Securities and Exchange Commission
Washington, D.C. 20549

Form 10-K

[X] Annual Report Pursuant To Section 13 or 15(d) of The Securities Exchange Act
of 1934 for the fiscal year ended February 1, 1997 ("Fiscal 1996").

[ ] Transition Report Pursuant To Section 13 or 15(d) of The Securities Exchange
Act of 1934 for the transition period from to ______.

[Commission file number 0-23874]

JOS. A. BANK CLOTHIERS, INC.
(Exact name of registrant as specified in its character)

Delaware 36-3189198
(State of Incorporation) (I.R.S. Employer Identification No.)

500 Hanover Pike, Hampstead, MD 21074
(Address of principal executive offices) (zip code)

(410) 239-2700
(Registrant's telephone number, including area code)

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

Title of each class None
-------------------
Common Stock (the "Common Stock") par value $.01 per share

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.

Yes X No
--- ---

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

The aggregate market value of the voting stock held by nonaffiliates of the
registrant, based upon the closing price of shares of Common Stock on the
National Association of Securities Dealers Automated Quotation ("NASDAQ")
National Market System at April 25, 1997 was approximately $25,891,267.

The number of shares of Common Stock, par value $0.01 per share, outstanding on
April 25, 1997 was 6,791,152.

DOCUMENTS INCORPORATED BY REFERENCE:
Portions of Definitive Proxy Statement for Annual Meeting of Shareholders to be
held on June 10, 1997 are incorporated by reference into Part III hereof.

Index to the exhibits appears on Page 18.

PART I
Item 1. BUSINESS

General

Jos. A. Bank Clothiers, Inc., (the "Company"), established in 1905, is
a retailer, cataloger and manufacturer of Men's tailored and casual clothing and
accessories. The Company's products are sold exclusively under the Jos. A. Bank
label through its 68 Company-operated retail stores, 4 outlet stores and 8
franchise stores located throughout the Northeast, Midwest, South and
Mid-Atlantic regions of the U.S., as well as through the Company's nationwide
catalog operations. The Company's products are targeted at the male career
professional, and its marketing emphasizes the Jos. A. Bank line of quality
tailored and casual clothing, which is offered at price points typically
established at 20-30% below those of its principal competitors for items of
comparable quality. The Company believes that it is able to achieve this pricing
advantage for its men's suits, sport coats and pants, primarily by its designing
and manufacturing capabilities, and for other clothing and accessories by
effectively sourcing and negotiating with vendors. The Company has two
principal, wholly owned subsidiaries, The Joseph A. Bank Mfg. Co., Inc., (the
"Manufacturer") and National Tailoring Services, Inc. ("NTS").

History

In May 1991, the Company completed a debt and capital restructuring,
under which the Company issued a combination of new preferred stock and Common
Stock in exchange for all of its then outstanding preferred stock and Common
Stock, senior subordinated notes and subordinated debentures issued in
connection with the 1986 leveraged acquisition of the Company. As a result of
this restructuring, JAB Holdings, Inc., a Delaware corporation ("Holdings"), was
created and issued $47.4 million aggregate principal amount of 8% Secured Notes
due December 31, 1998 (the "Notes") to the Company's former debtholders. There
were no cash proceeds from the issuance of the Notes. During its existence,
Holdings had no operations and did not incur any costs or expenses on behalf of
the Company. As a result of this restructuring, Holdings became the holder of
90% of the Company's Common Stock.

As of January 29, 1994, the Company and Holdings completed a capital
restructuring, the overall substantive effect of which was to eliminate all of
the debt incurred in connection with the 1986 leveraged acquisition of the
Company. In connection with such restructuring, Holdings entered into an
exchange agreement (the "Exchange Agreement") with the holders of its Notes
pursuant to which all Notes were exchanged for common stock of Holdings.
Concurrently with the execution of the Exchange Agreement, the Company entered
into a merger and exchange agreement (the "Merger and Exchange Agreement") with
Holdings and the Company's other stockholders. Pursuant to the Merger and
Exchange Agreement: (i) the Company's preferred stock was converted into Common
Stock; (ii) Holdings' common stock was converted into the Company's Common
Stock; (iii) all existing shares of the Company's Common Stock other than the
shares issued in exchange for the Company's preferred stock or Holdings' common
stock were canceled; and (iv) Holdings was merged into the Company.

On May 10, 1994, the Company sold 2,000,000 shares of its Common Stock
for $10.00 per share in connection with an initial registration with the
Securities Exchange Commission. The net proceeds of $16,894,000 were used to pay
off long-term debt of approximately $8,100,000 and for the opening of new
stores.

In the first half of fiscal 1995, the men's and women's apparel
industries began suffering a significant down-turn. In the face of a potential
cash shortage and other factors affecting the women's business, the Company
decided to discontinue the women's product line (which was sold in the same
stores as the men's products) to generate cash. The women's product line
represented approximately $33 million and $26 million of sales in fiscal 1994
and 1995, respectively (or 19% and 15% of sales, respectively). With this loss
of the women's volume, and with the men's business experiencing a decline (but
improving) certain previously-profitable stores became unprofitable since the
store rents remained basically unchanged. Given these events, the Company
performed a store-by-store analysis to determine which stores were losing money
and not expected to generate future cash flows that were sufficient to support
the book values of the related store assets. Based upon this analysis, the
Company determined that (a) certain stores needed to be closed, down-sized or
relocated and (b) a provision of $3.5 million was required to write-down
specific store leasehold improvements and equipment and to cover costs of
exiting several store locations.

an operating loss of $15.6 million in 1995. The Company improved its operating
income in each quarter during fiscal 1996 compared to the same quarter in fiscal
1995. The turnaround in operating results for the year ended February 1, 1997
was due primarily to a) higher maintained margins which were driven by strong
suit sales, b) the elimination of the unprofitable, lower margin women's
business, c) men's comparable store sales increase of 9.3 percent, d) lower
operating expenses and e) the closure of several unprofitable stores. The
Company also restructured several leases to support its men's-only business,
adjusted its manufacturing capacity, relocated three stores and lowered its
store selling expenses. The increased men's comparable store sales was generated
on men's average inventory levels that were approximately $5.6 million lower
than the prior year as the Company improved its inventory turns as well as its
product selection.

The Company has not completely replaced the volume generated by the
women's division which generated sales of approximately $26 million in fiscal
1995. To increase sales and improve the leverage of its assets, the Company is
opening new stores, including six stores that were opened in fall 1996. The
Company expects to open up to ten new stores in 1997.

Strategy

The Company's strategy is to further enhance its competitive position
in men's proprietary label, updated apparel, including a full line of casual
wear, and accessories and to capitalize on the strength of the Jos. A. Bank name
and reputation through enhanced product offerings within its existing store base
and to increase the number of full-line stores, primarily in existing markets.

Store and Catalog Operations and Growth. The Company's strategy is to
operate its stores and catalogs as an integrated business and to
provide the same personalized service to its customers regardless of
whether merchandise is purchased through its stores or catalogs. The
Company believes that the synergy between the Company stores and
catalogs offers an important convenience to its customers and a
competitive advantage to the Company in identifying new store sites and
testing new business concepts. The Company also uses its catalog to
communicate the Jos. A. Bank image, to provide customers with fashion
guidance in coordinating outfits and to generate store traffic. The
Company believes there are opportunities to develop spin-off catalogs
to the existing customer base to grow the catalog volume.

The Company believes that it has substantial opportunity to increase
its store base by adding stores in its existing markets and entering
new markets. The Company opened four new full-line stores and two
franchise stores in fall 1996 and it expects to open up to ten new
stores in 1997. Substantially all of the stores to be opened in 1997
will be placed in existing markets which allows the Company to leverage
its existing advertising, management and distribution.

Competitive Pricing and Aggressive Promotion. The Company is a value
oriented retailer with price points typically established at 20% to 30%
below those of its principal competitors for items of comparable
quality. In addition to the Company's everyday values, the Company has
a Corporate Card program, which provides employees of participating
businesses and their families with discounts on all Jos. A. Bank
merchandise, and runs promotions throughout the year, such as wardrobe
and trade-in sales, designed to generate store traffic and create
shopping excitement.

Merchandising

The Company's target customer is a professional man, age 25 to 55, who
is well-educated and relatively affluent. The Company's merchandising strategy
focuses on achieving an updated classic look. The Company's stores offer a
distinctive collection of proprietary label, classic career clothing and
accessories, as well as casual wear for men, all made exclusively by or for the
Company in predominantly natural fibers. The men's line includes all clothing
and accessories necessary to dress the career man from head to toe, including
suits, shirts, vests, ties, sport coats, pants, formal wear, overcoats,
mufflers, sweaters, belts and braces, socks and underwear.

The market for classic quality men's clothing is segmented at various
points in men's careers and the Company has designed special collections to
target these segments:

"Signature Collection" - is designed for the man who has achieved
success and is willing to pay for the value of the best fabric,
superior quality and extra details.

"Corporate Collection" - was created for the confident executive who
is making his mark and is looking to set himself apart. It features
updated, tailored clothing and dress furnishings offered in a range
of fabrics and silhouettes that reflect current trends in the men's
market.

"Executive Collection" - is designed for the executive creating or
replenishing his wardrobe essentials. It includes tailored clothing
and dress furnishings in a broad range of basic fabrics and styles at
affordable prices.

"Joe's Casual" - was created for the man who seeks the same quality
for leisure wear as for their working lives. Classic sportswear
featuring quality, styling, fabric and details comparable to brands
which are considerably more expensive.

Since Spring 1991, the Company has offered its male customers its
Business Express line, a concept for purchasing suits that allows customers to
customize their wardrobe by selecting separate, but perfectly matched, jackets
and pants from one of three coat styles, plain front or pleated pants, and
numerous fabric choices. Matching vests are also available in selected fabrics.
The Business Express line allows a customer to buy a suit with minimal
alteration that fits their unique body size, similar to a custom-made suit. Jos.
A. Bank is one of the few retailers in the country that has successfully
developed this concept which the Company believes is a competitive advantage.

The Company also signed a five-year agreement with David Leadbetter, a
world-renowned golf professional, to produce golf and other apparel under his
name. This line will be available in the Company's stores and catalog in fall
1997.

Design and Purchasing

The Jos. A. Bank merchandise is designed through the coordinated
efforts of the Company's merchandising and buying staffs working in conjunction
with either the Company's manufacturing division or contract manufacturers. The
merchandising and buying staffs oversee the development of each product in terms
of style, color and fabrication. Because the Company's designs are focused on
updated classic clothing, the Company experiences much less fashion risk than
other retailers. The process of creating a new garment begins approximately nine
months before the product's expected in-store date. In addition to being
responsible together with the merchandising staff for selecting and developing
appropriate products, the Company's buying staff is also responsible for
providing the catalog operations and stores with the correct amount of products
at all times.

The Company believes that it gains a distinct advantage over many of
its competitors in terms of quality and price by effectively sourcing piece
goods and then having merchandise manufactured to its own specifications by
contract manufacturers, either domestically or abroad, or in its own
manufacturing facility. For example, the Company currently buys quality English
and Italian wool for some of its suits and Italian silk for its neckwear, and
then has the suits made at its factory and neckwear hand sewn by contract
manufacturers in the U.S. The Company buys its shirts from leading U.S. and
overseas shirt manufacturers who also supply shirts to many of the Company's
competitors. All clothing manufactured for the Company by contract manufacturers
must conform to the Company's rigorous specifications with respect to
standardized sizing and quality.

The Company transacts business on an order-by-order basis and does not
maintain any long-term or exclusive contracts, commitments or arrangements to
purchase from any piece goods vendor or contract manufacturer. During fiscal
1996, Burlington Industries, Inc., Warren Corporation, Eighteen International
1981, Ltd., and High Mill Textiles accounted for over 70% of the piece goods
purchased by the Company. The Company does business with all of its vendors in
U.S. currency and has not experienced any material difficulties as a result of
any foreign political, economic or social instabilities. The Company believes
that is has good relationships with its piece goods vendors and contract
manufacturers and that there will be adequate sources to produce a sufficient
supply of quality goods in a timely manner and on satisfactory economic terms.

