in a decline in our operating results and/or result in an inappropriate capitalization of our organization.

Our operations are influenced by weather patterns and natural or man-made disasters.

Like other companies in the apparel industry, our sales volume and operations may be adversely affected by unseasonable weather
conditions or natural or man-made disasters, which may cause consumers to alter their purchasing habits or result in a disruption to our operations. Because of the seasonality of our
business, the concentration of a significant proportion of our customers in certain geographic regions, the concentration of our sourcing operations and the concentration of our distribution
operations, the occurrence of such events could disproportionately impact our business, financial condition and operating results.

Item 1B.Unresolved Staff Comments

None.

32

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Table of Contents

Item 2.Properties

We lease and own space for our distribution centers, manufacturing facilities, retail stores and sales/administration office space in
various domestic and international locations. We believe that our existing properties are well maintained, are in good operating condition and will be adequate for our present level of operations. Our
operations utilize:



In
addition to our owned distribution facilities, we also utilize certain third party warehouse/distribution providers where we do not own or lease any space. Each of our retail stores
and restaurants are less than 16,000 square feet, and we do not believe that we are dependent on any individual retail or restaurant location for our business operations. These retail stores and
restaurants are operated by Tommy Bahama, Ben Sherman and Lilly Pulitzer, as described in more detail in Item 1. Business of this report. We anticipate that we will be able to extend our leases
to the extent that they expire in the near future on terms that are satisfactory to us or, if necessary, locate substitute properties on acceptable terms.

Details
of our principal administrative, sales, distribution and manufacturing facilities, including approximate square footage, are as follows:

Location

Primary Use

Operating Group

Square Footage

Lease ExpirationSeattle, Washington

Sales/administration

Tommy Bahama


80,000

2015Auburn, Washington

Distribution center

Tommy Bahama


260,000

2015King of Prussia, Pennsylvania

Sales/administration

Lilly Pulitzer


40,000

OwnedKing of Prussia, Pennsylvania

Distribution center

Lilly Pulitzer


65,000

OwnedLondon, England

Sales/administration

Ben Sherman


20,000

2013Lurgan, Northern Ireland

Sales/administration

Ben Sherman


10,000

OwnedToccoa, Georgia

Distribution center

Lanier Clothes


310,000

OwnedMerida, Mexico

Manufacturing plant

Lanier Clothes


80,000

OwnedAtlanta, Georgia

Sales/administration

Corporate and Other and Lanier Clothes


70,000

OwnedLyons, Georgia

Sales/administration

Corporate and Other and Ben Sherman


90,000

OwnedLyons, Georgia

Distribution center

Corporate and Other and Ben Sherman


330,000

OwnedNew York, New York

Sales/administration

Various


35,000

VariousHong Kong

Sales/administration

Various


30,000

Various


Item 3.Legal Proceedings

From time to time, we are a party to litigation and regulatory actions arising in the ordinary course of business. We are not currently
a party to litigation or regulatory actions, or aware of any proceedings contemplated by governmental authorities, that we believe could reasonably be expected to have a material impact on our
financial position, results of operations or cash flows.

33

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Table of Contents

Item 4.Reserved

PART II

Item 5.Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market and Dividend Information

Our common stock is listed and traded on the New York Stock Exchange under the symbol "OXM." As of March 18, 2011, there were
384 record holders of our common stock. The following table sets forth the high and low sale prices and quarter-end closing prices of our common stock as reported on the New York Stock
Exchange for the quarters indicated. Additionally, the table indicates the dividends per share declared on shares of our common stock by our Board of Directors for each quarter.

High

Low

Close

DividendsFiscal 2010Fourth Quarter

$
29.50

$
21.50

$
23.86

$
0.11Third Quarter

$
24.66

$
19.23

$
23.03

$
0.11Second Quarter

$
24.50

$
15.00

$
22.40

$
0.11First Quarter

$
23.71

$
16.05

$
21.59

$
0.11Fiscal 2009Fourth Quarter

$
25.62

$
17.54

$
17.84

$
0.09Third Quarter

$
23.80

$
12.66

$
19.35

$
0.09Second Quarter

$
14.01

$
8.39

$
13.71

$
0.09First Quarter

$
10.70

$
3.14

$
9.84

$
0.09


On
March 28, 2011, our Board of Directors approved a cash dividend of $0.13 per share payable on April 29, 2011 to shareholders of record as of the close of business on
April 15, 2011. Although we have paid dividends in each quarter since we became a public company in July 1960, we may discontinue or modify dividend payments at any time if we determine that
other uses of our capital, including but not limited to, payment of outstanding debt, repurchases of outstanding shares or funding of future acquisitions, may be in our best interest; if our
expectations of future cash flows and future cash needs outweigh the ability to pay a dividend; or if the terms of our credit facilities, the indenture for the 113/8% Senior Secured
Notes, other debt instruments, contingent consideration arrangements or applicable law limit our ability to pay dividends. We may borrow to fund dividends in the short-term based on our
expectation of operating cash flows in future periods subject to the terms and conditions of our credit facilities, the indenture for the 113/8% Senior Secured Notes or other debt
instruments and applicable law. All cash flow from operations will not necessarily be paid out as dividends in all periods.

For
details about limitations on our ability to pay dividends, see Note 5 of our consolidated financial statements and Part II, Item 7. Management's Discussion and
Analysis of Financial Condition and Results of Operations, both contained in this report.

Recent Sales of Unregistered Securities

We did not sell any unregistered equity securities during fiscal 2010.

Purchases of Equity Securities by the Issuer and Affiliated Purchases

We have certain stock incentive plans as described in Note 7 to our consolidated financial statements included in this report,
all of which are publicly announced plans. Under the plans, we can

34

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Table of Contents

repurchase
shares from employees to cover employee tax liabilities related to the exercise of stock options or the vesting of previously restricted shares. No shares were purchased during the fourth
quarter of fiscal 2010. On March 28, 2011, approximately 0.3 million shares of our common stock which were issued as restricted stock awards vested. At that time, we purchased
approximately 0.1 million shares of the vested common stock from our employees, including certain of our named executive officers, to cover employee tax liabilities related to the vesting of
the shares.

In
the second quarter of fiscal 2010, our Board of Directors authorized us to spend up to $50 million to repurchase shares of our common stock and/or 113/8% Senior
Secured Notes. This authorization superseded and replaced all previous authorizations to repurchase shares of our common stock and/or our 113/8% Senior Secured Notes. As of
January 29, 2011, no shares of our common stock nor any of our 113/8% Senior Secured Notes had been repurchased pursuant to this authorization, which has no automatic expiration.

Stock Price Performance Graph

The graph below reflects cumulative total shareholder return (assuming an initial investment of $100 and the reinvestment of dividends)
on our common stock compared to the cumulative total return for a period of five years and eight months, beginning June 3, 2005 and ending January 29, 2011 of:



Comparison of Cumulative Total Return

GRAPHIC

INDEXED RETURNS
Years EndingBase
Period
6/3/05Company / Index

6/2/06

6/1/07

2/2/08

1/31/09

1/30/10

1/29/11Oxford Industries, Inc.

100

101.28

113.10

57.76

17.57

48.42

65.98S&P SmallCap 600 Index

100

119.04

137.84

120.39

74.30

103.25

134.30S&P 500 Apparel, Accessories & Luxury Goods

100

101.05

145.13

98.39

50.51

95.44

131.13


Item 6.Selected Financial Data

Our selected financial data included in the table below reflects (1) the results of operations for Lilly Pulitzer, which was
acquired on December 21, 2010, subsequent to date of the acquisition and (2) the divestiture of substantially all of the operations and assets of our former Womenswear and

35

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Table of Contents

Oxford
Apparel operations in fiscal 2006 and fiscal 2010, respectively, resulting in those operations being classified as discontinued operations for all periods presented. On October 8, 2007,
our Board of Directors approved a change to our fiscal year end. Effective with our fiscal year which commenced on June 2, 2007, our fiscal year ends the end of the Saturday closest to
January 31 and will, in each case, begin at the beginning of the day next following the last day of the preceding fiscal year. Accordingly, there was a transition period from June 2,
2007 through February 2, 2008 for which we filed a transition report on Form 10-KT for that period.

Fiscal
2010

Fiscal
2009

Fiscal
2008

Eight-month
Transition
Period Ended
February 2,
2008

Fiscal
2007

Fiscal
2006(In millions, except per share amounts)Net sales

$
603.9

$
585.3

$
699.1

$
501.5

$
799.5

$
766.2Cost of goods sold


276.5


294.5


363.5


263.8


422.2


406.2Gross profit


327.4


290.8


335.6


237.7


377.4


360.0SG&A


301.0


282.5


325.4


218.5


310.6


284.9Amortization of intangible assets


1.0


1.2


2.8


3.1


6.3


7.6Change in fair value of contingent consideration


0.2














Impairment of goodwill and intangible assets








307.5








Royalties and other operating income


15.4


11.8


15.7


11.3


12.8


12.7Operating income (loss)


40.7


18.9


(284.4
)

27.4


73.2


80.2Gain on repurchase of 87/8% Senior Unsecured Notes








7.8








Interest expense, net


19.9


20.5


21.3


13.8


20.9


17.0Earnings (loss) from continuing operations before income taxes


20.8


(1.6
)

(298.0
)

13.6


52.3


63.3Income taxes (benefit)


4.5


(2.9
)

(19.8
)

1.9


16.3


18.8Net earnings (loss) from continuing operations


16.2


1.4


(278.1
)

11.7


36.0


44.5Earnings from discontinued operations, net of taxes


12.9


13.2


6.6


8.5


15.5


14.8Gain on sale of discontinued operations, net of taxes


49.5














10.4Net earnings from discontinued operations, net of taxes


62.4


13.2


6.6


8.5


15.5


25.2Net earnings (loss)

$
78.7

$
14.6

$
(271.5
)
$
20.2

$
51.6

$
69.7Diluted net earnings (loss) from continuing operations per common share

$
0.98

$
0.09

$
(17.42
)
$
0.67

$
2.01

$
2.50Diluted earnings from discontinued operations, net of taxes, per common share

$
0.78

$
0.81

$
0.42

$
0.49

$
0.87

$
0.83Diluted gain on sale of discontinued operations, net of taxes, per common share

$
2.99













$
0.58Diluted net earnings from discontinued operations per common share

$
3.77

$
0.81

$
0.42

$
0.49

$
0.87

$
1.41Diluted net earnings (loss) per common share

$
4.75

$
0.90

$
(17.00
)
$
1.16

$
2.88

$
3.92Diluted weighted average shares outstanding


16.6


16.3


16.0


17.4


17.9


17.8Dividends declared

$
7.3

$
5.9

$
11.5

$
9.3

$
11.7

$
9.9Dividends declared per common share

$
0.44

$
0.36

$
0.72

$
0.54

$
0.66

$
0.57Total assets, at period-end

$
558.5

$
425.2

$
467.7

$
910.1

$
907.6

$
885.0Long-term debt, less current maturities, at period-end

$
147.1

$
146.4

$
194.2

$
234.4

$
199.3

$
200.0Shareholders' equity, at period-end

$
180.0

$
104.4

$
87.3

$
407.4

$
452.9

$
398.1Capital expenditures

$
13.3

$
11.3

$
20.0

$
21.1

$
31.3

$
25.0Depreciation and amortization

$
18.8

$
20.4

$
23.6

$
16.0

$
23.1

$
22.7Amortization of deferred financing costs

$
1.3

$
3.4

$
2.9

$
1.7

$
2.5

$
2.5Book value per share at period-end

$
10.90

$
6.34

$
5.50

$
25.38

$
25.38

$
22.56


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Table of Contents

Item 7.Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our operations, cash flows, liquidity and capital resources should be read in conjunction with
our consolidated financial statements contained in this report.

OVERVIEW

We generate revenues and cash flow primarily through the design, production, sale and distribution of branded consumer apparel for men,
women and children and the licensing of company owned trademarks. Our principal markets and customers are located in the United States and, to a lesser extent, the United Kingdom. We source
substantially all of our products
through third party manufacturers located outside of the United States and United Kingdom. We distribute our products through our direct to consumer channels, including our retail stores,
e-commerce websites and restaurants, as well as through our wholesale distribution channel, which includes department stores, specialty stores, national chains, specialty catalogs, mass
merchants and Internet retailers.

Although
we have seen signs of recovery in fiscal 2010, the last three years have been particularly challenging for our operating groups due to the weak global economic conditions which
began in fiscal 2008 and continued through fiscal 2009. In much of fiscal 2010, we purchased inventory at levels which mitigated inventory markdown risk and promotional pressure, while also
maintaining the integrity of our brands. However, these precautions also limited our growth opportunities in some cases. Although the challenging economic conditions continue to have an impact on our
business and the apparel industry as a whole, and we continue to focus on minimizing inventory markdown risk and promotional pressure, we have been slightly more aggressive in our inventory purchases
for fiscal 2011 and anticipate continuing to purchase inventory more aggressively if the economic conditions continue to show improvement. We believe that fiscal 2011 will be impacted by pricing
pressures on raw materials, fuel, transportation and other costs necessary for the production and sourcing of apparel products.

We
continue to believe it is important to focus on maintaining a strong balance sheet and ample liquidity. We believe that the measures we have taken to reduce working capital
requirements, moderate capital expenditures for retail stores, reduce our overhead structure, refinance our significant debt agreements and divest substantially all of the operations and assets of our
former Oxford Apparel operating group have significantly enhanced our balance sheet and liquidity, while allowing us to acquire the Lilly Pulitzer brand and operations and continue to operate our
businesses appropriately. We believe our strong balance sheet and liquidity will allow us to aggressively develop Tommy Bahama, Lilly Pulitzer and Ben Sherman, our lifestyle brands, while maintaining
Lanier Clothes' high level of performance, and at the same time maintain the financial flexibility to opportunistically enhance our capital structure and pursue desirable acquisitions, if any meet our
investment criteria.

The
apparel and retail industry is cyclical and dependent upon the overall level of discretionary consumer spending, which changes as regional, domestic and international economic
conditions change. The impact of negative economic conditions may have a longer and more severe impact on the apparel and retail industry than the same conditions have on other industries. Therefore,
even if conditions improve in the general economy, the negative impact on the apparel and retail industry may continue.

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Table of Contents

The
following table sets forth our consolidated operating results (in thousands, except per share amounts) for fiscal 2010 compared to fiscal 2009:

Fiscal 2010

Fiscal 2009

$ ChangeNet sales

$
603,947

$
585,306

$
18,641Earnings from continuing operations

$
16,235

$
1,386

$
14,849Earnings from continuing operations per diluted common share

$
0.98

$
0.09

$
0.89Earnings from discontinued operations, net of taxes

$
12,877

$
13,238

$
(361
)Earnings from discontinued operations per diluted common share

$
0.78

$
0.81

$
(0.03
)Gain on sale of discontinued operations, net of taxes

$
49,546

$


$
49,546Gain on sale of discontinued operations per diluted common share

$
2.99

$


$
2.99Net earnings from discontinued operations, net of taxes

$
62,423

$
13,238

$
49,185Net earnings from discontinued operations per diluted common share

$
3.77

$
0.81

$
2.96Net earnings

$
78,658

$
14,624

$
64,034Net earnings per diluted common share

$
4.75

$
0.90

$
3.85Weighted average common shares outstandingdiluted


16,551


16,304


247


The
primary reasons for the improvement in earnings from continuing operations were:



These
items were partially offset by:



38

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Table of Contents



Earnings
from discontinued operations reflect operations related to our former Oxford Apparel operating group. We sold substantially all of the operations and assets of Oxford Apparel in
fiscal 2010, as discussed below. Earnings from discontinued operations for fiscal 2010 included the $49.5 million gain on sale associated with this transaction and eleven months of operations
for the discontinued operations, whereas fiscal 2009 included twelve months of operations for the discontinued operations. We do not anticipate significant operating activities associated with
discontinued operations in the future other than the conversion of the net retained assets and liabilities of the discontinued operations as of January 29, 2011, into cash, substantially all of
which we anticipate will occur during the first half of fiscal 2011 and the sale of inventory and recognition of the related commission income associated with goods in process as of January 29,
2011.

ACQUISITION OF LILLY PULITZER

On December 21, 2010, we acquired all of the outstanding capital stock of Sugartown Worldwide, Inc. from SWI
Holdings, Inc., pursuant to a stock purchase agreement, which was treated as an asset purchase for tax purposes. Sugartown owns the Lilly Pulitzer trademark and designs, sources and distributes
upscale collections of women's dresses, sportswear and other products to specialty and department stores, as well as through direct to consumer channels, including retail stores and an
e-commerce site. The operations of the acquired business are reported as our Lilly Pulitzer operating group from the date of acquisition.

We
paid $60 million in cash, subject to adjustment based on net working capital as of the closing date of the acquisition. After giving effect to a preliminary working capital
adjustment, the purchase price paid was approximately $58.3 million, net of acquired cash of $0.9 million. In connection with the acquisition, we entered into a contingent consideration
agreement on December 21, 2010, pursuant to which we will be obligated to pay cash payments of up to $2.5 million after each of the four fiscal years following the closing of the
transaction and an additional $10 million subsequent to the end of the fourth fiscal year, contingent upon the Lilly Pulitzer operating group's achievement of certain performance targets.

DISCONTINUED OPERATIONSOXFORD APPAREL

On January 3, 2011, we sold to LF USA Inc., substantially all of the operations and assets of our former Oxford Apparel
operating group (other than accounts receivable associated with the businesses which are being sold and all assets and operations relating to our Oxford Golf business and our distribution center in
Lyons, Georgia). The purchase price paid by LF was equal to approximately $121.7 million, less an adjustment based on net working capital on the closing date of the transaction. After giving
effect to the preliminary net working capital adjustment, the purchase price paid by LF at the closing of the transaction was approximately $108.2 million, of which $5.4 million is being
held in escrow pending completion of the final working capital adjustment and other requirements. The net working capital deficit resulted from our retention of accounts receivable and goods in
transit as of the closing date, partially offset by our retention of certain accounts payable, as of the closing date, associated with Oxford Apparel. The final net working capital adjustment is
expected to occur within 120 days of the closing date of the transaction. LF also agreed to purchase our goods in transit relating to Oxford Apparel following the closing of the transaction. As
of January 29, 2011, there were approximately $17.0 million of net assets associated with the discontinued operations, including a

39

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$5.4 million
receivable for the cash held in escrow. We anticipate that these net assets, as well as certain commissions we will earn related to goods in transit and inventory in process as of
the transaction date, will be converted into cash during the first half of fiscal 2011.

In
connection with the consummation of the transaction described above, we, among other things, entered into (1) license agreements with LF to grant licenses (subject to the
limitations set forth in the applicable license agreements) to LF to use the trade name "Oxford Apparel" perpetually in connection with its business, as well as to use certain other trademarks in
connection with the manufacture, sale and distribution of men's dress shirts for certain periods of time in the applicable territory; (2) a services agreement with LF pursuant to which, in
exchange for various fees, we will provide certain transitional support services to LF in its operation of the transferred assets; and (3) a limited non-competition agreement with
LF pursuant to which we agreed (subject to the exceptions set forth in the non-competition agreement) not to engage in certain activities for a period of three years following the
completion of the transaction.

The
results of operations classified as discontinued operations include the operating results for Oxford Apparel as reported historically, except that (1) the operations of our
Oxford Golf business and the operations of our Lyons, Georgia distribution center are reported within Corporate and Other as those operations were not sold and (2) certain corporate service
costs which were previously allocated to Oxford Apparel are included in Corporate and Other as there is uncertainty in whether there will be a reduction in those costs as a result of the Oxford
Apparel sale.

We
allocated all interest expense related to our U.S. Revolving Credit Agreement to earnings from discontinued operations as the estimated net proceeds from the transaction and the
proceeds from the settlement of the retained assets and liabilities related to the discontinued operations, substantially all of which are expected to be converted into cash during the first half of
fiscal 2011, exceed the amounts outstanding under our U.S. Revolving Credit Agreement during each of the periods presented. We did not allocate any interest related to our 113/8% Senior
Secured Notes to discontinued operations. The income taxes for discontinued operations reflect the residual income tax expense after calculating the income taxes for continuing operations, excluding
the discontinued operations.

OPERATING GROUPS

Our business is primarily operated through our four operating groups: Tommy Bahama, Lilly Pulitzer, Ben Sherman and Lanier Clothes. We
identify our operating groups based on the way our management organizes the components of our business for purposes of allocating resources and assessing performance. All amounts included in this
report and in our consolidated financial statements reflect our changes in operating groups during fiscal 2010, including (1) the acquisition of Sugartown, resulting in the creation of our
Lilly Pulitzer operating group, (2) the sale of substantially all of the operations and assets of our former Oxford Apparel operating group, which are now classified as discontinued operations,
(3) the reclassification of our Oxford Golf business and our Lyons, Georgia distribution center operations into Corporate and Other, as these activities were previously included in Oxford
Apparel, but will continue to be operated by us, and (4) the reclassification of certain corporate service costs from Oxford Apparel, where they were previously allocated, to Corporate and
Other, as there is uncertainty in whether there will be a reduction in those costs as a result of the Oxford Apparel sale.

Tommy
Bahama designs, sources and markets collections of men's and women's sportswear and related products. The target consumers of Tommy Bahama are affluent men and women age 35 and
older who embrace a relaxed and casual approach to daily living. Tommy Bahama products can be found in our owned and licensed Tommy Bahama retail stores and on our Tommy Bahama e-commerce
website, as well as in certain department stores and independent specialty stores throughout the United

40

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States.
We also license the Tommy Bahama name for various product categories and operate Tommy Bahama restaurants.

Lilly
Pulitzer designs, sources and distributes upscale collections of women's and girl's dresses, sportswear and other products. Lilly Pulitzer was originally created in the late 1950's
and is an affluent brand with heritage and aesthetic based on the Palm Beach resort lifestyle. The brand is somewhat unique among women's brands in that it has demonstrated multi-generational appeal.
The brand targets three distinct groups of women: young women recently graduated from college; young mothers and
their daughters; and women who are not tied to the academic calendar. Lilly Pulitzer products can be found in our owned Lilly Pulitzer stores, in Lilly Pulitzer Signature Stores and on our Lilly
Pulitzer website, as well as in certain department stores and a variety of independent specialty stores. We also license the Lilly Pulitzer name for various product categories.

Ben
Sherman is a London-based designer, marketer and distributor of men's branded sportswear and related products. Ben Sherman was established in 1963 as an edgy, "Mod"-inspired shirt
brand and has evolved into a British lifestyle brand of apparel targeted at style conscious men ages 25 to 40 in multiple markets throughout the world. Ben Sherman products can be found in certain
department stores, a variety of independent specialty stores and our owned and licensed Ben Sherman retail stores, as well as on Ben Sherman e-commerce websites. We also license the Ben
Sherman name for various product categories.

Lanier
Clothes designs and markets branded and private label men's tailored clothing including suits, sportcoats, suit separates and dress slacks across a wide range of price points.
Certain Lanier Clothes products are sold using trademarks licensed to us by third parties, including Kenneth Cole, Dockers, and Geoffrey Beene. Lanier Clothes also offers branded products under our
Billy London and Arnold Brant trademarks. In addition to the branded businesses, Lanier Clothes designs and sources certain private label products for certain customers. Significant private label
brands include Stafford, Lands' End, Alfani, Structure and Kenneth Roberts. Our Lanier Clothes products are sold to national chains, department stores, specialty stores, specialty catalog retailers
and discount retailers throughout the United States.

Corporate
and Other is a reconciling category for reporting purposes and includes our corporate office, substantially all financing activities, elimination of inter-segment sales, LIFO
inventory accounting adjustments, other costs that are not allocated to the operating groups and operations of our other businesses which are not included in our four operating groups. LIFO inventory
calculations are made on a legal entity basis which does not correspond to our operating group definitions; therefore, LIFO inventory accounting adjustments are not allocated to operating groups. The
operations of businesses that are included in Corporate and Other include our Oxford Golf business and our Lyons, Georgia distribution center operations.

For
further information regarding our operating groups, see Note 10 to our consolidated financial statements and Part I, Item 1, Business, both included in this
report.

RESULTS OF OPERATIONS

The following table sets forth the specified line items in our consolidated statements of operations both in dollars (in thousands) and
as a percentage of net sales. We have calculated all percentages based on actual data, but percentage columns may not add due to rounding. Individual line items of our consolidated statements of
operations may not be directly comparable to those of our competitors, as classification of certain expenses may vary by company. In accordance with U.S. GAAP, net sales, cost of goods sold,
gross profit, SG&A, amortization of intangible assets, change in fair value of contingent consideration, impairment of goodwill and intangible assets, royalties and other operating income, operating
income, interest expense, net, earnings from continuing operations before income taxes, income taxes and earnings from continuing operations reflect continuing operations only, and all

41

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discontinued
operations are reflected in net earnings from discontinued operations. For purposes of the tables below, "NM" means not meaningful.

Fiscal 2010

Fiscal 2009

Fiscal 2008Net sales

$
603,947


100.0
%
$
585,306


100.0
%
$
699,064


100.0
%Cost of goods sold


276,540


45.8
%

294,493


50.3
%

363,452


52.0
%Gross profit


327,407


54.2
%

290,813


49.7
%

335,612


48.0
%SG&A


301,002


49.8
%

282,489


48.3
%

325,342


46.5
%Amortization of intangible assets


973


0.2
%

1,217


0.2
%

2,800


0.4
%Change in fair value of contingent consideration


200


0.0
%










Impairment of goodwill and intangible assets














307,532


44.0
%Royalties and other operating income


15,430


2.6
%

11,803


2.0
%

15,661


2.2
%Operating income (loss)


40,662


6.7
%

18,910


3.2
%

(284,401
)

(40.7
)%Gain on repurchase of 87/8% Senior Unsecured Notes














7,767


1.1
%Interest expense, net


19,887


3.3
%

20,469


3.5
%

21,317


3.0
%Earnings (loss) from continuing operations before income taxes


20,775


3.4
%

(1,559
)

(0.3
)%

(297,951
)

(42.6
)%Income taxes


4,540


0.8
%

(2,945
)

(0.5
)%

(19,845
)

(2.8
)%Earnings (loss) from continuing operations


16,235


2.7
%

1,386


0.2
%

(278,106
)

(39.8
)%Earnings from discontinued operations, net of taxes


12,877


NM


13,238


NM


6,649


NMGain on sale of discontinued operations, net of taxes


49,546


NM





NM





NMNet earnings from discontinued operations, net of taxes


62,423


NM


13,238


NM


6,649


NMNet earnings (loss)

$
78,658


NM

$
14,624


NM

$
(271,457
)

NM


FISCAL 2010 COMPARED TO FISCAL 2009

The discussion and tables below compares certain line items included in our statements of operations for fiscal 2010 to fiscal 2009.
Each dollar and percentage change provided reflects the change between these periods unless indicated otherwise. Each dollar and share amount included in the tables is in thousands except for per
share amounts.

Net Sales

Fiscal 2010

Fiscal 2009

$ Change

% ChangeTommy Bahama

$398,510

$363,084

$35,426

9.8%Lilly Pulitzer

5,959



5,959

NMBen Sherman

86,920

102,309

(15,389)

(15.0)%Lanier Clothes

103,733

114,542

(10,809)

(9.4)%Corporate and Other

8,825

5,371

3,454

64.3%Total net sales

$603,947

$585,306

$ 18,641

3.2%


42

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Table of Contents

Consolidated net sales increased $18.6 million, or 3.2%, in fiscal 2010 compared to fiscal 2009. The increase in net sales was primarily a result of the
changes in each operating group discussed below as well as the inclusion of sales for Lilly Pulitzer in fiscal 2010 subsequent to our acquisition on December 21, 2010. Fiscal 2010 included
$2.5 million of sales related to businesses that we have exited in Ben Sherman and Lanier Clothes compared to $20.8 million of such sales in fiscal 2009.

Tommy Bahama:

The increase in net sales for Tommy Bahama was primarily due to improved comparable retail store sales, sales at retail stores opened
during fiscal 2009 and fiscal 2010, higher e-commerce sales and higher wholesale sales. Tommy Bahama apparel unit sales increased 14.1%, which was a result of the improvement in all
channels of distribution. The average selling price per unit decreased by 3.2% due to Tommy Bahama offering more items at entry level price points below $100 and women's, home and gift items, which
carry a lower average unit price than men's, making up a higher proportion of Tommy Bahama's sales mix.

Lilly Pulitzer:

We acquired Lilly Pulitzer on December 21, 2010. Therefore, fiscal 2010 reflects approximately six weeks of net sales that
totaled $6.0 million for Lilly Pulitzer while the prior year includes no net sales for Lilly Pulitzer.

Ben Sherman:

The decrease in net sales for Ben Sherman was primarily due to a 17.8% reduction in unit sales largely resulting from our exit from and
subsequent licensing of our footwear and kids' businesses and our exit from our women's operations during fiscal 2009. Net sales related to the footwear, kids' and women's businesses totaled
approximately $2.1 million in fiscal 2010 compared to $17.2 million in fiscal 2009. Net sales were also negatively impacted by a 2.1% decrease in the average exchange rate of the British
pound sterling versus the United States dollar during fiscal 2010 compared to the average exchange rate for fiscal 2009. The impact of the exited businesses and the exchange rate were partially offset
by increased in retail sales in fiscal 2010. The average selling price per unit for Ben Sherman increased 3.4% as retail sales represented a greater proportion of total Ben Sherman sales during fiscal
2010 and there were fewer off-price sales in fiscal 2010. Fiscal 2009 included more off-price sales associated with the exited businesses.

Lanier Clothes:

The decrease in net sales for Lanier Clothes was primarily due to a reduction in unit sales of 10.8%, which was driven by lower sales
in our private label businesses and the inclusion of approximately $3.6 million of net sales in fiscal 2009 related to businesses that we have exited. These decreases in net sales were
partially offset by higher sales in our branded tailored clothing business. The average selling price per unit increased 1.5% as a result of the change in sales mix as private label products typically
have a lower selling price than branded products and many of the sales of the products for businesses that we exited were off-price, close out sales.

Corporate and Other:

Corporate and Other primarily consists of the net sales of our Oxford Golf business and our Lyons, Georgia distribution center. The
increase in the net sales for Corporate and Other are primarily driven by the higher net sales in our Oxford Golf business during fiscal 2010.

