UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


þ		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~May 1,~~July 31, 2010 or


o		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 1-16097

THE MEN’S WEARHOUSE, INC.

(Exact Name of Registrant as Specified in its Charter)


Texas		74-1790172
(State or Other Jurisdiction of		(I.R.S. Employer
Incorporation or Organization)		~~(I.R.S. Employer~~ Identification Number)

6380 Rogerdale
Houston, Texas		77072-1624
(Address of Principal Executive Offices)		(Zip Code)

(281) 776-7000
(Registrant’s telephone number, including area code)

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yesoþ. Noo.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filerþ	Accelerated filero	~~Accelerated~~Non-accelerated filero	~~Non-accelerated filer~~o	Smaller reporting companyo
		(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yeso. Noþ.

The number of shares of common stock of the Registrant, par value $.01 per share, outstanding at ~~June 4,~~September 3, 2010 was ~~52,641,800~~52,683,462 excluding 18,118,736 shares classified as Treasury Stock.

Forward-Looking and Cautionary Statements

Certain statements made in this Quarterly Report onForm 10-Q and in other public filings and press releases by the Company contain “forward-looking” information (as defined in the Private Securities Litigation Reform Act of 1995) that involves risk and uncertainty. These forward-looking statements may include, but are not limited to, references to future capital expenditures, acquisitions, sales, earnings, margins, costs, number and costs of store openings, demand for clothing, market trends in the retail clothing business, currency fluctuations, inflation and various economic and business trends. Forward-looking statements may be made by management orally or in writing, including, but not limited to, Management’s Discussion and Analysis of Financial Condition and Results of Operations included in this Quarterly Report on Form 10-Q and other sections of our filings with the Securities and Exchange Commission under the Securities Exchange Act of 1934 and the Securities Act of 1933.

Forward-looking statements are not guarantees of future performance and a variety of factors could cause actual results to differ materially from the anticipated or expected results expressed in or suggested by these forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, actions by governmental entities, domestic and international economic activity and inflation, our ~~success or lack~~successful execution of ~~success in executing~~ internal operating plans and new store and new market expansion plans, including successful integration of acquisitions, performance issues with key suppliers, disruption in buying trends due to homeland security concerns, severe weather, foreign currency fluctuations, government export and import policies, aggressive advertising or marketing activities of competitors and legal proceedings. Future results will also be dependent upon our ability to continue to identify and complete successful expansions and penetrations into existing and new markets and our ability to integrate such expansions with our existing operations. Refer to “Risk Factors” in our Annual Report on Form 10-K for the year ended January 30, 2010 and Item 1A contained in Part II of this Quarterly Report on Form 10-Q for a more complete discussion of these and other factors that might affect our performance and financial results. These forward-looking statements are intended to relay the Company’s expectations about the future, and speak only as of the date they are made. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

PART I. FINANCIAL INFORMATION

ITEM 1 —– CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

GENERAL INFORMATION

The condensed consolidated financial statements herein include the accounts of The Men’s Wearhouse, Inc. and its subsidiaries and have been prepared without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. As applicable under such regulations, certain information and footnote disclosures have been condensed or omitted. We believe that the presentation and disclosures herein are adequate to make the information not misleading, and the condensed consolidated financial statements reflect all elimination entries and normal adjustments which are necessary for a fair statement of the results for the ~~quarters~~three and six months ended ~~May 1,~~July 31, 2010 and ~~May 2,~~August 1, 2009.

Our business historically has been seasonal in nature, and the operating results of the interim periods presented are not necessarily indicative of the results that may be achieved for the full year. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements for the year ended January 30, 2010 and the related notes thereto included in the Company’s Annual Report on Form 10-K for the year then ended filed with the SEC.

Unless the context otherwise requires, “Company”, “we”, “us” and “our” refer to The Men’s Wearhouse, Inc. and its subsidiaries.