Marketing, Advertising and Promotion

Strategy

Historically, the Company pursued a traditional or mass marketing
approach in support of it's retail locations. In 1996, in addition to employing
print and radio medias to convey its message, direct mail usage was enhanced to
achieve improved marketing efficiency. Core to each campaign, while primarily
promotional, is the identification of the Jos. A. Bank name as synonymous with
high quality, updated classic clothing offered at price points typically
established at 20-30% below those of its principal competitors for items of
comparable quality. The Company has a database of over one million customers who
have made purchases from either the catalog and/or retail stores. The Company
selects names from this database based on expectations of response to specific
promotions which allows the Company to more efficiently use its advertising
dollars.

In 1997, the Company is allocating a portion of its marketing
expenditures to image advertising on CNN Headline News. The Company believes
that it has strong brand recognition and wants to increase the awareness of its
name as a complement to its store opening strategy.

Product Specific Sales and Promotional Events

Throughout each season, the Company promotes specific items or
categories at specific prices that are below the normal retail price. Examples
are the trade-in sale whereby a customer receives $75 off the purchase of a suit
by "trading-in" an old suit which is donated to charity and the $199 suit sale.
These sales are used to complement promotional events and to meet the needs of
the customers. These events also include the wardrobe sale and the clearance and
roundup sales. Twice a year the Company stores conduct wardrobe sales in which
customers who purchase certain levels of merchandise receive an additional
amount of merchandise selected free. At the end of each season, the Company
stores conduct clearance sales to promote the sale of that season's merchandise.

Corporate Card

Through the Corporate Card program, the Company issues corporate
discount cards to employees of major companies. The card provides the holder and
members of his or her immediate family with a discount on all regularly priced
merchandise. The Company believes that this program enhances customer loyalty
from a core base of customers.

Apparel Incentive Program

Jos. A. Bank Clothiers apparel incentive gift certificates are used by
various companies as a reward for achievement. The Company also redeems
proprietary gift certificates marketed by major premium/incentive companies
through its stores and catalogs.

Jos. A. Bank Credit Card

In addition to accepting cash, checks and major credit cards, since
1992 the Company has offered customers its own credit card. The Company pays an
independent contractor to administer the Jos. A. Bank credit card and assume all
credit risks. The Company believes that the Jos. A. Bank credit card enhances
customer loyalty while providing the customer with additional credit. At the end
of fiscal 1996, the Company had approximately 97,000 credit card accounts, and
sales through the Jos. A. Bank credit card represented approximately 5% of total
retail sales for the year. The Jos. A. Bank credit card also provides the
Company with an important tool for building its customer mailing list.

Stores

At April 18, 1997, the Company operated 68 retail stores and 4 outlet
stores and had 8 franchise locations in a total of 30 states and the District of
Columbia. The following table sets forth the region and market of the 80 stores
that were open at such date.

JOS. A. BANK STORES

Total #
Region & Market Of Stores
- --------------- --------------

Northeast
Connecticut 2
New York 5
Massachusetts 2
New Hampshire 1
Rhode Island 1
----
Subtotal ............... 11
----

Mid-Atlantic
Delaware 1
New Jersey 3
Maryland 6(b)
Pennsylvania 5(b)
Washington, D.C. 1
----
Subtotal ............... 16
----

West
Denver, Colorado 1
----
Subtotal ............... 1
----

Midwest
Kansas 1
Illinois 6(a)
Indiana 1
Michigan 3
Minnesota 1
Missouri 1
Ohio 4
Wisconsin 1
----
Subtotal ................ 18

Total #
Region & Market Of Stores
- --------------- --------------

South
Alabama 2(a)
Florida 3
Georgia 3(a)
North Carolina 5(a)
South Carolina 1
Kentucky 1
Louisiana 1(a)
Mississippi 1(a)
Tennessee 3(a)
Texas 6
Virginia 7(a),(b)
West Virginia 1
----
Subtotal .............. 34
----

TOTAL 80
====

(a) Indicates one or more franchise stores.
(b) Indicates one or more outlet stores.

During 1996, the Company opened four new full-line stores and two
franchise stores, and closed two unprofitable full-line stores and five catalog
stores. The stores that were closed represented approximately 2% of sales in
fiscal 1995.

The Company-operated stores are located in a variety of retail
settings, including high income shopping areas, malls, specialty village centers
and urban locations. In general, the store space in existing stores is divided
as follows: 71% selling space, 10% stockroom, 9% tailor shop and 10% service
area. The full-line stores average 8,500 square feet, with sizes ranging from
4,500 square feet to 19,000 square feet. A new store model has been developed to
support the mens-only business which requires approximately 5,000 square feet.
The selling space in newer stores is typically higher than the average,
(approximately 80%), as the Company decreased the space dedicated to the
stockroom, service area and tailor shop. The newer stores are designed to
utilize regional overflow tailor shops which allows the use of smaller tailor
shops within each store. Each store's selling area is designed to present a
broad selection of products with great depth of inventory, and is divided
generally as follows: 35% men's tailored clothing; 40% other men's clothing and
accessories; and 5% fitting rooms.

The Company's principal consideration in selecting store sites is
finding locations with excellent sales potential coupled with reasonable rental
rates. Stores in suburban areas are usually not located in malls, but in
high-income shopping areas near major malls. In urban locations, stores are
generally located in major retail or financial areas. Since the Company believes
that its stores are destination stores and that its customer do not like to be
inconvenienced, the Company stores are generally most successful in locations
that are easily accessible and provide sufficient parking. Thus, when stores are
located within a mall, they often have a private entrance to the parking area.

The Company has developed a standard store design to appeal to the
Company's quality oriented customers while remaining consistent with the
Company's value image. The design is based on the use of wooden fixtures with
glass shelving, Shaker style furniture with numerous tables to feature fashion
merchandise, carpet, quilted wall hangings and abundant accent lighting and is
intended to promote a pleasant and comfortable shopping environment. The Company
developed this standard design to effect cost savings in the design and
construction of new stores.

Stores normally employ a total of 5 to 25 full- and part-time sales
associates depending on their size. Store management consists of a store manager
and two or three department managers who are also sales associates. The typical
store manager has ten to fifteen years of experience in the tailored clothing
industry. Store management receives compensation in the form of a base salary
plus a bonus based on achieving targeted profit goals. In addition, store
managers are required to meet sales quotas. Sales associates receive a base
salary against a commission. A number of programs offer incentives to both
management and sales associates to increase sales.

The Company attributes part of its success to its customer service
policies. The Company encourages sales associates to develop one-on-one
relationships with their customers. Sales associates maintain personal business
planners containing information on customers' sizes, favorite styles and colors
and are encouraged to call their customers when new items are stocked and before
special promotions. The Company strives to create an environment in its stores
in which sales associates are responsive to customers' needs. Sales associates
are encouraged to assist customers in merchandise selection and wardrobe
coordination, and thereby encourage multiple purchases.

Each full line store has a tailor shop which provides a range of
tailoring services. Approximately 79% of the tailor shops are owned by the
Company, and the remainder are leased to independent tailors. The Company plans
to convert most of the leased shops to Company-owned shops in 1997. The Company
guarantees all the tailoring work and controls the pricing structure used in all
stores. In addition, NTS, the Company's wholly-owned tailoring subsidiary,
provides alteration services primarily to the Company's stores and, to a lesser
extent, outside retailers. NTS has four locations - Houston (leased location),
Atlanta (leased location), Chicago (in present store) and Hampstead, MD (in
distribution facility). Operating NTS has allowed the Company to reduce the
number of tailors in the stores by sending all overflow work to NTS. These
overflow shops experience higher productivity as the tailors are not interrupted
by store personnel during the course of the day. In every store, the store
manager and certain additional staff have been trained to fit tailored clothing
for alterations.

The Company has eight franchise locations. Generally, a franchise
agreement between the Company and the franchisee provides for a ten-year term
with an option, exercisable by the franchisee under certain circumstances, to
extend the term for an additional ten-year period. Franchisees pay the Company
an initial fixed franchise fee and then a percentage of sales. To assure that
customers at franchise locations receive the same personalized service offered
at Company operated stores, the Company

typically requires certain franchisee employees to attend a Company sponsored
training program. In addition, franchisees are required to present and sell
merchandise according to the Company standardized procedures and to maintain and
protect the Company's reputation for high quality, classic clothing. Franchisees
purchase substantially all merchandise offered for sale in their stores from the
Company.

The Company presently has four outlet stores which are used to
liquidate excess merchandise and typically offer first quality products at a
reduced price. Because of the classic character of the Company's merchandise and
aggressive store clearance promotions, historically the Company has not had
significant quantities of merchandise to sell through its outlet stores.

Catalog

The Company's catalogs offer potential and existing customers
convenience in ordering the Company's merchandise. In fiscal 1996, the Company
distributed approximately 7.5 million catalogs, including catalogs sent to
stores for display and general distribution. During fiscal 1996, catalog sales
represented approximately 11% of net sales. The Company divides the year into
two merchandise seasons, Spring and Fall, and mails its catalog to active
customers as often as every four weeks. Catalog circulation has traditionally
included base catalogs offering a representative assortment of the Company's
entire range of merchandise. In addition to providing customers convenience in
ordering merchandise, the Company generally uses its catalogs to: (i)
communicate its image of quality clothing; (ii) provide customers with fashion
guidance in coordinating outfits; (iii) generate store traffic; and (iv) provide
the Company with market data, including identification of new store locations.

To make catalog shopping as convenient as possible, the Company
maintains a toll-free telephone number accessible 24 hours a day, seven days a
week. The Company utilizes on-line computer terminals to enter customer orders
and to retrieve information about merchandise and its availability. Catalog
sales associates are generally able to help select merchandise and can provide
detailed information regarding size, color, fit and other merchandise features.
In most cases, sample merchandise is available for catalog sales associates to
view, thereby allowing them to better assist customers. Clothing purchased from
the catalog may be returned to any Company store or to the Company by mail.

To process catalog orders, sales associates enter orders on-line into a
computerized catalog order entry system which automatically updates all files,
including the Company's customer mailing list and permits the Company to measure
the response to individual merchandise and catalog mailings. Sales and inventory
information is available to the Company's buyers the next day. Computer
processing of orders is performed by the warehouse management system which
permits efficient picking of inventory from the warehouse. The Company's
efficient order entry and fulfillment systems permit the shipment of most orders
the following day. Orders are shipped primarily by second day delivery or, if
requested, by expedited delivery services, such as UPS priority.

Distribution

Inventory of basic merchandise in the Company stores is replenished
regularly based on sales tracked through its state-of-the-art point-of-sale
terminals. The Company uses a centralized distribution system, under which all
merchandise is received, processed and distributed through the Company's
principal distribution facility located in Hampstead, Maryland. Merchandise
received at the distribution center is promptly inspected to insure expected
quality in workmanship and conformity to Company sizing specifications. The
merchandise is then allocated to individual stores, packed for delivery and
shipped to the stores, principally by common carrier, usually within two days of
receipt. Each store generally receives a shipment of merchandise twice a week
from the distribution center; however, when necessary because of a store's size
or volume, a store can receive shipments more frequently. Shipments to catalog
customers are also made from the central distribution facility.

Management Information Systems

Since November 1991, the Company has replaced substantially all of its
management information systems with updated technology. The new systems provide
for automated stock replenishment and distribution, integrated accounts payable
and general ledger maintenance, purchase order management, forecasting and
planning, extensive management reporting capabilities through interactive and
batch processing and a comprehensive human resource/payroll system to support
future growth plans. The Company uses IBM AS\400 systems for substantially all
applications.

In January 1993, a complete new mail order system was installed and
integrated into the merchandising system and later

into the warehouse management system. Consistent with industry practice, the
Company uses an outside service to analyze and provide data in connection with
its catalog operations. The Company's last remaining mainframe system is used in
its manufacturing operation and has been modified to interface with its
merchandising systems. The Company plans to eliminate this remaining mainframe
system in 1997.