43

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Table of Contents

Gross Profit

Fiscal 2010

Fiscal 2009

$ Change

% ChangeGross profit

$
327,407

$
290,813

$
36,594


12.6%Gross margin (gross profit as a % of net sales)


54.2
%

49.7
%LIFO charges included in gross profit

$
3,792

$
4,943Restructuring charges included in gross profit




$
355Write-up of acquired inventory included in gross profit

$
764





The
increase in gross profit was primarily due to higher net sales and increased gross margins. The increase in gross margins was primarily due to changes in the sales mix for fiscal
2010 compared to
fiscal 2009. The changes in sales mix included (1) direct to consumer sales, which generally have higher gross margins than wholesale sales, making up a larger proportion of Tommy Bahama sales,
(2) Tommy Bahama sales representing a larger proportion of our consolidated net sales, (3) fewer close out sales in Ben Sherman as fiscal 2009 included sales associated with footwear,
kids' and women's operations, which we exited, (4) the inclusion of $0.4 million of restructuring charges in Ben Sherman in 2009 associated with our exit from the Ben Sherman footwear,
kids' and women's operations, (5) a sales mix change in Lanier Clothes towards branded products and (6) the impact of LIFO accounting charges which totaled $3.8 million and
$4.9 million in fiscal 2010 and fiscal 2009, respectively. These positive items were partially offset by the negative impact on our gross profit of approximately $0.8 million of charges
to cost of goods sold in Lilly Pulitzer resulting from the write-up of acquired inventory from cost to fair value pursuant to the purchase method of accounting in connection with the sale
of acquired inventory. Our gross profit may not be directly comparable to those of our competitors, as statement of operations classification of certain expenses may vary by company.

SG&A

Fiscal 2010

Fiscal 2009

$ Change

% ChangeSG&A

$
301,002

$
282,489

$
18,513


6.6%SG&A (as % of net sales)


49.8
%

48.3
%Restructuring and other charges included in SG&A

$
3,212

$
2,201Acquisition transaction costs included in SG&A

$
848


Environmental reserve reduction included in SG&A

$
(2,242
)




The
increase in SG&A was primarily due to fiscal 2010 including (1) costs associated with the resumption of our incentive compensation program, which was suspended in fiscal 2009
and is tied to
our financial performance, which impacted SG&A for each of our operating groups, (2) the incremental SG&A associated with the costs of operating retail stores which opened during fiscal 2009
and fiscal 2010, (3) SG&A costs associated with Lilly Pulitzer subsequent to our acquisition and (4) transaction costs associated with the Lilly Pulitzer acquisition totaling
$0.8 million. Additionally, SG&A was impacted by the impact of restructuring charges which totaled $3.2 million in fiscal 2010 and $2.2 million in fiscal 2009. The fiscal 2010
restructuring costs primarily related to lease termination charges related to two Ben Sherman retail stores in the United Kingdom and certain fixed asset impairment charges in Ben Sherman. The fiscal
2009 restructuring charges included $2.0 million related to charges associated with our exit from the Ben Sherman women's, footwear and kids' operations, as well as other streamlining
initiatives, and $0.5 million related to the impairment of certain leasehold improvements associated with a Tommy Bahama New York office lease. These increased charges to SG&A were partially
offset by the $2.2 million of decrease in SG&A in fiscal 2010 resulting from a reduction in our estimate of expected remediation costs associated with an existing environmental reserve.

44

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Table of Contents

Amortization of Intangible Assets

Fiscal 2010

Fiscal 2009

$ Change

% ChangeAmortization of intangible assets

$
973

$
1,217

$
(244
)

(20.0
)%


The
decrease in amortization of intangibles was the result of decreases in amortization for Tommy Bahama and Ben Sherman as amortization of intangible assets is typically greater in the
earlier periods following an acquisition. We anticipate that amortization of intangible assets in fiscal 2011 will be approximately $1.2 million with an increase due to the amortization of
intangible assets related to Lilly Pulitzer being partially offset by decreases in amortization of intangible assets for Tommy Bahama and Ben Sherman.

Change in fair value of contingent consideration

Fiscal 2010

Fiscal 2009

$ Change

% ChangeChange in fair value of contingent consideration

$
200

$


$
200


100.0%


In
connection with the acquisition of the Lilly Pulitzer brand and operations, we entered into a contingent consideration agreement with the sellers, whereby we will be obligated to pay
certain contingent consideration amounts based on the achievement of certain performance criteria by our Lilly Pulitzer operating group, which may be as much as $20 million in the aggregate
over the four years subsequent to the acquisition. In accordance with U.S. GAAP, we have recognized a liability in our consolidated balance sheets for the fair value of this liability. This
liability will increase in fair value as we approach the date of anticipated payment, resulting in a charge to our consolidated statements of operations. Additionally, the fair value of the contingent
consideration will change in future periods to the extent that our assumptions regarding the probability of the payment of the contingent consideration, discount rates and other factors change as part
of our periodic assessment of the fair value of the liability. We anticipate that the change in fair value of contingent consideration due to the passage of time only will be approximately
$2.4 million in fiscal 2011; however, this charge will change if we alter any assumptions related to fair value of the contingent consideration. The change in assumptions could result in a
material change to the amount included in the statement of operations for fiscal 2011.

Royalties and other operating income

Fiscal 2010

Fiscal 2009

$ Change

% ChangeRoyalties and other operating income

$
15,430

$
11,803

$
3,627


30.7%


The
increase in royalties and other operating income was primarily due to increased royalty income in Tommy Bahama, as sales reported by certain licensees increased and new licensees
were added as well as the impact of a payment received related to the termination of the license for Tommy Bahama rum in fiscal 2010.

45

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Table of Contents

Operating income (loss)

Fiscal 2010

Fiscal 2009

$ Change

% ChangeTommy Bahama

$
51,081

$
37,515

$
13,566


36.2
%Lilly Pulitzer


(372
)




(372
)

NMBen Sherman


(2,664
)

(8,616
)

5,952


69.1
%Lanier Clothes


14,316


12,389


1,927


15.6
%Corporate and Other


(21,699
)

(22,378
)

679


3.0
%Total operating income

$
40,662

$
18,910

$
21,752


115.0
%LIFO charges included in operating income

$
3,792

$
4,943Write-up of acquired inventory included in operating income

$
764


Change in fair value of contingent consideration including in operating income

$
200


Acquisition transaction costs included in operating income

$
848


Restructuring charges included in operating income

$
3,212

$
2,556Environmental reserve reduction included in operating income

$
(2,242
)




Operating
income, on a consolidated basis, increased to $40.7 million in fiscal 2010 from $18.9 million in fiscal 2009. The $21.8 million increase in operating
income was primarily due to (1) increased net sales,
(2) improved gross margins and (3) higher royalty income, which were partially offset by (1) increased SG&A, (2) the impact of restructuring charges of $3.2 million
for fiscal 2010 and $2.6 million for fiscal 2009, (3) inventory mark-up charges associated with purchase accounting of $0.8 million and (4) transaction costs
associated with the Lilly Pulitzer acquisition of $0.8 million. Additionally, operating income included charges for LIFO accounting of $3.8 million in fiscal 2010 and $4.9 million
in fiscal 2009. Fiscal 2010 also included a $2.2 million of decrease in SG&A resulting from a reduction in our estimate of remediation costs associated with an existing environmental reserve.
Changes in operating income by operating group are discussed below.

Tommy Bahama:

Fiscal 2010

Fiscal 2009

$ Change

% ChangeNet sales

$
398,510

$
363,084

$
35,426


9.8%Operating income

$
51,081

$
37,515

$
13,566


36.2%Operating income as % of net sales


12.8
%

10.3
%Restructuring charges included in operating income

$


$
534


The
increase in operating income for Tommy Bahama was primarily due to the increased net sales, improved gross margins due to a greater proportion of direct to consumer sales as a
percentage of total Tommy Bahama sales and higher royalty income, which were partially offset by increased SG&A associated with higher incentive compensation expense, the costs of operating additional
retail stores during fiscal 2010 and other overhead cost increases.

46

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Table of Contents

Lilly Pulitzer:

Fiscal 2010

Fiscal 2009Net sales

$
5,959

$
Operating income (loss)

$
(372
)
$
Operating income (loss) as % of net sales


(6.2
%)

Write-up of acquired inventory included in operating income (loss)

$
764

$
Change in fair value of contingent consideration included in operating income (loss)

$
200

$



We
acquired Lilly Pulitzer on December 21, 2010. Therefore, fiscal 2010 reflects approximately six weeks of operating income for Lilly Pulitzer while the prior year includes no
operating income for Lilly Pulitzer. The six weeks of fiscal 2010 operating results were negatively impacted by approximately $0.8 million of charges to cost of goods sold in Lilly Pulitzer
resulting from the write-up of acquired inventory from cost to fair value pursuant to the purchase method of accounting in connection with the sale of acquired inventory. U.S. GAAP
requires that all assets acquired as part of an acquisition, including inventory, be recorded at fair value, rather than cost. This write-up is recognized as an increase to cost of goods
sold as the inventory is sold in the ordinary course of business. The remaining write-up included in our inventory at January 29, 2010 is approximately $1.0 million, which we
anticipate will be recognized as cost of goods sold, in addition to normal cost of goods sold amounts, during the first quarter of fiscal 2011 as the acquired inventory is sold. Additionally, the
Lilly Pulitzer operating results included a $0.2 million charge related to the change in the fair value of the contingent consideration. U.S. GAAP requires that we estimate the fair
value of the contingent consideration periodically, with any change in the fair value being included in the statement of operations during that period.

Ben Sherman:

Fiscal 2010

Fiscal 2009

$ Change

% ChangeNet sales

$
86,920

$
102,309

$
(15,389
)

(15.0
)%Operating income (loss)

$
(2,664
)
$
(8,616
)
$
5,952


69.1
%Operating income (loss) as % of net sales


(3.1
)%

(8.4
)%Restructuring charges included in operating income (loss)

$
3,212

$
2,022


The
improved operating results for Ben Sherman were primarily due to increased gross margins and reduced SG&A, driven by our exit from and subsequent licensing of the footwear and kids'
businesses, our exit from the women's operations and other streamlining initiatives. Fiscal 2010 included $3.2 million of charges associated with our termination of two retail store leases in
the United Kingdom and fixed asset impairment charges, while 2009 SG&A included $2.0 million of restructuring charges
primarily related to our exit from and subsequent licensing of the footwear and kids' businesses and other streamlining initiatives.

Lanier Clothes:

Fiscal 2010

Fiscal 2009

$ Change

% ChangeNet sales

$
103,733

$
114,542

$
(10,809
)

(9.4
)%Operating income

$
14,316

$
12,389

$
1,927


15.6
%Operating income as % of net sales


13.8
%

10.8
%


47

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Table of Contents

The increase in operating income for Lanier Clothes was primarily a result of improved gross margins due to sales mix, with branded sales representing a greater
proportion of Lanier Clothes' sales in fiscal 2010, and close out sales associated with exited businesses being included in net sales fiscal 2009. The improved gross margins were partially offset by
increased SG&A, resulting from higher incentive compensation expense and the higher cost structure generally associated with branded businesses.

Corporate and Other:

Fiscal 2010

Fiscal 2009

$ Change

% ChangeNet sales

$
8,825

$
5,371

$
3,454


64.3
%Operating loss

$
(21,699
)

(22,378
)

679


3.0
%LIFO charges included in operating loss

$
3,792

$
4,943Acquisition transaction costs included operating loss

$
848


Environmental reserve reduction included in operating loss

$
(2,242
)




The
Corporate and Other operating results improved by $0.7 million from a loss of $22.4 million in fiscal 2009 to a loss of $21.7 million in fiscal 2010. Fiscal 2010
and fiscal 2009 included LIFO accounting
charges of $3.8 million and $4.9 million, respectively. Fiscal 2010 also included $0.8 million of transaction costs associated with the acquisition of Lilly Pulitzer, which were
expensed as incurred, and a $2.2 million reduction in our estimate of expected remediation costs associated with an existing environmental reserve. Aside from the impact of LIFO accounting
charges, the transaction costs associated with the Lilly Pulitzer acquisition and the reduction in the environmental reserve, the reduced operating results were primarily due to higher incentive
compensation costs resulting from the resumption of our incentive compensation program, which was suspended in fiscal 2009 and is tied to our financial performance.

Interest expense, net

Fiscal 2010

Fiscal 2009

$ Change

% ChangeInterest expense, net

$
19,887

$
20,469

$
(582
)

(2.8
)%Write-off of deferred financing costs included in interest expense

$


$
1,759


Interest
expense for fiscal 2010 and fiscal 2009 was relatively unchanged, after reclassifying all interest related to our U.S. Revolving Credit Agreement to discontinued operations.
However, fiscal 2009 included a $1.8 million write-off of unamortized deferred financing costs and discount related to the 87/8% Senior Unsecured Notes, which were
satisfied and discharged in June 2009. Aside from the impact of this $1.8 million write-off, the increase in interest expense was primarily due to higher interest rates in fiscal
2010, which resulted from the June 2009 replacement of our 87/8% Senior Unsecured Notes with our 113/8% Senior Secured Notes.

Income taxes

Fiscal 2010

Fiscal 2009

$ Change

% ChangeIncome taxes

$
4,540

$
(2,945
)
$
7,485

NMEffective tax rate


21.9
%

NM


Income
taxes for both periods were impacted by certain discrete items, including a decrease in income tax contingency reserves upon the expiration of the corresponding statute of
limitations, favorable permanent differences and tax credits which do not necessarily fluctuate with earnings. The

48

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Table of Contents

effective
tax rate in fiscal 2010 is not necessarily indicative of the effective tax rates in future periods, as the effective tax rate in the future will be higher if our earnings levels increase
because the incremental earnings will likely be taxed at rates more closely aligned with statutory tax rates.

Net earnings

Fiscal 2010

Fiscal 2009

ChangeEarnings from continuing operations

$
16,235

$
1,386

$
14,849Earnings from continuing operations per diluted common share

$
0.98

$
0.09

$
0.89Net earnings from discontinued operations

$
62,423

$
13,238

$
49,185Net earnings from discontinued operations per diluted common share

$
3.77

$
0.81

$
2.96Net earnings

$
78,658

$
14,624

$
64,034Net earnings per diluted common share

$
4.75

$
0.90

$
3.85Weighted average common shares outstandingdiluted


16,551


16,304


247


The
increase in earnings from continuing operations was primarily due to higher net sales with a higher gross margin resulting from a change in sales mix and higher royalty income, but
partially offset by higher SG&A, each as discussed above. The increased results of the discontinued operations reflects the $49.5 million after-tax gain on the sale of substantially
all the operations and assets of our former Oxford Apparel operating group, partially offset by the impact of fiscal 2010 including 11 months of activity prior to the sale (compared with
12 months of activity in fiscal 2009). We do not anticipate significant earnings from the discontinued operations in future periods, except that we do anticipate earning commissions on
inventory in transit during the first half of fiscal 2011 for inventory that was in process at the time of the transaction.

FISCAL 2009 COMPARED TO FISCAL 2008

Net sales

Fiscal 2009

Fiscal 2008

$ Change

% ChangeTommy Bahama

$
363,084

$
421,687

$
(58,603
)

(13.9
)%Lilly Pulitzer











Ben Sherman


102,309


133,522


(31,213
)

(23.4
)%Lanier Clothes


114,542


135,581


(21,039
)

(15.5
)%Corporate and Other


5,371


8,274


(2,903
)

(35.1
)%Total net sales

$
585,306

$
699,064

$
(113,758
)

(16.3
)%


Net
sales, on a consolidated basis, decreased $113.8 million, or 16.3%, in fiscal 2009 compared to fiscal 2008 primarily as a result of the changes in each operating group
discussed below. Approximately $35 million of the decline in net sales from fiscal 2008 to fiscal 2009 was due to the exit of certain businesses in Ben Sherman and Lanier Clothes.

Tommy Bahama:

The decrease in net sales for Tommy Bahama was primarily due to a reduction in net sales in our wholesale business and in our existing
retail stores resulting from the challenging retail environment. This decrease in wholesale sales and existing store retail sales was partially offset by sales at our retail stores opened during
fiscal 2008 and fiscal 2009 and increased e-commerce sales. Unit sales decreased 18.8% due primarily to the challenging economic environment. The average selling price per unit increased
by 5.3%, as sales at our retail stores and our e-commerce sales, both of which have higher sales prices than wholesale sales, represented a greater proportion of total Tommy Bahama sales.

49

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Table of Contents

Ben Sherman:

The decrease in net sales for Ben Sherman was primarily due to (1) our exit from our Ben Sherman women's, footwear and kids'
operations, (2) a 13% reduction in the average exchange rate of the British pound sterling versus the United States dollar during fiscal 2009 compared to the average exchange rate during fiscal
2008 and (3) the impact of the challenging economic environment. During fiscal 2009, unit sales for Ben Sherman declined by 19.5% due primarily to the challenging economic conditions as well as
our exit from our women's, footwear and kids' operations. The average selling price per unit decreased 4.9%, resulting primarily from the impact of the weaker
British pound sterling, which was partially offset by a larger percentage of total Ben Sherman sales being sales at our retail stores, which generally have a higher sales price than wholesale sales.

Lanier Clothes:

The decrease in net sales for Lanier Clothes was primarily due to (1) our exit from the Oscar de la Renta and Nautica licensed
businesses, with fiscal 2009 sales primarily consisting of close out sales of these product lines, (2) the restructuring of the Arnold Brant business in fiscal 2008 and (3) the
challenging economic conditions. These factors resulted in a decrease in unit sales of 4.1% and a decrease in the average selling price per unit of 11.9%.

Corporate and Other:

Corporate and Other includes the net sales of our Oxford Golf business and our Lyons, Georgia distribution center operations. The
decrease in the net sales for Corporate and Other was primarily driven by lower net sales in our Oxford Golf business.

Gross Profit

Fiscal 2009

Fiscal 2008

$ Change

% ChangeGross profit

$
290,813

$
335,612

$
(44,799
)

(13.3
)%Gross margin (gross profit as a % of net sales)


49.7
%

48.0
%LIFO accounting charges included in gross profit

$
4,943

$
473Restructuring and other charges included in gross profit

$
355

$
4,767


The
decrease in gross profit was primarily due to lower sales in each operating group, as described above. Ben Sherman's gross margins were negatively impacted by increased cost of goods
sold related to inventory purchases denominated in United States dollars but sold in other currencies. Fiscal 2009 included LIFO accounting charges of $4.9 million, while fiscal 2008 included
LIFO accounting charges of $0.5 million. Fiscal 2009 gross profit was negatively impacted by restructuring charges of $0.4 million, while fiscal 2008 gross profit was negatively impacted
by restructuring charges of $4.8 million primarily related to our exit from certain businesses in our Lanier Clothes group. Consolidated gross margins increased to 49.7% of net sales in fiscal
2009 from 48.0% in fiscal 2008. In addition to the LIFO
accounting adjustments and restructuring charges, gross margins were also impacted by the sales mix between our retail operations and wholesale operations, with retail sales, which generally have
higher gross margins, representing a higher proportion of our net sales during fiscal 2009 than in fiscal 2008. Our gross profit may not be directly comparable to those of our competitors, as
statement of operations classification of certain expenses may vary by company.

50

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Table of Contents

SG&A

Fiscal 2009

Fiscal 2008

$ Change

% ChangeSG&A

$
282,489

$
325,342

$
(42,853
)

(13.2
)%SG&A (as % of net sales)


48.3
%

46.5
%Restructuring and other charges included in SG&A

$
2,201

$
5,847


The
decrease in SG&A was primarily due to (1) significant reductions in our headcount and other overhead costs across all operating groups, (2) cost reductions associated
with our exit from certain businesses, (3) the impact on Ben Sherman of a 13% reduction in the average value of the British pound sterling versus the United States dollar in fiscal 2009 as
compared to fiscal 2008, (4) reductions in store opening costs resulting from fewer retail store openings in fiscal 2009, (5) reductions in advertising expenses and (6) a decrease
in restructuring charges as fiscal 2009 SG&A included restructuring charges of approximately $2.2 million while fiscal 2008 SG&A included restructuring charges and other unusual items totaling
a net charge of approximately $5.8 million. The fiscal 2008 restructuring charges were primarily associated with our decision to exit from certain license agreements relating to Nautica and
Oscar de la Renta brands and the restructuring of our Arnold Brant business as well as certain severance and fixed asset impairment charges in Tommy Bahama, Ben Sherman and Corporate and Other. The
cost savings were partially offset by expenses associated with the operation of additional retail stores which opened subsequent to the beginning of fiscal 2008.

Amortization of intangible assets

Fiscal 2009

Fiscal 2008

$ Change

% ChangeAmortization of intangible assets

$
1,217

$
2,800

$
(1,583
)

(56.5
)%


The
decrease was the result of amortization typically being greater in the earlier periods following an acquisition.

Impairment of goodwill and intangible assets

Fiscal 2009

Fiscal 2008

$ ChangeImpairment of goodwill and intangible assets

$


$
307,532

$
(307,532
)


The
non-cash impairment charges in fiscal 2008 included (1) goodwill impairment charges in Tommy Bahama and Ben Sherman of $204.5 million and
$37.7 million, respectively, and (2) trademark and other intangible asset impairment charges in Tommy Bahama, Ben Sherman and Lanier Clothes of $17.1 million, $46.1 million
and $2.2 million, respectively.

Royalties and other operating income

Fiscal 2009

Fiscal 2008

$ Change

% ChangeRoyalties and other operating income

$
11,803

$
15,661

$
(3,858
)

(24.6
)%


The
decrease in royalties and other operating income was primarily due to the termination of the license agreement for footwear in Tommy Bahama and the challenging economic conditions,
as well as the 13% decline in the average value of the British pound sterling versus the United States dollar, which impacted Ben Sherman royalty income.

51

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Table of Contents

Operating Income (Loss)

Fiscal 2009

Fiscal 2008

$ ChangeTommy Bahama

$
37,515

$
(173,448
)
$
210,963Lilly Pulitzer








Ben Sherman


(8,616
)

(84,988
)

76,372Lanier Clothes


12,389


(8,283
)

20,672Corporate and Other


(22,378
)

(17,682
)

(4,696
)Total operating income (loss)

$
18,910

$
(284,401
)
$
303,311Impairment of goodwill and intangible assets included in operating income (loss)

$


$
307,532LIFO accounting charges included in total operating income (loss)

$
4,943

$
473Other restructuring and unusual charges included in total operating income (loss)

$
2,556

$
10,614


Operating
results, on a consolidated basis, improved from an operating loss of $284.4 million in fiscal 2008 to operating income of $18.9 million in fiscal 2009. The
improved results were primarily due to (1) the impairment charges in fiscal 2008, (2) the larger amount of restructuring charges in fiscal 2008 and (3) the reduction in SG&A in
fiscal 2009. These items were partially offset by (1) the sales decline, as discussed above, which resulted in lower gross profit, (2) the greater LIFO accounting charges in fiscal 2009
and (3) the decrease in royalties and other operating income. Changes in operating income by operating group are discussed below.

Tommy Bahama:

Fiscal 2009

Fiscal 2008

$ Change

% ChangeNet sales

$
363,084

$
421,687

$
(58,603
)

(13.9
)%Operating income (loss)


37,515


(173,448
)

210,963


NMOperating income (loss) % of net sales


10.3
%

(41.1
)%Impairment of goodwill and intangible assets included in operating income (loss)

$


$
221,559Restructuring charges included in operating income(loss)

$
534

$
952


The
improved operating results for Tommy Bahama were primarily due to the impairment charges in fiscal 2008. The fiscal 2009 operating results of Tommy Bahama were impacted by
(1) decreased SG&A including decreased employment, advertising, store pre-opening and other variable operating costs and (2) higher gross margins as retail sales, which
generate higher gross margins, represented a greater proportion of total Tommy Bahama sales. These positive factors were partially offset by (1) decreased gross profit, despite the higher gross
margins, due to the decreased net sales and (2) decreased royalty income primarily due to the termination of the license agreement for footwear. Fiscal 2009 included approximately
$0.5 million of restructuring charges related to a leasehold improvement charge with respect to a New York office lease while fiscal 2008 included restructuring charges of $1.0 million
consisting of severance costs and fixed asset impairment charges.

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Ben Sherman:

Fiscal 2009

Fiscal 2008

$ Change

% ChangeNet sales

$
102,309

$
133,522

$
(31,213
)

(23.4
)%Operating income (loss)


(8,616
)

(84,988
)

76,372


NMOperating income (loss) % of net sales


(8.4
)%

(63.7
)%Impairment of goodwill and intangible assets included in operating income (loss)

$


$
83,766Restructuring charges included in operating income (loss)

$
2,022

$
535


The
improved operating results for Ben Sherman were primarily due to the impairment charges in fiscal 2008. The operating results for fiscal 2009 were negatively impacted by
(1) lower net sales, (2) the unfavorable impact on gross margins related to inventory purchases denominated in United States dollars but sold in other currencies, (3) lower
royalty income and (4) $2.0 million of restructuring charges, which were primarily related to the exit from the Ben Sherman women's, footwear and kids' operations as well as other
streamlining initiatives. These items were partially offset by headcount and other overhead reductions, which resulted in lower SG&A in fiscal 2009. Fiscal 2008 included restructuring charges of
$0.5 million consisting of severance payments.

Lanier Clothes:

Fiscal 2009

Fiscal 2008

$ Change

% ChangeNet sales

$
114,542

$
135,581

$
(21,039
)

(15.5
)%Operating income (loss)


12,389


(8,283
)

20,672


NMOperating income (loss) % of net sales


10.8
%

(6.1
)%Impairment of intangible assets included in operating income (loss)

$


$
2,207Restructuring charges included in operating income (loss)

$


$
7,908


The
improved operating results for Lanier Clothes were primarily due to (1) increased gross profit as improved gross margins more than offset the impact of the decreased net
sales, (2) reductions in SG&A due to reductions in headcount and other overhead costs and (3) fiscal 2008 including impairment charges of $2.2 million and restructuring charges of
$7.9 million, which were primarily related to our exit from the Nautica and Oscar de la Renta licensed businesses, the restructuring of our Arnold Brant business and certain other unusual
items.

Corporate and Other:

Fiscal 2009

Fiscal 2008

$ Change

% ChangeNet sales

$
5,371

$
8,274

$
(2,903
)

(35.1
)%Operating income (loss)

$
(22,378
)
$
(17,682
)
$
(4,696
)

NMLIFO accounting charges included in operating income (loss)

$
4,943

$
473Restructuring charges included in operating income (loss)

$


$
1,219


The
decrease in operating results for Corporate and Other is primarily due to (1) the $4.9 million LIFO accounting charge in fiscal 2009 compared to a LIFO accounting
charge of $0.5 million in fiscal 2008 and (2) $1.2 million of restructuring charges consisting of severance and charges associated with certain leased office space incurred in
fiscal 2008.

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Gain on repurchase of 87/8% Senior Unsecured Notes

Fiscal 2009

Fiscal 2008

$ ChangeGain on repurchase of 87/8% Senior Unsecured Notes

$


$
7,767

$
(7,767
)


Fiscal
2008 included a $7.8 million gain on our repurchase of $33.2 million of aggregate principal amount of our 87/8% Senior Unsecured Notes for
$25.0 million.

Interest expense, net

Fiscal 2009

Fiscal 2008

$ Change

% ChangeInterest expense, net

$
20,469

$
21,317

$
(848
)

(4.0
)%Write-off of deferred financing costs included in interest expense

$
1,759

$
900


The
decrease in interest expense, net was primarily due to lower debt levels on our 113/8% Senior Secured Notes and our 87/8% Senior Unsecured Notes in
fiscal 2009 as compared to the amount outstanding on our 87/8% Senior Secured Notes in fiscal 2008. The decrease in debt was primarily attributable to the net impact of (1) our
repurchase of $33.2 million aggregate principal amount of our 87/8% Senior Unsecured Notes at a discount in fiscal 2008, (2) the issuance of $150.0 million
aggregate principal amount of 113/8% Senior Secured Notes in fiscal 2009 and (3) the satisfaction and discharge of $166.8 million aggregate principal amount of our
87/8% Senior Unsecured Notes in fiscal 2009, which was funded by the proceeds from the issuance of the 113/8% Senior Secured Notes and borrowings under our U.S. Revolving
Credit Agreement. The decrease in debt was partially offset by the higher interest rates associated with our 113/8% Senior Secured Notes. The impact of these changes was partially
offset by the net impact of the $1.8 million and $0.9 million of charges related to the write-off of unamortized deferred financing costs as a result of certain changes to
our financing arrangements in each period in fiscal 2009 and fiscal 2008, respectively. All interest expense associated with our U.S. Revolving Credit Agreement was allocated to interest expense in
discontinued operations for both fiscal 2009 and fiscal 2008.

Income Taxes

Fiscal 2009

Fiscal 2008

$ ChangeIncome taxes

$
(2,945
)
$
(19,845
)
$
16,900Effective tax rate


NM


6.7
%


Income
taxes for fiscal 2009 benefited from the impact of (1) changes in permanent book/tax differences related to our foreign operations, (2) the impact of certain tax
credits which do not fluctuate with our earnings and (3) certain other discrete items. Income taxes for fiscal 2008 reflect the non-deductibility of a significant portion of the
goodwill impairment charges recognized in fiscal 2008.

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Table of Contents

Net earnings

Fiscal 2009

Fiscal 2008

ChangeEarnings (loss) from continuing operations

$
1,386

$
(278,106
)
$
279,492Earnings (loss) from continuing operations per diluted common share

$
0.09

$
(17.42
)
$
17.51Net earnings from discontinued operations

$
13,238

$
6,649

$
6,589Net earnings from discontinued operations per diluted common share

$
0.81

$
0.42

$
0.39Net earnings (loss)

$
14,624

$
(271,457
)
$
286,081Net earnings (loss) per diluted common share

$
0.90

$
(17.00
)
$
17.90Weighted average common shares outstandingdiluted


16,304


15,968


336


The
improved earnings from continuing operations was primarily due to the fiscal 2008 impairment charges and lower SG&A in fiscal 2009. These improvements were partially offset by the
impact of (1) lower net sales in fiscal 2009, (2) lower royalty income in fiscal 2009 and (3) the gain on the repurchase of our 87/8% Senior Unsecured Notes in
fiscal 2008, each as discussed above. The change in the net earnings from discontinued operations was primarily due to $7.3 million of impairment charges and a net charge of $0.4 million
for other unusual items in fiscal 2008 as well as the impact of lower SG&A, which were offset by decreased gross profit resulting from a decrease in net sales.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

Our primary source of revenue and cash flow is our operating activities in the United States and, to a lesser extent, the United
Kingdom. Our primary uses of cash flow include the acquisition of apparel products in the operation of our business, as well as employee compensation and benefits, occupancy costs, marketing and
advertising costs, other general and administrative operating expenses, funding of capital expenditures for retail stores, payment of quarterly dividends, periodic interest payments related to our
financing arrangements and repayment of our indebtedness. If cash inflows are less than cash outflows, we have access to amounts under our U.S. Revolving Credit Agreement and U.K. Revolving Credit
Agreement, subject to their terms, each of which is described below. We may seek to finance future capital investment programs through various methods, including, but not limited to, cash on hand,
cash flow from operations, borrowings under our current or additional credit facilities and sales of debt or equity securities.