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)


	May 1,			May 2,			January 30,			July 31,			August 1,			January 30,
	2010			2009			2010			2010			2009			2010
	(Unaudited)			(Unaudited)						(Unaudited)			(Unaudited)
ASSETS

CURRENT ASSETS:
Cash and cash equivalents	$	219,562		$	107,538		$	186,018		$	281,500		$	144,449		$	186,018
Short-term investments		—			17,707			—			—			19,490			—
Accounts receivable, net		24,640			24,858			16,745			19,066			17,129			16,745
Inventories		435,351			448,018			431,492			416,377			430,777			431,492
Other current assets		68,830			59,752			74,075			61,762			51,876			74,075


Total current assets		748,383			657,873			708,330			778,705			663,721			708,330

PROPERTY AND EQUIPMENT, net		336,771			378,510			344,746			333,133			375,595			344,746

TUXEDO RENTAL PRODUCT, net		101,731			120,083			102,479			91,690			107,848			102,479
GOODWILL		60,780			57,622			59,414			60,449			59,266			59,414
OTHER ASSETS, net		16,690			12,439			17,137			22,850			16,466			17,137


TOTAL	$	1,264,355		$	1,226,527		$	1,232,106		$	1,286,827		$	1,222,896		$	1,232,106


LIABILITIES AND SHAREHOLDERS’ EQUITY

CURRENT LIABILITIES:
Accounts payable	$	99,720		$	142,984		$	83,052		$	82,163		$	78,918		$	83,052
Accrued expenses and other current liabilities		136,183			127,868			117,047			129,971			115,488			117,047
Income taxes payable		2,826			3,461			23,936			7,589			19,276			23,936
Current maturities of long-term debt		45,780			—			—			45,226			—			—


Total current liabilities		284,509			274,313			224,035			264,949			213,682			224,035

LONG-TERM DEBT		—			39,213			43,491			—			43,161			43,491

DEFERRED TAXES AND OTHER LIABILITIES		62,741			63,955			62,236			64,402			63,289			62,236


Total liabilities		347,250			377,481			329,762			329,351			320,132			329,762


COMMITMENTS AND CONTINGENCIES (Note 3 and Note 10)
COMMITMENTS AND CONTINGENCIES (Note 3 and Note 11)

SHAREHOLDERS’ EQUITY:
Preferred stock		—			—			—			—			—			—
Common stock		707			702			705			708			703			705
Capital in excess of par		329,030			316,034			327,742			332,677			319,029			327,742
Retained earnings		962,834			925,881			953,986			1,000,553			961,670			953,986
Accumulated other comprehensive income		37,304			19,055			32,537			36,308			33,988			32,537
Treasury stock, at cost		(412,770	)		(412,626	)		(412,626	)		(412,770	)		(412,626	)		(412,626	)


Total shareholders’ equity		917,105			849,046			902,344			957,476			902,764			902,344


TOTAL	$	1,264,355		$	1,226,527		$	1,232,106		$	1,286,827		$	1,222,896		$	1,232,106

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(In thousands, except per share data)
(Unaudited)


	For the Quarter Ended						For the Three Months Ended						For the Six Months Ended
	May 1,			May 2,			July 31,			August 1,			July 31,			August 1,
	2010			2009			2010			2009			2010			2009
Net sales:
Clothing product	$	368,371		$	359,062		$	362,228		$	364,302		$	730,599		$	723,364
Tuxedo rental services		72,154			71,419			142,462			129,567			214,616			200,986
Alteration and other services		32,941			33,653			32,299			32,339			65,240			65,992

Total net sales		473,466			464,134			536,989			526,208			1,010,455			990,342

Cost of sales:
Clothing product, including buying and distribution costs		167,313			167,457			161,121			170,187			328,434			337,644
Tuxedo rental services		11,326			12,032			22,036			21,475			33,362			33,507
Alteration and other services		24,064			24,090			24,446			23,690			48,510			47,780
Occupancy costs		69,691			72,566			69,803			73,068			139,494			145,634

Total cost of sales		272,394			276,145			277,406			288,420			549,800			564,565

Gross margin		201,072			187,989			259,583			237,788			460,655			425,777

Selling, general and administrative expenses		179,650			179,213			191,168			173,896			370,818			353,109


Operating income		21,422			8,776			68,415			63,892			89,837			72,668

Interest income		34			258			46			231			80			489
Interest expense		(259	)		(418	)		(321	)		(231	)		(580	)		(649	)


Earnings before income taxes		21,197			8,616			68,140			63,892			89,337			72,508

Provision for income taxes		7,589			3,360			25,620			24,407			33,209			27,767


Net earnings	$	13,608		$	5,256		$	42,520		$	39,485		$	56,128		$	44,741


Net earnings per common share (Note 2):
Basic	$	0.26		$	0.10		$	0.80		$	0.75		$	1.06		$	0.85