In order to assure the accuracy of inventory from purchase order
through the sale of an item to the consumer, the Company employs sophisticated
scanning, modern point-of-sale systems and updated distribution facilities. For
any item to be moved between stores and for all sales in the stores a bar-coded
tag must be scanned, which then causes the price to be captured via the price
look-up feature in the IBM 4680 point-of-sale terminal. A warehouse management
system was installed in August 1993 to improve the accuracy and control of
warehouse inventory. Since Fall 1993, warehouse distributions have been
controlled through the use of a "pick-to-light" system.

In connection with the millennium, the systems in many companies will
require significant modification to properly handle transactions. A thorough
review of the impact of this change is expected in the next year.

Manufacturing

Through its subsidiary, Manufacturer, the Company makes men's suits,
sport coats and pants at its two facilities located in the greater Baltimore
area. (See Item 2-Description of Properties) As of April 18, 1997, 383 employees
worked at these manufacturing facilities. From the initial inspection of piece
goods through final finishing and distribution, the Company's manufacturing
capabilities allow it complete control over merchandise flow, consistency of
sizing, and quality. The Company believes that its manufacturing capabilities
also allow the Company generally to achieve greater flexibility than it would be
able to achieve if the Company purchased items of comparable quality from
outside sources. In addition, the Company is using contract manufacturers for
certain categories of its clothing which can provide a quality product at
competitive prices.

The Company believes that the equipment and machinery it uses in its
manufacturing processes provide for efficient production and, in many instances,
represent the state-of-the-art in the industry. The Company currently utilizes
50% of its cutting capacity based on one shift per day and 75% of its sewing
capacity based on one shift per day. In fiscal 1996, the Company manufactured
approximately 50% of its tailored clothing which accounts for over 60% of the
Company's sales.

Competition

The Company competes primarily with other specialty retailers,
department stores and other catalogers engaged in the retail sale of apparel,
and to a lesser degree with other retailers of men's apparel. Among others, the
Company's store and catalog operations compete with Brooks Brothers, Nordstrom
and Lands End, as well as local competitors in each store's market. Many of
these major competitors are considerably larger and have substantially greater
financial, marketing and other resources than the Company.

In general, the Company believes that it maintains its competitive
position based not only on its ability to offer its quality career clothing at
price points typically established at 20-30% below those of its principal
competitors for items of comparable quality, but also on greater selection of
merchandise within the Company's focus on classic career clothing, the quality,
consistency and value of the Jos. A. Bank brand, and superior customer service.
The Company believes that it is able to achieve this pricing advantage for its
men's suits, sports coats and pants primarily by designing and manufacturing
substantially all of these items and for other men's clothing and accessories by
effectively sourcing and negotiating with vendors. In addition, the Company
believes that its Business Express program gives the Company distinct advantages
relative to its competition.

Trademarks

The Company is the owner in the United States of the trademark "Jos. A.
Bank". This trademark is registered in the United States Patent and Trademark
Office. A federal registration is renewable indefinitely if the trademark is
still in use at the time of renewal. The Company's rights in the Jos. A. Bank
trademark are a significant part of the Company's business. Accordingly, the
Company intends to maintain its trademark and the related registration. The
Company is not aware of any claims of infringement or other challenges to the
Company's right to use its trademark in the United States. The Company is also
the owner of pending applications for "The Miracle Tie Collection" (U.S. Serial
No. 75/219,824) and "Joe's Casual" (U.S. Serial No. 74/726,017).

Employees

As of April 18, 1997, the Company had 1,139 full-time employees and 281
part-time employees.

As of April 18, 1997, 383 employees worked at the Company's
manufacturing facilities, approximately 97% of whom are represented by the Union
of Needletrades Industrial & Textile Employees. The current collective
bargaining agreement, which was extended in 1997, expires on April 30, 2001. The
Company believes that union relations are good. During the past 48 years, the
Company has had only one work stoppage, which occurred more than 18 years ago.
The Company believes that its relations with its non-union employees are also
good. A small number of our sales associates are union members.

Item 2. DESCRIPTION OF PROPERTY

Except as noted below, the Company owns its manufacturing, distribution
and corporate office facilities located in the Maryland area, subject to certain
financing liens. See "Notes to Consolidated Financial Statements -- Note 6." The
Company believes that its existing facilities are well maintained and in good
operating condition. The table below presents certain information relating to
the Company's corporate properties as of April 18, 1997:

Location Gross Square Feet Owned/Leased Primary Function
- -------- ----------------- ------------ ----------------

Hampstead, Maryland......... 210,000 Owned Corporate offices, distribution center,
catalog fulfillment and regional tailoring
overflow shop
Baltimore, Maryland......... 118,000 Owned Coat and pants sewing plant and
central pressing.
Baltimore, Maryland......... 51,000 Leased Cutting facility

As of April 18, 1997, the Company had 72 Company-operated stores,
including its outlet stores, all of which were leased. The full line stores
average 8,500 square feet, including selling ,storage, tailor shop, and service
areas. The full line stores range in size from approximately 4,500 square feet
to approximately 19,000 square feet. The leases typically provide for an initial
term of between 10 and 15 years, with renewal options permitting the Company to
extend the term for between 5 and 10 years thereafter. The Company generally has
been successful in renewing its store leases as they expire. In most cases the
Company pays a fixed annual base rent plus a percentage rent based on the
store's annual sales in excess of specified levels. Most leases also require the
Company to pay real estate taxes, insurance and utilities and, other than free
standing locations, to make contributions toward the common area operating
costs. Most of the Company's lease arrangements provide for an increase in
annual fixed rental payments during the lease term.

In July 1996, the Company sold a 35,000 square foot manufacturing
facility in Hampstead, Maryland.

Item 3. LEGAL PROCEEDINGS

The Company has been named as a defendant in legal actions arising from
its normal business activities. Although the outcome of these lawsuits or other
proceedings against the Company cannot be accurately predicted, the Company does
not expect that any such liability will have a material adverse effect on the
business, net assets or financial position of the Company.

On December 14, 1995, the Company filed a Verified Complaint in the
United States District Court for the Northern District of Maryland (case No. MJG
95-3826) against J.A.B. of Lexington, Inc. and its principals (the "Defendants")
alleging federal trademark infringement, common law trademark and service mark
infringement, statutory unfair competition, common law unfair competition,
breach of franchise agreement, breach of lease, breach of promissory note and
breach of security agreement. Damages sought in the Verified Complaint are
unspecified. The Defendants have counterclaimed against the Company seeking
declaratory judgements, compensatory damages and punitive damages. The Company
denies the allegations in the counterclaims and intends to vigorously defend
same.

The unfair labor practice charge filed by the Regional Joint Board, Union of
Needletrades, Industrial and Textile Employees (Baltimore Regional Office,
National Labor Relations Board Case No. 5-CA-26484, as noted in the Company's
third quarter 10-Q, has been withdrawn by the Union.

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

No matters were submitted to a vote of the Company's security holders
during the quarter ended February 1, 1997.

PART II

Item 5. MARKET FOR THE REGISTRANTS COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

(a) Price Range of Common Stock, subsequent to its initial public offering in
May 3, 1994

The Common Stock is quoted on the National Association of Securities
Dealers Automated Quotation ("NASDAQ") National Market System under the trading
symbol "JOSB". The following table sets forth, for the periods indicated, the
range of high and low bid prices for the Common Stock, as reported on NASDAQ.
The approximate high and low bid prices for the Common Stock tabulated below
represent inter-dealer quotations which do not include retail mark-ups,
mark-downs or commissions. Such prices do not necessarily represent actual
transactions.

Fiscal 1995 Fiscal 1996
--------------- ---------------
High Low High Low
---- --- ---- ---

1st Quarter ................ $4.25 $2.50 $2.50 $1.63
2nd Quarter ................ 3.63 2.09 6.13 2.50
3rd Quarter ................ 4.88 2.50 4.88 2.94
4th Quarter ................ 3.00 1.50 5.00 3.00

1st Quarter (through April 25, 1997) $4.38 $3.63
On April 25, 1997 the closing sale price of the Common Stock was $3.81.

(b) Holders of Common Stock

At April 25, 1997, there were 169 holders of record of the Company's
Common Stock.

The Company intends to retain its earnings to finance the development
and expansion of its business and for working capital purposes, and therefore
does not anticipate paying any cash dividends in the foreseeable future. In
addition, the Company's Credit Agreement prohibits the Company from paying cash
dividends.

Item 6. SELECTED CONSOLIDATED FINANCIAL DATA

The following selected consolidated financial data with respect to each
of the fiscal years in the five-year period ended February 1, 1997 have been
derived from the Company's audited Consolidated Financial Statements. Fiscal
years 1992 through 1994 and fiscal year 1996 were 52-week years, and fiscal year
1995 was a 53-week year, each of which ended on the Saturday closest to the end
of January of the respective year. The information should be read in conjunction
with the Consolidated Financial Statements and Notes thereto that appear
elsewhere in the 10-K and "Management's Discussion and Analysis of Financial
Condition and Results of Operations."

Fiscal Year
--------------------------------------------------------------------------
1992 1993 1994 1995 1996
----------- ----------- ----------- ------------ ------------
(in thousands, except per share data)

Consolidated Statements of Income (Loss) Information:

Net Sales:
Men's...................... $99,461 $121,319 $143,465 $143,659 $155,058
Women's.................... 23,895 28,259 32,589 25,908 --
- --------------------------------------------------------------------------------------------------------------------
Net Sales (a)................ 123,356 149,578 176,054 169,567 155,058
Cost of goods sold........... 65,120 79,580 94,199 100,789 84,866
- --------------------------------------------------------------------------------------------------------------------
Gross profit................. 58,236 69,998 81,855 68,778 70,192
- --------------------------------------------------------------------------------------------------------------------
Operating Expenses:
General and administrative. 15,258 15,168 16,817 17,852 16,720
Sales and marketing........ 37,540 47,156 59,375 63,013 50,924
Store opening costs........ 240 1,064 1,025 -- 192
Termination of executive equity plan -- 3,425(c) -- -- --
Termination of participation in
multi-employer pension plan -- 3,300(b) -- -- --
Store repositioning costs.. -- -- -- 3,500(e) --
- --------------------------------------------------------------------------------------------------------------------
Total operating expenses.... 53,038 70,113 77,217 84,365 67,836
- --------------------------------------------------------------------------------------------------------------------
Operating income (loss)...... 5,198 (115) 4,638 (15,587) 2,356
Interest expense, net....... (2,043) (2,075) (2,430) (3,444) (1,946)

Income (loss) before benefit (provision)
for income taxes, extraordinary item
and cumulative effect of change in
accounting principle 3,155 (2,190) 2,208 (19,031) 410
(Provision) benefit for income taxes (1,222) 3,833 (861) 5,845 (159)
- --------------------------------------------------------------------------------------------------------------------
Income (loss) before extraordinary item and
cumulative effect of change in accounting
principle 1,933 1,643 1,347 (13,186) 251
Extraordinary Item:
Utilization of tax operating loss
carryforward 1,086 -- -- -- --
Cumulative effect of change in
accounting principle...... -- 2,127 -- -- --
- --------------------------------------------------------------------------------------------------------------------
Net income (loss)............ $3,019 $3,770 $1,347 $(13,186) $251
- --------------------------------------------------------------------------------------------------------------------

Per Share Information:
Income (loss) before extraordinary
items and cumulative effect of
change in accounting principle $0.40 $0.34 $0.22 ($1.94) $0.04
Extraordinary items........ 0.22 -- -- -- --
Cumulative effect of change in
accounting principle -- 0.44 -- -- --
- --------------------------------------------------------------------------------------------------------------------
Net income (loss) per share.. $0.62 $0.78 $0.22 ($1.94) $0.04
- --------------------------------------------------------------------------------------------------------------------
Weighted average number of
shares outstanding (d)..... 4,862 4,862 6,241 6,790 6,824

Balance Sheet Information (As of End of
Fiscal Year):
Working capital............ $26,547 $36,138 $45,089 $35,722 $28,631
Total assets............... 62,707 83,803 101,783 90,671 81,410
Total debt ................ 19,492 27,525 23,975 30,245 18,433
Total long-term obligations 21,013 31,730 28,180 33,632 21,366
Shareholder`s equity....... 25,115 30,390 48,631 35,445 35,699

(a) In 1995, the Company discontinued its womens product line to concentrate
solely on its men's business.
(b) During fiscal 1993, the Company recognized an expense and a corresponding
liability of $3.3 million relating to its termination of participation
in a multi-employer pension plan.
(c) As of January 29, 1994, the employment agreements between the Company and
two executives were amended to surrender the executives' rights to receive
certain payments related to increases in the equity value of the Company
in exchange for, among other things, 373,553 shares of the Company's
Common Stock.
(d) Gives effect to the exercise of all stock options and all shares issued
in the initial public offering in May 1994.
(e) In fiscal 1995, the Company recorded an expense of $3.5 million related
to the early adoption of Statement of Financial Accounting Standards No.
121 and costs to exit certain leases and reposition stores.