Although
our net sales, operating income and operating cash flows were impacted by the weak economic conditions since fiscal 2008, we maintained positive operating cash flows for each of
fiscal 2008, fiscal 2009 and fiscal 2010 and we anticipate operating cash flows will increase as economic conditions continue to improve. Also, we believe we have maintained a strong balance sheet and
liquidity through various actions including (1) purchasing inventory at levels which mitigated inventory markdown risk and promotional pressure in fiscal 2009 and most of fiscal 2010,
(2) reducing working capital levels during fiscal 2008 and fiscal 2009, (3) reducing our corporate overhead costs in fiscal 2008 and fiscal 2009, (4) exiting certain
underperforming businesses in Ben Sherman and Lanier Clothes, (4) reducing our capital expenditures related to new store openings during fiscal 2009 and fiscal 2010 and (5) divesting of
substantially all of the operations and assets of our former Oxford Apparel operating group in January 2011. As a result of these actions and positive operating cash flows, we were able to purchase
the Lilly Pulitzer brand and operations on December 21, 2010 for $60 million. After all of these events, we had approximately $44.1 million of cash on hand as of
January 29, 2011 with no borrowings outstanding under our $175 million U.S. Revolving Credit agreement.

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Table of Contents

Key Liquidity Measures

($ in thousands)

January 29,
2011

January 30,
2010

$ Change

% ChangeCurrent assets

$
268,913

$
191,906

$
77,007


40.1
%Current liabilities


147,091


96,450


50,641


52.5
%Working capital

$
121,822

$
95,456

$
26,366


27.6
%Working capital ratio


1.83


1.99Debt to total capital ratio


45
%

58
%


Our
working capital ratio is calculated by dividing total current assets by total current liabilities, including assets and liabilities related to discontinued operations. Current assets
and current liabilities increased from January 30, 2010 to January 29, 2011, as described below; however, current liabilities increased more than current assets, primarily due to the
income tax payable related to the gain on sale of our Oxford Apparel operations which is included in current liabilities related to discontinued operations. For the ratio of debt to total capital,
debt is defined as short-term and long-term debt, and total capital is defined as debt plus shareholders' equity. The change in the debt to total capital ratio from
January 30, 2010 to January 29, 2011 was primarily a result of the gain on the sale of our Oxford Apparel operations and assets in fiscal 2010, as well as earnings from continuing
operations and discontinued operations during fiscal 2010, which resulted in an increase in shareholders' equity during the year. Our debt levels and ratio of debt to total capital in future periods
may not be comparable to historical amounts due to the impact of the Oxford Apparel sale and as we continue to assess our capital structure. Changes in our capital structure in the future, if any,
will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.

Balance Sheet

The following tables set forth certain information included in our consolidated balance sheets (in thousands) and calculations of
changes in the information included in our consolidated balance sheets. Below each table are explanations for any significant changes in the balances at January 29, 2011 compared to
January 30, 2010.

Current Assets:

January 29,
2011

January 30,
2010

$ Change

% ChangeCash and cash equivalents

$
44,094

$
8,288

$
35,806


432.0
%Receivables, net


50,177


44,690


5,487


12.2
%Inventories, net


85,338


58,180


27,158


46.7
%Prepaid expenses, net


12,554


10,508


2,046


19.5
%Deferred tax assets


19,005


13,875


5,130


37.0
%Total current assets related to continuing operations


211,168


135,541


75,627


55.8
%Assets related to discontinued operations


57,745


56,365


1,380


2.4
%Total current assets

$
268,913

$
191,906

$
77,007


40.1
%


Cash
and cash equivalents as of January 29, 2011 increased compared to cash and cash equivalents as of January 30, 2010 due to the net impact of cash flow generated from
the sale of our Oxford Apparel operations and positive cash flow generated from our continuing operations, which were partially offset by (1) the $60 million acquisition of the Lilly
Pulitzer brand and operations, (2) negative cash flows provided by our discontinued operations during fiscal 2010 resulting from increased working

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capital
needs prior to the Oxford Apparel sale, (3) capital expenditures incurred during fiscal 2010 and (4) the payment of dividends during fiscal 2010. Receivables, net as of
January 29, 2011 increased compared to January 30, 2010 primarily due to the receivables associated with our Lilly Pulitzer business as of January 29, 2011. Inventories, net as of
January 29, 2011 increased from January 30, 2010 primarily due to an increase in inventories in Tommy Bahama to support anticipated sales and growth and the inventory associated with our
Lilly Pulitzer business as of January 29, 2011. The increase in prepaid expenses, net from January 30, 2010 to January 29, 2011 was primarily due to the prepaid expenses
associated with our Lilly Pulitzer business. Deferred tax assets have increased from January 30, 2010 primarily as a result of the change in book to tax differences associated with compensation
accruals, restricted stock awards and accounts receivable reserves. The decrease in assets related to discontinued operations was primarily a result of the sale of inventory, excluding inventory in
transit, and other assets related to our Oxford Apparel operations, which was partially offset by an increase in receivables associated with this business, substantially all of which we anticipate
collecting prior to the end of the first quarter of fiscal 2011.

Non-current Assets:

January 29,
2011

January 30,
2010

$ Change

% ChangeProperty and equipment, net

$
83,895

$
78,425

$
5,470


7.0
%Intangible assets, net


166,680


137,462


29,218


21.3
%Goodwill


16,866





16,866


100.0
%Other non-current assets, net


22,117


17,381


4,736


27.2
%Total non-current assets, net

$
289,558


233,268

$
56,290


24.1
%


The
increase in property and equipment, net at January 29, 2011 was primarily due to assets associated with our Lilly Pulitzer business and fiscal 2010 capital expenditures which
were partially offset by fiscal 2010 depreciation expense. The increase in intangible assets, net and goodwill was primarily related to the intangible assets and goodwill acquired as part of our
acquisition of Lilly Pulitzer during fiscal 2010. The increase in other non-current assets was primarily due to the payment of loans associated with company owned life insurance policies,
which had previously been recorded as a reduction to other non-current assets in accordance with U.S. GAAP.

Liabilities:

January 29,
2011

January 30,
2010

$ Change

% ChangeCurrent liabilities related to continuing operations

$
106,306

$
77,508

$
28,798


37.2
%Long-term debt, less current maturities


147,065


146,408


657


0.4
%Other non-current liabilities


55,441


49,478


5,963


12.1
%Non-current deferred income taxes


28,846


28,421


425


1.5
%Total liabilities related to continuing operations

$
337,658

$
301,815


35,843


11.9
%Liabilities related to discontinued operations

$
40,785

$
18,942


21,843


115.3
%Total liabilities

$
378,443

$
320,757

$
57,686


18.0
%


The
increase in current liabilities was primarily due to the increase in accounts payable and accrued expenses due to higher inventory purchases near year end in fiscal 2010 and accrued
compensation, which resulted from the resumption of our incentive compensation program in fiscal 2010. Our incentive compensation program was suspended in fiscal 2009 and is tied to our financial
performance, which exceeded targets for our incentive compensation program in fiscal 2010. The

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increase
in other non-current liabilities primarily resulted from the contingent acquisition consideration liability recognized as part of the acquisition of Lilly Pulitzer, which was
partially offset by decreases in deferred rent and environmental reserve liabilities during fiscal 2010. The increase in liabilities related to discontinued operations was primarily a result of the
tax liability associated with the gain on sale of the discontinued operations, partially offset by decreases in trade payables due to the sale of the business. We anticipate that substantially all
liabilities associated with the discontinued operations will be satisfied before the end of the first half of fiscal 2011.

Statement of Cash Flows

The following table sets forth the net cash flows resulting in the change in our cash and cash equivalents (in thousands):

Fiscal 2010

Fiscal 2009

Fiscal 2008Net cash provided by operating activities

$
35,691

$
60,975

$
51,849Net cash used in investing activities


(71,553
)

(11,297
)

(19,801
)Net cash used in financing activities


(11,223
)

(65,026
)

(79,701
)Net cash provided by discontinued operations


82,860


20,579


37,075Net change in cash and cash equivalents

$
35,775

$
5,231

$
(10,578
)


Fiscal 2010 Compared to Fiscal 2009

Cash and cash equivalents on hand was $44.1 million and $8.3 million at January 29, 2011 and January 30,
2010, respectively. The change in cash was primarily due to the cash flow activities discussed below.

Operating Activities:

The operating cash flows for fiscal 2010 and fiscal 2009 of $35.7 million and $61.0 million, respectively, were primarily
the result of net earnings for the relevant period, adjusted for non-cash activities such as depreciation, amortization and stock compensation expense as well as changes in our working
capital accounts. In fiscal 2010, the more significant changes in working capital were increases in inventories and accounts payable as we increased our inventory in anticipation of higher sales in
the future, whereas fiscal 2009 reflected a $35.7 million reduction in inventories during fiscal 2009 as we reduced our inventory levels in all operating groups due to the economic uncertainty
and our exit from certain businesses.

Investing Activities:

During fiscal 2010 and fiscal 2009, investing activities used $71.6 million and $11.3 million, respectively, of cash. In
fiscal 2010, we used approximately $58.3 million of cash to acquire the Lilly Pulitzer brand and operations. Additionally, we used cash totaling $13.3 million and $11.3 million of
capital expenditures in fiscal 2010 and fiscal 2009, respectively, which were primarily related to new retail stores and costs associated with investments in certain technology initiatives.

Financing Activities:

During fiscal 2010 and fiscal 2009, financing activities used $11.2 million and $65.0 million, respectively, of cash. In
fiscal 2010, the primary use of cash for financing activities was the payment of dividends and the repayment of loans related to certain company owned life insurance policies. In fiscal 2009, cash
flow from operations, borrowings under our U.S. Revolving Credit Agreement and the proceeds from the issuance of $150.0 million aggregate principal amount of our 113/8% Senior
Secured

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Notes
were used to repurchase $166.8 million aggregate principal amount of our 87/8% Senior Unsecured Notes, to pay $5.9 million of dividends and to pay
$5.0 million of financing costs associated with the issuance of our 113/8% Senior Secured Notes in June 2009.

Discontinued Operations:

The cash flows from discontinued operations reflect cash flow provided by or used in the activities of our discontinued operations. The
change in cash flow from discontinued operations primarily reflects the $102.8 million of proceeds from the sale of the discontinued operations during fiscal 2010, but also reflects that the
discontinued operations were reducing working capital requirements in fiscal 2009 and increasing working capital requirements in fiscal 2010. As of January 29, 2011, there were approximately
$17.0 million of net assets associated with the discontinued operations included in our consolidated balance sheet, including a $5.4 million receivable for the cash held in escrow
related to the Oxford Apparel sale. We anticipate that these net assets, as well as certain commissions we will earn related to inventory in process as of the transaction date, will be converted into
cash in the first half of fiscal 2011.

Fiscal 2009 Compared to Fiscal 2008

Cash and cash equivalents on hand were $8.3 million and $3.3 million at January 30, 2010 and January 31,
2009, respectively. The change in cash was primarily due to the cash flow activities discussed below.

Operating Activities:

The operating cash flows for fiscal 2009 and fiscal 2008 were primarily the result of earnings for the relevant period, adjusted for
non-cash activities such as depreciation, amortization, impairment and stock compensation expense as well as changes in our working capital accounts. In fiscal 2009, the significant change
in working capital was a $35.7 million reduction in inventories, while the significant changes in working capital in fiscal 2008 were decreases in inventories and accounts receivable, which
increased cash flow from operations, and a decrease in current liabilities, which decreased cash flow from operations. These changes reflect our emphasis in fiscal 2009 and fiscal 2008 on reducing our
working capital investment.

Investing Activities:

During fiscal 2009 and fiscal 2008, investing activities used $11.3 million and $19.8 million, respectively, of cash. In
both years, these investing activities primarily consisted of capital expenditures related to new retail stores and costs associated with our ongoing implementation of a new integrated financial
system.

Financing Activities:

In fiscal 2009, financing activities used $65.0 million of cash, which was primarily used for a $54.1 million reduction
in debt. In fiscal 2009, cash flow from operations, borrowings under our U.S. Revolving Credit Agreement and the proceeds from the issuance of $150.0 million aggregate principal amount of our
113/8% Senior Secured Notes were used to repurchase $166.8 million aggregate principal amount of our 87/8% Senior Unsecured Notes, to pay $5.9 million of
dividends and to pay $5.0 million of financing costs associated with the issuance of our 113/8% Senior Secured Notes in June 2009.

In
fiscal 2008, financing activities used $79.7 million of cash, which was primarily used for a $63.7 million reduction in debt. In fiscal 2008, cash flow from operations
were used to repurchase $33.2 million of our 87/8% Senior Unsecured Notes, reduce the debt outstanding under our U.S.

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Revolving
Credit Agreement, pay $14.4 million of dividends and pay $1.7 million of deferred financing costs associated with the refinancing of our U.S. Revolving Credit Agreement.

Discontinued Operations:

The cash flows from discontinued operations reflect cash flow provided by or used in the activities of our discontinued operations. The
change in cash flow from discontinued operations reflects the impact of earnings and reductions in working capital levels during both fiscal 2009 and fiscal 2008.

Liquidity and Capital Resources

The table below provides a description of our significant financing arrangements and the amounts outstanding under these financing
arrangements (in thousands) as of January 29, 2011:

Outstanding$175 million U.S. Secured Revolving Credit Facility ("U.S. Revolving Credit Agreement"), which is limited to a borrowing base consisting of
specified percentages of eligible categories of assets, accrues interest, unused line fees and letter of credit fees based upon a pricing grid which is tied to average unused availability, requires interest payments monthly with principal due at
maturity (August 2013) and is secured by a first priority security interest in the accounts receivable (other than royalty payments in respect of trademark licenses), inventory, investment property (including the equity interests of certain
subsidiaries), general intangibles (other than trademarks, trade names and related rights), deposit accounts, intercompany obligations, equipment, goods, documents, contracts, books and records and other personal property of Oxford Industries,
 Inc. and substantially all of its domestic subsidiaries and a second priority security interest in those assets in which the holders of the 113/8% Senior Secured Notes have a first priority security
interest

$
£7 million Senior Secured Revolving Credit Facility ("U.K. Revolving Credit Agreement"), which accrues interest at the bank's
base rate plus 3.5%, requires interest payments monthly with principal payable on demand and is collateralized by substantially all of the United Kingdom assets of Ben Sherman


11.375% Senior Secured Notes ("113/8% Senior Secured Notes"), which accrue interest at an annual rate of
11.375% (effective interest rate of 12%) and require interest payments semi-annually in January and July of each year, require payment of principal at maturity (July 2015), are subject to certain prepayment penalties, are secured by a first priority
interest in all U.S. registered trademarks and certain related rights and certain future acquired real property owned in fee simple of Oxford Industries, Inc. and substantially all of its consolidated domestic subsidiaries and a second priority
security interest in those assets in which the lenders under the U.S. Revolving Credit Agreement have a first priority security interest, and are guaranteed by certain of our domestic subsidiaries


150,000Unamortized discount


(2,935
)Total debt

$
147,065Short-term debt and current maturities of long-term debt


Long-term debt, less current maturities

$
147,065


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To the extent cash flow needs exceed cash flow provided by our operations, we will have access, subject to their terms, to our lines of credit to provide funding
for operating activities, capital expenditures and acquisitions, if any. Our credit facilities are also used to finance trade letters of credit for product purchases, which are drawn against our lines
of credit at the time of shipment of the products and reduce the amounts available under our lines of credit and borrowing capacity under our credit facilities when issued. As of January 29,
2011, approximately $29.9 million of trade letters of credit and other limitations on availability in the aggregate were outstanding against the U.S. Revolving Credit Agreement and the U.K.
Revolving Credit Agreement. As of January 29, 2011, we had approximately $145.0 million in unused availability under the U.S. Revolving Credit Agreement and approximately
$7.5 million in unused availability under the U.K. Revolving Credit Agreement, subject to the respective limitations on borrowings set forth in the U.S. Revolving Credit Agreement, U.K.
Revolving Credit Agreement and the indenture for the 113/8% Senior Secured Notes.

Covenants, Other Restrictions and Prepayment Penalties:

Our credit facilities and 113/8% Senior Secured Notes are subject to a number of affirmative covenants regarding the
delivery of financial information, compliance with law, maintenance of property, insurance and conduct of business. Also, our credit facilities and 113/8% Senior Secured Notes are
subject to certain negative covenants or other restrictions including, among other things, limitations on our ability to (i) incur debt, (ii) guaranty certain obligations,
(iii) incur liens, (iv) pay
dividends to shareholders, (v) repurchase shares of our common stock, (vi) make investments, (vii) sell assets or stock of subsidiaries, (viii) acquire assets or
businesses, (ix) merge or consolidate with other companies, or (x) prepay, retire, repurchase or redeem debt.

Our
U.S. Revolving Credit Agreement contains a financial covenant that applies if unused availability under the U.S. Revolving Credit Agreement for three consecutive days is less than
the greater of (i) $26.25 million or (ii) 15% of the total revolving commitments. In such case, our fixed charge coverage ratio as defined in the U.S. Revolving Credit Agreement
must not be less than 1.0 to 1.0 for the immediately preceding 12 fiscal months for which financial statements have been delivered. This financial covenant continues to apply until we have maintained
unused availability under the U.S. Revolving Credit Agreement of more than the greater of (i) $26.25 million or (ii) 15% of the total revolving commitments for 30 consecutive
days.

Additionally,
pursuant to the indenture governing our 113/8% Senior Secured Notes, our ability to incur certain indebtedness or to make certain restricted payments, as
defined in the indenture, is subject to our meeting certain conditions, including in each case the condition that our fixed charge coverage ratio, as defined in the indenture, not be less than 2.0 to
1.0 for the preceding four fiscal quarters on a pro forma basis after giving effect to the proposed indebtedness or restricted payment and, in the case of a restricted payment, the condition that the
aggregate total of all restricted payments not exceed a certain allowable amount calculated pursuant to a formula set forth in the indenture. Restricted payments under the indenture include, without
limitation, cash dividends to shareholders, repurchases of our capital stock, and certain investments.

We
believe that the affirmative covenants, negative covenants, financial covenants and other restrictions are customary for those included in similar facilities and notes entered into at
the time we entered into our agreements. During fiscal 2010 and as of January 29, 2011, no financial covenant testing was required pursuant to our U.S. Revolving Credit Agreement as the minimum
availability threshold was met at all times. As of January 29, 2011, we were compliant with all covenants related to our credit facilities and 113/8% Senior Secured Notes.

At
any time prior to July 15, 2012, we may redeem all or a portion of the 113/8% Senior Secured Notes, on not less than 30 nor more than 60 days' prior
notice, in amounts of $2,000 or an integral multiple of $1,000 in excess thereof, at a price equal to the greater of (i) 100% of the aggregate

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principal
amount of the 113/8% Senior Secured Notes to be redeemed, together with accrued and unpaid interest, if any, to the date of redemption or (ii) as determined by an
independent investment banker (as prescribed under the indenture), the sum of the present values of 105.688% of the principal amount of the 113/8% Senior Secured Notes being redeemed
plus scheduled payments of interest (not including any portion of such payments of interest accrued as of the date of redemption) from the date of redemption to July 15, 2012 discounted to the
redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the Adjusted
Treasury Rate (as defined in the indenture) plus 50 basis points, together with accrued and unpaid interest, if any, to the date of redemption.

On
or after July 15, 2012, we may redeem all or a portion of the 113/8% Senior Secured Notes, on not less than 30 nor more than 60 days' prior notice, in
amounts of $2,000 or an integral multiple of $1,000 in excess thereof at the following redemption prices (expressed as percentages of the principal amount), together with accrued and unpaid interest,
if any, to the redemption date, if redeemed during the 12-month period beginning July 15 of the years indicated below:

2012


105.688
%2013


102.844
%2014 and thereafter


100.000
%


Other Liquidity Items:

We anticipate that we will be able to satisfy our ongoing cash requirements, which generally consist of working capital and other
operating activity needs, capital expenditures (primarily for the opening of additional retail stores), interest payments on our debt during fiscal 2011 and dividends, if any, primarily from positive
cash flow from operations supplemented by cash on hand and borrowings under our lines of credit, if necessary. Our need for working capital is typically seasonal with the greatest requirements
generally existing in the fall and spring of each year. Our capital needs will depend on many factors including our growth rate, the need to finance inventory levels and the success of our various
products. At maturity of the U.S. Revolving Credit Agreement and the 113/8% Senior Secured Notes or if the U.K. Revolving Credit Agreement was required to be paid, we anticipate that we
will be able to refinance the facilities and debt with terms available in the market at that time, which may or may not be as favorable as the terms of the current agreements.

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Contractual Obligations

The following table summarizes our contractual cash obligations, as of January 29, 2011, by future period:

Payments Due by PeriodLess Than
1 year

1-3
Years

3-5
Years

More Than
5 Years

Total(In thousands)Contractual Obligations:113/8% Senior Secured Notes

$


$


$
150,000

$


$
150,000Interest on 113/8% Senior Secured Notes


17,063


34,125


25,594





76,782U.S. Revolving Credit Agreement and U.K. Revolving Credit Agreement(1)Operating leases(2)


38,671


71,840


57,125


64,895


232,531Minimum royalty and advertising payments pursuant to royalty agreements


3,283


2,973


1,024





7,280Letters of credit


29,949











29,949Contingent purchase price consideration(3)





5,000


15,000





20,000Other(4)(5)(6)














Total

$
88,966

$
113,938

$
248,743

$
64,895

$
516,542


(1)Principal
and interest amounts payable in future periods on our U.S. Revolving Credit Agreement and U.K. Revolving Credit Agreement have been excluded from
the table above, as the amount that will be outstanding and interest rate during any fiscal year will be dependent upon future events which are not known at this time. As of January 29, 2011,
no amounts were outstanding under our U.S. Revolving Credit Agreement or our U.K. Revolving Credit Agreement.(2)Amounts
to be paid in future periods for real estate taxes, insurance, other operating expenses and contingent rent applicable to the properties pursuant to
the respective operating leases have been excluded from the table above, as the amounts payable in future periods are generally not specified in the lease agreements and are dependent on factors which
are not known at this time. Such amounts incurred in fiscal 2010 totaled approximately $11.3 million.(3)Amounts
reflected in the table reflect the maximum amount payable pursuant to a contingent consideration arrangement associated with the Lilly Pulitzer
acquisition, which totaled $20 million as of January 29, 2011. Amounts are payable if certain performance criteria related to the acquired business are met during the four years
subsequent to acquisition. As of January 29, 2011, our balance sheet reflects a liability of $10.7 million associated with this arrangement, which reflects the fair value of the
anticipated payments as of that date.(4)Amounts
totaling $9.7 million of deferred compensation obligations and obligations related to the postretirement benefit portions of
endorsement-type split dollar life insurance policies, which are included in other non-current liabilities in our consolidated balance sheet as of January 29, 2011, have
been excluded from the table above, due to the uncertainty of the timing of the payment of these obligations, which are generally at the discretion of the individual employees or upon the death of the
former employee, respectively.(5)An
environmental reserve liability of $1.9 million, which is included in other non-current liabilities in our consolidated balance sheet
as of January 29, 2011 and discussed in Note 6 to our consolidated financial statements included in this report, has been excluded from the above table, as we were not contractually
obligated to incur these costs as of January 29, 2011 and the timing of payment is uncertain.


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(6)Non-current
deferred tax liabilities of $28.8 million included in our consolidated balance sheet as of January 29, 2011 and
discussed in Note 8 to our consolidated financial statements included in this report have been excluded from the above table, as deferred income tax liabilities are calculated based on
temporary differences between the tax basis and book basis of assets and liabilities, which will result in taxable amounts in future years when the liabilities are settled at their reported financial
statement amounts. As the results of these calculations do not have a direct connection with the amount of cash taxes to be paid in any future periods, scheduling deferred income tax liabilities by
period could be misleading.


Our
anticipated capital expenditures for fiscal 2011, which are excluded from the table above as we are not contractually obligated to pay these amounts as of January 29, 2011,
are expected to be approximately $30 million. These expenditures are expected to consist primarily of costs associated with opening new retail stores and certain technology initiatives.

Dividend Declaration

On March 28, 2011, our Board of Directors approved a cash dividend of $0.13 per share payable on April 29, 2011 to
shareholders of record as of the close of business on April 15, 2011. Although we have paid dividends in each quarter since we became a public company in July 1960, we may discontinue or modify
dividend payments at any time if we determine that other uses of our capital, including but not limited to, payment of outstanding debt, repurchases of outstanding shares or funding of future
acquisitions, may be in our best interest; if our expectations of future cash flows and future cash needs outweigh the ability to pay a dividend; or if the terms of our credit facilities, the
indenture for the 113/8% Senior Secured Notes, other debt instruments, contingent consideration arrangements or applicable law limit our ability to pay dividends. We may borrow to fund
dividends in the short-term based on our expectation of operating cash flows in future periods subject to the terms and conditions of our credit facilities, the indenture for the
113/8% Senior Secured Notes or other debt instruments. All cash flow from operations will not necessarily be paid out as dividends in all periods.

Off Balance Sheet Arrangements

We have not entered into agreements which meet the SEC's definition of an off balance sheet financing arrangement, other than operating
leases, and have made no financial commitments to or guarantees with respect to any unconsolidated subsidiaries or special purpose entities.

CRITICAL ACCOUNTING POLICIES

The discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements,
which have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets,
liabilities, revenues and expenses and related disclosures. On an ongoing basis, we evaluate our estimates, including those related to receivables, inventories, goodwill, intangible assets, income
taxes, contingencies and other accrued expenses. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results
of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under
different assumptions or conditions. We believe that we have appropriately applied our critical accounting policies. However, in the event that inappropriate assumptions or methods were used relating
to the critical accounting policies below, our consolidated statements of operations could be misstated.

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The
detailed summary of significant accounting policies is included in Note 1 to our consolidated financial statements contained in this report. The following is a brief
discussion of the more significant accounting policies, estimates and methods we use.

Revenue Recognition and Accounts Receivable

Our revenue primarily consists of wholesale, retail store, restaurant and e-commerce sales. We consider revenue realized or
realizable and earned when the following criteria are met: (1) persuasive evidence of an agreement exists, (2) delivery has occurred, (3) our price to the buyer is fixed or
determinable, and (4) collectibility is reasonably assured.

In
the normal course of business we offer certain discounts or allowances to our wholesale customers. Wholesale operations' sales are recorded net of such discounts and allowances, as
well as advertising support not specifically relating to the reimbursement for actual advertising expenses by our customers and provisions for estimated returns. As certain allowances and other
deductions are not finalized until the end of a season, program or other event which may not have occurred yet, we estimate such discounts and allowances on an ongoing basis. Significant
considerations in determining our estimates for discounts, returns and allowances for wholesale customers include historical and current trends, agreements with customers, projected seasonal results,
an evaluation of current economic conditions and retailer performance. Actual discounts and allowances to our wholesale customers have not differed materially from our estimates in prior periods. As
of January 29, 2011, our total reserves for discounts and allowances were approximately $9.2 million and, therefore, if the allowances changed by 10% it would have a pre-tax
impact of $0.9 million on earnings from continuing operations.

In
circumstances where we become aware of a specific customer's inability to meet its financial obligations, a specific reserve for bad debts is taken as a reduction to accounts
receivable to reduce the net recognized receivable to the amount reasonably expected to be collected. For all other customers, we recognize estimated reserves for bad debts based on our historical
collection experience, the financial condition of our customers, an evaluation of current economic conditions and anticipated trends, each of which is subjective and requires certain assumptions.
Actual charges for uncollectible amounts have not differed materially from our estimates in prior periods. As of January 29, 2011, our allowance for doubtful accounts was approximately
$2.6 million, and therefore, if the allowance for doubtful accounts changed by 10% it would have a pre-tax impact of approximately $0.3 million on earnings from continuing
operations.

Inventories, net

For operating group reporting, inventory is carried at the lower of the first-in, first-out (FIFO) method cost
or market. We continually evaluate the composition of our inventories for identification of distressed inventory. In performing this evaluation we consider slow-turning products, prior
seasons' fashion products and current levels of replenishment program products as compared to future sales estimates. For wholesale inventory, we estimate the amount of goods that we will not be able
to sell in the normal course of
business and write down the value of these goods as necessary. For retail inventory, we provide an allowance for shrinkage and goods expected to be sold below cost. As the amount to be ultimately
realized for the goods is not necessarily known at period end, we must utilize certain assumptions considering historical experience, the age of the inventory, inventory quantity, quality and mix,
historical sales trends, future sales projections, consumer and retailer preferences, market trends and general economic conditions.

For
consolidated financial reporting, approximately $74.1 million of our inventories are valued at the lower of last-in, first-out (LIFO) method cost or
market after deducting the $46.0 million LIFO reserve as of January 29, 2011. Approximately $11.3 million of our inventories are valued at the lower

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of
FIFO cost or market as of January 29, 2011. As of January 29, 2011 and January 30, 2010, approximately 87% and 81%, respectively, of our inventories are accounted for using the
LIFO method. Generally, our inventories related to our domestic operations are valued at the lower of LIFO cost or market and our inventories related to our international operations are valued at the
lower of FIFO cost or market. LIFO inventory accounting adjustments are not allocated to our operating groups as LIFO inventory pools do not correspond to our operating group definitions. LIFO
reserves are based on the Producer Price Index as published by the United States Department of Labor. We write down inventories valued at the lower of LIFO cost or market when LIFO exceeds market
value. We consider LIFO accounting adjustments to not only include changes in the LIFO reserve, but also changes in markdown reserves which are considered in LIFO accounting. For operating group
reporting purposes included in Note 10 to our consolidated financial statements and in the results of operations in our Management's Discussion and Analysis of Financial Condition and Results
of Operations included in this report, the impact of LIFO accounting is included in Corporate and Other.

As
of January 29, 2011, we had recorded a reserve of approximately $0.8 million related to inventory on the lower of FIFO cost or market method. A 10% change in the amount
of markdowns for inventory valued on the lower of FIFO cost or market method as of January 29, 2011 would have a pre-tax impact of approximately $0.1 million on earnings from
continuing operations. A change in the markdowns of our inventory valued at the lower of LIFO cost or market method would not be expected to have a material impact on our consolidated financial
statements due to the existence of our significant LIFO reserve of $46.0 million, or 38% of the FIFO cost of the inventory, as of January 29, 2011. A change in inventory levels at the
end of future years compared to inventory balances as of January 29, 2011 could result in a material impact on our consolidated financial statements as such a change may erode portions of our
earlier base year layers for purposes of making our annual LIFO computation.