Diluted	$	0.26		$	0.10		$	0.80		$	0.75		$	1.05		$	0.85


Weighted average common shares outstanding (Note 2):
Basic		52,417			51,895			52,648			52,112			52,533			52,004


Diluted		52,628			51,955			52,806			52,255			52,717			52,105


Cash dividends declared per common share	$	0.09		$	0.07		$	0.09		$	0.07		$	0.18		$	0.14

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)
(Unaudited)

~~(Unaudited)~~


	For the Quarter Ended						For the Six Months Ended
	May 1,			May 2,			July 31,			August 1,
	2010			2009			2010			2009
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings	$	13,608		$	5,256		$	56,128		$	44,741
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization		18,690			22,222			36,885			43,881
Tuxedo rental product amortization		6,978			7,644			20,812			22,089
Loss on disposition of assets		219			1,768			209			1,750
Asset impairment charges								162			—
Deferred rent expense		830			378			1,681			892
Share-based compensation		2,637			2,732			5,723			5,159
Excess tax benefits from share-based plans		(763	)		(20	)		(780	)		(42	)
Deferred tax provision		6,412			3,009
Deferred tax provision (benefit)								3,958			(8,135	)
Increase in accounts receivable		(7,813	)		(8,480	)		(2,263	)		(631	)
Increase in inventories		(1,103	)		(6,194	)
Decrease in inventories								17,165			15,460
Increase in tuxedo rental product		(5,240	)		(30,370	)		(9,276	)		(30,816	)
(Increase) decrease in other assets		(478	)		3,332
Increase in accounts payable, accrued expenses and other current liabilities		36,592			52,011
Decrease in other assets								1,971			24,755
Increase (decrease) in accounts payable, accrued expenses and other current liabilities								13,485			(27,682	)
Increase (decrease) in income taxes payable		(20,683	)		10,714			(15,402	)		19,984
Decrease in other liabilities		(612	)		(700	)		(170	)		(1,276	)


Net cash provided by operating activities		49,274			63,302			130,288			110,129


CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		(11,099	)		(15,035	)		(25,865	)		(28,757	)
Other investing activities								23			—


Net cash used in investing activities		(11,099	)		(15,035	)		(25,842	)		(28,757	)


CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock		783			506			1,321			1,051
Payments on revolving credit facility		—			(25,000	)		—			(25,000	)
Cash dividends paid		(4,756	)		(3,664	)		(9,535	)		(7,344	)
Tax payments related to vested deferred stock units		(2,656	)		(1,627	)		(2,656	)		(1,630	)
Excess tax benefits from share-based plans		763			20			780			42
Purchase of treasury stock		(144	)		(90	)		(144	)		(90	)


Net cash used in financing activities		(6,010	)		(29,855	)		(10,234	)		(32,971	)


Effect of exchange rate changes		1,379			1,714			1,270			8,636


INCREASE IN CASH AND CASH EQUIVALENTS		33,544			20,126			95,482			57,037
Balance at beginning of period		186,018			87,412			186,018			87,412


Balance at end of period	$	219,562		$	107,538		$	281,500		$	144,449

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Significant Accounting Policies

Basis of Presentation —The condensed consolidated financial statements herein include the accounts of The Men’s Wearhouse, Inc. and its subsidiaries (the “Company”) and have been prepared without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). As applicable under such regulations, certain information and footnote disclosures have been condensed or omitted. We believe that the presentation and disclosures herein are adequate to make the information not misleading, and the condensed consolidated financial statements reflect all elimination entries and normal adjustments which are necessary for a fair presentation of the financial position, results of operations and cash flows at the dates and for the periods presented. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K for the year ended January 30, 2010.

The preparation of the condensed consolidated financial statements in conformity with accounting principals generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts and related disclosures. Actual amounts could differ from those estimates.