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

Overview

During fiscal year 1996, the Company focused on its core men's business
after discontinuing the women's business in 1995. Operating income for the year
ended February 1, 1997 improved $18.0 million to an operating income of $2.4
million from an operating loss of $15.6 million in 1995. The Company improved
its operating income in each quarter during fiscal 1996 compared to the same
quarter in fiscal 1995.

The turnaround in operating results for the year ended February 1, 1997
was due primarily to a) higher maintained margins which were driven by strong
suit sales, b) the elimination of the unprofitable, lower margin women's
business, c) men's comparable store sales increase of approximately 9.3 percent,
d) lower operating expenses and e) the closure of several unprofitable stores.
The Company has also restructured several leases to support its men's-only
business, adjusted its manufacturing capacity, relocated three stores and
lowered its store selling expenses. The increase in men's comparable store sales
was generated on men's average inventory levels that were approximately $5.6
million lower than the prior year as the Company improved its inventory turns.

The Company has not completely replaced the volume generated by the
women's division which generated sales of $25.9 million in fiscal 1995. To
increase sales and improve the leverage of its assets, the Company is opening
new stores, including six stores that were opened in fall 1996. The Company
expects to open up to ten new stores in 1997.

Results of Operations

The following table is derived from the Company's Consolidated
Statements of Income (Loss) and sets forth, for the periods indicated, the items
included in the Consolidated Statements of Income (Loss), expressed as a
percentage of net sales.

Percentage Of Net Sales
Fiscal Years
-------------------------------------
1994 1995 1996
Sales:
Men's .................................. 81.5% 84.7% 100.0%
Women's ................................ 18.5 15.3 --
- --------------------------------------------------------------------------------

Net Sales ................................ 100.0 100.0 100.0
Cost of goods sold ....................... 53.5 59.4 54.7
- --------------------------------------------------------------------------------

Gross profit ............................. 46.5 40.6 45.3
General and administrative expenses ...... 9.6 10.5 10.8
Sales and marketing expenses ............. 33.7 37.2 32.8
Store opening costs ...................... 0.6 -- .1
Store repositioning costs ................ -- 2.1 --
- --------------------------------------------------------------------------------

Operating income (loss) .................. 2.6 (9.2) 1.5
Interest expense, net .................... (1.3) (2.0) 1.2
- --------------------------------------------------------------------------------

Income (loss) before income taxes ........ 1.3 (11.2) 0.3
Income taxes ............................. (0.5) 3.4 0.1
- --------------------------------------------------------------------------------

Net income (loss) ........................ 0.8% (7.8)% 0.2%
- --------------------------------------------------------------------------------

Fiscal 1996 Compared to Fiscal 1995

Net Sales - Men's sales showed a strong improvement over the prior year as
reflected in the men's total sales increase of $11.4 million or 7.9% on sales of
$155.1 million in fiscal 1996 as compared to $143.7 million in fiscal 1995.
Men's comparable store sales also posted an increase of $10.6 million or 9.3% in
fiscal 1996, from $114.4 million to $125.0 million, while men's catalog sales
posted a $1.3 million increase or 8.3% on sales of $16.9 million in fiscal 1996
and $15.6 million in fiscal 1995. The increase in men's sales can be attributed
to favorable apparel trends, an improved merchandising mix, reduced competition
from attrition within the industry and improved efficiency in the Company's
marketing approach, among other factors.

Total sales decreased $14.5 million or 8.5% to $155.1 million in fiscal 1996
from $169.6 million in fiscal 1995 due to the discontinuance of the women's
product line which generated $25.9 million of net sales in fiscal 1995.

Gross Profit - Gross profit as a percentage of net sales rose to 45.3% in
fiscal 1996 from 40.6% in fiscal 1995. This improvement was due to the
elimination of the women's product line and the improvement of margins in the
continuing men's business through better sourcing and fresher product offering,
particularly in the higher margin suit and tie categories. Gross profit also
improved as the Company consolidated its in-store tailoring operations into
several Company-owned overflow shops. The 1996 cost of goods sold includes a
non-recurring cost of approximately $.4 million relating to cost overruns
associated with the manufacturing of formal wear on a contract basis, which the
Company has discontinued.

General and Administrative Expenses - General and administrative expenses
decreased $1.2 million to $16.7 million for fiscal 1996 compared to $17.9
million for fiscal 1995. Approximately $.7 million of the decrease was related
to severance in the first quarter of 1995 for terminated employees. The
remainder of the improvement was due primarily to lower professional fees and
payroll and related expenses which reflects the Company's continued focus on
controlling overhead costs. These reductions were partially offset by higher
employee relocation expenses and performance incentive compensation in 1996.

Sales and Marketing Expenses - Sales and Marketing expense decreased $12.1
million to $50.9 million in fiscal 1996 from $63.0 million in fiscal 1995. These
expenses also decreased to 32.8% of sales in 1996 from 37.2% in 1995 due
primarily to a) more efficient retail store advertising expenditures resulting
from a shift in strategy putting a greater emphasis on direct mail, b) the
elimination of the women's product line and its related costs, c) the reduction
of the number of catalogs mailed to prospects in the first half of 1996, and d)
a $.3 million expense reduction related to a lease settlement.

Store Opening Costs - The Company opened four new full-line stores in fiscal
1996 and incurred approximately $.2 million of new store opening expense. The
Company expects the new store opening cost per store in 1997 to be comparable to
the costs in 1996 as its strategy is to open new stores in existing markets
which requires lower incremental costs of opening compared to a new market.

Interest Expense - The decrease of $1.5 million in interest expense for fiscal
1996 is attributable to lower inventories and $.6 million of interest income
related to an income tax refund received from the Company's pre-1986 parent. The
Company expects interest expense to increase in fiscal 1997 as it increases its
borrowings to finance new store openings.

Income Taxes - The Company has net tax operating loss carryforwards (NOLs) of
approximately $19.6 million which expire through 2010. The NOLs were generated
during periods in which the Company operated its women's business along with the
men's business. In 1995, the Company discontinued its women's business to focus
its efforts on its men's business. Realization of the future tax benefits of the
NOLs is dependent on the Company's ability to generate taxable income within the
carryforward period. Management has determined, based on the Company's history
of earnings and its repositioning strategy discussed earlier, that future
earnings of the Company will more likely than not be sufficient to utilize at
least $16 million of the NOLs prior to their expiration. Accordingly, the
Company has recorded a deferred tax asset of $6.1 million and a valuation
allowance of $1.4 million relating to the NOLs. The average minimum taxable
income that the Company would need to generate prior to the expiration of the
NOLs would be less than the average taxable income that the Company earned
during fiscal years 1992 through 1994, as adjusted for unusual charges.
Management believes that although the prior earnings and current year operating
results might justify a higher amount, the $6.1 million represents a reasonable
estimate of the future utilization of the NOLs and will continue to evaluate the
likelihood of future profit and the necessity of future adjustments to the
deferred tax asset valuation allowance. No assurance can be given that
sufficient taxable income will be generated for full utilization of the NOLs.

Fiscal 1995 Compared to Fiscal 1994

Net Sales - Net sales decreased $6.5 million or 3.7% to $169.6 million in
fiscal 1995 from $176.1 million in fiscal 1994. Total men's sales of $143.7
million in fiscal 1995 were comparable to the prior year, and sales from the
women's business declined $6.7 million from $32.6 million to $25.9 million as
the Company was exiting this product line. Men's comparable store sales
increased $4.1 million, or 3.6%, in fiscal 1995 while men's catalog sales
decreased $5.1 million, or 21.8%. The increase in men's comparable store sales
was primarily due to an increase in promotional activity and the expansion of
the sportswear offering. The decrease in catalog sales was primarily due to
decreased circulation as the Company reacted to increased paper and postage
costs.

Gross Profit - Gross profit as a percentage of net sales declined to 40.6% in
fiscal 1995 from 46.5% in fiscal 1994 due primarily to the significant erosions
in the women's gross margins resulting from the Company's decision to
discontinue its women's product line and the resulting need to sell off the
inventory (which was completed in fiscal 1995). Men's gross profit percentage
declined slightly from 1994 to 1995 primarily as a result of increased
promotional activity as the Company incurred startup costs for its new
sportswear line and competitive pressures in the men's apparel market.

General and Administrative Expenses - General and administrative expenses of
$17.9 million increased $1.1 million from $16.8 million in fiscal 1995 due
primarily to severance pay of $1.0 million, related to staff reductions during
1995.

Sales and Marketing Expenses - Sales and marketing expenses increased as a
percentage of net sales to 37.2% in fiscal 1995 from 33.7% in fiscal 1994
primarily as a result of higher marketing expenses for image advertising of the
increased sportswear offering, higher catalog costs due to increased postage and
paper costs and increased advertising necessitated by the promotional nature of
the men's clothing industry in fiscal 1995.

Store Opening Costs - The Company did not incur significant store opening
costs in fiscal 1995, compared to fiscal 1994 when it incurred $1.0 million.

Store Repositioning Costs - The Company has recorded a $3.5 million charge
which includes a $2.3 million impairment of assets associated with the early
adoption of Statement of Financial Accounting Standards No. 121 and a $1.2
million charge to exit certain leases and reposition stores.

Interest Expense - Interest expense increased $1.0 million in fiscal 1995. The
increase was due primarily to increased interest rates on the revolving loan and
an increase in the outstanding balance.

Income Taxes -The Company has net tax operating loss carryforwards (NOLs) of
approximately $20 million which expire through 2010. SFAS No. 109 - Accounting
for Income Taxes requires that the tax benefit of such NOL's be recorded as an
asset to the extent that management assesses the utilization of such NOL's to be
"more likely than not". Realization of the future tax benefits is dependent on
the Company's ability to generate taxable income within the carryforward period.
Future levels of operating income are dependent upon general economic
conditions, including interest rates and general levels of economic activity,
competitive pressures on sales and margins and other factors beyond the
Company's control, and no assurance can be given that sufficient taxable income
will be generated for full utilization of the NOL's. Management has determined,
based on the Company's history of prior operating earnings and its expectations
for the future, that operating income of the Company will more likely than not
be sufficient to utilize at least $16 million NOL's prior to their expiration.

Liquidity and Capital Resources

The Company's availability in excess of outstanding borrowings as
supported by the existing borrowing base under its Credit Agreement has
increased to $13.4 million at April 18, 1997 compared to $7.2 million at the
same time in 1996. In April 1996 the Company extended its $40 million Credit
Agreement to April 1999, which reduced the financial covenant requirements and
provides for a seasonal over-advance. An additional $7.3 million of potential
availability exists to support additional inventory purchases if required. The
Company's availability at April 18, 1997 has increased by $6.2 million compared
to the same time in 1995 principally by a) lower inventory levels, b) better
terms with vendors, c) the tax refund from its pre-1986 parent and d) reduced
letter of credit requirements from several landlords. The Company reduced its
total debt by $11.8 million in 1996 to $18.4 million at February 1, 1997 from
$30.2 million at February 3, 1996.