The
purchase method of accounting for business combinations requires that assets and liabilities, including inventories, are recorded at fair value at acquisition. In accordance with
U.S. GAAP, the definition of fair value of inventories acquired generally will equal the expected sales price less certain costs associated with selling the inventory, which may exceed the
actual cost of producing the acquired inventories. In determining the fair value of the acquired inventory, we must make certain assumptions regarding costs incurred prior to acquisition for the
acquired inventory, an appropriate profit allowance
and estimates of the costs to sell the inventory. Such estimates involve significant uncertainty, and if we had made different assumptions, the impact on our consolidated financial statements could be
significant. In accordance with U.S. GAAP, we recognized a write-up of inventories of approximately $1.8 million above the cost of acquired inventories to fair value in
connection with our acquisition of the Lilly Pulitzer brand and operations, which we included in our allocation of purchase price. Based on the inventory turn of the acquired inventories,
approximately $0.8 million of the write-up was recognized as additional cost of goods sold in fiscal 2010, and we anticipate that the remaining $1.0 million of the
write-up, which is included in inventories, net in our consolidated balance sheet as of January 29, 2011, will be recognized as cost of goods sold during the first quarter of fiscal
2011 as the acquired inventory is sold in the ordinary course of business.

Goodwill, net

Goodwill is recognized as the amount by which the cost to acquire a company or group of assets exceeds the fair value of assets
acquired less any liabilities assumed at acquisition. Such goodwill is allocated to the respective reporting unit at the time of acquisition. Goodwill is not amortized but instead is evaluated for
impairment annually or more frequently if events or circumstances indicate that the goodwill might be impaired. The evaluation of the recoverability of goodwill includes valuations of each applicable
underlying business using fair value techniques and market comparables which may include a discounted cash flow analysis or an independent appraisal. Significant estimates, some of

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which
require subjective judgment, included in such a valuation include future cash flow projections of the business, which are based on our future expectations for the business. Additionally, the
discount rate used in this analysis is an estimate of the risk-adjusted market-based cost of capital.

As
part of our annual impairment test, we use certain indicators to evaluate whether the carrying value of goodwill may not be recoverable, such as (i) negative operating cash
flow or a forecast that demonstrates declines in the operating cash flow of a reporting unit or the inability of a reporting unit to improve its operations to appropriate levels, (ii) a
significant adverse change in the business climate that could affect the value of an entity and (iii) whether the book value of our shareholders' equity exceeds our market capitalization. A
decrease in our market capitalization resulting from a decrease in our stock price, or a negative long-term performance outlook, could cause the carrying value of our reporting units to
exceed their fair values, which may result in an impairment loss. If our analysis indicates an impairment of goodwill balances, the impairment is recognized in the consolidated financial statements.

During
fiscal 2008, the price of our common stock declined significantly, particularly late in the third quarter and throughout the fourth quarter. As of January 31, 2009, the
carrying value of our net assets exceeded the fair value of our net assets, measured as market capitalization of our outstanding
common stock, plus a reasonable control premium, and the fair value of our outstanding debt. The analysis comparing our enterprise fair value to our book value along with consideration of the actual
and projected results of our reporting units indicated that it was appropriate to write off all goodwill in Tommy Bahama and Ben Sherman in fiscal 2008, resulting in a total goodwill impairment charge
of approximately $242.2 million. Additionally, all goodwill related to Oxford Apparel of $1.8 million was written off in fiscal 2008, which is included in discontinued operations in our
statements of operations. No impairment of goodwill was recognized in fiscal 2009 or fiscal 2010.

As
a result of our acquisition of the Lilly Pulitzer brand and operations, we allocated approximately $16.9 million of goodwill based on our preliminary fair value allocation. The
amount of goodwill ultimately recognized may change in the future if we revise our fair value allocation during the allocation period.

Intangible Assets, net

Intangible assets included in our consolidated balance sheet as of January 29, 2011 totaled approximately $166.7 million,
which includes approximately $6.0 million of customer relationships with finite lives and $160.7 million of trademarks with indefinite lives. At acquisition, we estimate and record the
fair value of purchased intangible assets, which primarily consist of trademarks and customer relationships. The fair values and useful lives of these intangible assets are estimated based on
management's assessment as well as independent third party appraisals in some cases. Such valuation may include a discounted cash flow analysis of anticipated revenues or cost savings resulting from
the acquired intangible asset using an estimate of a risk-adjusted market-based cost of capital as the discount rate.

Amortization
of intangible assets with finite lives, which primarily consist of customer relationships, is recognized over their estimated useful lives using a method of amortization
that reflects the pattern in which the economic benefits of the intangible assets are consumed or otherwise realized. We amortize our intangible assets with finite lives for periods of up to
15 years. The determination of an appropriate useful life for amortization is based on our plans for the intangible asset as well as factors outside of our control. Intangible assets with
finite lives are reviewed for impairment periodically if events or changes in circumstances indicate that the carrying amount may not be recoverable. If expected future undiscounted cash flows from
operations are less than their carrying amounts, an asset is determined to be impaired and a loss is recorded for the amount by which the carrying value of the

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asset
exceeds its fair value. Amortization related to intangible assets with finite lives totaled $1.0 million during fiscal 2010 and is anticipated to be approximately $1.2 million in
fiscal 2011.

Trademarks
with indefinite lives are not amortized but instead evaluated for impairment annually or more frequently if events or circumstances indicate that the intangible asset might be
impaired. The evaluation of the recoverability of trademarks with indefinite lives includes valuations based on a discounted cash flow analysis utilizing the relief from royalty method, among other
considerations. This approach is dependent upon a number of uncertain factors, including estimates of future net sales, growth rates, royalty rates for the trademarks and discount rates. Such
estimates involve significant uncertainty, and if our plans or anticipated results change, the impact on our financial statements could be significant. If this analysis indicates an impairment of a
trademark with an indefinite useful life, the amount of the impairment is recognized in the consolidated financial statements based on the amount that the carrying value exceeds the estimated fair
value of the asset.

As
a result of the impact of the difficult economic conditions on the operations of Tommy Bahama and Ben Sherman as well as the required use of higher discount rates than used in prior
years, we recognized approximately $65.4 million of impairment charges related to intangible assets in fiscal 2008. Charges of $17.1 million, $46.1 million and $2.2 million
were recognized in Tommy Bahama, Ben Sherman and Lanier Clothes, respectively. The fiscal 2008 impairment charges related to intangible assets resulted in a tax benefit in our consolidated statements
of operations. In fiscal 2009 and fiscal 2010, no impairment charges related to intangible assets were recognized.

As
a result of our acquisition of the Lilly Pulitzer brand and operations, we recognized $30.5 million of intangible assets including trademarks and customer relationships in our
consolidated balance sheet at acquisition using the methodology outlined above. These acquired intangible assets consist of $27.5 million of indefinite lived trademarks and $3.0 million
of definite lived customer relationships. The amount of intangible assets ultimately recognized may change in the future if we revise our fair value allocation during the allocation period.

Income Taxes

Significant judgment is required in determining the provision for income taxes for a company with global operations. The ultimate tax
outcome may be uncertain for many transactions. Our provisions are based on federal and projected state statutory rates and take into account our assessment of permanent book/tax differences, income
tax credits and uncertain tax positions. We estimate the effective tax rate for the full fiscal year and record a quarterly income tax provision in accordance with the anticipated annual rate. As the
fiscal year progresses, the estimate is refined based upon actual events and earnings (loss) by jurisdiction and to reflect changes in our judgment of the likely outcome of uncertain tax positions.
This estimation process periodically results in a change to the expected effective tax rate for the fiscal year. When this occurs, we adjust the income tax provision during the quarter in which the
change in estimate occurs so that the year-to-date provision reflects the expected annual rate. Income tax expense may also be adjusted for discrete events occurring during the
year, such as the enactment of tax rate changes or changes in uncertain tax positions, which are reflected in the quarter that the changes occur.

Business Combinations

We account for our business combinations using the purchase method of accounting. The cost of each acquired business is allocated to
the individual tangible and intangible assets acquired and liabilities assumed or incurred as a result of the acquisition based on their estimated fair values. The assessment of the estimated fair
values of assets and liabilities acquired requires us to make certain assumptions regarding the use of the acquired assets, anticipated cash flows, probabilities of cash flows,

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discount
rates and other factors. The methodology of determining the acquired fair value for inventories, goodwill and intangible assets are each discussed in more detail above.

As
part of our acquisition of the Lilly Pulitzer brand and operations, we have entered into certain contingent consideration arrangements with the sellers, whereby we will owe the
sellers contingent consideration if certain performance criteria related to the acquired business are attained. The purchase method of accounting requires that this contingent consideration is
recorded at fair value on the date of acquisition and adjusted periodically based on our estimates of fair value. Such valuation requires assumptions regarding anticipated cash flows, probabilities of
cash flows, discount rates and other factors. For the Lilly Pulitzer acquisition, the total contingent consideration that we may be required to pay totals $20 million; however, our estimate on
the date of acquisition of the fair value of this amount is approximately $10.5 million, which reflects the discounted fair value of the anticipated payments. This estimate of fair value
considers each of the assumptions discussed above. Such estimates involve significant uncertainty, and we expect that during the one year allocation period and subsequent to the allocation period, we
will gain better knowledge about the uncertainties, and we expect that it is very likely that we will revise our estimate of the fair value of this contingent consideration in future periods.
Additionally, the fair value will change each period with the recognition of interest expense resulting from the passage of time at the applicable discount rate as we approach the payment dates of the
contingent consideration. If our plans or the anticipated results of the acquired business change, the impact on our consolidated balance sheets and consolidated statements of operations could be
significant.

Based
on our current assumptions related to the contingent consideration valuation, we anticipate that the change in fair value associated with the contingent consideration arrangement
will be approximately $2.4 million during fiscal 2011 assuming there are no other changes to our assumptions related to the fair value of the contingent consideration arrangement. The change in
fair value of the contingent consideration in fiscal 2011 and subsequent periods could change significantly if our assumptions regarding the valuation of the contingent consideration change during
fiscal 2011.

We
anticipate that the allocation of purchase price will be revised during the allocation period as necessary when, and if, information becomes available to revise the fair value of the
assets acquired and the liabilities assumed. To the extent information to revise the allocation becomes available during the allocation period the allocation of the purchase price will be adjusted.
Should information become available after the allocation period indicating that adjustments to the allocation are appropriate, those adjustments will be included in operating results. The allocation
period will not exceed one year from the date of the acquisition. As we have not completed our valuation of assets and liabilities acquired, including the valuation of the contingent consideration, we
have not completed the purchase price allocation related to our December 21, 2011 acquisition of Lilly Pulitzer as discussed in Note 14 of our consolidated financial statements included
in this report.

For
the valuation of each of the acquired assets, including receivables, inventories, fixed assets, intangible assets, other assets and goodwill, and the acquired liabilities, including
accounts payable, accrued expenses, contingent consideration and any other liabilities, the assumptions that we made regarding the valuation of these assets could differ significantly from the
assumptions made by other parties. The use of different assumptions could result in materially different valuations for the acquired assets and liabilities assumed, which would impact the opening
balance sheet as well as the results of operations for future periods.

SEASONALITY

Although our various product lines are sold on a year-round basis, the demand for specific products or styles may be
seasonal. For example, the demand for Tommy Bahama and Lilly Pulitzer products in our principal markets is generally higher in the spring season and lower in the fall season.

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Typically,
our wholesale products are sold prior to each of the retail selling seasons, including spring, summer, fall and holiday. As the timing of product shipments and other events affecting the
retail business may vary, we do not believe that results for any particular quarter are necessarily indicative of results for the full fiscal year. In addition, we do not believe that the fiscal 2010
distribution of net sales and operating income is necessarily indicative of the expected distribution in future years as the information below does not reflect a full year's operations of Lilly
Pulitzer and individual quarters may be impacted by certain unusual or non-recurring items, economic conditions or other factors. The following table presents the percentage of net sales
and operating income by quarter (unaudited) for fiscal 2010:

First
Quarter

Second
Quarter

Third
Quarter

Fourth
QuarterNet sales

27%

24%

23%

26%Operating income

37%

27%

16%

20%


Item 7A.Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Risk

We are exposed to market risk from changes in interest rates on our indebtedness, which could impact our financial condition and
results of operations in future periods. Our objective is to limit the impact of interest rate changes on earnings and cash flow, primarily through a mix of fixed-rate and
variable-rate debt. This assessment also considers our need for flexibility in our borrowing arrangements resulting from the seasonality of our business, among other factors. We
continuously monitor interest rates to consider the sources and terms of our borrowing facilities in order to determine whether we have achieved our interest rate management objectives. None of our
debt was entered into for speculative purposes. Also, we generally do not engage in hedging activities with respect to our interest rate risk and generally do not enter into such any such hedging
transactions on a speculative basis.

As
of January 29, 2011, we had no debt outstanding which was subject to variable interest rates, although we did have debt subject to variable interest rates outstanding at
various times during fiscal 2010. Our lines of credit, which are based on variable interest rates, provide the necessary borrowing flexibility we require due to the seasonality of our business and our
need to fund certain product purchases with trade letters of credit. To the extent that the amounts outstanding under our variable-rate lines of credit change, our exposure to changes in
interest rates would also change. We do not believe that borrowings and interest rates, and therefore interest expense, for fiscal 2010 are necessarily indicative of borrowings in future periods given
our divestiture and acquisition activities in the fourth quarter of fiscal 2010, as well as other factors. After considering the impact of these transactions, we do not anticipate having a significant
amount of borrowings outstanding under our variable-rate lines of credits during fiscal 2011; however, we may have amounts outstanding under our variable-rate lines of credits
at certain times during fiscal 2011 based on our seasonal working capital requirements or if anticipated cash requirements exceed our current expectations. If we make changes to our capital structure
or acquire additional businesses in the future, such transactions could materially impact our borrowing levels on our variable-rate lines of credit and, thus, interest expense in future
periods as well.

As
of January 29, 2011, we had approximately $150 million aggregate principal amount of fixed-rate debt outstanding, consisting of our 113/8%
Senior Secured Notes, which have an effective interest rate of 12.0% and mature in July 2015. Such fixed-rate debt may result in higher interest expense than could be obtained under
variable interest rate arrangements in certain periods, but is primarily intended to provide long-term financing of our capital structure and minimize our exposure to increases in interest
rates. A change in the market interest rate impacts the fair value of our fixed-rate

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debt
but has no impact on interest incurred or cash flows. Even if we have a substantial amount of cash on hand, our ability to reduce the amount of our 113/8% Senior Secured Notes
outstanding may be limited until July 2012, without a significant costs.

Foreign Currency Risk

To the extent that we have assets and liabilities, as well as operations, denominated in foreign currencies that are not hedged, we are
subject to foreign currency transaction and translation gains and losses. We view our foreign investments as long-term and, as a result, we generally do not hedge such foreign investments.
We do not hold or issue any derivative financial instruments related to foreign currency exposure for speculative purposes.

We
receive United States dollars for most of our product sales. However, approximately 10% of our net sales for fiscal 2010 were denominated in currencies other than the United States
dollar. These sales primarily relate to Ben Sherman sales in the United Kingdom and Europe. A strengthening United States dollar could result in lower levels of sales and earnings in our consolidated
statements of operations in future periods, although the sales in foreign currencies could be equal to or greater than amounts as previously reported. Based on our net sales during fiscal 2010
denominated in foreign currencies, if the United States dollar had been 10% stronger against the British pound we would have experienced a decrease in net sales of approximately $6.2 million,
but the impact on operating income would have been immaterial.

Substantially
all of our inventory purchases, including goods for operations in the United Kingdom, from contract manufacturers throughout the world are denominated in United States
dollars. Purchase prices for our products may be impacted by fluctuations in the exchange rate between the United States dollar and the local currencies of the contract manufacturers, which may have
the effect of increasing our cost of goods sold in the future. Additionally, to the extent that the exchange rate between the United States dollar and the currency that the inventory will be sold in
changes, the gross margins of those businesses could be impacted significantly.

We
may from time to time purchase short-term foreign currency forward exchange contracts to hedge against changes in foreign currency exchange rates, and at
January 29, 2011, we were a party to approximately $16.5 million of such contracts that were unsettled. These contracts primarily consist of agreements to purchase U.S. dollars and sell
Euro. During fiscal 2010, foreign currency forward exchange contracts outstanding did not exceed $20 million at any time. When such contracts are outstanding, the contracts are marked to market
with the offset being recognized in other comprehensive income or our consolidated statement of operations if the transaction does or does not, respectively, qualify as a hedge in accordance with
U.S. GAAP.

Commodity and Inflation Risk

We are affected by inflation and changing prices primarily through the purchase of raw materials and finished goods and increased
operating costs to the extent that any such fluctuations are not reflected by adjustments in the selling prices of our products. Inflation/deflation risks are managed by each operating group through
selective price increases when possible, productivity improvements and cost containment initiatives. We do not enter into significant long-term sales or purchase contracts, and we do not
engage in hedging activities with respect to such risk. Based on purchases and negotiations for inventory purchases thus far in fiscal 2011, it appears that our gross margins will be impacted by
pricing pressures on raw materials, fuel, transportation and other costs necessary for the production and sourcing of apparel products during fiscal 2011 compared to fiscal 2010.

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Item 8.Financial Statements and Supplementary Data

OXFORD INDUSTRIES, INC.        CONSOLIDATED STATEMENTS OF OPERATIONS        (in thousands, except per share amounts)

Fiscal 2010

Fiscal 2009

Fiscal 2008Net sales

$
603,947

$
585,306

$
699,064Cost of goods sold


276,540


294,493


363,452Gross profit


327,407


290,813


335,612SG&A


301,002


282,489


325,342Amortization of intangible assets


973


1,217


2,800Change in fair value of contingent consideration


200





Impairment of goodwill and intangible assets








307,532302,175


283,706


635,674Royalties and other operating income


15,430


11,803


15,661Operating income (loss)


40,662


18,910


(284,401
)Gain on repurchase of 87/8% Senior Unsecured Notes








7,767Interest expense, net


19,887


20,469


21,317Earnings (loss) from continuing operations before income taxes


20,775


(1,559
)

(297,951
)Income taxes (benefit)


4,540


(2,945
)

(19,845
)Earnings (loss) from continuing operations


16,235


1,386


(278,106
)Earnings from discontinued operations, net of taxes


12,877


13,238


6,649Gain on sale of discontinued operations, net of taxes


49,546





Net earnings from discontinued operations


62,423


13,238


6,649Net earnings (loss)

$
78,658

$
14,624

$
(271,457
)Earnings (loss) from continuing operations, net of taxes per common share:Basic

$
0.98

$
0.09

$
(17.42
)Diluted

$
0.98

$
0.09

$
(17.42
)Earnings from discontinued operations, net of taxes per common share:Basic

$
0.78

$
0.81

$
0.42Diluted

$
0.78

$
0.81

$
0.42Gain on sale of discontinued operations, net of taxes per common share:Basic

$
3.00

$
0.00

$
0.00Diluted

$
2.99

$
0.00

$
0.00Net earnings from discontinued operations per common share:Basic

$
3.77

$
0.81

$
0.42Diluted

$
3.77

$
0.81

$
0.42Net earnings (loss) per common share:Basic

$
4.76

$
0.90

$
(17.00
)Diluted

$
4.75

$
0.90

$
(17.00
)Weighted average common shares outstanding:Basic


16,537


16,297


15,968Dilution


14


7


Diluted


16,551


16,304


15,968Dividends declared per common share

$
0.44

$
0.36

$
0.72


See accompanying notes.

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OXFORD INDUSTRIES, INC.        CONSOLIDATED BALANCE SHEETS        (in thousands, except par amounts)

January 29,
2011

January 30,
2010ASSETSCurrent Assets:Cash and cash equivalents

$
44,094

$
8,288Receivables, net


50,177


44,690Inventories, net


85,338


58,180Prepaid expenses, net


12,554


10,508Deferred tax assets


19,005


13,875Assets related to discontinued operations, net


57,745


56,365Total current assets


268,913


191,906Property and equipment, net


83,895


78,425Intangible assets, net


166,680


137,462Goodwill


16,866


Other non-current assets, net


22,117


17,381Total Assets

$
558,471

$
425,174LIABILITIES AND SHAREHOLDERS' EQUITYCurrent Liabilities:Trade accounts payable and other accrued expenses

$
83,211

$
68,249Accrued compensation


23,095


9,259Liabilities related to discontinued operations


40,785


18,942Total current liabilities


147,091


96,450Long-term debt, less current maturities


147,065


146,408Other non-current liabilities


55,441


49,478Non-current deferred income taxes


28,846


28,421Commitments and contingenciesShareholders' Equity:Common stock, $1.00 par value per common share


16,511


16,461Additional paid-in capital


96,597


91,840Retained earnings


90,739


19,356Accumulated other comprehensive loss


(23,819
)

(23,240
)Total shareholders' equity


180,028


104,417Total Liabilities and Shareholders' Equity

$
558,471

$
425,174


See
accompanying notes.

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Table of Contents

OXFORD INDUSTRIES, INC.        CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY        (in thousands)

Common
Stock

Additional
Paid-In
Capital

Retained
Earnings

Accumulated
Other
Comprehensive
Income (Loss)

TotalBalance, February 2, 2008


16,049

$
85,224

$
293,045

$
13,063

$
407,381Comprehensive income:Net earnings (loss) and other comprehensive income (loss)








(271,457
)

(40,668
)

(312,125
)Shares issued under stock plans, net of tax benefit of $0.3 million


375


(284
)







91Compensation expense for stock awards





3,485








3,485Repurchase of common stock


(558
)




558





Cash dividends declared








(11,525
)




(11,525
)Balance, January 31, 2009


15,866


88,425


10,621


(27,605
)

87,307Comprehensive income:Net earnings and other comprehensive income








14,624


4,365


18,989Shares issued under stock plans, net of tax provision of $0.4 million


595


(950
)







(355
)Compensation expense for stock awards





4,365








4,365Cash dividends declared








(5,889
)




(5,889
)Balance, January 30, 2010


16,461


91,840


19,356


(23,240
)

104,417Comprehensive income:Net earnings and other comprehensive income (loss)








78,658


(579
)

78,079Shares issued under stock plans, net of tax benefit of $0.1 million


50


224








274Compensation expense for stock awards





4,533








4,533Cash dividends declared








(7,275
)




(7,275
)Balance, January 29, 2011


16,511

$
96,597

$
90,739

$
(23,819
)
$
180,028


See
accompanying notes.

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OXFORD INDUSTRIES, INC.        CONSOLIDATED STATEMENTS OF CASH FLOWS        (in thousands)

Fiscal 2010

Fiscal 2009

Fiscal 2008Cash Flows From Operating Activities:Earnings (loss) from continuing operations

$
16,235

$
1,386

$
(278,106
)Adjustments to reconcile earnings (loss) from continuing operations to net cash provided by operating activities:Depreciation


17,840


19,207


20,849Amortization of intangible assets


973


1,217


2,800Impairment of goodwill and intangible assets








307,532Change in fair value of contingent consideration


200





Amortization/write-off of deferred financing costs and bond discount


1,952


3,370


2,921Gain on repurchase of 87/8% Senior Unsecured Notes








(7,767
)Stock compensation expense


4,549


4,003


3,420Loss on sale of property and equipment


376


2,147


128Deferred income taxes


(4,620
)

(8,114
)

(26,254
)Changes in working capital, net of acquisitions and dispositions:Receivables


162


1,250


20,405Inventories


(17,920
)

35,669


20,399Prepaid expenses


(369
)

79


1,327Current liabilities


22,340


(1,220
)

(17,113
)Other non-current assets


(1,260
)

(1,390
)

3,751Other non-current liabilities


(4,767
)

3,371


(2,443
)Net cash provided by operating activities


35,691


60,975


51,849Cash Flows From Investing Activities:Acquisitions, net of cash acquired


(58,303
)




Purchases of property and equipment


(13,328
)

(11,308
)

(20,038
)Other


78


11


237Net cash used in investing activities


(71,553
)

(11,297
)

(19,801
)Cash Flows From Financing Activities:Repayment of revolving credit arrangements


(172,082
)

(252,764
)

(373,088
)Proceeds from revolving credit arrangements


172,082


219,444


334,344Repayment of company owned life insurance policy loans


(4,125
)




Repurchase of 87/8% Senior Unsecured Notes





(166,805
)

(24,971
)Proceeds from the issuance of 113/8% Senior Secured Notes





146,029


Deferred financing costs paid





(5,049
)

(1,664
)Proceeds from issuance of common stock


177


8


91Dividends on common stock


(7,275
)

(5,889
)

(14,413
)Net cash used in financing activities


(11,223
)

(65,026
)

(79,701
)Cash Flows from Discontinued Operations:Net operating cash flows (used in) provided by discontinued operations


(19,930
)

20,594


38,513Net investing cash flows provided by (used in) discontinued operations


102,790


(15
)

(1,438
)Net cash provided by discontinued operations


82,860


20,579


37,075Net change in cash and cash equivalents


35,775


5,231


(10,578
)Effect of foreign currency translation on cash and cash equivalents


31


(233
)

(1,044
)Cash and cash equivalents at the beginning of year


8,288


3,290


14,912Cash and cash equivalents at the end of year

$
44,094

$
8,288

$
3,290Supplemental disclosure of cash flow information:Cash paid for interest, net, including interest paid for discontinued operations

$
18,560

$
20,051

$
21,900Cash paid for income taxes, including income taxes paid for discontinued operations

$
20,859

$
9,741

$
11,241


See accompanying notes.

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Table of Contents

OXFORD INDUSTRIES, INC.        NOTES TO CONSOLIDATED FINANCIAL STATEMENTS        January 29, 2011

Note 1. Summary of Significant Accounting Policies



We are an international apparel design, sourcing and marketing company featuring a diverse portfolio of owned lifestyle brands,
featuring Tommy Bahama, Ben Sherman and Lilly Pulitzer, as well as owned and licensed brands of tailored clothing and golf apparel. We distribute our owned lifestyle branded products through a variety
of upscale department stores and specialty stores as well as company owned retail stores and e-commerce websites. Additionally, we operate Tommy Bahama restaurants, which are generally
adjacent to certain of our Tommy Bahama retail stores. Our branded and private label tailored clothing products are distributed through department stores, specialty stores, national chains, specialty
catalogs, mass merchants and Internet retailers. Originally founded in 1942, we have undergone a transformation as we migrated from our historical domestic manufacturing roots towards a focus on
designing, sourcing and marketing apparel products bearing prominent trademarks owned by us.

Unless
otherwise indicated, all references to assets, liabilities, revenues and expenses in these financial statements reflect continuing operations and exclude any amounts related to
the discontinued operations of our former Oxford Apparel Group, as discussed in note 15.



Our fiscal year ends on the Saturday closest to January 31 and will, in each case, begin at the beginning of the day next
following the last day of the preceding fiscal year. As used in these financial statements, the terms listed below (or words of similar import) reflect the respective period noted:

Fiscal 2011

52 weeks ending January 28, 2012Fiscal 2010

52 weeks ended January 29, 2011Fiscal 2009

52 weeks ended January 30, 2010Fiscal 2008

52 weeks ended January 31, 2009




Our consolidated financial statements include the accounts of Oxford Industries, Inc. and any other entities in which we have a
controlling financial interest, including our wholly-owned domestic and foreign subsidiaries, or entities that meet the definition of a variable interest entity of which we are deemed to be the
primary beneficiary. In determining whether a controlling financial interest exists, we consider ownership of voting interests, as well as other rights of the investors. The results of operations of
acquired businesses are included in our consolidated statements of operations from the respective dates of the acquisitions. All significant intercompany accounts and transactions are eliminated in
consolidation.

We
account for investments in which we exercise significant influence, but do not control and have not been determined to be the primary beneficiary, using the equity method of
accounting. Significant influence is generally presumed to exist when we own between 20% and 50% of the entity. However, if we own a greater than 50% ownership interest in an entity and the minority
shareholders hold certain rights that allow them to approve or veto certain major decisions of the business, we would use the equity method of accounting. Under the equity method of accounting,
original investments are

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OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 1. Summary of Significant Accounting Policies (Continued)

recorded
at cost, and are subsequently adjusted for our contributions to, distributions from and share of income or losses of the entity. Allocations of income and loss and distributions by the entity
are made in accordance with the terms of the ownership agreement. We did not own any investments in an unconsolidated entity accounted for under the equity method as part of our continuing operations
in any period presented. Our investments accounted for under the equity method related to discontinued operations are included in assets related to discontinued operations, net in our consolidated
balance sheets, and the related income is included in earnings from discontinued operations in our consolidated statements of operations.



We account for our business combinations using the purchase method of accounting. The cost of each acquired business is allocated to
the individual tangible and intangible assets acquired and liabilities assumed based on their estimated fair values. The assessment of the estimated fair values of assets and liabilities acquired
requires us to make certain assumptions regarding the use of the acquired assets, anticipated cash flows, probabilities of cash flows, discount rates and other factors. The allocation may be revised
during an allocation period as necessary when, and if, information becomes available to revise the fair value of the assets acquired and the liabilities assumed. To the extent information to revise
the allocation becomes available during the allocation period, the allocation of the purchase price will be adjusted. Should information become available after the allocation period indicating that
adjustments to the allocation is appropriate, those adjustments will be included in operating results. The allocation period will not exceed one year from the date of the acquisition. As we have not
completed our valuation of assets and liabilities acquired, we have not completed the purchase price allocation related to our December 21, 2010 acquisition of the Lilly Pulitzer brand and
operations, as discussed in note 14.



Our revenue consists of wholesale, retail store, restaurant and e-commerce. We consider revenue realized or realizable and
earned when the following criteria are met: (1) persuasive evidence of an agreement exists, (2) delivery has occurred, (3) our price to the buyer is fixed or determinable and
(4) collectibility is reasonably assured.