Recent Accounting Guidance —In January 2010, the Financial Accounting Standards Board (“FASB”) issued authoritative guidance that expands the required disclosures about fair value measurements. This guidance provides for new disclosures requiring the Company to (a) disclose separately the amounts of significant transfers in and out of Level 1 and Level 2 fair value measurements and describe the reasons for the transfers and (b) present separately information about purchases, sales, issuances and settlements in the reconciliation of Level 3 fair value measurements. This guidance also provides clarification of existing disclosures requiring the Company to (i) determine each class of assets and liabilities based on the nature and risks of the investments rather than by major security type and (ii) for each class of assets and liabilities, disclose the valuation techniques and inputs used to measure fair value for both Level 2 and Level 3 fair value measurements. We adopted this guidance effective January 31, 2010, except for the presentation of purchases, sales, issuances and settlements in the reconciliation of Level 3 fair value measurements, which will be effective for fiscal years beginning after December 15, 2010. The adoption of the first phase of this guidance did not have a material impact to our financial position, results of operations or cash flows.

2. Earnings per ~~Common~~ Share

We calculate earnings per common share using the two-class method in accordance with the guidance for determination of whether instruments granted in share-based payment transactions are participating securities. Our unvested restricted stock and deferred stock units contain rights to receive nonforfeitable dividends or dividend equivalents, respectively, and thus are participating securities requiring the two-class method of computing earnings per common share. The two-class method is an earnings allocation formula that determines earnings per common share for each class of common stock and participating security according to dividends declared and participation rights in undistributed earnings.

Basic earnings per common share is determined using the two-class method and is computed by dividing net earnings attributable to common shareholders by the weighted-average common shares outstanding during the period. Diluted earnings per common share reflects the more dilutive earnings per common share amount calculated using the treasury stock method or the two-class method.

For the Quarter Ended
May 1, 2010 May 2, 2009
Numerator
Net earnings $ 13,608 $ 5,256
Net earnings allocated to participating securities (restricted stock and deferred stock units) (121 ) (51 )

Net earnings available to common shareholders $ 13,487 $ 5,205

Denominator

Basic weighted average common shares outstanding 52,417 51,895
Effect of dilutive securities:
Stock options and equity-based compensation 211 60

Diluted weighted average common shares outstanding 52,628 51,955

Net earnings per common share:
Basic $ 0.26 $ 0.10

Diluted $ 0.26 $ 0.10

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Unaudited)


	For the Three Months						For the Six Months
	Ended						Ended
	July 31,			August 1,			July 31,			August 1,
	2010			2009			2010			2009
Numerator
Net earnings	$	42,520		$	39,485		$	56,128		$	44,741
Net earnings allocated to participating securities (restricted stock and deferred stock units)		(397	)		(388	)		(518	)		(442	)

Net earnings available to common shareholders	$	42,123		$	39,097		$	55,610		$	44,299

Denominator
Basic weighted average common shares outstanding		52,648			52,112			52,533			52,004
Effect of dilutive securities:
Stock options and equity-based compensation		158			143			184			101

Diluted weighted average common shares outstanding		52,806			52,255			52,717			52,105


Net earnings per common share:
Basic	$	0.80		$	0.75		$	1.06		$	0.85

Diluted	$	0.80		$	0.75		$	1.05		$	0.85

For the ~~quarter~~three and six months ended ~~May 1,~~July 31, 2010, ~~and May 2, 2009, 0.8~~1.0 million and ~~1.3~~0.9 million anti-dilutive stock options were excluded from the calculation of diluted earnings per common share, respectively. For the three and six months ended August 1, 2009, 1.0 million and 1.2 million anti-dilutive stock options were excluded from the calculation of diluted earnings per common share, respectively.

3. Debt

Our Amended and Restated Credit Agreement (the “Credit Agreement”) with a group of banks, which was last amended on February 2, 2007, provides for a total senior secured revolving credit facility of $200.0 million, which can be expanded to $250.0 million upon additional lender commitments, that matures on February 11, 2012. The Credit Agreement also provided our Canadian subsidiaries with a ~~senior~~ secured term loan used to fund the repatriation of US$74.7 million of Canadian earnings in January 2006 under the American Jobs Creation Act of 2004. The Canadian term loan matures on February 10, 2011. The Credit Agreement is secured by the stock of certain of the Company’s subsidiaries. The Credit Agreement has several borrowing and interest rate options including the following indices: (i) an alternate base rate (equal to the greater of the prime rate or the federal funds rate plus 0.5%) or (ii) LIBO rate or (iii) CDO rate. Advances under the Credit Agreement bear interest at a rate per annum using the applicable indices plus a varying interest rate margin up to 1.125%. The Credit Agreement also provides for fees applicable to unused commitments ranging from 0.100% to 0.175%. As of ~~May 1,~~July 31, 2010, there was US$~~45.8~~45.2 million outstanding under the Canadian term loan with an effective interest rate of ~~1.2%~~1.6%, and no borrowings outstanding under the revolving credit facility.