The following table summaries the Company's sources and uses of funds
as reflected in the condensed consolidated statements of cash flows:
Year Ended
February 3, February 1,
1996 1997
----------- -----------

Cash provided by (used in):
Operating activities ................ $(3,564) $ 13,582
Investing activities, net ........... (2,094) (1,373)
Financing activities ................ 5,565 (12,134)
- --------------------------------------------------------------------------------

Net (decrease) increase in cash and
cash equivalents ........................ $ (93) $ 75
- --------------------------------------------------------------------------------

Cash provided by the Company's operating activities was due primarily
to improved operating results, the income tax refund received from its pre-1986
parent, improved vendor terms and lower inventory levels. Cash used in investing
activities relates primarily to leasehold improvements in new and relocated
stores and continued consolidation of the Company's tailoring operations, net of
proceeds from the sale of one of the Company's three manufacturing plants. Cash
used in financing activities represents primarily repayments of the revolving
loan under the Credit Agreement.

The Company spent $2.2 million on capital expenditures in fiscal year
1996 as it implemented its program to reposition its existing store base, which
included $1.1 million to open four new company-owned stores in fall 1996 and $.8
million to relocate three stores. The Company also opened two new franchise
stores. The Company closed two unprofitable full-line stores in 1996, as well as
five catalog stores. These closed stores accounted for less than 2% of sales in
1995.

The Company expects to spend between $4.0 and $5.0 million in capital
expenditures to open up to ten new stores and renovate existing stores in 1997.
The Company believes that its current liquidity and Credit Agreement will be
adequate to maintain its currently anticipated working capital and investment
needs. The Company's plans and beliefs concerning 1997 contained herein are
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Actual results may differ materially from those
forecast due to a variety of factors that can adversely affect the Company's
operating results, liquidity, and financial condition.

Seasonality

Unlike many other retailers, the Company's operations are not greatly
affected by seasonal fluctuations. Although variations in sales volumes do exist
between quarters, the Company believes the nature of its merchandise helps to
stabilize demand between the different periods of the year. The Company does not
expect seasonal fluctuation to materially affect its operations in the future.

Item 8. FINANCIAL STATEMENTS AND SUPPLEMENT DATA

The financial statements listed in Item 14(a) 1 and 2 are included in
the Report beginning on page F-1.

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

None.

PART III

Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The information included under the captions "Directors", "Executive
Officers" and "Compliance with Section 16(a) of the Exchange Act" in the
Company' proxy statement for the 1997 Annual Meeting of Shareholders to be filed
with the Commission (the "Proxy Statement") are incorporated herein by
reference.

Item 11. EXECUTIVE COMPENSATION

The information included under the captions "Executive Compensation",
"Executive Employment Agreements", "Compensation of Directors", "Report of the
Compensation Committee of the Board of Directors" and "Performance Graph" in the
Company's Proxy Statement are incorporated herein by reference.

Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The information included under the caption "Security Ownership of
Directors and Officers" in the Company's Proxy Statement is incorporated herein
by reference.

Item 13. CERTAIN RELATIONSHIP AND RELATED TRANSACTIONS

The information included under the caption "Certain Transactions" in
the Company's Proxy Statement is incorporated herein by reference.

PART IV

Item 14. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K

(a) The following Financial Statements of Jos. A. Bank Clothiers, Inc., the
notes thereto, and the related reports thereon of the independent public
accountants are filed under Item 8 of this report:

1. Financial Statements Page

Report of Independent Public Accountants................................... F-1
Consolidated Balance Sheets as of February 3, 1996 and February 1, 1997.... F-2
Consolidated Statements of Income (Loss) for the Years Ended
January 28, 1995, February 3, 1996 and February 1, 1997.................. F-3
Consolidated Statement of Shareholders' Equity for the Years Ended
January 28, 1995, February 3, 1996 and February 1, 1997.................. F-4
Consolidated Statements of Cash Flows for the Years Ended
January 28, 1995, February 3, 1996 and February 1, 1997.................. F-5
Notes to Consolidated Financial Statements................................. F-6

2. Financial Statement Schedules

All required information is included within the Consolidated Financial
Statements and the notes thereto.

(b) Forms 8-K

No reports on Form 8-K were filed during the last quarter of the year
covered by this Annual Report on Form 10-K, which ended on February 1, 1997.

(c) Exhibits
3.1 -- Restated Certificate of Incorporation of the Company.*......................................
3.2 -- By-laws of the Company, together with all amendments thereto.*..............................
4.1 -- Form of Common Stock certificate.*..........................................................
4.2 -- Amended and Restated Stockholders Agreement, dated as of January 29, 1994,
among the parties named therein.*.........................................................
10.4(a) -- Second Amendment to Third Amended and Restated Credit
Agreement, dated as of October 24, 1994, by and among the
Company, Wells Fargo Bank, N.A. National Association and other
lenders named therein **..................................................................
10.4(b) -- Third Amendment to Third Amended and Restated Credit Agreement,
dated as of April 26, 1995, by and among the Company, Wells Fargo
Bank, N.A. and other lenders named therein. **............................................
10.4(c) -- Fourth Amendment to Third Amended and Restated Credit Agreement,
dated as of June 30, 1995, by and among the Company, Wells Fargo
Bank, N.A. and other lenders named therein. **............................................
10.4(d) -- Fifth Amendment to Third Amended and Restated Credit Agreement,
dated as of July 28, 1995, by and among the Company, Wells Fargo
Bank, N.A. and other lenders named therein. **............................................
10.4(e) -- Sixth Amendment to Third Amended and Restated Credit Agreement,
dated as of August 15, 1995, by and among the Company, Wells Fargo
Bank, N.A. and other lenders named therein. **............................................
10.4(f) -- Fourth Amended and Restated Credit Agreement, April 30, 1996, by and
among the Company, Wells Fargo Bank, N.A. ***.............................................
21.1 -- Company subsidiaries *
10.5(b) -- Amendment to Finley Employment Agreement, dated as of January 29,
1994, filed herewith......................................................................
10.6(b) -- Amendment to Schwartz Employment Agreement, dated as of January 29, 1994,
filed herewith............................................................................

10.5(a) -- Employment Agreement, dated as of March 31, 1994, between Timothy F. Finley and
Jos. A. Bank Clothiers, Inc., filed herewith..............................................
10.6(a) -- Employment Agreement, dated as of March 31, 1994, between Henry C. Schwartz and
Jos. A. Bank Clothiers, Inc., filed herewith..............................................
10.6(c) -- Amendment to Employment Agreement, dated February 3, 1996, by and between
Henry C. Schwartz and Jos. A. Bank Clothiers, Inc., filed herewith........................
10.7 -- Employment Agreement, dated February 5, 1996, between Frank Tworecke and Jos. A.
Bank Clothiers, Inc., filed herewith......................................................
10.8 -- Employment Agreement, dated February 5, 1996, between David E. Ullman and Jos. A.
Bank Clothiers, Inc., filed herewith......................................................
10.9 -- Jos. A. Bank Clothiers, Inc. Retirement and Savings Plan and Trust Agreement as
amended and restated effective April 1, 1994., filed herewith.............................
10.10 -- Collective Bargaining Agreement between Retail Employees Union Local 340,
Amalgamated Clothing and Textile Workers Union, AFL-CIO and Jos. A. Bank Clothiers
Inc., filed herewith......................................................................
10.11 -- Union Agreement, dated May 1, 1995, by and between Joseph A. Bank Mfg. Co., Inc. and
Baltimore Regional Joint Board, Amalgamated Clothing and Textile Workers Union (also known
as U.N.I.T.E.), filed herewith............................................................

- ---------------
* Incorporated by reference to the Company's Registration Statement on Form
S-1 filed May 3, 1994.
** Incorporated by reference to the Company's Annual Report on Form 10-K for
the year ended January 28, 1995.
*** Incorporated by reference to the Company's Annual Report on Form 10-K for
the year ended February 3, 1996.

Pursuant to the requirements Section 13 and 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of
Hampstead, State of Maryland, on April 18, 1997.

JOS. A. BANK CLOTHIERS, INC.
(registrant)
By: /s/: Timothy F. Finley
----------------------

TIMOTHY F. FINLEY
CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER

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

NAME TITLE DATE

/s/: Timothy F. Finley Director, Chairman of the Board and Chief
- ----------------------- Executive Officer (Principal Executive Officer)... April 18, 1997

/s/: Frank Tworecke President and Chief Merchandising Officer......... April 18, 1997
- -----------------------

/s/: David E. Ullman Executive Vice President, Chief Financial Officer. April 18, 1997
- -----------------------

/s/: Thomas E. Polley Vice President, Controller (Principal
- ----------------------- Accounting Officer), Treasurer.................... April 18, 1997

/s/: Robert B. Bank Director.......................................... April 18, 1997
- -----------------------

/s/: Andrew A. Giordano Director.......................................... April 18, 1997
- -----------------------

/s/: Gary S. Gladstein Director.......................................... April 18, 1997
- -----------------------

/s/: Peter V. Handal Director.......................................... April 18, 1997
- -----------------------

/s/: David A. Preiser Director......................................... April 18, 1997
- -----------------------

/s/: Robert N. Wildrick Director......................................... April 18, 1997
- -----------------------

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors and Shareholders
of Jos. A. Bank Clothiers, Inc.

We have audited the accompanying consolidated balance sheets of Jos. A. Bank
Clothiers, Inc. (a Delaware corporation) and subsidiaries as of February 3,
1996, and February 1, 1997, and the related consolidated statements of income
(loss), shareholders' equity and cash flows for the years ended January 28,
1995, February 3, 1996, and February 1, 1997. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. 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 financial statements referred to above present fairly,
in all material respects, the financial position of Jos. A. Bank Clothiers,
Inc. and subsidiaries as of February 3, 1996, and February 1, 1997, and the
results of its operations and its cash flows for the years ended January 28,
1995, February 3, 1996, and February 1, 1997, in conformity with generally
accepted accounting principles.

/s/ Arthur Andersen LLP
- -----------------------

Baltimore, Maryland,
March 11, 1997

F-1

JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES
---------------------------------------------

CONSOLIDATED BALANCE SHEETS
---------------------------

AS OF FEBRUARY 3, 1996 AND FEBRUARY 1, 1997
-------------------------------------------
(In Thousands, Except Share Information)

ASSETS
February 3, 1996 February 1, 1997
---------------- ----------------

CURRENT ASSETS:
Cash and cash equivalents $ 644 $ 719
Accounts receivable 3,866 3,300
Inventories 43,273 40,883
Prepaid expenses and other current assets 4,333 4,874
Deferred income taxes 5,200 3,200
- -------------------------------------------------------------------------------------------------
Total current assets 57,316 52,976

NON-CURRENT ASSETS:
Property, plant and equipment, net 25,671 22,840
Other noncurrent assets, net 1,717 1,511
Deferred income taxes 5,967 4,083
- -------------------------------------------------------------------------------------------------
Total assets $ 90,671 $ 81,410
- -------------------------------------------------------------------------------------------------

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:
Accounts payable $ 8,929 $ 12,357
Accrued expenses 10,896 10,484
Current portion of long-term debt 856 685
Current portion of capital lease obligations 183 16
Current portion of pension liability 730 803
- -------------------------------------------------------------------------------------------------
Total current liabilities 21,594 24,345

NON-CURRENT LIABILITIES:
Long-term debt 29,389 17,748
Long-term capital lease obligations 16 --
Deferred rent 2,666 2,860
Pension liability 1,561 758
- -------------------------------------------------------------------------------------------------
Total liabilities 55,226 45,711
- -------------------------------------------------------------------------------------------------

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY:
Common stock, $.01 par, 20,000,000 shares authorized,
6,999,567 issued and 6,790,152 outstanding as of
February 3, 1996 and 7,000,567 issued and 6,791,152
outstanding as of February 1, 1997 70 70
Preferred stock, $1.00 par, 500,000 shares authorized,
none outstanding -- --
Additional paid-in capital 56,333 56,336
Accumulated deficit (19,038) (18,787)
Less 209,415 shares of common stock held in treasury,
at cost (1,920) (1,920)
- -------------------------------------------------------------------------------------------------
Total shareholders' equity 35,445 35,699
- -------------------------------------------------------------------------------------------------
Total liabilities and shareholders' equity $ 90,671 $ 81,410
- -------------------------------------------------------------------------------------------------

The accompanying notes are an integral part of these consolidated balance sheets.