For
sales within our wholesale operations, we consider a submitted purchase order or some form of electronic communication from the customer requesting the goods persuasive evidence of
an agreement. For substantially all of our wholesale sales, our products are considered sold and delivered at the time that the products are shipped, as substantially all products are sold based on
FOB shipping point terms. This generally coincides with the time that title passes and the risks and rewards of ownership have passed to the customer. For certain transactions in which the goods do
not pass through our owned or third party distribution centers and title and the risks and rewards of ownership pass at the time the goods leave the foreign port, revenue is recognized at that time.
In certain cases in which we retain the risk of loss during shipment, revenue recognition does not occur until the goods have reached the specified customer. Retail store revenue, concession revenue
and restaurant revenues are recorded at the time of sale to consumers. E-commerce revenue is recorded at the time of shipment to consumers. Retail store, e-commerce and
restaurant revenues are recorded net of

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OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 1. Summary of Significant Accounting Policies (Continued)

estimated
returns, as appropriate, and net of applicable sales taxes in our consolidated statements of operations.

In
the normal course of business we offer certain discounts or allowances to our wholesale customers. Wholesale operations' sales are recorded net of such discounts and allowances, as
well as advertising support not specifically relating to the reimbursement for actual advertising expenses by our customers and provisions for estimated returns. As certain allowances and other
deductions are not finalized until the end of a season, program or other event which may not have occurred yet, we estimate such discounts and allowances on an ongoing basis. Significant
considerations in determining our estimates for discounts, returns and allowances for wholesale customers include historical and current trends, agreements with customers, projected seasonal results,
an evaluation of current economic conditions and retailer performance. We record the discounts, returns and allowances as a reduction to net sales in our consolidated statements of operations. As of
January 29, 2011 and January 30, 2010, reserve balances related to these items were $9.2 million and $8.8 million, respectively.

In
circumstances where we become aware of a specific customer's inability to meet its financial obligations, a specific reserve for bad debts is taken as a reduction to accounts
receivable to reduce the net recognized receivable to the amount reasonably expected to be collected. Such amounts are written off at the time that the amounts are not considered collectible. For all
other customers, we recognize estimated reserves for bad debts based on our historical collection experience, the financial condition of our customers, an evaluation of current economic conditions and
anticipated trends, each of which is subjective and requires certain assumptions. We include such charges and write-offs in SG&A in our consolidated statements of operations. As of
January 29, 2011 and January 30, 2010, bad debt reserve balances were $2.6 million and $1.6 million, respectively.

We
have determined that gift card balances are unlikely to be redeemed once they have been outstanding for four years and therefore may be recognized as income, subject to applicable
laws in certain states. Gift card breakage is included in net sales in our consolidated statements of operations.

Royalties
from the license of our owned brands, which are generally based on the greater of a percentage of the licensee's actual net sales or a contractually determined minimum royalty
amount, are recorded based upon the guaranteed minimum levels and adjusted as sales data is received from licensees. In some cases, we may receive initial payments for the grant of license rights,
which are recognized as revenue over the term of the license agreement. Royalty income was $15.3 million, $11.6 million and $15.5 million during fiscal 2010, fiscal 2009 and
fiscal 2008, respectively and is included in royalties and other operating income in our consolidated statements of operations.



We include in cost of goods sold and inventories all manufacturing, sourcing and procurement costs and expenses incurred prior to or in
association with the receipt of finished goods at our distribution facilities. These costs principally include product cost, inbound freight charges, import costs, purchasing costs, internal transfer
costs, direct labor, manufacturing overhead, insurance, duties, brokers' fees and consolidators' fees. For retail operations, in-bound freight from our warehouse to our own retail stores
is also included.

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OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 1. Summary of Significant Accounting Policies (Continued)

Our
gross margins may not be directly comparable to those of our competitors, as statement of operations classifications of certain expenses may vary by company.



We include in SG&A costs incurred subsequent to the receipt of finished goods at our distribution facilities, such as the cost of
inspection, stocking, warehousing, picking and packing, and shipping and handling of goods for delivery to customers. SG&A also includes product design costs, selling costs, royalty costs,
advertising, promotion and marketing expenses, professional fees, other general and administrative expenses and our corporate overhead costs. Additionally, all costs associated with the operations of
our retail stores, concessions and restaurants, such as labor and occupancy costs and other fees, are included in SG&A.

Distribution
network costs, including shipping and handling, are included as a component of SG&A. We consider distribution network costs to be the costs associated with operating our
distribution centers, as well as the costs paid to third parties who perform those services for us. In fiscal 2010, fiscal 2009 and fiscal 2008, distribution network costs, including shipping and
handling, included in SG&A totaled approximately $21.6 million, $21.4 million and $28.3 million, respectively. We generally classify amounts billed to customers for shipping and
handling fees as revenues and classify costs related to shipping in SG&A in our consolidated statements of operations.

All
costs associated with advertising, promoting and marketing of our products are expensed during the period when the advertisement first shows. Costs associated with cooperative
advertising programs under which we agree to make general contributions to the customers' advertising and promotional funds are recorded as a reduction to net sales as recognized. If we negotiate an
advertising plan and share in the cost for an advertising plan that is for specific ads run for products purchased by the customer from us, and the customer is required to provide proof that the
advertisement was run, such costs are recognized as SG&A. Advertising, promotions and marketing expenses included in SG&A for fiscal 2010, fiscal 2009 and fiscal 2008 were $15.2 million,
$15.0 million and $23.8 million, respectively. Prepaid advertising, promotions and marketing expenses included in prepaid expenses in our consolidated balance sheets as of
January 29, 2011 and January 30, 2010 were $0.8 million and $0.8 million, respectively.

Royalties
related to our license of third party brands, which are generally based on the greater of a percentage of our actual net sales for the brand or a contractually determined
minimum royalty amount, are recorded based upon the guaranteed minimum levels and adjusted based on net sales of the branded products, as appropriate. In some cases, we may be required to make certain
up-front payments for the license rights, which are deferred and recognized as royalty expense over the term of the license agreement. Royalty expenses recognized as SG&A in fiscal 2010,
fiscal 2009 and fiscal 2008 were $3.4 million, $2.7 million and $5.1 million, respectively. Such amounts may be dependent upon sales of our products which we sell pursuant to the
terms of a license agreement with another party.



We consider cash equivalents to be short-term investments with original maturities of three months or less for purposes of
our consolidated statements of cash flows.

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OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 1. Summary of Significant Accounting Policies (Continued)



During fiscal 2010, in connection with our acquisition of the Lilly Pulitzer brand and operations, we accrued the fair value of
contingent consideration totaling $10.5 million as a non-cash investing activity. The timing of payment of the contingent consideration is dependent upon the acquired Lilly Pulitzer
business meeting certain earnings thresholds in the four years subsequent to acquisition. The amount to ultimately be paid is uncertain at this time, but the maximum amount payable is
$20 million in the aggregate.

During
fiscal 2010, in connection with our sale of substantially all of the operations and assets of our former Oxford Apparel Group, we accrued $5.4 million, which is payable to
us upon completion of the related working capital calculation, less the working capital shortfall, if any. This amount represents a non-cash investing activity. We anticipate that this
amount, as adjusted for the final working capital adjustment, if any, will be paid to us in the first quarter of fiscal 2011.



For operating group reporting, inventory is carried at the lower of FIFO cost or market. We continually evaluate the composition of our
inventories for identification of distressed inventory. In performing this evaluation we consider slow-turning products, prior-seasons' fashion products and current levels of replenishment
program products as compared to future sales estimates. For wholesale inventory, we estimate the amount of goods that we will not be able to sell in the normal course of business and write down the
value of these goods as necessary. For retail inventory, we provide an allowance for shrinkage and goods expected to be sold below cost. As the amount to be ultimately realized for the goods is not
necessarily known at period end, we must utilize certain assumptions considering historical experience, the age of the inventory, inventory quantity, quality and mix, historical sales trends, future
sales projections, consumer and retailer preferences, market trends and general economic conditions.

For
consolidated financial reporting, as of January 29, 2011 and January 30, 2010, approximately $74.1 million and $47.2 million of our inventories are valued
at the lower of LIFO cost or market after deducting our LIFO reserve, and approximately $11.3 million and $11.0 million of our inventories are valued at the lower of FIFO cost or market
as of January 29, 2011 and January 30, 2010, respectively. As of January 29, 2011 and January 30, 2010, approximately 87% and 81%, respectively, of our inventories are
accounted for using the LIFO method. Generally, inventories of our domestic operations are valued at the lower of LIFO cost or market, and our inventories of our international operations are valued at
the lower of FIFO cost or market. LIFO inventory accounting adjustments are not allocated to the respective operating groups as our LIFO inventory pool does not correspond to our operating group
definitions. LIFO reserves are based on the Producer Price Index as published by the United States Department of Labor. We write down inventories valued at the lower of LIFO cost or market when LIFO
cost exceeds market value. We consider LIFO accounting adjustments to not only include changes in the LIFO reserve, but also changes in markdown reserves which are considered in LIFO accounting. The
impact of accounting for inventories on the LIFO method is reflected in Corporate and Other for operating group reporting purposes included in Note 10.

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OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 1. Summary of Significant Accounting Policies (Continued)

The
purchase method of accounting for business combinations requires that assets and liabilities, including inventories, are recorded at fair value at acquisition. In accordance with
U.S. GAAP, the definition of fair value of inventories acquired generally will equal the expected sales price less certain costs associated with selling the inventory, which may exceed the
actual cost of the acquired inventories. In accordance with U.S. GAAP, we recognized a write-up of inventories in connection with our acquisition of the Lilly Pulitzer brand and
operations of approximately $1.8 million above the cost of the acquired inventories to fair value, which we included in our allocation of purchase price. Based on the inventory turn of the
acquired inventories, approximately $0.8 million of the write-up was recognized as additional cost of goods sold in fiscal 2010, and we anticipate that the remaining
$1.0 million of the write-up, which is included in inventories in our consolidated balance sheet as of January 29, 2011, will be recognized as cost of goods sold in the first
quarter of fiscal 2011.



Property and equipment, including leasehold improvements that are reimbursed by landlords as a tenant improvement allowance and any
assets under capital leases is carried at cost less accumulated depreciation. Additions are capitalized while repair and maintenance costs are charged to the statement of operations as incurred.
Depreciation is calculated using both straight-line and accelerated methods generally over the estimated useful lives of the assets as follows:

Buildings and improvements

7  40 yearsMachinery and equipment

2  15 yearsLeasehold improvements

Lesser of remaining life of the asset or lease term


Property
and equipment is reviewed periodically for impairment if events or changes in circumstances indicate that the carrying amount may not be recoverable. If expected future
undiscounted cash flows from operations are less than their carrying amounts, an asset is determined to be impaired and a loss is recorded for the amount by which the carrying value of the asset
exceeds its fair value.

Depreciation
expense for fiscal 2010, fiscal 2009 and fiscal 2008 included approximately $0.4 million, $2.3 million and $1.5 million, respectively, of impairment
charges for property and equipment. Substantially all of these charges were recorded in SG&A in our consolidated statements of operations.



Goodwill is recognized as the amount by which the cost to acquire a company or group of assets exceeds the fair value of assets
acquired less any liabilities assumed at acquisition. Such goodwill is allocated to the respective reporting unit at the time of acquisition. Goodwill is not amortized but instead is evaluated for
impairment annually or more frequently if events or circumstances indicate that the goodwill might be impaired. The evaluation of the recoverability of goodwill includes valuations of each applicable
underlying business using fair value techniques and market comparables which may include a discounted cash flow analysis or an independent appraisal. Significant estimates, some of which require
subjective judgment, included in such a valuation include future cash flow projections of the business, which are based on our future expectations for the business. Additionally, the discount

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rate
used in this analysis is an estimate of the risk-adjusted market-based cost of capital. The estimates and assumptions included in the valuation involve significant uncertainty, and if
our plans or anticipated results change, the impact on our financial statements could be significant.

We
test goodwill for impairment as of the first day of the fourth quarter of our fiscal year, which coincides with the timing of our annual budgeting process that is used in estimating
future cash flows for the analysis. In addition to the annual impairment test, we use certain indicators to evaluate whether it is more likely than not that the carrying value of goodwill may not be
recoverable, such as (i) negative operating cash flow or a forecast that demonstrates declines in the operating cash flow of a
reporting unit or the inability of a reporting unit to improve its operations to appropriate levels, (ii) a significant adverse change in the business climate that could affect the value of an
entity or (iii) whether the book value of our shareholders' equity exceeds our market capitalization. A sustained decrease in our market capitalization resulting from a decrease in our stock
price, or a negative long-term performance outlook, could cause the carrying value of our reporting units to exceed their fair values, which may result in an impairment loss. If our
analysis indicates an impairment of goodwill balances, the impairment is recognized in the consolidated financial statements.

During
fiscal 2008 the price of our common stock declined significantly, particularly late in the third quarter and throughout the fourth quarter. At the time of our impairment test
during the fourth quarter of fiscal 2008, the carrying value of our net assets exceeded the fair value of our net assets, measured as market capitalization of our outstanding common stock, plus a
reasonable control premium, and the fair value of our outstanding debt. The analysis comparing our enterprise fair value to our book value along with consideration of the actual and projected results
of our reporting units indicated that it was appropriate to write-off all goodwill in Tommy Bahama and Ben Sherman in fiscal 2008, resulting in a total goodwill impairment charge of
approximately $242.2 million. Additionally, in connection with this analysis, we also wrote off all goodwill related to Oxford Apparel, which is included in earnings from discontinued
operations. No impairment of goodwill was identified during any other periods presented.

As
of January 29, 2011, all the goodwill included in our consolidated balance sheet is deductible for tax purposes.



At acquisition, we estimate and record the fair value of purchased intangible assets, which primarily consist of trademarks and
customer relationships. The fair values and useful lives of these intangible assets are estimated based on our assessment as well as independent third party appraisals in some cases. Such valuations
may include a discounted cash flow analysis of anticipated revenues or cost savings resulting from the acquired intangible asset using an estimate of a risk-adjusted market-based cost of
capital as the discount rate.

Amortization
of intangible assets with finite lives, which primarily consist of customer relationships, is recognized over their estimated useful lives using a method of amortization
that reflects the pattern in which the economic benefits of the intangible assets are consumed or otherwise realized. We amortize our intangible assets with finite lives for periods of up to
15 years in some cases. The determination of an appropriate useful life for amortization is based on our plans for the intangible

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asset
as well as factors outside of our control, including expected customer attrition. Intangible assets with finite lives are reviewed for impairment periodically if events or changes in
circumstances indicate that the carrying amount may not be recoverable. If expected future undiscounted cash flows from operations are less than their carrying amounts, an asset is determined to be
impaired and a loss is recorded for the amount by which the carrying value of the asset exceeds its fair value.

Intangible
assets with indefinite lives, which primarily consist of trademarks, are not amortized but instead evaluated for impairment annually or more frequently if events or
circumstances indicate that the intangible asset might be impaired. The evaluation of the recoverability of trademarks with indefinite lives includes valuations based on a discounted cash flow
analysis utilizing the relief from royalty method, among other considerations. This approach to determining fair value is dependent upon a number of uncertain factors, including estimates of future
net sales, growth rates, royalty rates for the trademarks and discount rates. Such estimates and assumptions involve significant uncertainty, and if our plans or anticipated results change, the impact
on our financial statements could be significant. If this analysis indicates an impairment of a trademark with an indefinite useful life, the amount of the impairment is recognized in our consolidated
financial statements based on the amount that the carrying value exceeds the estimated fair value of the asset. We test intangible assets with indefinite lives for impairment as of the first day of
the fourth quarter of our fiscal year, which coincides with the timing of our annual budgeting process that is used in estimating future cash flows for the analysis.

Impairment
of intangible assets with finite and indefinite lives, which is included in impairment of goodwill and intangible assets in our consolidated statements of operations and
consolidated statements of cash flows, totaled approximately $65.4 million during fiscal 2008. These charges were impacted by the difficult economic conditions on the operations of our
operating groups as well as the required use of higher discount rates, among other factors. These impairment charges primarily related to the Tommy Bahama, Ben Sherman and Arnold Brant trademarks.
Certain trademarks in Oxford Apparel were also impaired during fiscal 2008, which are included in earnings from discontinued operations. No impairment of intangible assets with indefinite lives was
identified during any other periods presented.

Any
costs associated with extending or renewing recognized intangible assets, which primarily consist of trademarks and customer relationships, are generally expensed as incurred.



Amounts included in prepaid expenses primarily consist of prepaid operating expenses, including rent, taxes, insurance, royalties and
advertising. Other non-current assets primarily consist of investments related to our deferred compensation plan, deferred financing costs and certain investments in officers' life
insurance policies.

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Deferred financing costs, which are included in other non-current assets, net, are
amortized on a straight-line basis, which approximates the effective interest method over the life of the related debt. Amortization expense for deferred financing costs, which is included
in interest expense in the consolidated statements of operations was $1.3 million, $3.0 million and $2.7 million during fiscal 2010, fiscal 2009 and fiscal 2008, respectively.
Included in the amortization expense above were $1.8 million associated with the satisfaction and discharge of our 87/8% Senior Unsecured Notes recognized in fiscal 2009 and
$0.9 million associated with an amendment to certain of our financing arrangements in fiscal 2008. Unamortized deferred financing costs totaled approximately $4.9 million and
$6.2 million at January 29, 2011 and January 30, 2010, respectively.

Officers'
life insurance policies that are owned by us, which are included in other non-current assets, net, are recorded at their cash surrender value, less any outstanding
loans associated with the life insurance policies that are payable to the life insurance company with which the policy is outstanding. As of January 29, 2011 and January 30, 2010, the
officers' life insurance policies, net recorded in our consolidated balance sheets totaled approximately $5.1 million and $0.9 million, respectively. The increase in the balance
primarily relates to the $4.1 million payment of the loans associated with the life insurance policies during fiscal 2010.



We have a non-qualified deferred compensation plan offered to a select group of highly compensated employees. The plan
provides participants with the opportunity to defer a portion of their cash compensation in a given plan year, of which a percentage may be matched by us in accordance with the terms of the plan. We
make contributions to rabbi trusts or other investments to provide a source of funds for satisfying these deferred compensation liabilities. Investments held for our deferred compensation plan consist
of insurance contracts and are recorded based on valuations provided by insurance carriers, which may incorporate unobservable factors. A change in the value of the underlying assets would
substantially be offset by a change in the liability to the employee resulting in an immaterial net impact on our consolidated financial statements. These securities approximate the
participant-directed investment selections underlying the deferred compensation liabilities.

The
total value of the deferred compensation investments, which are included in other non-current assets, net, as of January 29, 2011 and January 30, 2010 was
$9.9 million and $9.0 million, respectively, substantially all of which are held in a rabbi trust. The liabilities associated with the non-qualified deferred compensation
plan are included in other non-current liabilities in our consolidated balance sheets and totaled approximately $9.8 million and $9.1 million at January 29, 2011 and
January 30, 2010, respectively.



Liabilities for trade accounts payable, accrued compensation and other accrued expenses are carried at cost, which is the fair value of
the consideration expected to be paid in the future for goods and services received, whether or not billed to us. Accruals for employee insurance and workers' compensation, which are included in
accounts payable and other accrued expenses in our consolidated balance sheets, include estimated settlements for known claims, as well as accruals for estimates of incurred but not reported claims
based on our claims experience and statistical trends.

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We
are subject to certain claims and assessments related to legal, environmental or tax items in the ordinary course of business. For those matters where it is probable that we have
incurred a loss and the loss, or range of loss, can be reasonably estimated, we have recorded reserves in the consolidated financial statements. In other instances, because of the uncertainties
related to both the probable outcome and amount or range of loss, we are unable to make a reasonable estimate of a liability, if any, and therefore have not recorded a reserve. As additional
information becomes available, we adjust our assessment and estimates of such liabilities accordingly.



Amounts included in other non-current liabilities primarily consist of deferred rent related to our lease agreements, as
discussed below and deferred compensation and income tax uncertainties, as discussed in Note 9 and Note 8, respectively.



In the ordinary course of business we enter into lease agreements for retail, office and warehouse/distribution space, as well as
leases for certain property and equipment. The leases have varying terms and expirations and frequently have provisions to extend, renew or terminate the lease agreement, among other terms and
conditions, as negotiated. We assess the lease at
inception and determine whether the lease qualifies as a capital or operating lease. Assets leased under capital leases and the related liabilities are included in our consolidated balance sheets in
property and equipment and long-term debt, respectively. Assets leased under operating leases are not recognized as assets and liabilities in our consolidated balance sheets.

When
a non-cancelable operating lease includes any fixed escalation clauses, lease incentives for rent holidays and/or landlord build-out-related
allowances, rent expense is recognized on a straight-line basis over the initial term of the lease from the date that we take possession of the space. The amount by which rents currently
payable under the lease differs from the average amount is recorded in other non-current liabilities in our consolidated balance sheets. Deferred rent as of January 29, 2011 and
January 30, 2010 was approximately $28.8 million and $30.3 million, respectively. Contingent rents, including those based on a percentage of retail sales over stated levels, and
rental payment increases based on a contingent future event are recognized as the expense is incurred.

If
we vacate leased space and determine that we do not plan to use the space in the future, we recognize a loss for any future rent payments, less any anticipated future sublease income
and adjusted for any deferred rent amounts included in our consolidated balance sheet on that date. Additionally, for any lease that we terminate and agree to a lease termination payment, we recognize
a loss for the lease termination payment at the time of the agreement. During fiscal 2010 and fiscal 2008, we recognized $2.8 million and $1.5 million of charges related to lease
termination losses and vacated leased office space that we do not intend to utilize in the future. No material charges related to lease terminations or vacated leased office space were incurred in
fiscal 2009.



Dividends are accrued at the time that the dividend is declared by our Board of Directors.

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Other comprehensive income (loss) includes all changes in equity from non-owner sources, such as foreign currency
translation adjustments and the net unrealized gain (loss) associated with forward foreign currency exchange contracts which qualify for hedge accounting. The following summary sets forth the
components of accumulated other comprehensive income (loss), net of tax (in thousands) which are included in shareholders' equity in our consolidated balance sheets.

Foreign Currency
Translation Gain
(Loss)

Net Unrealized Gain
(Loss) on Forward
Foreign Currency
Exchange Contracts

Total Accumulated
Other Comprehensive
Income (Loss)Balance, February 2, 2008

$
13,063

$


$
13,063Fiscal 2008 activity, net of income taxes


(40,668
)




(40,668
)Balance, January 31, 2009


(27,605
)




(27,605
)Fiscal 2009 activity, net of income taxes


4,365





4,365Balance, January 30, 2010


(23,240
)




(23,240
)Fiscal 2010 activity, net of income taxes


(536
)

(43
)

(579
)Balance, January 29, 2011

$
(23,776
)
$
(43
)
$
(23,819
)




Assets and liabilities denominated in amounts other than the functional currency are remeasured into the functional currency at the
rate of exchange in effect on the balance sheet date, and income and expenses are remeasured at the average rates of exchange prevailing during the relevant period. The impact of any such
remeasurement is recognized in our consolidated statements of operations in the respective period. Net gains (losses) related to foreign currency transactions were not material for fiscal 2010, fiscal
2009 and fiscal 2008. The financial statements of our subsidiaries for which the functional currency is a currency other than the United States dollar are translated into United States dollars at the
rate of exchange in effect on the balance sheet date for the balance sheet and at the average rates of exchange prevailing during the period for the statements of operations. The impact of such
translation is recognized in accumulated other comprehensive income (loss) in our consolidated balance sheets and included in other comprehensive income (loss) in our consolidated statements of
shareholders' equity.



We are exposed to foreign currency exchange risk when we purchase or sell goods in foreign currencies. Such exposures primarily result
from our U.K. business purchasing goods in U.S. dollars, Euro or other currencies, our U.K. business selling goods in U.S. dollars, Euro and other currencies and certain intercompany transactions
between our U.S. operations and U.K operations. We may enter into short-term forward foreign currency exchange contracts in the ordinary course of business to mitigate a portion of the
risk associated with foreign currency exchange rate fluctuations related to purchases of inventory or selling goods in currencies other than their functional currencies by certain of our foreign
subsidiaries. The fair value and book value of the forward foreign exchange contracts,

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which
is included in prepaid expenses or accounts payable and accrued expenses in our consolidated balance sheets, is based on dealer quotes of market forward rates and reflects the amount that we
would receive or pay at the short-term maturity dates for contracts involving the same currencies and maturity dates. Such contracts have not been entered into for speculative purposes.
All forward foreign currency exchange contracts that had not been settled as of January 29, 2011 have contractual settlement dates during fiscal 2011.

For
any forward foreign currency exchange contracts that are not designated as cash flow hedges for accounting purposes, the unrealized gains (losses) on outstanding forward foreign
currency exchange contracts are included in earnings (losses) from continuing operations as a component of SG&A in our consolidated statements of operations. The notional amount of forward foreign
currency exchange contracts which had not been settled that are not designated as cash flow hedges for accounting purposes totaled approximately $0.0 million and $7.0 million as of
January 29, 2011 and January 30, 2010, respectively.

For
any forward foreign currency exchange contracts that qualify as cash flow hedges for accounting purposes and have not been settled as of period-end, the unrealized gains
(losses) on outstanding forward foreign currency exchange contracts are recognized, to the extent the hedge relationship has been effective, as a component of accumulated other comprehensive income
(loss) in our consolidated balance sheets. Any ineffectiveness of these instruments is immediately recognized in our consolidated statements of operations as a component of SG&A similar to the policy
for such contracts not designated as hedges for accounting purposes. No significant ineffectiveness was recorded on designated hedges during fiscal 2010, fiscal 2009 and fiscal 2008. The notional
amount of forward foreign currency exchange contracts which had not been settled that qualify as hedges for accounting purposes totaled approximately $16.5 million and $0.0 million as of
January 29, 2011 and January 30, 2010, respectively. We measure effectiveness of our forward foreign currency exchange contracts that qualify as cash flow hedges, both at inception and
on an ongoing basis.



Fair value, in accordance with U.S. GAAP, is defined as the exchange price that would be received for an asset or paid to
transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. As such fair
value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. Valuation techniques include the market approach
(comparable market prices), the income approach (present value of future income or cash flow), and the cost approach (cost to replace the service capacity of an asset or replacement cost). These
valuation techniques may be based upon observable and unobservable inputs. The three levels of inputs used to measure fair value pursuant to the guidance are as follows:



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Our
financial instruments consist primarily of our cash and cash equivalents, accounts receivable, accounts payable, forward foreign currency exchange contracts, contingent purchase
price consideration and long-term debt. Given their short-term nature, the carrying amounts of cash and cash equivalents, receivables and accounts payable approximate their
fair values. Additionally, the carrying amounts of our variable-rate borrowings approximate fair value.

We
have determined that forward foreign currency exchange contracts in U.S. dollars and Euro with a notional amount of $16.5 million and $7.0 million as of
January 29, 2011 and January 30, 2010, respectively, are financial assets or financial liabilities measured at fair value on a recurring basis included in our consolidated balance
sheets. The fair value of these contracts was less than $0.1 million as of each of January 29, 2011 and January 30, 2010. Such amounts which were included in prepaid expenses and
accumulated comprehensive income in our consolidated financial statements was based on dealer quotes of market forward rates and reflects the amount that we would receive or pay at the
short-term maturity dates for contracts involving the same currencies and maturity dates. Based on these circumstances, we believe that these forward foreign currency exchange contracts
are most appropriately included within level 2 of the fair value hierarchy.

We
have determined that the $10.7 million of contingent purchase price consideration related to our acquisition of the Lilly Pulitzer brand and operations is a financial liability
measured at fair value on a recurring basis included in our consolidated financial statements as of January 29, 2011. The fair value and book value of the contingent purchase price
consideration are included in other non-current liabilities in our consolidated balance sheets and are based on our assumptions related to the probability of the aggregate
$20 million of potential contingent purchase price consideration being paid, discounted to present value. Based on these circumstances, we believe that this liability is most appropriately
classified within level 3 of the fair value hierarchy.

Recent
trades of our 113/8% Senior Secured Notes have indicated that the fair value of our 113/8% Senior Secured Notes is approximately $168 million
as of January 29, 2011; however, based on the limited trading activity of our 113/8% Senior Secured Notes, this amount may not necessarily be indicative of fair value. The net
book value of our 113/8% Senior Secured Notes as of January 29, 2011 is approximately $147.1 million. The significant terms of our debt arrangements are disclosed in
Note 5.

Additionally,
we have determined that our property and equipment, intangible assets and goodwill are non-financial assets measured at fair value on a
non-recurring basis. We have determined that our approaches for determining fair values for each of these assets generally are based on Level 3 inputs.



Our financial instruments that are exposed to concentrations of credit risk consist primarily of accounts receivable, for which the
total exposure is limited to the amount recognized in our consolidated balance sheets. We sell our merchandise to customers operating in a number of retail distribution channels in the United States,
as well as in some retail distribution channels in other

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countries.
We extend and continuously monitor credit risk based on an evaluation of the customer's financial condition and credit history and generally require no collateral. Credit risk is impacted
by conditions or occurrences within the economy and the retail industry and is principally dependent on each customer's financial condition. Additionally, a decision by the controlling owner of a
group of stores or any significant customer to decrease the amount of merchandise purchased from us or to cease carrying our products could have an adverse effect on our results of operations in
future periods. Nordstrom represented 14% of our consolidated accounts receivable, net as of January 29, 2011. During fiscal 2008, Macy's represented 11% of our consolidated net sales, while no
individual customer represented greater than 10% of our consolidated net sales in fiscal 2010 or fiscal 2009.

The
table below presents the percentages of net sales by any customer that represents 10% or more of the operating group's (and our consolidated total) net sales, including wholesale,
retail, restaurant and e-commerce sales, during the periods presented.

Fiscal 2010

Fiscal 2009

Fiscal 2008Tommy Bahama

10%

10%, 10%

13%, 10%Ben Sherman

11%

15%

13%Lanier Clothes

22%, 14%, 11%, 10%, 10%

28%, 16%, 13%, 11%

30%, 18%, 12%




We recognize deferred tax assets and liabilities based on the difference between the financial and the tax bases of the assets and
liabilities using enacted tax rates expected to apply to taxable income in the period in which such amounts are expected to be realized or settled. Our policy is to recognize net deferred tax assets,
whose realization is dependent upon taxable net earnings (loss) in future years, when a greater than 50% probability exists that the tax benefits will actually be realized some time in the future.
This is accomplished by recording a valuation allowance against deferred tax assets in the amount for which we believe there is not more than a 50% probability that a benefit will be realized.

There
are certain exceptions to the requirement that deferred tax liabilities be recognized for the difference in the financial and tax bases of assets in the case of foreign
subsidiaries. The excess of financial over tax basis of an investment in a foreign subsidiary in excess of undistributed earnings is not recognized if the investment is considered to be essentially
permanent in duration. We consider our investments in certain of our foreign subsidiaries to be permanently reinvested. For each of these entities, the tax basis equals or exceeds the financial basis
as of January 29, 2011.