The Credit Agreement contains certain restrictive and financial covenants, including the requirement to maintain certain financial ratios. The restrictive provisions in the Credit Agreement reflect an overall covenant structure that is generally representative of a commercial loan made to an investment-grade company. Our debt, however, is not rated, and we have not sought, and are not seeking, a rating of our debt. We were in compliance with the covenants in the Credit Agreement as of ~~May 1,~~July 31, 2010.

Conditions in the U.S. and global credit markets have made it difficult for many businesses to obtain financing on acceptable terms. If these market conditions continue or worsen, it may be more difficult for us to renew or increase our credit facility.

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Unaudited)

We utilize letters of credit primarily to secure inventory purchases and as collateral for workers compensation claims. At ~~May 1,~~July 31, 2010, letters of credit totaling approximately $11.6 million were issued and outstanding. Borrowings available under our Credit Agreement at ~~May 1,~~July 31, 2010 were $188.4 million.

4. Comprehensive Income and Supplemental Cash Flows

Our comprehensive income is as follows (in thousands):


					For the Three Months					For the Six Months
					Ended					Ended
	For the Quarter Ended				July 31,			August 1,		July 31,		August 1,
	May 1, 2010		May 2, 2009		2010			2009		2010		2009
Net earnings	$	13,608	$	5,256	$	42,520		$	39,485	$	56,128	$	44,741
Change in derivative fair value, net of tax						94			—		94		—
Currency translation adjustments, net of tax		4,767		4,763		(1,090	)		14,933		3,677		19,696


Comprehensive income	$	18,375	$	10,019	$	41,524		$	54,418	$	59,899	$	64,437

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Unaudited)

Goodwill is evaluated for impairment annually as of our fiscal year end. A more frequent evaluation is performed if events or circumstances indicate that impairment could have occurred. Such events or circumstances could include, but are not limited to, new significant negative industry or economic trends, unanticipated changes in the competitive environment, decisions to significantly modify or dispose of operations and a significant sustained decline in the market price of our stock. No additional impairment evaluation was considered necessary during the first ~~quarter~~six months of 2010.

The gross carrying amount and accumulated amortization of our other intangibles, which are included in other assets in the accompanying condensed consolidated balance sheet, are as follows (in thousands):


										July 31,			August 1,			January 30,
	May 1, 2010			May 2, 2009			January 30, 2010			2010			2009			2010
Trademarks, tradenames, favorable leases and other intangibles	$	14,511		$	16,991		$	15,305		$	13,932		$	16,991		$	15,305
Accumulated amortization		(11,286	)		(10,058	)		(11,018	)		(11,428	)		(10,576	)		(11,018	)

Net total	$	3,225		$	6,933		$	4,287		$	2,504		$	6,415		$	4,287

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Unaudited)

7. Treasury Stock

As of ~~May 1,~~July 31, 2010, we had 18,118,736 shares held in treasury stock. The change in our treasury shares for the year ended January 30, 2010 and for the ~~quarter~~six months ended ~~May 1,~~July 31, 2010 is provided below:


	Treasury
	Shares
Balance, January 31, 2009		18,104,310
Purchases of treasury stock		7,292

Balance, January 30, 2010		18,111,602
Purchases of treasury stock		7,134

Balance, ~~May 1,~~July 31, 2010		18,118,736

In January 2006, the Board of Directors authorized a $100.0 million share repurchase program of our common stock. This authorization superceded any remaining previous authorizations. In August 2007, the Company’s Board of Directors approved a replenishment of the Company’s share repurchase program to $100 million by authorizing $90.3 million to be added to the remaining $9.7 million of the then current program. No shares were purchased under the August 2007 authorization during the first ~~quarter~~six months of 2010 or 2009. At ~~May 1,~~July 31, 2010, the remaining balance available under the August 2007 authorization was $44.3 million.

~~For~~During the ~~quarter~~six months ended ~~May 1,~~July 31, 2010, 7,134 shares at a cost of $0.1 million were repurchased at an average price per share of $20.24 in a private transaction to satisfy tax withholding obligations arising upon the vesting of certain restricted stock. ~~For~~During the ~~quarter~~six months ended ~~May 2,~~August 1, 2009, 7,292 shares at a cost of $0.1 million were repurchased at an average price per share of $12.29 in a private transaction to satisfy tax withholding obligations arising upon the vesting of certain restricted stock.