F-2

JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES
---------------------------------------------

CONSOLIDATED STATEMENTS OF INCOME (LOSS)
----------------------------------------

FOR THE YEARS ENDED JANUARY 28, 1995, FEBRUARY 3, 1996 AND FEBRUARY 1, 1997
---------------------------------------------------------------------------
(In Thousands, Except Share Information)

Years Ended
----------------------------------------------
Jan. 28, 1995 Feb. 3, 1996 Feb. 1, 1997
------------- ------------ ------------

NET SALES:
Men's $ 143,465 $ 143,659 $ 155,058
Women's 32,589 25,908 --
- -----------------------------------------------------------------------------------------------------------------------

NET SALES 176,054 169,567 155,058

COST OF GOODS SOLD 94,199 100,789 84,866
- -----------------------------------------------------------------------------------------------------------------------
Gross profit 81,855 68,778 70,192
- -----------------------------------------------------------------------------------------------------------------------

OPERATING EXPENSES:
General and administrative 16,817 17,852 16,720
Sales and marketing 59,375 63,013 50,924
Store opening costs 1,025 -- 192
Store repositioning costs -- 3,500 --
- -----------------------------------------------------------------------------------------------------------------------
Total operating expenses 77,217 84,365 67,836
- -----------------------------------------------------------------------------------------------------------------------

OPERATING INCOME (LOSS) 4,638 (15,587) 2,356

Interest expense, net (2,430) (3,444) (1,946)
- -----------------------------------------------------------------------------------------------------------------------
Income (loss) before (provision) benefit for
income taxes 2,208 (19,031) 410

(Provision) benefit for income taxes (861) 5,845 (159)
- -----------------------------------------------------------------------------------------------------------------------

NET INCOME (LOSS) $ 1,347 $ (13,186) $ 251
- -----------------------------------------------------------------------------------------------------------------------

PER COMMON SHARE:
Fully diluted earnings (loss) per common share $ .22 $ (1.94) $ .04
- -----------------------------------------------------------------------------------------------------------------------

WEIGHTED AVERAGE SHARES OUTSTANDING 6,240,700 6,790,152 6,824,117
- -----------------------------------------------------------------------------------------------------------------------

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

F-3

JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES
---------------------------------------------

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
-----------------------------------------------

FOR THE YEARS ENDED JANUARY 28, 1995, FEBRUARY 3, 1996 AND FEBRUARY 1, 1997
---------------------------------------------------------------------------
(In Thousands, Except Share Information)

Additional Total
Common Preferred Paid-In Accumulated Treasury Shareholders'
Stock Stock Capital Deficit Stock Equity
------ --------- ---------- ----------- -------- -------------

BALANCE, January 29, 1994 $ 50 $ -- $ 39,459 $ (7,199) $ (1,920) $ 30,390

Net proceeds from issuance of
common stock (2,000,000 shares)
pursuant to initial public offering 20 -- 16,874 -- -- 16,894

Net income -- -- -- 1,347 -- 1,347
- ------------------------------------------------------------------------------------------------------------------------

BALANCE, January 28, 1995 70 -- 56,333 (5,852) (1,920) 48,631

Net loss -- -- -- (13,186) -- (13,186)
- ------------------------------------------------------------------------------------------------------------------------

BALANCE, February 3, 1996 70 -- 56,333 (19,038) (1,920) 35,445

Net proceeds from issuance of
common stock (1,000 shares)
pursuant to Incentive Option Plan -- -- 3 -- -- 3

Net income -- -- -- 251 -- 251
- ------------------------------------------------------------------------------------------------------------------------

BALANCE, February 1, 1997 $ 70 $ -- $ 56,336 $ (18,787) $ (1,920) $ 35,699
- ------------------------------------------------------------------------------------------------------------------------

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

F-4

JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES
---------------------------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS
-------------------------------------

FOR THE YEARS ENDED JANUARY 28, 1995, FEBRUARY 3, 1996 AND FEBRUARY 1, 1997
---------------------------------------------------------------------------
(In Thousands)

Years Ended
--------------------------------------------------
Jan. 28, 1995 Feb. 3, 1996 Feb. 1, 1997
------------- ------------ ------------

CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 1,347 $ (13,186) $ 251
Adjustments to reconcile net income (loss)
to net cash provided by (used in) operating
activities:
Deferred tax (benefit) expense 427 (5,533) 3,884
Depreciation and amortization 4,088 4,668 3,901
(Gain) loss on disposition of assets -- 168 (25)
Store repositioning costs -- 3,500 --
Changes in assets and liabilities:
(Increase) decrease in accounts receivable (1,082) 679 566
(Increase) decrease in inventories (8,941) 8,609 2,390
(Increase) decrease in prepaid expenses and
other current assets (2,278) 3,491 (541)
(Increase) decrease in other non-current assets -- (776) 101
Increase (decrease) in accounts payable 3,794 (5,386) 3,428
Increase (decrease) in long-term pension liability (665) (665) (730)
Increase (decrease) in accrued expenses (350) 406 163
Increase in deferred rent 385 461 194
- ---------------------------------------------------------------------------------------------------------------------------------
Net cash provided by (used in) operating
activities (3,275) (3,564) 13,582
- ---------------------------------------------------------------------------------------------------------------------------------

CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (9,377) (2,231) (2,152)
Proceeds from disposal of assets -- 137 779
- ---------------------------------------------------------------------------------------------------------------------------------
Net cash used in investing activities (9,377) (2,094) (1,373)
- ---------------------------------------------------------------------------------------------------------------------------------

CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings under revolving loan agreement 67,310 54,364 29,786
Repayment of borrowings under revolving loan
agreement (62,710) (47,550) (40,680)
Proceeds from issuance of other long-term debt 324 -- --
Repayment of other long-term debt (8,474) (544) (918)
Net proceeds from issuance of common stock 16,894 -- 3
Principal payments under capital lease obligations (196) (212) (183)
Payments related to debt financing (130) (493) (142)
- ---------------------------------------------------------------------------------------------------------------------------------
Net cash provided by financing activities 13,018 5,565 (12,134)
- ---------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in cash and cash
equivalents 366 (93) 75

CASH AND CASH EQUIVALENTS, beginning of year 371 737 644
- ---------------------------------------------------------------------------------------------------------------------------------

CASH AND CASH EQUIVALENTS, end of year $ 737 $ 644 $ 719
- ---------------------------------------------------------------------------------------------------------------------------------

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

F-5

JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES
---------------------------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------
JANUARY 28, 1995, FEBRUARY 3, 1996 AND FEBRUARY 1, 1997
-------------------------------------------------------

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
-------------------------------------------

Description of Business - Jos. A. Bank Clothiers, Inc. (Clothiers) is a
manufacturer and nationwide retailer of classic men's clothing through
conventional retail stores, including catalog direct marketing and franchisees.

Fiscal Year - The Company maintains its accounts on a fifty-two / fifty-three
week fiscal year ending on the Saturday nearest to January 31. The fiscal years
ended January 28, 1995 (fiscal 1994) and February 1, 1997 (fiscal 1996), each
contained fifty-two weeks and the fiscal year ended February 3, 1996 (fiscal
1995) contained fifty-three weeks.

Basis of Presentation - The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.

Principles of Consolidation - The consolidated financial statements include the
accounts of Clothiers and its wholly-owned subsidiaries, The Joseph A. Bank Mfg.
Co., Inc. and National Tailoring Services, Inc. (collectively referred to as the
Company). All significant intercompany balances and transactions have been
eliminated in consolidation.

Cash and Cash Equivalents - Cash and cash equivalents include overnight
investments.

Supplemental Cash Flow Information - Interest and income taxes paid were as
follows (in thousands):

Years Ended
-------------------------------------
January 28, February 3, February 1,
1995 1996 1997
----------- ----------- -----------
Interest paid $2,125 $2,679 $2,784
Income taxes paid 323 30 100

Inventories - Inventories are stated at the lower of first-in first-out, cost or
market. The Company capitalizes into inventories certain warehousing and
delivery costs associated with getting its manufactured and purchased
merchandise to the point of sale.

Catalogs and Promotional Materials - Costs related to mail order catalogs and
promotional materials are included in prepaid expenses and other current assets.
These costs are amortized over the expected periods of benefit, not to exceed
six months. At February 3, 1996 and February 1, 1997, prepaid catalog and
promotional materials were approximately $1,375,000 and $1,505,000,
respectively.

Property, Plant and Equipment - Property, plant and equipment are stated at
cost. The Company depreciates and amortizes property, plant and equipment on a
straight-line basis over the following estimated useful lives:

Estimated
Asset Class Useful Lives
---------------------- --------------
Buildings 25 years
Equipment 3-10 years
Furniture and fixtures 10 years
Leasehold improvements Initial term of
lease, not to
exceed 10 years

Other Noncurrent Assets - Other noncurrent assets includes deferred financing
costs of $620,000 and $514,000 as of February 3, 1996 and February 1, 1997,
respectively. Deferred financing costs were incurred in connection with the
Company's bank credit agreement described in Note 6 and are being amortized as
additional interest expense over the remaining term of the agreement using the
effective interest method. Other noncurrent assets include $776,000 and $675,000
of notes receivable as of February 3, 1996 and February 1, 1997, respectively.

Franchise Revenue Recognition - Initial franchise fees for a store are generally
recognized as revenue when the Company has provided substantially all the
initial franchise services. Inventory sales (and cost of sales) to the
franchisees are recognized when the inventory is shipped. Monthly franchise fees
are recorded when earned under the franchise agreements.

Lease Expense - The Company records lease expense in accordance with Statement
of Financial Accounting Standards (SFAS) No. 13 -- Accounting for Leases. As
such, rent expense on leases is recorded on a straight-line basis over the term
of the lease and the excess of expense over cash amounts paid are reflected as
"deferred rent" in the accompanying balance sheets.

Store Opening Costs - Costs incurred in connection with start-up and promotion
of new store openings are expensed as incurred.

F-6

Income Taxes - The Company accounts for income taxes in accordance with SFAS No.
109 -- Accounting for Income Taxes. Under SFAS 109, the liability method is used
in accounting for income taxes. Deferred tax liabilities are determined based on
differences between the financial reporting and tax basis of assets and
liabilities and are measured using tax rates and laws that are expected to be in
effect when the differences are scheduled to reverse.

Earnings Per Share - Net income (loss) per common share was computed based on
the net income (loss) divided by the weighted average number of common shares
outstanding. Primary income (loss) per share approximates fully diluted income
per share in each year presented. For net income per common share, the effect of
stock options is factored into the calculation of weighted average shares
outstanding using the treasury stock method.

Accounting for Stock Based Compensation - In October 1995, the Financial
Accounting Standards Board issued SFAS No. 123, "Accounting for Stock Based
Compensation." With respect to stock options granted to employees, SFAS No. 123
permits companies to continue using the accounting method promulgated by the
Accounting Principles Board Opinion No. 25 ("APB No. 25"), "Accounting for Stock
Issued to Employees", to measure compensation expense or to adopt the fair value
based method prescribed by SFAS No. 123. If APB No. 25's method is continued,
pro forma disclosures are required as if SFAS No. 123 accounting provisions were
followed. Management has elected to continue to measure compensation expense
under APB No. 25, with pro forma footnote disclosures of the expense under the
SFAS No. 123 method (See Note 11).

Reclassifications - Certain reclassifications have been made to the February 3,
1996, financial statements in order to conform with the February 1, 1997,
presentation.

New Accounting Pronouncement - In February 1997, the FASB issued Statement No.
128 (SFAS 128), "Earnings per Share," which establishes new standards for
computing and presenting earnings per share. SFAS 128 is effective for financial
statements for periods ending after December 15, 1997, including interim
periods.

2. CAPITAL STRUCTURE AND INITIAL PUBLIC OFFERING
---------------------------------------------

Effective January 29, 1994, the Company changed its capital structure by
authorizing 20,000,000 shares of new Common Stock, $.01 par value per share
(Common Stock), and 500,000 shares of new preferred stock, $1.00 par value per
share (Preferred Stock).