Deferred
tax liabilities are also not required to be recognized for undistributed earnings of foreign subsidiaries when those earnings are considered to be permanently reinvested outside
the United States. The company does not consider the earnings of its foreign subsidiaries to be permanently reinvested outside the U.S., and therefore records the deferred tax liability on such
earnings in the year they are included in the financial statements.

We
utilize a two-step approach for evaluating tax positions. Under the two-step method, recognition occurs when we conclude that a tax position, based solely on
technical merits, is more-likely-than-not (greater than 50%) to be sustained upon examination. Measurement is only addressed if step one has been satisfied. The tax
benefit recorded is measured as the largest amount of

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Note 1. Summary of Significant Accounting Policies (Continued)

benefit,
determined on a cumulative probability basis, that is more-likely-than-not to be realized upon ultimate settlement. Those tax positions failing to qualify
for initial recognition are recognized in the first subsequent interim period they meet the more-likely-than-not standard, or are resolved through negotiation or
litigation with the taxing authority or upon expiration of the statute of limitations. Derecognition of a tax position that was previously recognized occurs when we subsequently determine that a tax
position no longer meets the more-likely-than-not threshold of being sustained.

We
file income tax returns in the United Sates and various state, local and foreign jurisdictions. Our federal, state, local and foreign income tax returns filed for the years ended on
or before June 2, 2006, with limited exceptions, are no longer subject to examination by tax authorities.

Interest
and penalties associated with unrecognized tax positions are recorded within income tax expense in our consolidated statements of operations.

We
generally receive a United States income tax benefit upon the exercise of our employee stock options and the vesting of stock granted to employees. The benefit is equal to the
difference between the fair market value of the stock at the time of the exercise and the option price, if any, times the approximate tax rate. We have recorded the benefit associated with the
exercise of employee stock
options and the vesting of stock granted to employees as a reduction to income taxes payable. To the extent compensation expense has been recorded, income tax expense is reduced. Any additional
benefit is recorded directly to shareholders' equity in our consolidated balance sheets. If a tax benefit is realized on compensation of an amount less than recorded for financial statement purposes,
the decrease in benefit is also recorded directly to shareholders' equity.



We have certain stock-based employee compensation plans as described in Note 7, which provide for the ability to grant
restricted stock, stock options and other stock-based awards to our employees and non-employee directors. We recognize share-based payments to employees and non-employee
directors in our consolidated statements of operations based on their fair values on the grant date.

Using
the fair value method, compensation expense, with a corresponding entry to additional paid-in capital, is recognized related to the issuance of restricted stock awards.
The awards which are unvested as of January 29, 2010 are dependent upon the employee remaining employed by us for a specified time subsequent to the grant date; however, some prior grants were
also dependent upon us meeting certain performance measures in one year and the employee remaining employed by us for a specified time subsequent to the performance period, if applicable. The amount
of compensation expense recognized over the performance, if any, and vesting period is calculated based upon the market value of the shares on the grant date. The compensation expense, less an
estimated forfeiture rate, if material, is recognized on a straight-line basis over the performance period, if any, and required service period. The estimated forfeiture rate is assessed
and adjusted periodically as appropriate.



Basic net earnings (loss) per share is calculated as net earnings divided by the weighted average number of common shares outstanding
during the period, including any unvested shares with

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Note 1. Summary of Significant Accounting Policies (Continued)

nonforfeitable
rights to dividends. Shares repurchased are removed from the weighted average number of common shares outstanding upon repurchase and delivery.

Diluted
net earnings (loss) per share is calculated similarly to basic net earnings (loss) per share, except that it also includes the potential dilution using the treasury stock method
that could occur if dilutive securities, including stock options, were exercised. The treasury stock method assumes that shares are issued for stock options that are "in the money," and that we use
the proceeds of such stock option exercises to repurchase shares at the average market value of our shares for the respective period. For purposes of the treasury stock method, proceeds consist of
cash to be paid, future compensation expense to be recognized and the amount of tax benefits, if any, which will be credited to additional paid-in capital assuming exercise of the stock
options. During fiscal 2010, fiscal 2009 and fiscal 2008, approximately 0.1 million, 0.1 million and 0.2 million, respectively, of stock options were excluded from our computation
of diluted earnings (loss) per share as the options were anti-dilutive. Thus, as very few of our outstanding stock options were dilutive during fiscal 2010, fiscal 2009 and fiscal 2008
outstanding stock options did not have a significant impact on weighted average shares outstanding during any period presented.



As discussed in Note 15, on January 3, 2011, we disposed of substantially all of the operations and assets of our former
Oxford Apparel operating group. The results of operations classified as discontinued operations in our consolidated balance sheets, consolidated statements of operations and consolidated statements of
cash flows for all periods presented include the operations of our former Oxford Apparel operating group, as reported historically, except that (1) the operations of our Oxford Golf business
and the operations of our Lyons, Georgia distribution center are reported within Corporate and Other as those operations were not sold and (2) certain corporate service costs which were
previously allocated to Oxford Apparel are reported as corporate service costs included in Corporate and Other as there is uncertainty in whether there will be a reduction in those costs as a result
of the Oxford Apparel sale.

With
respect to interest expense, we allocated all interest expense related to our U.S. Revolving Credit Agreement to earnings from discontinued operations as the net proceeds from the
transaction and the proceeds from the settlement of the retained assets and liabilities related to the discontinued operations, substantially all of which are expected to be converted into cash during
the first half of fiscal 2011, exceeded the amounts outstanding under our U.S. Revolving Credit Agreement during each of the periods presented. We did not allocate any interest related to our
113/8% Senior Secured Notes to discontinued operations. The income taxes for discontinued operations reflect the residual income tax expense after calculating the income taxes for
continuing operations, excluding the discontinued operations.



Although our various product lines are sold on a year-round basis, the demand for specific products or styles may be
seasonal. For example, the demand for Tommy Bahama and Lilly Pulitzer products in our principal markets is generally higher in the spring season and lower in the fall season. Typically, our wholesale
products are sold prior to each of the retail selling seasons, including spring,

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summer,
fall and holiday. As the timing of product shipments and other events affecting the retail business may vary, we do not believe that results for any particular quarter are necessarily
indicative of results for the full fiscal year. In addition, we do not believe that the fiscal 2010 distribution of net sales and operating income is necessarily indicative of the expected
distribution in future years as the information below does not reflect a full year's operations of Lilly Pulitzer and individual quarters may be impacted by certain unusual or
non-recurring items, economic conditions or other factors. The following table presents the percentage of net sales and operating income by quarter (unaudited) for fiscal 2010:

First Quarter

Second Quarter

Third Quarter

Fourth QuarterNet sales

27%

24%

23%

26%Operating income

37%

27%

16%

20%




The preparation of our consolidated financial statements in conformity with U.S. GAAP requires us to make certain estimates and
assumptions that affect the amounts reported as assets, liabilities, revenues and expenses in the consolidated financial statements and accompanying notes. Actual results could differ from those
estimates.

Note 2. Inventories

The components of inventories are summarized as follows (in thousands):

January 29,
2011

January 30,
2010Finished goods

$
122,159

$
89,980Work in process


5,744


6,971Fabric, trim and supplies


3,389


5,667LIFO reserve


(45,954
)

(44,438
)Total inventory

$
85,338

$
58,180


There
were no LIFO inventory liquidations in fiscal 2010. During fiscal 2009 and fiscal 2008, inventories valued on the LIFO basis declined, which resulted in a liquidation of LIFO
inventory carried at the lower costs prevailing in prior years. The impact of the liquidation in fiscal 2009 and fiscal 2008 was to decrease cost of goods sold as compared to the cost of current year
purchases by approximately $3.5 million and $1.2 million, respectively.

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OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 3. Property and Equipment, Net

Property and equipment, carried at cost, is summarized as follows (in thousands):

January 29,
2011

January 30,
2010Land

$
1,870

$
700Buildings


34,325


23,303Machinery and equipment


79,632


80,680Leasehold improvements


107,567


98,412Subtotal


223,394


203,095Less accumulated depreciation and amortization


(139,499
)

(124,670
)Total property and equipment, net

$
83,895

$
78,425


Note 4. Intangible Assets and Goodwill

Intangible assets by category are summarized below (in thousands):

January 29, 2011

January 30, 2010Intangible assets with finite lives, which primarily consist of customer relationships:Gross carrying amount

$
45,877

$
43,049Accumulated amortization


(39,856
)

(39,028
)Total intangible assets with finite lives, net


6,021


4,021Intangible assets with indefinite lives:Trademarks


160,659


133,441Total intangible assets, net

$
166,680

$
137,462


Based
on the current estimated useful lives assigned to our intangible assets, amortization expense for fiscal 2011, fiscal 2012, fiscal 2013, fiscal 2014 and fiscal 2015 is expected to
be $1.2 million, $1.0 million, $0.8 million, $0.6 million and $0.5 million, respectively.

During
fiscal 2008, we recognized intangible asset impairment charges of approximately $65.4 million. The method and assumptions used in determining the impairment charges are
discussed further in Note 1. Approximately $17.1 million, $46.1 million and $2.2 million of the charges relate to Tommy Bahama, Ben Sherman and Lanier Clothes,
respectively. No other periods presented included any intangible asset impairment charges.

Goodwill
as of February 2, 2008 primarily related to the acquisition of Tommy Bahama in June 2003, Ben Sherman in July 2004 and the third party buying agent utilized by Tommy
Bahama on February 1, 2008, and were allocated to the Tommy Bahama, Ben Sherman and Tommy Bahama operating groups, respectively. As a result of our goodwill impairment tests in fiscal 2008, we
determined that the goodwill associated with the Tommy Bahama and Ben Sherman businesses was impaired, and we wrote off all related goodwill amounts. No other periods presented included any

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OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 4. Intangible Assets and Goodwill (Continued)

goodwill
impairment charges. The changes in the carrying amount of goodwill by operating group and in total, for fiscal 2010, fiscal 2009 and fiscal 2008 are as follows (in thousands):

Tommy Bahama

Ben Sherman

Lilly Pulitzer

TotalBalance, February 2, 2008

$
204,423

$
51,651

$


$
256,074Impairment of goodwill


(204,423
)

(37,731
)




(242,154
)Impact of foreign currency exchange rate change prior to impairment of goodwill





(13,920
)




(13,920
)Balance, January 31, 2009











Activity











Balance, January 30, 2010











Acquisition








16,866


16,866Balance, January 29, 2011

$


$


$
16,866

$
16,866


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OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 5. Debt

The following table details our debt (in thousands) as of the dates specified:

January 29,
2011

January 30,
2010$175 million U.S. Secured Revolving Credit Facility ("U.S. Revolving Credit Agreement"), which is limited to a borrowing base consisting of
specified percentages of eligible categories of assets, accrues interest, unused line fees and letter of credit fees based upon a pricing grid which is tied to average unused availability, requires interest payments monthly with principal due at
maturity (August 2013) and is secured by a first priority security interest in the accounts receivable (other than royalty payments in respect of trademark licenses), inventory, investment property (including the equity interests of certain
subsidiaries), general intangibles (other than trademarks, trade names and related rights), deposit accounts, intercompany obligations, equipment, goods, documents, contracts, books and records and other personal property of Oxford Industries,
 Inc. and substantially all of its domestic subsidiaries and a second priority interest in those assets in which the holders of the 113/8% Senior Secured Notes have a first priority interest

$


$
£7 million Senior Secured Revolving Credit Facility ("U.K. Revolving Credit Agreement"), which accrues interest at the bank's
base rate plus as much as 3.5%, requires interest payments monthly with principal payable on demand and is collateralized by substantially all of the United Kingdom assets of Ben Sherman





11.375% Senior Secured Notes ("113/8% Senior Secured Notes"), which accrue interest at an annual rate of
11.375% (effective interest rate of 12%) and require interest payments semi-annually in January and July of each year, require payment of principal at maturity (July 2015), are subject to certain prepayment penalties, are secured by a first priority
interest in all U.S. registered trademarks and certain related rights and certain future acquired real property owned in fee simple of Oxford Industries, Inc. and substantially all of its consolidated domestic subsidiaries and a second priority
interest in those assets in which the lenders under the U.S. Revolving Credit Agreement have a first priority interest(1)


150,000


150,000Unamortized discount(1)


(2,935
)

(3,592
)Total debt


147,065


146,408Short-term debt and current maturities of long-term debt





Long-term debt, less current maturities

$
147,065

$
146,408


(1)In
June 2009, we issued the 113/8% Senior Secured Notes at 97.353% of the $150 million principal amount, resulting in gross proceeds
of $146.0 million.


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OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 5. Debt (Continued)




Our
credit facilities are used to finance trade letters of credit, as well to provide funding for other operating activities, capital expenditures and acquisitions. As of
January 29, 2011, approximately $29.9 million of trade letters of credit and other limitations on availability were outstanding against the U.S. Revolving Credit Agreement and the U.K.
Revolving Credit Agreement. On January 29, 2011, we had approximately $145.0 million and $7.5 million in unused availability under the U.S. Revolving Credit Agreement and the U.K.
Revolving Credit Agreement, respectively, subject to the respective limitations on borrowings set forth in the U.S. Revolving Credit Agreement, U.K. Revolving Credit Agreement and the indenture for
the 113/8% Senior Secured Notes.



Our credit facilities and 113/8% Senior Secured Notes are subject to a number of affirmative covenants regarding the
delivery of financial information, compliance with law, maintenance of property, insurance and conduct of business. Also, our credit facilities and 113/8% Senior Secured Notes are
subject to certain negative covenants or other restrictions including, among other things, limitations on our ability to (i) incur debt, (ii) guaranty certain obligations,
(iii) incur liens, (iv) pay dividends to shareholders, (v) repurchase shares of our common stock, (vi) make investments, (vii) sell assets or stock of subsidiaries,
(viii) acquire assets or businesses, (ix) merge or consolidate with other companies, or (x) prepay, retire, repurchase or redeem debt.

Our
U.S. Revolving Credit Agreement contains a financial covenant that applies only if unused availability under the U.S. Revolving Credit Agreement is less than the greater of
(i) $26.25 million or (ii) 15% of the total revolving commitments for three consecutive business days. In such case, our fixed charge coverage ratio, as defined in the U.S.
Revolving Credit Agreement, must not be less than 1.0 to 1.0 for the immediately preceding 12 fiscal months for which financial statements have been delivered. This financial covenant continues to
apply until we have maintained unused availability under the U.S. Revolving Credit Agreement of more than the greater of (i) $26.25 million or (ii) 15% of the total revolving
commitments for thirty consecutive days.

Additionally,
pursuant to the indenture governing our 113/8% Senior Secured Notes, our ability to incur certain indebtedness or to make certain restricted payments, as
defined in the indenture, is subject to our meeting certain conditions, including in each case the condition that our fixed charge coverage ratio, as defined in the indenture, not be less than 2.0 to
1.0 for the preceding four fiscal quarters on a pro forma basis after giving effect to the proposed indebtedness or restricted payment and, in the case of a restricted payment, the condition that the
aggregate total of all restricted payments not exceed a certain allowable amount calculated pursuant to a formula set forth in the indenture. Restricted payments under the indenture include, without
limitation, cash dividends to shareholders, repurchases of our capital stock, and certain investments.

We
believe that the affirmative covenants, negative covenants, financial covenants and other restrictions are customary for those included in similar facilities and notes entered into at
the time we entered into
these agreements. As of January 29, 2011, no financial covenant testing was required pursuant to our U.S. Revolving Credit Agreement as the minimum availability threshold was met. As of
January 29, 2011, we were compliant with all covenants related to our credit facilities and 113/8% Senior Secured Notes.

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OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 5. Debt (Continued)

At any time prior to July 15, 2012, we may redeem all or a portion of the 113/8% Senior Secured Notes,
on not less than 30 nor more than 60 days' prior notice, in amounts of $2,000 or an integral multiple of $1,000 in excess thereof, at a price equal to the greater of (i) 100% of the
aggregate principal amount of the 113/8% Senior Secured Notes to be redeemed, together with accrued and unpaid interest, if any, to the date of redemption or (ii) as determined
by an independent investment banker (as prescribed under the indenture), the sum of the present values of 105.688% of the principal amount of the 113/8% Senior Secured Notes being
redeemed plus scheduled payments of interest (not including any portion of such payments of interest accrued as of the date of redemption) from the date of redemption to July 15, 2012
discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the Adjusted Treasury Rate (as defined in the indenture)
plus 50 basis points, together with accrued and unpaid interest, if any, to the date of redemption.

On
or after July 15, 2012, we may redeem all or a portion of the 113/8% Senior Secured Notes, on not less than 30 nor more than 60 days' prior notice, in
amounts of $2,000 or an integral multiple of $1,000 in excess thereof at the following redemption prices (expressed as percentages of the principal amount), together with accrued and unpaid interest,
if any, to the redemption date, if redeemed during the 12-month period beginning July 15 of the years indicated below:

2012


105.688
%2013


102.844
%2014 and thereafter


100.000
%




In fiscal 2008, we repurchased in open market transactions approximately $33.2 million aggregate principal amount of an original
$200.0 million aggregate principal amount 87/8% Senior Unsecured Notes for approximately $25.0 million. The repurchase of the 87/8% Senior Unsecured Notes
and related write-off of approximately $0.4 million of deferred financing costs and unamortized debt discount associated with the 87/8% Senior Unsecured Notes
resulted in a gain of approximately $7.8 million. The remaining $166.8 million of 87/8% Senior Unsecured Notes were satisfied and discharged in fiscal 2009 in connection
with our issuance of the 113/8% Senior Secured Notes. Therefore, none of the 87/8% Senior Unsecured Notes were outstanding as of January 29, 2011 and
January 30, 2010.

Note 6. Commitments and Contingencies

We have operating lease agreements for buildings, retail space, sales offices and equipment with varying terms. The aggregate minimum base rental commitments for all
non-cancelable operating real property leases with original terms in excess of one year are $38.7 million, $37.4 million, $34.5 million, $31.0 million,
$26.1 million and $64.9 million for fiscal 2011, fiscal 2012, fiscal 2013, fiscal 2014, fiscal 2015 and thereafter, respectively. Total rent expense under all leases was
$43.3 million, $42.0 million and $42.0 million in fiscal 2010, fiscal 2009 and fiscal 2008, respectively. Most leases provide for payments of real estate taxes, insurance and
other operating expenses applicable to the property and many retail leases provide for contingent rent based on retail sales, which are included in total rent

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OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 6. Commitments and Contingencies (Continued)

expense.
However, these payments for real estate taxes, insurance, other operating expenses and contingent rent are not included in the aggregate minimum rental commitments above, as the amounts
payable in future periods are generally not specified in the lease agreement and are dependent on future events. The total amount of such charges were $11.3 million, $10.3 million and
$9.9 million, in fiscal 2010, fiscal 2009 and fiscal 2008, respectively, which includes $0.9 million, $0.6 million and $0.7 million, of percentage rent during fiscal 2010,
fiscal 2009 and fiscal 2008, respectively.

We
are also currently obligated under certain apparel license and design agreements to make future minimum royalty and advertising payments of $3.3 million, $1.7 million,
$1.3 million and $1.0 million for fiscal 2011, fiscal 2012, fiscal 2013 and fiscal 2014, respectively, and none thereafter. These amounts do not include amounts, if any, that exceed the
minimums required pursuant to the agreements.

In
connection with our acquisition of the Lilly Pulitzer brand and operations on December 21, 2010, as discussed in note 14, we entered into a contingent consideration
agreement pursuant to which we will be obligated to pay cash payments of up to $2.5 million subsequent to each of the four years following the closing of the acquisition and an additional
$10 million subsequent to the end of the fourth year, each contingent upon Lilly Pulitzer's achievement of certain financial targets. The fair value of this liability,
totaling $10.7 million as of January 29, 2010, is included in contingent acquisition payable in our consolidated balance sheet.

In
a prior fiscal year, we discovered the presence of hazardous waste on one of our properties. We believe that remedial action will be required, including continued investigation,
monitoring and treatment of groundwater and soil, although the timing of such remedial action is uncertain. As of January 29, 2011 and January 30, 2010, the reserve for the remediation
of this site was approximately $1.9 million and $4.1 million, respectively, which is included in other non-current liabilities in our consolidated balance sheets. The amount
recorded represents our estimate of the costs, on an undiscounted basis, to clean up this site, based on currently available information. This estimate may change in future periods as more information
on the remediation activities required and timing of those activities become known. The decrease in the reserve during fiscal 2010 was primarily due to a $2.2 million reduction in our estimate
of the costs required to remediate the property, as well as certain monitoring costs incurred during fiscal 2010. The change in estimate is included as a reduction of SG&A in our consolidated
statements of operations. No other significant amounts related to this reserve were recorded in the statement of operations in fiscal 2010, fiscal 2009 or fiscal 2008.

Note 7. Shareholders Equity



We had 60 million shares of $1.00 par value per share common stock authorized for issuance as of January 29, 2011 and
January 30, 2010. We had 16.5 million shares of common stock issued and outstanding as of each of January 29, 2011 and January 30, 2010.



As of January 29, 2011 approximately 1.0 million share awards were available for issuance under our Long-Term
Stock Incentive Plan (the "Long-Term Stock Incentive Plan"). The plan allows us to

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OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 7. Shareholders Equity (Continued)

grant
stock-based awards to employees and non-employee directors in the form of stock options, stock appreciation rights, restricted shares and/or restricted share units. Shares granted or
that may be granted pursuant to outstanding options under our previous stock incentive plans, our 1992 Stock Option Plan and our 1997 Stock Option Plan, continue to be governed under those plans and
the individual agreements with respect to provisions relating to exercise, termination and forfeiture. No additional grants are available under the previous plans. Since December 2003, performance-
and service-based restricted stock awards have been the primary vehicle in our stock-based compensation strategy, although we are not prohibited from granting other types of share-based compensation
awards.

Restricted
shares granted in recent years generally vest three or four years from the date of grant if the employee is still employed by us on that date. At the time that the shares are
issued, the shareholder is entitled to the same dividend and voting rights as other holders of our common stock unless the shares are subsequently forfeited. The employee is restricted from
transferring or selling the restricted shares and generally forfeits the shares upon the termination of employment prior to the end of the vesting period. The specific provisions of the awards,
including exercisability and term of the award, are evidenced by agreements with the employee as determined by our compensation committee or Board of Directors, as applicable.

The
table below summarizes the restricted stock award activity (in shares) during fiscal 2010, fiscal 2009 and fiscal 2008:

Fiscal 2010

Fiscal 2009

Fiscal 2008Number of
Shares

Weighted-
average
grant date
fair value

Number of
Shares

Weighted-
average
grant date
fair value

Number of
Shares

Weighted-
average
grant date
fair valueRestricted stock outstanding at beginning of fiscal period


810,500

$
15


353,657

$
24


72,864

$
42Restricted stock issued


90,000

$
22


597,870

$
11


346,975

$
23Restricted stock vested, including restricted stock repurchased from employee for employees' tax liability


(50,000
)
$
22


(88,692
)
$
25


(48,182
)
$
42Restricted stock forfeited


(70,000
)
$
18


(52,335
)
$
19


(18,000
)
$
24Restricted stock outstanding at end of fiscal period


780,500

$
16


810,500

$
15


353,657

$
24


In
addition, we grant restricted stock awards to our non-employee directors for a portion of each non-employee director's compensation. The
non-employee directors must complete certain service requirements; otherwise, the restricted shares are subject to forfeiture. On the date of issuance, the non-employee
directors are entitled to the same dividend and voting rights as other holders of our common stock. The non-employee directors are restricted from transferring or selling the restricted
shares prior to the end of the vesting period. As of January 29, 2011, less than 0.1 million of such awards were outstanding and unvested.

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OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 7. Shareholders Equity (Continued)

As
of January 29, 2011, there was approximately $4.0 million of unrecognized compensation expense related to unvested share-based compensation awards which have been
issued. That expense is expected to be recognized through the first half of fiscal 2013. The following table summarizes information about the unvested shares as of January 30, 2010.

Restricted Stock Grant

Number
of
Shares

Average Market
Price on
Date of Grant

Vesting
DateFiscal 2008 Transition Year Restricted Stock Awards


3,000

$
35

June 2011Fiscal 2008 Restricted Stock Awards


260,000

$
22

March 2011Fiscal 2009 Restricted Stock Awards


472,500

$
11

April 2013Fiscal 2010 Restricted Stock Awards


45,000

$
22

April 2013780,500


Prior
to and including December 2003 grants under our previous stock incentive plans, we typically granted stock options to employees at certain times as determined by our Board of
Directors or our compensation committee. Stock options were typically granted with an exercise price equal to the
stock's fair market value on the date of grant. The previously granted stock options, including those still outstanding, had ten-year terms and vested and became exercisable in increments
of 20% on each anniversary from the date of grant. The last stock options granted by us vested in fiscal 2008 resulting in all options outstanding also being exercisable subsequent to that date. The
total grant date fair value for options vesting in fiscal 2008 totaled $0.6 million. The total intrinsic value for stock options exercised during fiscal 2010, fiscal 2009 and fiscal 2008 was
$0.2 million, $0.1 million and $0.1 million, respectively, while the aggregate intrinsic value for options outstanding and exercisable as of January 29, 2011 was
approximately $0.4 million.

A
summary of the stock option activity during fiscal 2010, fiscal 2009 and fiscal 2008 is presented below:

Fiscal 2010

Fiscal 2009

Fiscal 2008Shares

Weighted
Average
Exercise
Price

Shares

Weighted
Average
Exercise
Price

Shares

Weighted
Average
Exercise
PriceStock options outstanding, beginning of fiscal period


191,105

$
25


203,245

$
25


231,865

$
25Stock options exercised


(16,005
)
$
12


(1,800
)
$
11


(8,240
)
$
19Stock options forfeited


(23,980
)
$
27


(10,340
)
$
21


(20,380
)
$
28Stock options outstanding and exercisable, end of fiscal year


151,120

$
26


191,105

$
25


203,245

$
25


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OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 7. Shareholders Equity (Continued)

The
following table summarizes information about our stock options outstanding, all of which are exercisable, as of January 29, 2011.

Date of Option Grant

Number of
Options Outstanding and
Exercisable

Exercise
Price

Grant-Date
Fair Value

Expiration DateJuly 16, 2001


6,870

$
10.73

$
3.18


July 16, 2011July 15, 2002


23,000

$
11.73

$
3.25


July 15, 2012August 18, 2003


61,900

$
26.44

$
11.57


Aug. 18, 2013December 16, 2003


59,350

$
32.75

$
14.17


Dec. 16, 2013151,120




On November 8, 2007, we entered into a $60 million accelerated share repurchase agreement with Bank of America, N.A., an
unrelated third party. On that date, we made a payment of $60 million to Bank of America that was funded by borrowings under our prior revolving credit agreement. Bank of America made an
initial delivery to us of approximately 1.9 million shares during the eight month transition period ended February 2, 2008 and a final delivery of approximately 0.6 million shares
during fiscal 2008 upon completion of the program. Pursuant to the accelerated share repurchase program we acquired an aggregate of approximately 2.5 million shares at a price of $24.03 per
share. The accelerated share repurchase program is complete and no additional shares will be received pursuant to the agreement.



There were approximately 0.6 million shares of common stock authorized for issuance under our Employee Stock Purchase Plan
("ESPP") as of January 29, 2011. The ESPP allows qualified employees to purchase shares of our common stock on a quarterly basis, based on certain limitations, through payroll deductions. The
shares purchased pursuant to the ESPP are not subject to any vesting or other restrictions. On the last day of each calendar quarter, the accumulated payroll deductions are applied toward the purchase
of our common stock at a price equal to 85% of the closing market price on that date. Stock compensation expense related to the employee stock purchase plan recognized was $0.1 million in each
of fiscal 2010, fiscal 2009 and fiscal 2008.



We had 30 million shares of $1.00 par value preferred stock authorized for issuance as of January 29, 2011. No shares
were issued or outstanding as of January 29, 2011 or January 30, 2010.

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OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 8. Income Taxes

The following table summarizes our distribution between domestic and foreign earnings (loss) from
continuing operations before income taxes and the provision (benefit) for income taxes related to continuing operations (in thousands):

Fiscal
2010

Fiscal
2009

Fiscal
2008Earnings (loss) from continuing operations before income taxes:Domestic

$
16,733

$
(3,864
)
$
(191,592
)Foreign


4,042


2,305


(106,359
)Earnings (loss) from continuing operations before income taxes

$
20,775

$
(1,559
)
$
(297,951
)Current:Federal

$
5,649

$
3,050

$
4,362State


2,162


1,107


702Foreign


1,698


1,106


7269,509


5,263


5,790DeferredFederal and State


(4,637
)

(8,030
)

(12,517
)DeferredForeign


(332
)

(178
)

(13,118
)Income Taxes

$
4,540

$
(2,945
)
$
(19,845
)


Reconciliations
of the United States federal statutory income tax rates and our effective tax rates are summarized as follows:

Fiscal
2010

Fiscal
2009

Fiscal
2008Statutory rate


35.0
%

35.0
%

35.0
%State income taxesnet of federal income tax benefit


0.5
%

26.8
%

0.2
%Impact of foreign earnings (loss)(1)


(0.8
)%

145.1
%

1.1
%Valuation allowance against foreign losses and other carryforwards(1)


(3.0
)%

(85.4
)%

Change in contingency reserves related to unrecognized tax benefits


(6.6
)%

4.5
%

0.2
%Impact of permanent differences related to life insurance investments and compensation


(2.2
)%

9.1
%

Impact of federal tax credits


(2.1
)%

28.1
%

Permanent reduction of available carryforwards


2.0
%




Other adjustment(2)


(2.5
)%

25.6
%

Impact of non-deductible goodwill impairment(3)








(29.4
)%Other, net


1.6
%

0.1
%

(0.4
)%Effective rate for continuing operations


21.9
%

188.9
%

6.7
%


(1)The
percentage in fiscal 2009 reflects the benefit of foreign losses, including the reversal of deferred taxes recorded on undistributed earnings in prior
years. A portion of this benefit is estimated to have a less than 50% probability of being realized and is therefore reduced by a valuation allowance.


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OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 8. Income Taxes (Continued)

(2)The
other adjustment in fiscal 2010 and fiscal 2009 reflects the change in the expected tax impact to be realized upon reversal of deferred tax assets and
liabilities, caused by changes in enacted foreign and state tax rates and apportionment of total taxable income among jurisdictions.(3)In
fiscal 2008, we recorded an impairment of goodwill which resulted in a non-deductible difference.