8. Share-Based Compensation Plans

We maintain several equity plans under which we may grant stock options, stock appreciation rights, restricted stock, deferred stock units and performance based awards to full-time key employees and non-employee directors. We account for share-based awards in accordance with the FASB standard regarding share-based payments, which requires the compensation cost resulting from all share-based payment transactions be recognized in the financial statements. The amount of compensation cost is measured based on the grant-date fair value of the instrument issued and is recognized over the vesting period. Share-based compensation expense recognized for the ~~quarter~~three and six months ended ~~May~~July 31, 2010 was $3.1 million and $5.7 million, respectively. Share-based compensation expense recognized for the three and six months ended August 1, ~~2010 and May 2,~~ 2009 was ~~$2.6~~$2.4 million and ~~$2.7~~$5.2 million, respectively.

Stock Options

The following table summarizes stock option activity for the ~~quarter~~six months ended ~~May 1,~~July 31, 2010:


				Weighted-					Weighted-
				Average					Average
				Exercise					Exercise
	Shares			Price		Shares			Price
Outstanding at January 30, 2010		1,642,905		$	20.29		1,642,905		$	20.29
Granted		—			—		50,000			18.79
Exercised		(18,461	)		15.55		(20,745	)		15.35
Expired		(5,355	)		20.91		(5,374	)		20.89

Outstanding at May 1, 2010		1,619,089		$	20.34
Outstanding at July 31, 2010							1,666,786		$	20.30

Exercisable at May 1, 2010		776,578		$	18.46
Exercisable at July 31, 2010							802,608		$	18.47

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Unaudited)

The weighted-average grant date fair value of the 50,000 stock options granted during the six months ended July 31, 2010 was $8.27 per share. The following table summarizes the weighted average assumptions used to fair value stock options at the date of grant using the Black-Scholes option pricing model for the three and six months ended July 31, 2010:


	For the Three			For the Six
	MonthsEnded			Months Ended
	July 31,			July 31,
	2010			2010
Risk-free interest rate		1.80	%		1.80	%
Expected lives	5.0 years			5.0 years
Dividend yield		1.65	%		1.65	%
Expected volatility		57.03	%		57.03	%

The assumptions presented in the table above represent the weighted average of the applicable assumptions used to fair value stock options. Expected volatility is based on historical volatility of our common stock. The expected term represents the period of time the options are expected to be outstanding after their grant date. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. The dividend yield is based on the average of the annual dividend divided by the market price of our common stock at the time of declaration.

As of ~~May 1,~~July 31, 2010, we have unrecognized compensation expense related to nonvested stock options of approximately $5.9 million which is expected to be recognized over a weighted average period of ~~3.1~~3.0 years.

Restricted Stock and Deferred Stock Units

The following table summarizes restricted stock and deferred stock unit activity for the ~~quarter~~six months ended ~~May 1,~~July 31, 2010:


				Weighted-					Weighted-
				Average					Average
				Grant-Date					Grant-Date
	Shares			Fair Value		Shares			Fair Value
Nonvested at January 30, 2010		506,133		$	22.35		506,133		$	22.35
Granted		315,268			24.17		328,978			23.96
Vested (1)		(327,945	)		21.19		(327,945	)		21.19
Forfeited		(950	)		19.35		(3,175	)		22.73

Nonvested at May 1, 2010		492,506		$	24.29
Nonvested at July 31, 2010							503,991		$	24.15

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Unaudited)

Employee Stock Purchase Plan

The Employee Stock Discount Plan (“ESDP”) allows employees to authorize after-tax payroll deductions to be used for the purchase of up to 2,137,500 shares of our common stock at 85% of the lesser of the fair market value on the first day of the offering period or the fair market value on the last day of the offering period. We make no contributions to this plan but pay all brokerage, service and other costs incurred. The plan, as amended, allows participants to purchase no more than 125 shares during any calendar quarter.

During the ~~quarter~~six months ended ~~May 1,~~July 31, 2010, employees purchased ~~27,412~~59,604 shares under the ESDP, which had a weighted-average share price of ~~$18.10~~$16.83 per share. As of ~~May 1,~~July 31, 2010, ~~1,150,088~~1,117,896 shares were reserved for future issuance under the ESDP.