The Company then issued 3,912,363 shares of its new Common Stock in exchange for
all of its previously issued preferred stock. The Company also issued 713,651
shares of its new Common Stock to the holders of its former common stock. All of
the previously issued preferred and common stock of the Company was canceled.

On May 10, 1994, the Company sold 2,000,000 shares of its Common Stock for
$10.00 per share in connection with an initial registration with the Securities
Exchange Commission. In connection with this transaction, the Company incurred
costs of $3,106,000 consisting principally of underwriting, legal, accounting
and other fees. The net proceeds of $16,894,000 were used to pay off long-term
debt of approximately $8,100,000 and for the opening of new stores.

3. INVENTORIES:
------------

Inventories at February 3, 1996 and February 1, 1997, consist of the following
(in thousands):

February 3, 1996 February 1, 1997
---------------- ----------------

Finished goods $ 35,650 $ 32,104
Work in process 2,331 4,717
Raw materials 5,292 4,062
- ------------------------------------------------------------
Total $ 43,273 $ 40,883
- ------------------------------------------------------------

4. PROPERTY, PLANT AND EQUIPMENT:
------------------------------

Property, plant and equipment at February 3, 1996 and February 1, 1997, consist
of the following (in thousands):

February 3, 1996 February 1, 1997
---------------- ----------------

Land $ 671 $ 475
Buildings and
improvements 28,112 28,062
Equipment,
furniture and fixtures 20,088 19,541
- ---------------------------------------------------------------
48,871 48,078
Less: Accumulated
depreciation and
amortization (23,200) (25,238)
- ---------------------------------------------------------------
Property, plant and
equipment, net $ 25,671 $ 22,840
- ---------------------------------------------------------------

5. ACCRUED EXPENSES:
-----------------

Accrued expenses at February 3, 1996 and February 1, 1997, consist of the
following (in thousands):

F-7

Feb. 3, 1996 Feb. 1, 1997
------------ ------------

Accrued compensation
and benefits $ 3,129 $ 4,595
Accrued store
repositioning costs 1,200 273
Accrued advertising 2,961 2,142
Gift certificate
payable 1,108 1,135
Other accrued expenses 2,498 2,339
- --------------------------------------------------------
Total $ 10,896 $ 10,484
- --------------------------------------------------------

Other accrued expenses consist primarily of liabilities related to interest,
sales taxes, customer deposits, and percentage rent.

6. LONG-TERM DEBT:
---------------

Long-term debt at February 3, 1996 and February 1, 1997, consist of the
following (in thousands):

February 3, February 1,
1996 1997
-------------- -------------
Bank credit agreement-
Borrowings under
long-term revolving
loan agreement $ 28,904 $ 18,010

Note related to lease
termination, discounted
at 10.5%, payable in
variable installments
through January 15, 1998 396 89

Notes related to lease-
hold improvements,
interest at 2% plus
prime and 13.0%,
payable in monthly
installments through
June 1, 2012 484 134

Notes related to
building improve-
ments, interest at 10%,
payable in monthly
installments through
July 1, 1997 233 85

Mortgages payable,
interest at 3%, payable
in monthly installments
through September 1,
1999; secured by related
land and building 158 115

Mortgage payable, interest
at 6.5%, payable in
monthly installments
through May 1, 2000;
secured by related
properties 70 --
- -------------------------------------------------------------
Total debt 30,245 18,433

Less: Current maturities 856 685
- -------------------------------------------------------------
Long-term debt $ 29,389 $ 17,748
- -------------------------------------------------------------

Bank Credit Agreement - The Company maintains a $40 million bank credit
agreement (the "Credit Agreement"), which provides for a revolving loan whose
limit is determined by a formula based on the Company's inventories, accounts
receivable and real estate and equipment values. In April 1996, the Company
extended the Credit Agreement to April 1999. The amended Credit Agreement
changed the maximum borrowing under the revolver facility to $38,000,000 and
provided a term loan facility of $2,000,000 payable in monthly installments
based on a five-year amortization with any outstanding balance due in April
1999. The Credit Agreement also includes financial covenants concerning net
worth and working capital, among others, limitations on capital expenditures (up
to $7 million in fiscal 1997) and additional indebtedness and a restriction on
the payment of dividends. Interest rates under the amended agreement range from
prime plus 1.5% to prime plus 2.0% or LIBOR plus 3.5%. The amended agreement
also includes an early termination fee and provisions for a seasonal
over-advance.

As of February 3, 1996 and February 1, 1997 the Company's availability in excess
of outstanding borrowings under the formula was $5,500,000 and $13,750,000,
respectively. Substantially all assets of the Company are collateralized under
the Credit Agreement.

During the years ended January 28, 1995 and February 3, 1996, borrowings under
the Credit Agreement bore interest ranging from prime plus 1.5% to prime plus 2%
or LIBOR plus 3%. Amounts outstanding under the Credit Agreement as of February
1, 1997, bear interest at rates ranging from 9.0% to 10.75% which will vary in
the future depending upon prime and LIBOR.

In addition to borrowings under the Credit Agreement, the Company has issued
letters of credit aggregating approximately $517,000 at February 1, 1997, to
secure the payment of certain liabilities.

The aggregate maturities of the Company's long-term debt as of February 1, 1997,
are as follows: year ending 1998-$685,000; 1999-$479,000; 2000-$17,269,000;

F-8

7. COMMITMENTS AND CONTINGENCIES:
------------------------------

Litigation - Lawsuits and claims are filed from time to time against the Company
in its ordinary course of business. Management, after reviewing developments to
date with legal counsel, is of the opinion that the outcome of such matters will
not have a material adverse effect on the net assets of the Company or the
accompanying financial statements taken as a whole.

Employment Agreements - The Company has employment agreements with certain of
its executives expiring between 1998 and 1999, aggregating base compensation of
$2,177,000 over the term. The contracts also provide for additional incentive
payments subject to performance standards. In addition, other employees are
eligible for incentive payments based on performance. For fiscal 1996, the
Company expensed approximately $925,000 in incentive payments. No incentive
payments were expensed in fiscal years 1994 and 1995.

Lease Obligations - The Company has numerous noncancelable operating leases for
retail stores, certain office space and equipment. Certain facility leases
provide for annual base minimum rentals plus contingent rentals based on sales.
Renewal options are available under the majority of the leases. The Company has
also entered into certain capital leases.

Future minimum lease payments under noncancelable operating and capital leases
together with the present value of net minimum lease payments of capital leases
at February 1, 1997, are as follows (in thousands):

Operating Capital
Leases Leases
--------- -------
1998 $ 10,185 $ 20
1999 9,944 --
2000 9,895 --
2001 8,487 --
2002 7,843 --
2003 and thereafter 30,731 --
- --------------------------------------------
Total $ 77,085 20
- --------------------------------------------
Less: Executory costs 3
- --------------------------------------------

Net minimum lease payments 17
Less: Amounts representing interest 1
- --------------------------------------------

Present value of net minimum lease
payments $ 16
- --------------------------------------------

The minimum rentals above do not include additional payments for percentage
rent, insurance, property taxes and maintenance costs that may be due as
provided for in the leases. Many of the noncancelable operating leases include
scheduled rent increases.

Total rental expense for operating leases, including contingent rentals and net
of sublease payments received, was $8,903,000, $ 10,189,000 and $10,224,000 for
the years ended January 28, 1995, February 3, 1996 and February 1, 1997,
respectively. Minimum rentals were $8,893,000, $ 10,023,000 and $9,986,000,
respectively. Contingent rentals, which are based on a percentage of sales,
approximated $259,000, $ 353,000 and $395,000, respectively. Additionally,
sublease payments received approximated $249,000, $187,000 and $156,000,
respectively.

The Company has signed a five-year agreement with David Leadbetter, a golf
professional, to produce golf and other apparel under his name. Payments are
based on sales volumes. The minimum annual commitment under this agreement is
$150,000.

8. BENEFIT PLANS:
--------------

Multi-Employer Pension Plan - Through the year ended January 29, 1994, the
Company's employees covered by a collective bargaining agreement participated in
plans with pension and post-retirement benefits administered by the national and
local Union of Needletrades Industrial & Textile Employees. The Company made
contributions to the plans in accordance with the collective bargaining
agreement.

During the year ended January 29, 1994, the Company's Board of Directors and
management decided to terminate the Company's participation in the
multi-employer pension plan. The related liability is being repaid in
installments over four years through October, 1998. As of February 1, 1997 , the
Company owed approximately $1,240,000 related to the termination.

Defined Benefit Pension Plan - In connection with the above termination, the
Company adopted a new noncontributory defined benefit pension plan to cover the
above-mentioned union employees with equivalent benefits to the multi-employer
plan. The Company's contributions are intended to provide for both benefits
attributed to service to date and for benefits expected to be earned in the
future. The annual contributions are not less than the minimum funding standards
set forth in the Employee Retirement Income Security Act of 1974, as amended.
The plan provides for eligible employees to receive benefits based principally
on years of service with the Company.

The following table sets forth the plan's funded status as of December 31, 1995
and 1996, the date of the latest actuarial valuations (in thousands).

F-9

Actuarial present value of benefit obligations:

Feb. 3, Feb. 1,
1996 1997
------- -------
Accumulated benefit obligation,
including vested benefits of $520
and $605 $ 564 $ 728
- ------------------------------------------------------------
Projected benefit obligation for
service rendered to date $ (564) $ (728)
Fair value of plan assets 250 531
- ------------------------------------------------------------
Fair value of plan assets less
than projected benefit obligation (314) (197)
Unrecognized net loss (18) --
Unrecognized net transition liability 328 303
Adjustment required to recognize
minimum liability (328) (303)
- ------------------------------------------------------------
Accrued pension cost $ (332) $ (197)
- ------------------------------------------------------------

Net periodic pension expense for the years ended January 28, 1995, February 3,
1996 and February 1, 1997, includes the following components (in thousands):

Jan. 28, Feb. 3, Feb. 1,
1995 1996 1997
-------- ------- -------
Normal service
cost-benefits earned
during the period $ 74 $ 101 $ 84
Interest cost on
projected benefit
obligation 20 40 48
Actual return on plan
assets (1) (29) (48)
Net amortization
and deferral 14 42 37
- -------------------------------------------------------
Net periodic pension
expense $ 107 $ 154 $ 121
- -------------------------------------------------------

The Company recorded minimum pension liabilities of $328,000 and $303,000 at
February 3, 1996 and February 1, 1997, respectively, which is included in
"non-current pension liability", representing the excess of the unfunded
accumulated benefit obligation over previously accrued pension costs. A
corresponding intangible asset was recorded as an offset to this additional
liability, which is included in "other non-current assets".

In determining the actuarial present value of the projected benefit obligation,
the weighted average discount rate used was 7.75% fiscal 1996 and 8.0% in fiscal
1995 and the expected long-term rate of return on plan assets was 8.0% for
fiscal years 1995 and 1996.

Post-retirement Benefit Plan - In connection with the termination of
participation in the multi-employer pension plan described above, the Company
adopted a new post-retirement benefit plan to cover the above-mentioned union
employees with equivalent benefits to the multi-employer plan. The Company does
not pre-fund these benefits.

In accordance with SFAS No. 106, "Employers' Accounting for Post-retirement
Benefits Other than Pensions", the Company records the expected cost of these
benefits as expense during the years that employees render service. The Company
has adopted the standards on a prospective basis as permitted. As such, the
Company amortizes the related transition liability over 20 years. The following
table sets forth the post-retirement benefit program's funded status as of
December 31, 1995 and 1996, the dates of the latest actuarial valuations for the
related periods (in thousands):

Accumulated post-retirement benefit:
Feb. 3, Feb. 1,
1996 1997
------- -------

Retirees $ -- $ --
Fully eligible active plan participants (1,440) (1,145)
- -------------------------------------------------------------
(1,440) (1,145)
Unrecognized net transition liability 985 931
Unrecognized net gain (loss) 68 (418)
- -------------------------------------------------------------
Accrued post-retirement benefit
cost $ (387) $ (632)
- -------------------------------------------------------------

Net periodic post-retirement benefit expense for the years ended January 28,
1995, February 3, 1996 and February 1, 1997, includes the following components
(in thousands):

Jan. 28, Feb. 3, Feb. 1,
1995 1996 1997
-------- ------- -------

Normal service cost -
benefits earned during
the period $ 69 $ 99 $ 115
Interest cost on
accumulated post-
retirement benefit
obligation 57 90 88
Net amortization and
deferral 36 43 42
- ------------------------------------------------------------
Net periodic post-
retirement benefit
expense $ 162 $ 232 $ 245
- ------------------------------------------------------------

For measurement purposes, a 5% annual rate of increase in the per capita cost of
covered health care benefits was assumed.