Deferred
tax assets and liabilities included in our consolidated balance sheets are comprised of the following (in thousands):

January 29,
2011

January 30,
2010Deferred Tax Assets:Inventories

$
7,555

$
7,311Accrued compensation and benefits


10,630


7,230Allowance for doubtful accounts


373


491Depreciation and amortization


9,924


11,187Non-current liabilities


743


1,583Deferred rent and lease obligations


1,766


978Operating loss carryforwards


1,385


2,128Other, net


5,412


4,184Deferred tax assets


37,788


35,092Deferred Tax Liabilities:Acquired intangible assets


45,175


46,588Foreign(1)


597


510Deferred tax liabilities


45,772


47,098Valuation allowance


1,857


2,539Net deferred tax liability

$
(9,841
)
$
(14,545
)


(1)As
of January 29, 2011 and January 30, 2010, we had undistributed earnings of foreign subsidiaries of approximately $8.7 million and
$7.1 million, respectively, which have been provided for in our income tax provision, as the earnings are not considered permanently reinvested outside of the United States. If the earnings
were repatriated to the United States, the earnings would be subject to United States taxation at that time. The amount of deferred tax liability recognized associated with the undistributed earnings
represents the approximate excess of the United States tax liability over the creditable foreign taxes paid that would result from a full remittance of undistributed earnings.


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OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 8. Income Taxes (Continued)




A
reconciliation of unrecognized tax benefits at the beginning and end of the year is as follows (in thousands):

Fiscal
2010

Fiscal
2009

Fiscal
2008Balance at beginning of period

$
4,402

$
4,558

$
5,082Additions for current year tax positions


15


32


29Expiration of the statute of limitation for the assessment of taxes


(1,402
)

(670
)

(362
)Additions for tax positions of prior year


153


691


133Reductions for tax positions of prior year


(24
)

(64
)

(324
)Settlements


(223
)

(145
)

Balance at end of period

$
2,921

$
4,402

$
4,558


The
unrecognized tax benefits, if recognized, would reduce our annual effective rate. The net impact on our statements of operations for potential interest expense related to these
unrecognized tax benefits was a benefit of $0.5 million in fiscal 2010 and expense of less than $0.1 million for each of fiscal 2009 and fiscal 2008. As of January 29, 2011 and
January 30, 2010, we have recognized in our consolidated balance sheets, total liabilities for potential penalties and interest, in the aggregate, of $0.5 million and
$0.9 million, respectively. It is reasonably possible that the amount of unrecognized benefit with respect to certain of our unrecognized tax positions will increase or decrease within the next
twelve months. Events that may cause these changes include the settlement of issues with taxing authorities or expiration of statutes of limitations. At this time, an estimate of the reasonably
possible changes cannot be made.

Note 9. Defined Contribution Plans

We have a tax-qualified voluntary retirement savings plan covering substantially all full-time United States employees and other similar plans covering certain
foreign employees. If a participant decides to contribute, a portion of the contribution is matched by us. Additionally, we incur certain charges related to our non-qualified deferred
compensation plan as discussed in Note 1. Realized and unrealized gains and losses on the deferred compensation plan investments are recorded in SG&A in our consolidated statements of
operations and substantially offset the changes in deferred compensation liabilities to participants resulting from changes in market values. Our aggregate expense under these defined contribution and
non-qualified deferred compensation plans in fiscal 2010, fiscal 2009 and fiscal 2008 were $1.1 million, $1.2 million and $2.1 million, respectively.

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 10. Operating Groups

Our business is primarily operated through our four operating groups: Tommy Bahama, Lilly Pulitzer,
Ben Sherman and Lanier Clothes. We identify our operating groups based on the way our management organizes the components of our business for purposes of allocating resources and assessing
performance. All amounts included in this report and in our consolidated financial statements reflect our changes in operating groups during fiscal 2010, including (1) the acquisition of
Sugartown resulting in the creation of our Lilly Pulitzer operating group, (2) the sale of substantially all of the operations and assets of our former Oxford Apparel operating group, which are
now classified as discontinued operations, (3) the reclassification of our Oxford Golf business and our Lyons, Georgia distribution center operations into Corporate and Other, as these
activities were previously included in Oxford Apparel, but will continue to be operated by us, and (4) the reclassification of certain corporate service costs from Oxford Apparel, where they
were previously allocated, to Corporate and Other, as there is uncertainty in whether there will be a reduction in those costs as a result of the Oxford Apparel sale.

Tommy
Bahama designs, sources and markets collections of men's and women's sportswear and related products. The target consumers of Tommy Bahama are affluent men and women age 35 and
older who embrace a relaxed and casual approach to daily living. Tommy Bahama products can be found in our owned and licensed Tommy Bahama retail stores and on our Tommy Bahama e-commerce
website, as well as in certain department stores and independent specialty stores throughout the United States. We also license the Tommy Bahama name for various product categories and operate Tommy
Bahama restaurants.

Lilly
Pulitzer designs, sources and distributes upscale collections of women's and girl's dresses, sportswear and other products. Lilly Pulitzer was originally created in the late 1950's
and is an affluent brand with heritage and aesthetic based on the Palm Beach resort lifestyle. The brand is somewhat unique among women's brands in that it has demonstrated multi-generational appeal.
The brand targets three distinct groups of women: young women recently graduated from college; young mothers and their daughters; and women who are not tied to the academic calendar. Lilly Pulitzer
products can be found in our owned Lilly Pulitzer stores, in Lilly Pulitzer Signature Stores and on our Lilly Pulitzer website, as well as in certain department stores and a variety of independent
specialty stores. We also license the Lilly Pulitzer name for various product categories.

Ben
Sherman is a London-based designer, marketer and distributor of men's branded sportswear and related products. Ben Sherman was established in 1963 as an edgy, "Mod"-inspired shirt
brand and has evolved into a British lifestyle brand of apparel targeted at style conscious men ages 25 to 40 in multiple markets throughout the world. Ben Sherman products can be found in certain
department stores, a variety of independent specialty stores and our owned and licensed Ben Sherman retail stores, as well as on Ben Sherman e-commerce websites. We also license the Ben
Sherman name for various product categories.

Lanier
Clothes designs and markets branded and private label men's tailored clothing including suits, sportcoats, suit separates and dress slacks across a wide range of price points.
Certain Lanier Clothes products are sold using trademarks licensed to us by third parties, including Kenneth Cole, Dockers, and Geoffrey Beene. Lanier Clothes also offers branded products under our
Billy London and Arnold Brant trademarks. In addition to the branded businesses, Lanier Clothes designs and sources certain private label products for certain customers. Significant private label
brands include Stafford,

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 10. Operating Groups (Continued)

Lands'
End, Alfani, Structure and Kenneth Roberts. Our Lanier Clothes products are sold to national chains, department stores, specialty stores, specialty catalog retailers and discount retailers
throughout the United States.

Corporate
and Other is a reconciling category for reporting purposes and includes our corporate office, substantially all financing activities, elimination of inter-segment sales, LIFO
inventory accounting adjustments, other costs that are not allocated to the operating groups and operations of our other businesses which are not included in our four operating groups. LIFO inventory
calculations are made on a legal entity basis which does not correspond to our operating group definitions; therefore, LIFO inventory accounting adjustments are not allocated to operating groups. The
operations of businesses that are included in Corporate and Other include our Oxford Golf business and our Lyons, Georgia distribution center operations.

The
tables below presents certain information about our operating groups included in continuing operations (in thousands):

Fiscal
2010

Fiscal
2009

Fiscal
2008Net SalesTommy Bahama

$
398,510

$
363,084

$
421,687Lilly Pulitzer


5,959





Ben Sherman


86,920


102,309


133,522Lanier Clothes


103,733


114,542


135,581Corporate and Other


8,825


5,371


8,274Total

$
603,947

$
585,306

$
699,064DepreciationTommy Bahama

$
13,411

$
14,576

$
16,667Lilly Pulitzer


150





Ben Sherman


2,173


3,000


2,367Lanier Clothes


462


528


884Corporate and Other


1,644


1,103


931Total

$
17,840

$
19,207

$
20,849Amortization of Intangible AssetsTommy Bahama

$
693

$
888

$
1,418Lilly Pulitzer


13





Ben Sherman


267


329


1,322Lanier Clothes








60Corporate and Other








Total

$
973

$
1,217

$
2,800


106

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 10. Operating Groups (Continued)

Fiscal
2010

Fiscal
2009

Fiscal
2008Impairment of Goodwill and Intangible AssetsTommy Bahama

$


$


$
221,559Lilly Pulitzer








Ben Sherman








83,766Lanier Clothes








2,207Corporate and Other








Total

$


$


$
307,532Operating Income (Loss)Tommy Bahama

$
51,081

$
37,515

$
(173,448
)Lilly Pulitzer


(372
)




Ben Sherman


(2,664
)

(8,616
)

(84,988
)Lanier Clothes


14,316


12,389


(8,283
)Corporate and Other


(21,699
)

(22,378
)

(17,682
)Total Operating Income (Loss)


40,662


18,910


(284,401
)Gain on repurchase of 87/8% Senior Unsecured Notes








7,767Interest expense, net


19,887


20,469


21,317Earnings (Loss) From Continuing Operations Before Income Taxes

$
20,775

$
(1,559
)
$
(297,951
)Purchases of Property and EquipmentTommy Bahama

$
11,225

$
5,618

$
15,020Lilly Pulitzer


277





Ben Sherman


963


3,442


1,836Lanier Clothes


30


21


186Corporate and Other


833


2,227


2,996Total

$
13,328

$
11,308

$
20,038


107

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 10. Operating Groups (Continued)



January 29,
2011

January 30,
2010Total AssetsTommy Bahama

$
274,140

$
256,759Lilly Pulitzer


79,476


Ben Sherman


67,478


69,775Lanier Clothes


35,530


39,213Corporate and Other


44,102


3,062Assets related to Discontinued Operations


57,745


56,365Total

$
558,471

$
425,174Intangible Assets, netTommy Bahama

$
112,480

$
113,173Lilly Pulitzer


30,488


Ben Sherman


23,712


24,289Lanier Clothes





Corporate and Other





Total

$
166,680

$
137,462


Information
for the net book value of our long-lived assets, including property and equipment, goodwill and intangible assets, by geographic area is presented below (in
thousands):

January 29,
2011

January 30,
2010United States

$
239,041

$
185,595United Kingdom


26,687


28,276Other foreign


1,713


2,016Total

$
267,441

$
215,887


Information
for the net sales recognized by geographic area is presented below (in thousands):

Fiscal
2010

Fiscal
2009

Fiscal
2008United States and Canada

$
541,750

$
508,917

$
591,473United Kingdom and Europe


58,465


71,806


100,060Other


3,732


4,583


7,531Total

$
603,947

$
585,306

$
699,064


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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 11. Related Party Transactions

SunTrust Banks, Inc. and its subsidiaries ("SunTrust") is one of our principal shareholders, holding shares of our common stock in various fiduciary and agency capacities.
Mr. J. Hicks Lanier, our Chief Executive Officer, is on the board of directors of SunTrust and is a member of its Audit and Risk Committees. Mr. E. Jenner Wood, III, a board member of
Oxford Industries, Inc., has been Chairman, President and CEO of SunTrust Bank, Atlanta/Georgia Division since April 2010 and was previously Chairman, President and Chief Executive Officer of
SunTrust Bank, Central Group, during fiscal 2010, fiscal 2009 and fiscal 2008.

We
maintain a syndicated credit facility under which SunTrust serves as agent and lender and a SunTrust affiliate acted as a joint book-running manager in connection with our
2009 offering of the 113/8% Senior Secured Notes and as a dealer-manager in connection with the accompanying tender offer for our 87/8% Senior Unsecured Notes. The
services provided and fees paid to SunTrust in connection with such services for each period are set forth below (in thousands):

Service

Fiscal
2010

Fiscal
2009

Fiscal
2008Interest and agent fees for our credit facility

$
303

$
353

$
1,146Cash management and senior notes related services

$
66

$
85

$
93Book-running manager and dealer-manager fees

$


$
750

$
Other

$
8

$
8

$
8


Our
aggregate payments to SunTrust and its subsidiaries for these services did not exceed 1% of our gross revenues during the periods presented or 1% of SunTrust's gross revenues during
its fiscal years ended December 31, 2010, December 31, 2009 and December 31, 2008.

In
connection with our acquisition of the Lilly Pulitzer brand and operations on December 21, 2010, we entered into a contingent consideration agreement pursuant to which the
beneficial owners of the capital stock of Sugartown prior to the acquisition will be entitled to earn up to an additional $20 million in cash, in the aggregate, over the four years following
the closing of the acquisition based on our Lilly Pulitzer Group's achievement of certain financial targets. The beneficial owners of the capital stock of Sugartown prior to the acquisition continue
to manage the Lilly Pulitzer operations subsequent to the acquisition.

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 12. Summarized Quarterly Data (unaudited)

Each of our fiscal quarters consists of thirteen week periods, beginning on the first day after the end of
the prior fiscal quarter. Following is a summary of our fiscal 2010 and fiscal 2009 quarterly results, as modified to reflect the reclassification of substantially all of our Oxford Apparel operations
to discontinued operations (in thousands, except per share amounts):

Fiscal 2010

First
Quarter

Second
Quarter

Third
Quarter

Fourth
Quarter

TotalNet sales

$
163,625

$
142,981

$
139,627

$
157,714

$
603,947Cost of goods sold


73,918


63,963


65,942


72,717


276,540Gross profit


89,707


79,018


73,685


84,997


327,407SG&A


78,009


71,324


70,995


80,674


301,002Amortization of intangible assets


240


238


241


254


973Change in fair value of contingent consideration











200


200Royalties and other operating income


3,513


3,723


3,982


4,212


15,430Operating income


14,971


11,179


6,431


8,081


40,662Interest expense, net


4,967


5,053


5,095


4,772


19,887Earnings from continuing operations, before income taxes


10,004


6,126


1,336


3,309


20,775Income taxes


1,480


1,447


17


1,596


4,540Earnings from continuing operations


8,524


4,679


1,319


1,713


16,235Net earnings from discontinued operations, including gain on sale of discontinued operations, net of taxes


3,973


2,540


4,231


51,679


62,423Net earnings

$
12,497

$
7,219

$
5,550

$
53,392

$
78,658Earnings from continuing operations per common share:Basic

$
0.52

$
0.28

$
0.08

$
0.10

$
0.98Diluted

$
0.52

$
0.28

$
0.08

$
0.10

$
0.98Net earnings from discontinued operations per common share:Basic

$
0.24

$
0.15

$
0.26

$
3.12

$
3.77Diluted

$
0.24

$
0.15

$
0.26

$
3.12

$
3.77Net earnings per common share:Basic

$
0.76

$
0.44

$
0.34

$
3.23

$
4.76Diluted

$
0.76

$
0.44

$
0.33

$
3.22

$
4.75Weighted average common shares outstanding:Basic


16,491


16,540


16,564


16,552


16,537Diluted


16,503


16,552


16,576


16,562


16,551


110

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 12. Summarized Quarterly Data (unaudited) (Continued)

Fiscal 2009

First
Quarter

Second
Quarter

Third
Quarter

Fourth
Quarter

TotalNet sales

$
155,236

$
144,397

$
142,274

$
143,399

$
585,306Cost of goods sold


77,399


76,314


74,163


66,617


294,493Gross profit


77,837


68,083


68,111


76,782


290,813SG&A


72,125


68,806


66,896


74,662


282,489Amortization of intangible assets


298


306


307


306


1,217Royalties and other operating income


2,264


2,508


3,266


3,765


11,803Operating income


7,678


1,479


4,174


5,579


18,910Interest expense, net, including write-off of deferred financing costs


4,230


6,037


5,079


5,123


20,469Earnings (loss) from continuing operations, before income taxes


3,448


(4,558
)

(905
)

456


(1,559
)Income taxes


184


(1,495
)

(982
)

(652
)

(2,945
)Earnings (loss) from continuing operations


3,264


(3,063
)

77


1,108


1,386Net earnings from discontinued operations, net of taxes


3,347


2,883


4,228


2,780


13,238Net earnings (loss)

$
6,611

$
(180
)
$
4,305

$
3,888

$
14,624Earnings (loss) from continuing operations per common share:Basic

$
0.21

$
(0.19
)
$
0.00

$
0.07

$
0.09Diluted

$
0.21

$
(0.19
)
$
0.00

$
0.07

$
0.09Net earnings from discontinued operations per common shareBasic

$
0.21

$
0.18

$
0.26

$
0.17

$
0.81Diluted

$
0.21

$
0.18

$
0.26

$
0.17

$
0.81Net earnings (loss) per common share:Basic

$
0.42

$
(0.01
)
$
0.26

$
0.24

$
0.90Diluted

$
0.42

$
(0.01
)
$
0.26

$
0.24

$
0.90Weighted average common shares outstanding:Basic


15,876


16,288


16,522


16,503


16,297Diluted


15,876


16,288


16,533


16,517


16,304


The
sum of the quarterly earnings (loss) from continuing operations per common share, earnings from discontinued operations per common share and net earnings (loss) per common share
amounts may not equal the amounts for the full year due to rounding. Additionally, the sum of earnings (loss) from continuing operations per common share and net earnings (loss) from discontinued
operations per common share may not equal net earnings (loss) per common share for each quarter due to rounding.

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 12. Summarized Quarterly Data (unaudited) (Continued)

The
fourth quarter of fiscal 2010 included the following significant items which impacted earnings from continuing operations for the quarter: (1) the acquisition of Lilly
Pulitzer as discussed in Note 14, including the $0.8 million of transaction costs associated with the transaction and the $0.8 million of additional cost of goods over cost
resulting from the write-up of acquired inventory from cost to fair value pursuant to the purchase method of accounting, (2) $3.2 million of charges in Ben Sherman, primarily
related to the termination of certain lease agreements and the impairment of certain fixed assets, (3) the $2.2 million reduction of an environmental reserve liability and (4) the
$2.4 million LIFO accounting charge. The fourth quarter of fiscal 2009 included the following significant items which impacted earnings from continuing operations for the quarter:
(1) $1.2 million of restructuring and fixed asset impairment charges and (2) a $1.7 million LIFO accounting credit. Additionally, the fourth quarter of fiscal 2010 included
the sale of substantially all of the operations and assets of our former Oxford Apparel Group resulting in a gain of approximately $49.5 million which is included in discontinued operations in
our statement of operations.

Note 13. Restructuring Charges and Other Unusual Items

During fiscal 2010, we incurred approximately $3.2 million of charges primarily consisting of retail store lease terminations in the United Kingdom totaling $2.8 million,
which were paid in the first quarter of fiscal 2011, and fixed asset impairment charges of $0.4 million, all which were included in SG&A in our consolidated statements of operations.
Additionally, fiscal 2010 also included the acquisition of Lilly Pulitzer as discussed in Note 14, the disposal of substantially all of the operations and assets of our former Oxford Apparel
Group as discussed in Note 15 and the change in estimate for an environmental reserve discussed in Note 6.

During
fiscal 2009, we incurred approximately $2.0 million of charges related to certain restructuring initiatives in our Ben Sherman operating group, $1.7 million of which
were included in SG&A in our consolidated statements of operations with the remaining amounts included in cost of goods sold. The restructuring charges primarily relate to our exit from the Ben
Sherman footwear, kids' and women's operations as well as other streamlining initiatives. These charges primarily consist of employee termination costs and certain contract termination costs.
Substantially all such costs were paid during fiscal 2009.

During
fiscal 2008, Lanier Clothes incurred restructuring charges totaling approximately $9.8 million primarily associated with our decision to exit from certain license
agreements and the restructuring of our Arnold Brant business. These charges include costs associated with the disposal of the inventory, payments related to license termination, the impairment of
intangible assets associated with the Arnold Brant business of $2.2 million, severance costs, the $0.2 million impairment of certain property and equipment and charges associated with
certain leased office space. Approximately $2.8 million and $2.2 million of these charges were recorded in SG&A and impairment of goodwill and intangible assets, respectively, in our
consolidated statements of operations. The remaining charges, which relate to inventory disposal, were recognized in net sales and cost of goods sold in our consolidated statements of operations. In
addition to these restructuring charges recognized in fiscal 2008, we recognized other unusual items totaling a net charge of $0.3 million in Lanier Clothes. Substantially all of these
restructuring charges were paid in fiscal 2008.

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 13. Restructuring Charges and Other Unusual Items (Continued)

Tommy
Bahama, Ben Sherman and Corporate and Other recognized restructuring charges and fixed asset impairment charges totaling approximately $1.0 million, $0.5 million and
$1.2 million, respectively, in fiscal 2008, substantially all of which were paid in fiscal 2008. These charges primarily relate to severance, property and equipment impairment and costs
associated with certain office leases. All of these charges are included in SG&A in our consolidated statements of operations.

Note 14. Business Combinations

On December 21, 2010, we acquired all of the outstanding capital stock of Sugartown from SWI Holdings, Inc., pursuant to a stock purchase agreement. Sugartown owns the
Lilly Pulitzer trademark and designs, sources and distributes upscale collections of women's dresses, sportswear and other products to specialty and department stores, as well as through direct to
consumer channels, including
retail stores and an e-commerce site. We will report the acquired operations of Sugartown as our Lilly Pulitzer operating group.

We
paid $60 million in cash, subject to adjustment based on net working capital as of the closing date for the acquisition. After giving effect to a preliminary working capital
adjustment, the purchase price paid was approximately $58.3 million, net of acquired cash of $0.9 million. In connection with the acquisition, we entered into a contingent consideration
agreement dated as of December 21, 2010, pursuant to which we will be obligated to pay cash payments of up to $2.5 million in each of the four years following the closing of the
transaction and an additional $10 million subsequent to the end of the fourth year, contingent upon Lilly Pulitzer's achievement of certain financial targets. Transaction costs related to this
transaction totaled approximately $0.8 million and are included in SG&A in our consolidated statements of operations in fiscal 2010.

Our
allocation of purchase price to the fair value of the acquired assets and liabilities assumed, is preliminary and will be revised through the one year allocation period as
appropriate as we obtain new information about the fair values of these assets and liabilities and as we revise our estimates of the fair values of the assets and liabilities, including the contingent
consideration, based on any new information. The following table summarizes our preliminary allocation, subject to finalization during

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 14. Business Combinations (Continued)

the
allocation period as necessary, of the purchase price for the Lilly Pulitzer acquisition (in thousands):

Lilly Pulitzer
acquisitionCash

$
936Receivables


6,439Inventories(1)


9,439Prepaid expenses and other current assets


1,082Property and equipment


10,523Intangible assets


30,500Goodwill


16,866Other non-current assets


645Deferred income tax assets


688Trade accounts payable, accrued compensation and other accrued expenses assumed


(6,647
)Deferred income tax liability


(688
)Purchase price(2)

$
69,783


(1)Includes
a write-up of acquired inventory from cost to fair value of $1.8 million pursuant to the purchase method of accounting. This
amount will be recognized in cost of goods sold as the acquired inventory is sold.(2)The
purchase price includes $10.5 million of contingent considerations associated with the acquisition which may be payable in future periods if
certain financial targets are met.


Intangible
assets allocated in connection with our preliminary purchase price allocation, subject to finalization during the allocation period as necessary, consisted of the following
(in thousands):

Useful life

Lilly Pulitzer
acquisitionFinite lived intangible assets acquired, consisting of customer relationships

13 years

$
3,000Trade names and trademarksindefinite

n/a


27,500Total intangible assets acquired



$
30,500




The pro forma information presented below (in thousands, except per share data) gives effect to the December 21, 2010
acquisition of Lilly Pulitzer as if the acquisition had occurred as of the beginning of fiscal 2009. The information presented below is for illustrative purposes only and is not indicative of results
that would have been achieved if the acquisition had occurred as of the beginning of fiscal 2009, nor does it intend to be a projection of future results of operations. The pro forma statements of
operations have been prepared from our and Lilly Pulitzer's historical audited

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 14. Business Combinations (Continued)

consolidated
statements of operations for the years presented, including without limitation, purchase accounting adjustments, but does not include any synergies or operating cost reductions that may
be achieved from the combined operations. The fiscal 2009 pro forma information includes the following items which negatively impact earnings from continuing operations: (1) transaction costs
of approximately $0.8 million related to the acquisition, (2) $1.8 million of additional cost of goods sold resulting from the application of purchase accounting to inventory
acquired at acquisition and (3) approximately $0.5 million of amortization of acquired intangible assets in each year.

Fiscal
2010

Fiscal
2009Net sales

$
669,621

$
650,494Earnings from continuing operations before income taxes

$
25,785

$
(5,064
)Earnings from continuing operations

$
19,624

$
(4,277
)Earnings from continuing operations per share:Basic

$
1.19

$
(0.05
)Diluted

$
1.19

$
(0.05
)


We
anticipate that this acquisition will assist us in pursuing one of our strategic goals of owning a portfolio of lifestyle brands. The acquisition will provide strategic benefits
through growth opportunities and further diversification of our business over distribution channels, price points, product categories and target consumers.

Note 15. Discontinued Operations

On January 3, 2011, we sold to LF USA Inc. ("LF") substantially all of the operations and assets of our former Oxford Apparel operating group (other than accounts
receivable associated with the businesses that was sold and all assets and operations relating to our Oxford Golf business and our distribution center in Lyons, Georgia). The purchase price paid by LF
was equal to approximately $121.7 million, less an adjustment based on net working capital on the closing date of the transaction. After giving effect to a preliminary net working capital
adjustment, the purchase price paid by LF at the closing of the transaction was approximately $108.2 million, of which $5.4 million is held in escrow pending completion of the final
working capital adjustment and other requirements. The net working capital deficit resulted from our retention of accounts receivable and goods in transit as of the closing date, partially offset by
our retention of certain accounts payable, as of the closing date, associated with Oxford Apparel. The purchase price is subject to a final net working capital adjustment, which is expected to occur
within 120 days of the closing date of the transaction and not expected to be significantly different than the preliminary net working capital. LF also agreed to purchase our goods in transit
relating to Oxford Apparel following the closing of the transaction until all goods associated with the sold Oxford Apparel operations are transferred.

115

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 15. Discontinued Operations (Continued)

In
connection with the consummation of the transaction described above, we, among other things, entered into (1) license agreements with LF to grant licenses (subject to the
limitations set forth in the applicable license agreements) to LF to use the trade name "Oxford Apparel" perpetually in connection with its business, as well as to use certain other trademarks in
connection with the manufacture, sale and distribution of men's dress shirts for certain periods of time in the applicable territory; (2) a services agreement with LF pursuant to which, in
exchange for various fees, we will provide certain transitional support services to LF in its operation of the transferred assets; and (3) a limited non-competition agreement with
LF pursuant to which we agreed (subject to the exceptions set forth in the non-competition agreement) not to engage in certain activities for a period of three years following the
completion of the transaction.

The
following represents the major classes of assets and liabilities related to the discontinued operations included in our consolidated balance sheets as of the following dates (in
thousands):

January 29,
2011

January 30,
2010Receivables, net, including $5.4 million of purchase price consideration held in escrow

$
48,564

$
29,708Inventories, net


9,162


18,849Other current assets, net


19


205Property and equipment, net





1,115Other assets, net (1)





6,488Total assets

$
57,745

$
56,365Trade accounts payable, other accrued expenses and accrued compensation

$
13,164

$
17,592Income taxes payable associated with the discontinued operations


27,621


762Other liabilities





588Total liabilities


40,785


18,942Net assets

$
16,960

$
37,423


(1)The
other assets, net primarily consisted of our investment in an unconsolidated entity, which owned certain trademarks and was accounted for using the
equity method of accounting


We
do not anticipate significant operations or cash flows related to the discontinued operations other than the collection of receivables, payment of liabilities, sale of goods in
transit included in discontinued operations in our balance sheet as of January 29, 2011, and certain commissions related to in-process inventory on the date of the transaction,
substantially all of which we anticipate will be settled during the first half of fiscal 2011.

116

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 15. Discontinued Operations (Continued)

Operating
results of the discontinued operations are shown below (in thousands):

Fiscal
2010

Fiscal
2009

Fiscal
2008(1)Net sales

$
200,636

$
215,352

$
248,452Cost of goods sold


160,749


172,482


196,862Gross profit


39,887


42,870


51,590SG&A


19,873


21,880


32,729Impairment and amortization of goodwill, intangible assets and an investment in an unconsolidated entity(2)








7,384Royalties and other operating income(3)


1,118


1,254


1,633Operating income


21,132


22,244


13,110Interest expense, net


522


892


2,385Earnings from discontinued operations before income taxes


20,610


21,352


10,725Income taxes


7,733


8,114


4,076Earnings from discontinued operations, net of taxes


12,877


13,238


6,649Gain on sale of discontinued operations, net of taxes


49,546





Net earnings from discontinued operations, net of taxes

$
62,423

$
13,238

$
6,649


(1)Oxford
Apparel incurred certain restructuring charges totaling approximately $2.7 million during fiscal 2008 primarily associated with the decision
to exit certain businesses. These charges reflected in discontinued operations above include costs associated with the disposal of inventory of $0.5 million which are classified as a reduction
to net sales, the impairment of certain intangible assets of $1.1 million recorded in impairment of goodwill, intangible assets and investment in an unconsolidated entity, $0.9 million
of impairment of property and equipment included in SG&A and $0.3 million of severance related costs included in SG&A. Oxford Apparel also recorded a net benefit of $1.2 million
primarily related to the resolution of a contingent liability and the sale of a trademark partially offset by an increase in our bad debt reserve due to certain customers' bankruptcy filings,
substantially all of which were recorded in SG&A in the discontinued operations above.(2)During
fiscal 2008, as part of our annual impairment testing process, we determined that impairment charges totaling $6.2 million related to our
investment in an unconsolidated entity and goodwill were appropriate as the carrying values of the investment and goodwill exceeded their fair value. The fair values of the investment in an
unconsolidated entity and goodwill were determined using a discounted cash flow approach.(3)Royalties
and other operating income in discontinued operations primarily relate to earnings from an investment in an unconsolidated entity.


117

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011




Note 16. Condensed Consolidating Financial Statements

Our 113/8% Senior Secured Notes are guaranteed by substantially all of our wholly-owned domestic subsidiaries ("Subsidiary Guarantors"). All guarantees are full and
unconditional. For consolidated financial reporting purposes, non-guarantors consist of our subsidiaries which are organized outside the United States and certain domestic subsidiaries. We
use the equity method with respect to investment in subsidiaries included in other non-current assets in our condensed consolidating financial statements. Set forth below are our condensed
consolidating balance sheets as of January 29, 2011 and January 30, 2010 (in thousands) as well as our condensed consolidating statements of operations and statements of cash flows for
fiscal 2010, fiscal 2009 and fiscal 2008 (in thousands).