9. Fair Value Measurements

~~Our~~Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The authoritative guidance for fair value measurements establishes a three-tier fair value hierarchy, categorizing the inputs used to measure fair value. The hierarchy can be described as follows: Level 1- observable inputs such as quoted prices in active markets; Level 2- inputs other than the quoted prices in active markets that are observable either directly or indirectly; and Level 3- unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

Effective January 31, 2010, we adopted enhanced disclosure requirements for fair value measurements. There were no transfers into or out of Level 1 and Level 2 during the three and six months ended July 31, 2010.

Assets and Liabilities that are Measured at Fair Value on a Recurring Basis


			Fair Value Measurements at Reporting Date Using
			Quoted Prices
			in Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
			Instruments		Inputs		Inputs
(in thousands)	July 31, 2010		(Level 1)		(Level 2)		(Level 3)
Assets:
Derivative financial instruments	$	155	$	—	$	155	$	—

Liabilities:
Derivative financial instruments	$	60	$	—	$	60	$	—

Derivative financial instruments ~~consist~~are comprised of ~~cash and cash equivalents, short-term investments, accounts receivable, accounts payable,~~foreign currency forward exchange contracts primarily entered into to minimize our foreign currency exposure related to forecasted purchases of certain inventories denominated in a foreign currency (primarily the Euro). Our derivative financial instruments are recorded in the condensed consolidated balance sheets at fair value based upon observable market inputs. Derivative financial instruments in an asset position are included within other current assets in the condensed consolidated balance sheets. Derivative financial instruments in a liability position are included within accrued expenses and other current liabilities ~~current maturities of long-term debt and long-term debt. Management estimates that, as of May 1, 2010 and January 30, 2010,~~in the ~~fair value of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other current liabilities approximate their fair value due~~condensed consolidated balance sheets. Refer to ~~the highly liquid or short-term nature of these~~Note 10 for further information regarding our derivative instruments. The investments classified as short-term investments at May 2, 2009 are carried at fair value based on quoted market prices for such financial instruments. The fair values of current maturities of long-term debt at May 1, 2010 and of long-term debt at January 30, 2010 approximate their carrying amounts based upon terms available to us for borrowings with similar arrangements and remaining maturities.

1011

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Unaudited)

At August 1, 2009, we had highly liquid investments of $19.5 million classified as short-term investments included in our condensed consolidated balance sheet. The carrying amount of these instruments approximates fair value and is based on quoted market prices at the reporting date and is considered a Level 1 fair value measurement within the fair value hierarchy. We had no financial liabilities measured at fair value on a recurring basis at August 1, 2009. At January 30, 2010, we had no financial assets or liabilities measured at fair value on a recurring basis.

Assets and Liabilities that are Measured at Fair Value on a Non-Recurring Basis

Long-lived assets, such as property and equipment and identifiable intangibles with finite useful lives, are periodically evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If the asset carrying amount exceeds its fair value, an impairment charge is recognized in the amount by which the carrying amount exceeds the fair value of the asset. The fair values of long-lived assets held-for-use are based on our own judgments about the assumptions that market participants would use in pricing the asset and on observable market data, when available. We classify these measurements as Level 3 within the fair value hierarchy. For the three and six months ended July 31, 2010, we recorded charges for the impairment of long-lived assets of $0.2 million which is included within “Selling, general and administrative expenses” in our condensed consolidated statement of earnings. The asset impairment charges reduced the carrying amounts of the applicable long-lived assets to their fair values of $0.2 million as of July 31, 2010. No asset impairment charges were recorded for the ~~carrying~~three and six months ended August 1, 2009.

Fair Value of Financial Instruments

Our financial instruments, other than those presented in the disclosures above, consist of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other current liabilities, current maturities of long-term debt and long-term debt. Management estimates that, as of July 31, 2010, August 1, 2009 and January 30, 2010 the fair value of ~~long-lived assets during~~cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other current liabilities approximate their fair value due to the ~~first~~highly liquid or short-term nature of these instruments. The fair values of current maturities of long-term debt at July 31, 2010 and of long-term debt at August 1, 2009 and January 30, 2010 approximate their carrying amounts based upon terms available to us for borrowings with similar arrangements and remaining maturities.