F-10

The health care cost trend rate assumption has a significant effect on the
amounts reported. Increasing the assumed health care cost trend rate by one
percentage point would increase the accumulated post-retirement benefit
obligation by $190,000 and would increase net periodic post-retirement benefit
cost by $35,000. The weighted average discount rate used in determining the
accumulated post-retirement benefit obligation was 7.75%.

Profit Sharing Plan - The Company maintains a defined contribution 401(k) profit
sharing plan for its employees. All employees are eligible to participate after
one year of service. Employee contributions to the plan are limited based on
applicable sections of the Internal Revenue Code. The Company is required to
match a portion of employee contributions to the plan and may make additional
contributions at the discretion of the directors of the Company. Contributions
by the Company to the plan were approximately $182,000, $239,000 and $223,000
for the years ended January 28, 1995 February 3, 1996 and February 1, 1997,
respectively.

9. STORE REPOSITIONING COSTS:
--------------------------

In the fourth quarter of fiscal 1995, the Company elected early adoption of SFAS
No.121 -- "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to be Disposed of". In the first half of fiscal 1995, the men's and
women's apparel industries began suffering a significant down-turn. In the face
of a potential cash shortage and other factors affecting the women's business,
the Company decided to discontinue the women's product line (which was sold in
the same stores as the men's products) to generate cash. The women's product
line represented approximately $33 million and $26 million of sales in fiscal
1994 and 1995, respectively (or 18% and 15% of sales, respectively). With this
loss of the women's volume, and with the men's business experiencing a decline
(but improving) certain previously-profitable stores became unprofitable since
the store rents remained basically unchanged.

Given these events, the Company performed a store-by-store analysis to determine
which stores were losing money and not expected to generate future cash flows
that were sufficient to support the book values of the related store assets.
Based upon this analysis, the Company determined that (a) certain stores needed
to be closed, down-sized or relocated and (b) a write-down of the specific store
leasehold improvements and equipment was required. As a result, the Company
recorded an impairment loss of $2,300,000 representing the writedown of assets
to fair value. The fair values were determined based on estimated future cash
flows and market value of the assets. In addition, the Company recorded a
$1,200,000 charge representing an estimate of costs to be incurred to implement
the Company's plan to reposition its store base and to exit certain leases as it
discontinued the women's business and re-aligned its stores to support the
remaining men's-only business. These costs are included in "store repositioning
costs" in the accompanying consolidated statement of income (loss) for the year
ended February 3, 1996 (fiscal 1995).

During fiscal 1996, the Company closed two unprofitable full-line stores and
five catalog stores and relocated three stores at a cost of approximately
$930,000, which included lease settlement payments and moving costs. The stores
that were closed in 1996 represented approximately 2% of sales in fiscal 1995.
In 1997, the Company expects to fully utilize the remaining reserve by
relocating an additional full-line store and close up to three remaining catalog
stores.

10. INCOME TAXES:
-------------

At February 1, 1997, the Company had approximately $19.6 million of tax net
operating loss carryforwards (NOLs) which expire as follows: In the year
2006 - $4.6 million, 2009 - $4.4 million and 2010 - $10.6 million. SFAS No.
109 requires that the tax benefit of such NOLs be recorded as an asset to the
extent that management assesses the utilization of such NOLs to be "more likely
than not". Realization of the future tax benefits is dependent on the
Company' ability to generate taxable income within the carryforward period.
Future, levels of operating income are dependent upon general economic
conditions, including interest rates and general levels of economic activity,
competitive pressures on sales and margins and other factors beyond the
Company's control. Therefore no assurance can be given that sufficient taxable
income will be generated for full utilization of the NOLs.

Management has determined, based on the Company's history of earnings and its
repositioning results in fiscal 1996, that future earnings of the Company will
more likely than not be sufficient to utilize at least $16 million NOLs prior to
their expiration. Accordingly, the Company has recorded a deferred tax asset of
$6.1 million and a valuation allowance of $1.4 million relating to the NOLs. The
average minimum taxable income that the Company would need to generate prior to
the expiration of the NOLs would be less than the average taxable income that
the Company earned during fiscal years 1992 through 1994, as adjusted for
unusual charges. Management believes that although the prior earnings and
current year operating results might justify a higher amount, the $6.1 million
represents a reasonable estimate of the future utilization of the NOLs.
Management will continue to evaluate the likelihood of future profit and the
necessity of future adjustments to the deferred tax asset valuation allowance.

During the year ended January 29, 1994, the Company filed for a prior year net
operating loss carryback to a year in which the Company was included in the
consolidated federal income tax return of its pre-1986 parent and the Company
recorded a deferred tax asset of $3,000,000 in anticipation of collecting the
refund. In March 1996, the refund plus interest was collected. Included in the
fiscal 1996 Financial Statements is $600,000 of interest income related to the
refund.

F-11

The (provision) benefit for income taxes was comprised of the following (in
thousands):

Years Ended
------------------------------------------
January 28, February 3, February 1,
1995 1996 1997
----------- ----------- -----------
Federal:
Current $ (57) $ 74 $ (15)
Deferred (372) 4,824 (126)

State:
Current (377) 238 --
Deferred (55) 709 (18)
- ------------------------------------------------------------
Net (provision)
benefit for
income taxes $ (861) $ 5,845 $ (159)
- ------------------------------------------------------------

The differences between the recorded income tax (provision) benefit and the
"expected" tax (provision) benefit based on the statutory federal income tax
rate is as follows (in thousands):

Years Ended
--------------------------------
Jan. 28, Feb. 3, Feb. 1,
1995 1996 1997
-------- ------- -------
Computed federal
tax (provision)
benefit at
statutory rates $ (773) $ 6,470 $ (140)
State income taxes,
net of federal
income tax effect (285) 626 (23)
Valuation allowance -- (1,365) --
Other, net 197 114 4
- ---------------------------------------------------------
Net (provision)
benefit for income
taxes $ (861) $ 5,845 $ (159)
- ---------------------------------------------------------

Temporary differences between the financial reporting carrying amounts and tax
basis of assets and liabilities give rise to deferred income taxes. Total
deferred tax assets and deferred tax liabilities stated by sources of the
differences between financial accounting and tax basis of the Company's assets
and liabilities which give rise to the deferred tax assets and deferred tax
liabilities are as follows (in thousands):

Feb. 3, 1996 Feb.1, 1997
------------ -----------
Deferred Tax Assets:
Long-term pension
liability $ 768 $ 484
Inventories 956 487
Property, plant
and equipment 897 163
Accrued liabilities 1,919 2,085
Operating loss
carryforwards and
carrybacks 9,270 6,092
Valuation allowance (1,365) (1,365)
- -----------------------------------------------------
12,445 7,946
- -----------------------------------------------------
Deferred Tax Liabilities:
Prepaid expenses
and other current
assets (252) (628)
Property, plant and
equipment (902) --
Miscellaneous (124) (35)
- -----------------------------------------------------
(1,278) (663)
- -----------------------------------------------------
Net Deferred Tax Asset $11,167 $ 7,283
- -----------------------------------------------------

11. INCENTIVE OPTION PLAN:
----------------------

Effective January 28, 1994, the Company adopted an Incentive Plan (the Plan).
The Plan generally provides for the granting of stock, stock options, stock
appreciation rights, restricted shares or any combination of the foregoing to
the eligible participants, as defined. Approximately 954,000 shares of Common
Stock have been reserved for issuance under the Plan. The exercise price of an
option granted under the Plan may not be less than the fair market value of the
underlying shares of Common Stock on the date of grant and the options expire at
the earlier of termination of employment or ten years from the date of grant.

As of February 1, 1997 options for approximately 826,300 shares had been granted
under the plan at exercise prices ranging from $1.875 to $7.375 per share and
options for approximately 409,000 shares were exercisable at February 1, 1997.
In addition there are 209,415 options outstanding at $9.170 per share which were
issued in fiscal 1993 under employment agreements.

The Company has computed for pro forma disclosure purposes the value of all
compensatory options granted during fiscal year 1995 and 1996, using the
Black-Scholes option pricing model as prescribed by SFAS No. 123. Assumptions
used for the pricing model include 7.8% for the risk-free interest rate in 1996,
expected lives of 5-10 years, expected dividend yield of 0% each year and
expected volatility of 70% each year. Options were assumed to be exercised upon
vesting for the purposes of this valuation. Adjustments are made for options
forfeited prior to vesting. Had compensation costs for compensatory options been
determined consistent with SFAS No. 123, the Company's pro forma (loss) net
income would have been a loss of $(13,203,000) in 1995 and net income of
$223,000 in 1996.

F-12

Pro forma (loss) earnings per share would have been $(1.94) in 1995 and $.03 in
1996.

The following table summaries the stock option activity for the years ended
February 3, 1996 and February 1, 1997:

Number of Exercise Price
Shares Per Share
--------- --------------
Outstanding as of
January 28, 1995 741,965 $ 4.00 - 9.170
Granted 29,000 1.875 - 3.875
Exercised -- --
Terminated -- --
- -----------------------------------------------
Outstanding as of
February 3, 1996 770,965 1.875 - 9.170
Granted 265,750 1.625 - 4.750
Exercised (1,000) 3.25
Terminated -- --
- -----------------------------------------------
Outstanding as of
February 1, 1997 1,035,715 1.625 - 9.170
- -----------------------------------------------

Weighted average fair value of options granted for the years ended February 3,
1996 and February 1, 1997, was $1.40 and $1.78, respectively.

12. RELATED PARTY TRANSACTIONS:
---------------------------

The Company has an executive who is the Chairman of the Board of a consulting
group. The Company paid the group approximately $78,000 , $69,000 and $31,000
for the years ended January 28, 1995, February 3, 1996 and February 1, 1997,
respectively, for professional services rendered.

The Company has also made a $200,000 loan to its President in accordance with
his employment contract which is included in "other noncurrent assets" in the
accompanying consolidated balance sheet.

13. QUARTERLY FINANCIAL INFORMATION (Unaudited)
-------------------------------------------

FIRST SECOND THIRD FOURTH
QUARTER QUARTER QUARTER QUARTER TOTAL
------- ------- ------- ------- -----
(In Thousands Except Per Share Amounts)

FISCAL 1996
- -----------
Men's Sales $ 37,346 $ 33,770 $ 36,817 $ 47,125 $ 155,058
Women's Sales -- -- -- -- --
Net sales 37,346 33,770 36,817 47,125 155,058
Gross profit 17,681 14,378 17,275 20,858 70,192
Income (loss) from operations 1,088 (878) 840 1,306 2,356
Net Income (loss) 228 (559) 109 473 251
Net Income (loss) per share .03 (.08) .02 .07 .04

FISCAL 1995
- -----------
Men's Sales $ 36,200 $ 31,788 $ 30,822 $ 44,849 $ 143,659
Women's Sales 8,223 9,483 7,016 1,186 25,908
Net sales 44,423 41,271 37,838 46,035 169,567
Gross profit 16,450 16,893 16,040 19,395 68,778
Store repositioning costs -- -- -- (3,500) (3,500)
Income (loss) from operations (6,168) (2,422) (2,364) (4,633) (15,587)
Net Income (loss) (4,203) (1,990) (2,043) (4,950) (13,186)
Net Income (loss) per share (0.62) (0.29) (0.30) (0.73) (1.94)

F-13