OXFORD INDUSTRIES, INC.  CONDENSED CONSOLIDATING BALANCE SHEETS  January 29, 2011

Oxford
Industries
(Parent)

Subsidiary
Guarantors

Subsidiary
Non-
Guarantors

Consolidating
Adjustments

Consolidated
TotalASSETSCash and cash equivalents

$
41,130

$
809

$
2,155

$


$
44,094Receivables, net


10,969


3,431


44,897


(9,120
)

50,177Inventories, net


(13,234
)

86,747


11,889


(64
)

85,338Prepaid expenses and deferred tax assets, net


19,756


12,671


3,018


(3,886
)

31,559Assets related to discontinued operations, net


46,418


324


11,003





57,745Total current assets


105,039


103,982


72,962


(13,070
)

268,913Property and equipment, net


7,182


72,323


4,390





83,895Goodwill and intangible assets, net





159,543


24,003





183,546Other non-current assets, net


579,130


143,459


4,101


(704,573
)

22,117Total Assets

$
691,351

$
479,307

$
105,456

$
(717,643
)
$
558,471LIABILITIES AND SHAREHOLDERS' EQUITYCurrent liabilities related to continuing operations

$
13,978

$
59,255

$
41,170

$
(8,097
)
$
106,306Current liabilities related to discontinued operations


32,379





8,406





40,785Long-term debt, less current maturities


147,065











147,065Other non-current liabilities


322,237


(301,271
)

143,113


(108,638
)

55,441Non-current deferred income taxes


(4,336
)

26,944


6,332


(94
)

28,846Total shareholders'/invested equity


180,028


694,379


(93,565
)

(600,814
)

180,028Total Liabilities and Shareholders' Equity

$
691,351

$
479,307

$
105,456

$
(717,643
)
$
558,471


118

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 16. Condensed Consolidating Financial Statements (Continued)

January 30, 2010

Oxford
Industries
(Parent)

Subsidiary
Guarantors

Subsidiary
Non-
Guarantors

Consolidating
Adjustments

Consolidated
TotalASSETSCash and cash equivalents

$
5,933

$
503

$
1,852

$


$
8,288Receivables, net


11,251


2,868


40,486


(9,915
)

44,690Inventories, net


(9,896
)

57,217


11,856


(997
)

58,180Prepaid expenses and deferred tax assets, net


16,347


8,851


3,103


(3,918
)

24,383Assets related to discontinued operations, net


43,805


6,631


5,929





56,365Total current assets


67,440


76,070


63,226


(14,830
)

191,906Property and equipment, net


8,398


64,442


5,585





78,425Intangible assets, net





112,882


24,580





137,462Other non-current assets, net


490,554


142,827


3,819


(619,819
)

17,381Total Assets

$
566,392

$
396,221

$
97,210

$
(634,649
)
$
425,174LIABILITIES AND SHAREHOLDERS' EQUITYCurrent liabilities related to continuing operations

$
27,108

$
27,974

$
32,076

$
(9,650
)
$
77,508Current liabilities related to discontinued operations


12,332





6,610





18,942Long-term debt, less current maturities


146,408











146,408Other non-current liabilities


280,138


(268,351
)

145,486


(107,795
)

49,478Non-current deferred income taxes


(4,011
)

26,605


6,794


(967
)

28,421Total shareholders'/invested equity


104,417


609,993


(93,756
)

(516,237
)

104,417Total Liabilities and Shareholders' Equity

$
566,392

$
396,221

$
97,210

$
(634,649
)
$
425,174


119

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 16. Condensed Consolidating Financial Statements (Continued)

OXFORD INDUSTRIES, INC.  CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS  Fiscal 2010

Oxford
Industries
(Parent)

Subsidiary
Guarantors

Subsidiary
Non-
Guarantors

Consolidating
Adjustments

Consolidated
TotalNet sales

$
112,270

$
435,599

$
85,308

$
(29,230
)
$
603,947Cost of goods sold


77,481


178,776


35,780


(15,497
)

276,540Gross profit


34,789


256,823


49,528


(13,733
)

327,407SG&A including amortization of intangible assets and change in fair value of contingent consideration


33,982


231,246


52,813


(15,866
)

302,175Royalties and other operating income (loss)


1,118


8,830


7,343


(1,861
)

15,430Operating income


1,925


34,407


4,058


272


40,662Interest (income) expense, net


21,492


(4,548
)

2,949


(6
)

19,887Income from equity investment


25,863








(25,863
)

Earnings from continuing operations before income taxes


6,296


38,955


1,109


(25,585
)

20,775Income taxes (benefit)


(12,115
)

15,212


1,346


97


4,540Earnings (loss) from continuing operations


18,411


23,743


(237
)

(25,682
)

16,235Earnings from discontinued operations, net of taxes


60,068


1,409


946





62,423Net earnings (loss)

$
78,479

$
25,152

$
709

$
(25,682
)
$
78,658


Fiscal 2009

Oxford
Industries
(Parent)

Subsidiary
Guarantors

Subsidiary
Non-
Guarantors

Consolidating
Adjustments

Consolidated
TotalNet sales

$
120,148

$
395,982

$
98,394

$
(29,218
)
$
585,306Cost of goods sold


95,183


166,381


49,224


(16,295
)

294,493Gross profit


24,965


229,601


49,170


(12,923
)

290,813SG&A including amortization of intangible assets


27,663


215,834


54,081


(13,872
)

283,706Royalties and other operating income (loss)


18


5,812


6,373


(400
)

11,803Operating income (loss)


(2,680
)

19,579


1,462


549


18,910Interest (income) expense, net


22,323


(4,930
)

3,453


(377
)

20,469Income (loss) from equity investment


13,539








(13,539
)

Earnings (loss) from continuing operations before income taxes


(11,464
)

24,509


(1,991
)

(12,613
)

(1,559
)Income taxes (benefit)


(12,249
)

8,376


603


325


(2,945
)Earnings from continuing operations


785


16,133


(2,594
)

(12,938
)

1,386Earnings from discontinued operations, net of taxes


9,825


1,769


1,644





13,238Net earnings (loss)

$
10,610

$
17,902

$
(950
)
$
(12,938
)
$
14,624


120

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 16. Condensed Consolidating Financial Statements (Continued)

OXFORD INDUSTRIES, INC.  CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS  Fiscal 2008

Oxford
Industries
(Parent)

Subsidiary
Guarantors

Subsidiary
Non-
Guarantors

Consolidating
Adjustments

Consolidated
TotalNet sales

$
138,186

$
460,597

$
140,008

$
(39,727
)
$
699,064Cost of goods sold


113,251


208,168


64,617


(22,584
)

363,452Gross profit


24,935


252,429


75,391


(17,143
)

335,612SG&A including amortization and impairment of intangible assets goodwill


35,820


429,483


186,833


(16,462
)

635,674Royalties and other operating income (loss)


485


8,718


6,814


(356
)

15,661Operating income (loss)


(10,400
)

(168,336
)

(104,628
)

(1,037
)

(284,401
)Interest (income) expense, net including gain on repurchase of 87/8% Senior Unsecured Notes


15,696


(11,193
)

9,049


(2
)

13,550Income (loss) from equity investment


(259,608
)







259,608


Earnings (loss) from continuing operations before income taxes


(285,704
)

(157,143
)

(113,677
)

258,573


(297,951
)Income taxes (benefit)


(8,272
)

832


(12,043
)

(362
)

(19,845
)Earnings (loss) from continuing operations


(277,432
)

(157,975
)

(101,634
)

258,935


(278,106
)Earnings (loss) from discontinued operations, net of taxes


6,871


(937
)

715





6,649Net earnings (loss)

$
(270,561
)
$
(158,912
)
$
(100,919
)
$
258,935

$
(271,457
)


121

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 16. Condensed Consolidating Financial Statements (Continued)

OXFORD INDUSTRIES, INC.  CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS  Fiscal 2010

Oxford
Industries
(Parent)

Subsidiary
Guarantors

Subsidiary
Non-
Guarantors

Consolidating
Adjustments

Consolidated
TotalCash Flows From Operating Activities:Net cash provided by (used in) operating activities

$
(18,158
)
$
47,879

$
6,203

$
(233
)
$
35,691Cash Flows from Investing Activities:Net cash used in investing activities


(60,026
)

(10,884
)

(643
)




(71,553
)Cash Flows from Financing Activities:Repayments of company owned life insurance policy loans


(4,125
)










(4,125
)Proceeds from issuance of common stock


177











177Change in intercompany payable


44,288


(42,491
)

(2,030
)

233


Dividends on common stock


(7,275
)










(7,275
)Net cash provided by (used in) financing activities


33,065


(42,491
)

(2,030
)

233


(11,223
)Cash Flows from Discontinued Operations:Net cash provided by (used in) discontinued operations


80,316


5,802


(3,258
)




82,860Net change in Cash and Cash Equivalents


35,197


306


272





35,775Effect of foreign currency translation








31





31Cash and Cash Equivalents at the Beginning of Period


5,933


503


1,852





8,288Cash and Cash Equivalents at the End of Period

$
41,130

$
809

$
2,155

$


$
44,094


122

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 16. Condensed Consolidating Financial Statements (Continued)

OXFORD INDUSTRIES, INC.  CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS  Fiscal 2009

Oxford
Industries
(Parent)

Subsidiary
Guarantors

Subsidiary
Non-
Guarantors

Consolidating
Adjustments

Consolidated
TotalCash Flows From Operating Activities:Net cash provided by (used in) operating activities

$
8,953

$
51,203

$
593

$
226

$
60,975Cash Flows from Investing Activities:Net cash used in investing activities


(5,851
)

(6,927
)

(2,132
)

3,613


(11,297
)Cash Flows from Financing Activities:Change in debt


(27,722
)




(5,598
)




(33,320
)Repurchase of 87/8% Senior Unsecured Notes


(166,805
)










(166,805
)Proceeds from the issuance of 113/8% Senior Secured Notes


146,029











146,029Deferred financing costs paid


(5,049
)










(5,049
)Proceeds from issuance of common stock


8











8Equity contribution received








3,613


(3,613
)

Change in intercompany payable


44,507


(44,177
)

(104
)

(226
)

Dividends on common stock


(5,889
)










(5,889
)Net cash provided by (used in) financing activities


(14,921
)

(44,177
)

(2,089
)

(3,839
)

(65,026
)Cash Flows from Discontinued Operations:Net cash provided by discontinued operations


16,225


300


4,054





20,579Net change in Cash and Cash Equivalents


4,406


399


426





5,231Effect of foreign currency translation








(233
)




(233
)Cash and Cash Equivalents at the Beginning of Period


1,527


104


1,659





3,290Cash and Cash Equivalents at the End of Period

$
5,933

$
503

$
1,852

$


$
8,288


123

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Table of Contents

OXFORD INDUSTRIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

January 29, 2011

Note 16. Condensed Consolidating Financial Statements (Continued)

OXFORD INDUSTRIES, INC.  CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS  Fiscal 2008

Oxford
Industries
(Parent)

Subsidiary
Guarantors

Subsidiary
Non-
Guarantors

Consolidating
Adjustments

Consolidated
TotalCash Flows From Operating Activities:Net cash provided by (used in) operating activities

$
16,042

$
48,023

$
(12,005
)
$
(211
)
$
51,849Cash Flows from Investing Activities:Net cash used in investing activities


(2,183
)

(16,014
)

(1,604
)




(19,801
)Cash Flows from Financing Activities:Change in debt


(45,177
)

(1
)

6,434





(38,744
)Repurchase of 87/8% Senior Unsecured Notes


(24,971
)










(24,971
)Deferred financing costs paid


(1,664
)










(1,664
)Proceeds from issuance of common stock


91











91Change in intercompany payable


(22,538
)

22,847


(520
)

211


Dividends on common stock


50,407


(58,862
)

(5,958
)




(14,413
)Net cash provided by (used in) financing activities


(43,852
)

(36,016
)

(44
)

211


(79,701
)Cash Flows from Discontinued Operations:Net cash provided by (used in) discontinued operations


29,420


3,673


3,982





37,075Net change in Cash and Cash Equivalents


(573
)

(334
)

(9,671
)




(10,578
)Effect of foreign currency translation








(1,044
)




(1,044
)Cash and Cash Equivalents at the Beginning of Period


2,100


438


12,374





14,912Cash and Cash Equivalents at the End of Period

$
1,527

$
104

$
1,659

$


$
3,290


124

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Table of Contents

SCHEDULE II  Oxford Industries, Inc.        Valuation and Qualifying Accounts

Column A

Column B

Column C

Column D

Column EDescription

Balance at
Beginning
of Period

Additions
Charged to
Costs and
Expenses

Charged
to Other
Accounts
Describe

Deductions
Describe

Balance at
End of
Period(In thousands)Fiscal 2010Deducted from asset accounts:Accounts receivable reserves(1)

$
8,817

$
10,068

$
1,341
(3)
$
(11,048
)(4)
$
9,178Allowance for doubtful accounts(2)


1,571


(89
)

1,355
(3)

(278
)(5)

2,559Fiscal 2009Deducted from asset accounts:Accounts receivable reserves(1)

$
9,417

$
10,218




$
(10,818
)(4)
$
8,817Allowance for doubtful accounts(2)


1,857


1,466





(1,752
)(5)

1,571Fiscal 2008Deducted from asset accounts:Accounts receivable reserves(1)

$
9,201

$
11,794




$
(11,578
)(4)
$
9,417Allowance for doubtful accounts(2)


1,073


1,776





(992
)(5)

1,857


(1)Accounts
receivable reserves include estimated reserves for allowances, returns and discounts related to our wholesale operations as discussed in our
significant accounting policy disclosure for Revenue Recognition and Accounts Receivable in Note 1 of our consolidated financial statements.(2)Allowance
for doubtful accounts consists of amounts reserved for our estimate of a customer's inability to meet its financial obligations as discussed in
our significant accounting policy disclosure for Revenue Recognition and Accounts Receivable in Note 1 of our consolidated financial statements.(3)Addition
due to the acquisition of Lilly Pulitzer in December 2010.(4)Principally
amounts written off related to customer allowances, returns and discounts.(5)Principally
accounts written off as uncollectible.


125

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Table of Contents

Report of Independent Registered Public Accounting Firm

The
Board of Directors and Shareholders of Oxford Industries, Inc.

We
have audited the accompanying consolidated balance sheets of Oxford Industries, Inc. (the Company) as of January 29, 2011 and January 30, 2010, and the related
consolidated statements of operations, shareholders' equity, and cash flows for each of the three years in the period ended January 29, 2011. Our audits also included the financial statement
schedule listed in the Index at Item 15(a). These financial statements and schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these
financial statements and schedule 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 of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, 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 consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Oxford Industries, Inc. at
January 29, 2011 and January 30, 2010, and the consolidated results of its operations and its cash flows for each of the three years in the period ended January 29, 2011, in
conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related 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.

We
also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Oxford Industries, Inc.'s internal control over financial
reporting as of January 29, 2011, based on criteria established in Internal ControlIntegrated Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission and our report dated March 31, 2011 expressed an unqualified opinion thereon.



Atlanta,
Georgia
March 31, 2011

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Item 9.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A.Controls and Procedures

Our principal executive officer and principal financial officer have evaluated the effectiveness of our disclosure controls and
procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act) as of the end of the period covered by this report. Based upon that
evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered by this report, our
disclosure controls and procedures were effective in ensuring that information required to be disclosed by us in our Securities Exchange Act reports is recorded, processed, summarized and reported
within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal
financial officer, as appropriate, to allow timely decisions regarding required disclosure.

There
have not been any changes in our internal control over financial reporting (as such term is defined in Rule 13a-15(f) and 15d-15(f) under the
Securities Exchange Act) during the fourth quarter of fiscal 2010 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Report of Management on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as such term is
defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934). Our internal control over financial reporting is a process designed to provide
reasonable assurance regarding the reliability of financial reporting and the preparation of our consolidated financial statements for external purposes in accordance with accounting principles
generally accepted in the United States.

Our
internal control over financial reporting is supported by a program of appropriate reviews by management, written policies and guidelines, careful selection and training of qualified
personnel, and a written code of conduct. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. In addition, 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.

On
December 21, 2010, we completed our acquisition of Sugartown. Sugartown's results of operations are included in our consolidated financial statements from the date of
acquisition. As permitted by the SEC, we have elected to exclude Sugartown from our assessment of the effectiveness of our internal control over financial reporting as of January 29, 2011.
Total assets and net sales of Sugartown represent 14% and 1%, respectively, of our total assets and net sales as reported in our consolidated financial statements for fiscal 2010.

We
assessed the effectiveness of our internal control over financial reporting as of January 29, 2011. In making this assessment, management used the criteria set forth by the
Committee of Sponsoring Organizations of the Treadway Commission (COSO) in theInternal ControlIntegrated Framework. Based on this
assessment, we believe that our internal control over financial reporting was effective as of January 29, 2011.

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Ernst &
Young LLP, our independent registered public accounting firm, has audited our internal control over financial reporting as of January 29, 2011, and its
report thereon is included herein.

/s/ J. HICKS LANIER J. Hicks Lanier Chairman and Chief Executive Officer
(Principal Executive Officer)

/s/ K. SCOTT GRASSMYER K. Scott Grassmyer Senior Vice President, Chief Financial Officer and Controller
(Principal Financial Officer)March 31, 2011

March 31, 2011


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Report of Independent Registered Public Accounting Firm

The
Board of Directors and Shareholders of Oxford Industries, Inc.

We
have audited Oxford Industries, Inc.'s (the Company's) internal control over financial reporting as of January 29, 2011, based on criteria established in Internal
ControlIntegrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). Oxford Industries, Inc.'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 Report of
Management on Internal Control over Financial Reporting. Our responsibility is to express an opinion on 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 included obtaining an understanding of internal control
over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and
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.

As
indicated in the accompanying Report of Management on Internal Control over Financial Reporting, management's assessment of and conclusion on the effectiveness of internal control
over financial reporting did not include the internal controls of Sugartown Worldwide, Inc., which is included in the fiscal 2010 consolidated financial statements of Oxford
Industries, Inc. and constituted approximately 14% of total assets as of January 29, 2011 and approximately 1% of net sales for the year then ended. Our audit of internal control over
financial reporting of Oxford Industries, Inc. also did not include an evaluation of the internal control over financial reporting of Sugartown Worldwide, Inc.

In
our opinion, Oxford Industries, Inc. maintained, in all material respects, effective internal control over financial reporting as of January 29, 2011, based on the COSO
criteria.

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We
also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the fiscal 2010 consolidated financial statements of Oxford
Industries, Inc., and our report dated March 31, 2011 expressed an unqualified opinion thereon.



Atlanta,
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March 31, 2011

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Item 9B.Other Information

None

PART III

Item 10.Directors, Executive Officers and Corporate Governance

The following table sets forth certain information concerning the members of our Board of Directors as of January 29, 2011:

Name

Principal OccupationCecil D. Conlee

Mr. Conlee is Chairman of CGR Advisors, a real estate advisory company.George C. Guynn

Mr. Guynn is the retired President and CEO of the Federal Reserve Bank of Atlanta.John R. Holder

Mr. Holder is Chairman and Chief Executive Officer of Holder Properties, a commercial real estate development company.J. Hicks Lanier

Mr. Lanier is our Chairman and Chief Executive Officer.J. Reese Lanier

Mr. Lanier was self-employed in farming and related businesses until his retirement in 2009.Dennis M. Love

Mr. Love is President and Chief Executive Officer of Printpack Inc., a manufacturer of flexible and specialty rigid packaging.Clarence H. Smith

Mr. Smith is President and Chief Executive Officer of Haverty Furniture Companies, Inc., a home furnishings retailer.Helen B. Weeks

Ms. Weeks founded Ballard Designs, Inc., a home furnishing catalog business, in 1983 and served as Chief Executive Officer until she retired in 2002.E. Jenner Wood III

Mr. Wood is Chairman, President and CEO of SunTrust Bank, Atlanta/Georgia Division


The
following table sets forth certain information concerning our executive officers as of January 29, 2011:

Name

Position HeldJ. Hicks Lanier

Chairman and Chief Executive OfficerScott A. Beaumont

CEO, Lilly Pulitzer GroupThomas E. Campbell

Senior Vice PresidentLaw, General Counsel and SecretaryThomas C. Chubb III

PresidentK. Scott Grassmyer

Senior Vice President, Chief Financial Officer and ControllerDennis D. MacCulloch

President, Lanier ClothesPanayiotis P. Philippou

CEO, Ben Sherman GroupTerry R. Pillow

CEO, Tommy Bahama Group


Additional
information required by this Item 10 of Part III will appear in our definitive proxy statement under the headings "Corporate Governance and Board
MattersDirectors," "Executive Officers," "Common Stock Ownership by Management and Certain Beneficial OwnersSection 16(a)

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Beneficial
Ownership Reporting Compliance," "Corporate Governance and Board MattersCorporate Governance Guidelines; Conduct Policies," and "Corporate Governance and Board
MattersBoard Meetings and Committees of our Board of Directors," and is incorporated herein by reference.

Our
Board of Directors has adopted a code of ethical conduct for our Principal Executive Officer, our Principal Financial Officer, and other designated key financial associates.
Additionally, our Board of Directors has adopted a conflict of interest and business ethics policy for all of our employees. Our employees are expected to adhere at all times to these policies, as
applicable. We have posted both of these codes on our website, www.oxfordinc.com. We will provide, at no cost, copies of these codes to
any person who requests copies as described in Part I, Item 1. "BusinessAvailable Information." We will also disclose any amendments or waivers to our code of ethical
conduct on our website.

Item 11.Executive Compensation

The information required by this Item 11 of Part III will appear in our definitive proxy statement under the headings
"Corporate Governance and Board MattersDirector Compensation," "Executive Compensation," "Nominating, Compensation & Governance Committee Report" and "Compensation Committee
Interlocks and Insider Participation" and is incorporated herein by reference.

Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information required by this Item 12 of Part III will appear in our definitive proxy statement under the headings
"Equity Compensation Plan Information" and "Common Stock Ownership by Management and Certain Beneficial Owners" and is incorporated herein by reference.

Item 13.Certain Relationships and Related Transactions, and Director Independence

The information required by this Item 13 of Part III will appear in our definitive proxy statement under the headings
"Certain Relationships and Related Transactions" and "Corporate Governance and Board MattersDirector Independence" and is incorporated herein by reference.

Item 14.Principal Accountant Fees and Services

The information required by this Item 14 of Part III will appear in our definitive proxy statement under the heading
"Audit-Related MattersFees Paid to Independent Registered Public Accounting Firm" and "Audit-Related MattersAudit Committee Pre-Approval of Audit and Permissible
Non-Audit Services of Independent Auditors" and is incorporated herein by reference.

PART IV

Item 15.Exhibits and Financial Statement Schedules

(a)1.  Financial Statements

The
following consolidated financial statements are included in Part II, Item 8 of this report:



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2.     Financial Statement Schedules



All
other schedules for which provisions are made in the applicable accounting regulation of the SEC are not required under the related instructions or are inapplicable and, therefore,
have been omitted.

(b)   Exhibits

2.1

Purchase Agreement, dated as of November 22, 2010, among LF USA Inc., Oxford Industries, Inc., Piedmont Apparel Corporation, Tommy Bahama International, Pte. Ltd. and Oxford Product (International)
Limited. Incorporated by reference to Exhibit 2.1 to the Company's Form 8-K filed on November 22, 2010.2.2

Stock Purchase Agreement, dated as of December 21, 2010, by and among Oxford Industries, Inc., Sugartown Worldwide, Inc., SWI Holdings, Inc. and the other sellers party thereto. Incorporated by
reference to Exhibit 2.1 to the Company's Form 8-K filed on December 21, 2010.3.1

Restated Articles of Incorporation of Oxford Industries, Inc. Incorporated by reference to Exhibit 3.1 to the Company's Form 10-Q for the fiscal quarter ended August 29, 2003.3.2

Bylaws of Oxford Industries, Inc., as amended. Incorporated by reference to Exhibit 3.1 to the Company's Form 8-K filed on June 17, 2009.4.1

Indenture, dated June 30, 2009, among Oxford Industries, Inc., the Guarantors party thereto and U.S. Bank National Association, as trustee. Incorporated by reference to Exhibit 4.1 to the Company's
Form 8-K filed on July 2, 2009.4.2

Form of 11.375% Senior Secured Note due 2015. Incorporated by reference to Exhibit 4.2 to the Company's Form 8-K filed on July 2, 2009.10.1

1997 Stock Option Plan, as amended. Incorporated by reference to Exhibit 10(a) to the Company's Form 10-K for the fiscal year ended May 31, 2002.10.2

Second Amendment to the 1997 Stock Option Plan. Incorporated by reference to Exhibit 10(s) to the Company's Form 10-K for the fiscal year ended June 2, 2006.10.3

Amended and Restated Long-Term Stock Incentive Plan, effective as of March 26, 2009. Incorporated by reference to Appendix A to the Company's Proxy Statement for its Annual Meeting of Shareholders held
June 15, 2009, filed on May 11, 2009.10.4

Form of Restricted Stock Agreement. Incorporated by reference to Exhibit 10(y) to the Company's Form 10-KT for the eight month transition period ended February 2, 2008.10.5

Form of Oxford Industries, Inc. 2009 Restricted Stock Agreement. Incorporated by reference to Exhibit 10.1 to the Company's Form 8-K filed on June 17, 2009.10.6

Oxford Industries, Inc. Executive Performance Incentive Plan (as amended and restated, effective March 27, 2008). Incorporated by reference to Appendix A to the Company's Proxy Statement for its Annual
Meeting of Shareholders held June 16, 2008, filed on May 13, 2008.10.7

Executive Medical Plan. Incorporated by reference to Exhibit 10(d) to the Company's Form 10-K for the fiscal year ended June 3, 2005.10.8

Employment Offer Letter to Knowlton J. O'Reilly. Incorporated by reference to Exhibit 10.5 to the Company's Form 10-Q for the fiscal quarter ended November 30, 2007.


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10.9

Employment Offer Letter to Terry R. Pillow. Incorporated by reference to Exhibit 10(a) to the Company's Form 10-Q for the fiscal quarter ended August 2, 2008.10.10

Second Amended and Restated Credit Agreement, dated as of August 15, 2008, by and among Oxford Industries, Inc., Tommy Bahama Group, Inc., the Persons party thereto from time to time as Guarantors, the
financial institutions party thereto from time to time as lenders, the financial institutions party thereto from time to time as Issuing Banks and SunTrust Bank, as administrative agent.*/*\10.11

Amended and Restated Pledge and Security Agreement, dated as of August 15, 2008, among Oxford Industries, Inc., the other Grantors party thereto and SunTrust Bank, as administrative agent.*10.12

Second Amended and Restated Pledge and Security Agreement, dated June 30, 2009, among Oxford Industries, Inc., the other Grantors party thereto and SunTrust Bank, as administrative agent.*10.13

Intercreditor Agreement, dated June 30, 2009, between U.S. Bank National Association, as trustee and as collateral agent under the Indenture, and SunTrust Bank, as agent under the ABL Credit Agreement, as
acknowledged by the Company and the subsidiaries party thereto. Incorporated by reference to Exhibit 10.1 to the Company's Form 8-K filed on July 2, 2009.10.14

Registration Rights Agreement, dated June 30, 2009, among Oxford Industries, Inc., the guarantors party thereto, Banc of America Securities LLC, SunTrust Robinson Humphrey, Inc., Credit Suisse
Securities (USA) LLC, BB&T Capital Markets, a Division of Scott & Stringfellow, LLC, Morgan Keegan & Company, Inc, Barclays Capital Inc. and PNC Capital Markets LLC. Incorporated by reference to
Exhibit 10.2 to the Company's Form 8-K filed on July 2, 2009.10.15

Security Agreement, dated June 30, 2009, among Oxford Industries, Inc., the other Grantors party thereto, U.S. Bank National Association, as collateral agent and as trustee, and each Additional Pari Passu
Agent from time to time party thereto.*10.16

Letter agreement between the Company and Mr. Knowlton J. O'Reilly.10.17

Agreement dated as of January 30, 2010 between Ben Sherman Limited and Miles Gray.*10.18

Oxford Industries, Inc. Deferred Compensation Plan, as amended and restated effective September 1, 2010. Incorporated by reference to Exhibit 10.2 to the Company's Form 8-K filed on July 2,
2009.10.19

First Amendment to the Oxford Industries, Inc. Deferred Compensation Plan, as amended and restated effective September 1, 2010.*10.20

Earnout Agreement, dated as of December 21, 2010, by and among Oxford Industries, Inc., Sugartown Worldwide, Inc., SWI Holdings, Inc. and the other parties thereto.*10.21

Employment Agreement, dated as of December 21, 2010, by and between Sugartown Worldwide, Inc. and Scott A. Beaumont.*21

List of Subsidiaries.*23

Consent of Independent Registered Public Accounting Firm.*24

Powers of Attorney.*31.1

Certification by Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*


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31.2

Certification by Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*32

Certification by Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*


*Filed
herewithManagement
contract or compensation plan or arrangement required to be filed as an exhibit to this form pursuant to Item 15(b) of this
report./*\Application has been made to the SEC for confidential treatment of certain provisions of this
exhibit. Omitted material for which confidential treatment has been requested has been filed separately with the SEC.


We
agree to file upon request of the SEC a copy of all agreements evidencing long-term debt of ours omitted from this report pursuant to Item 601(b)(4)(iii) of
Regulation S-K.

Shareholders
may obtain copies of Exhibits without charge upon written request to the Corporate Secretary, Oxford Industries, Inc., 222 Piedmont Avenue, N.E., Atlanta,
Georgia 30308.

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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, hereunto duly authorized.

OXFORD INDUSTRIES, INC.By:

/s/ J. HICKS LANIER J. Hicks Lanier Chairman and Chief Executive OfficerDate: March 31, 2011


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

Signature

Capacity

Date/s/ J. HICKS LANIER J. Hicks Lanier

Chairman of the Board of Directors and Chief Executive Officer (Principal Executive Officer)

March 31, 2011/s/ K. SCOTT GRASSMYER K. Scott Grassmyer

Senior Vice President, Chief Financial Officer and Controller (Principal Financial Officer)

March 31, 2011* Cecil D. Conlee

Director

March 31, 2011* George C. Guynn

Director

March 31, 2011* John R. Holder

Director

March 31, 2011* J. Reese Lanier

Director

March 31, 2011* Dennis M. Love

Director

March 31, 2011


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Signature

Capacity

Date* Clarence H. Smith

Director

March 31, 2011Helen B. Weeks

Director* E. Jenner Wood

Director

March 31, 2011*By

/s/ THOMAS E. CAMPBELL Thomas E. Campbell as Attorney-in-Fact


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