10. Derivative Financial Instruments

In connection with our direct sourcing program, we may enter into purchase commitments that are denominated in a foreign currency (primarily the Euro). Our policy is to enter into foreign currency forward exchange contracts to minimize foreign currency exposure related to forecasted purchases of certain inventories. In accordance with the guidance for derivatives and hedging instruments, such contracts have been designated as and accounted for as cash flow hedges. The settlement terms of the forward contracts, including amount, currency and maturity, correspond with payment terms for the merchandise inventories. The effective portion of the gain or loss on the derivative financial instruments is reported as a component of accumulated other comprehensive income and is recognized in income in the period which approximates the time when the underlying transaction occurs. Gains and losses on the derivative financial instruments representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness, if any, are reported in earnings immediately. Our derivative financial instruments are recorded in the condensed consolidated balance sheet at fair value determined by comparing the cost of the foreign currency to be purchased under the contracts using the exchange rates obtained under the contracts (adjusted for forward points) to the hypothetical cost using the spot rate at quarter end. Refer to Note 9 for further information regarding fair value measurements of our derivative instruments.

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Unaudited)

At July 31, 2010, we had three contracts maturing in varying increments to purchase an aggregate notional amount of $2.9 million in foreign currency, maturing at various dates through March 2011. No contracts were held at August 1, 2009 or January 30, 2010. No amounts were recorded in our results of operations for the six months ended July 31, 2010 as a result of hedge ineffectiveness, hedge components excluded from the assessment of effectiveness or the discontinuance of cash flow hedges because the forecasted transactions were no longer probable. As of July 31, 2010, accumulated other comprehensive income included an unrealized gain of approximately $0.1 million, net of tax, of which an immaterial amount is estimated will be recognized as a reduction to cost of sales over the next 12 months at the then current values on a pre-tax basis, which may differ from the current quarter-end values. Additionally, no amounts were reclassified from accumulated other comprehensive income to earnings for the six months ended July 31, 2010.

We had no derivative financial instruments with credit-risk-related contingent features underlying the agreements as of July 31, 2010.

~~10.~~11. Legal Matters

On October 8, 2009, the Company was named in a federal securities class action lawsuit filed in the United States District Court for the Southern District of Texas, Houston Division. The case is styledMaterial Yard Workers Local 1175 Benefit Funds, et al. v. The Men’s Wearhouse, Inc., Case No. 4:09-cv-03265. The class period alleged in the complaint runs from March 7, 2007 to January 9, 2008. The primary allegations are that the Company issued false and misleading press releases regarding its guidance for fiscal year 2007 on various occasions during the alleged class period. The complaint seeks damages based on the decline in the Company’s stock price following the announcement of lowered guidance on Oct. 10, 2007, Nov. 28, 2007, and Jan. 9, 2008. The case is in its early stages and discovery has not begun. The Company believes the lawsuit is without merit and intends to mount a vigorous defense; we are unable to determine the likely outcome at this time.

We are involved in various routine legal proceedings, including ongoing litigation, incidental to the conduct of our business. Management believes that none of these matters will have a material adverse effect on our financial position, results of operations or cash flows.

1113

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Unaudited)

~~11.~~12. Supplemental Sales Information (in thousands)


	For the Quarter Ended				For the Three Months Ended				For the Six Months Ended
	May 1, 2010		May 2, 2009		July 31, 2010		August 1, 2009		July 31, 2010		August 1, 2009
Net sales:
Men’s tailored clothing product	$	197,094	$	191,767	$	194,190	$	197,774	$	391,284	$	389,541
Men’s non-tailored clothing product		145,701		142,659		145,206		145,981		290,907		288,640
Ladies clothing product		21,895		20,715		18,203		17,762		40,098		38,477
Corporate apparel and uniform product		3,681		3,921
Corporate apparel uniform product						4,629		2,785		8,310		6,706

Total clothing product		368,371		359,062		362,228		364,302		730,599		723,364


Tuxedo rental services		72,154		71,419		142,462		129,567		214,616		200,986

Alteration services		27,152		27,965		26,421		26,788		53,573		54,753
Retail dry cleaning services		5,789		5,688		5,878		5,551		11,667		11,239

Total alteration and other services		32,941		33,653		32,299		32,339		65,240		65,992


Total net sales	$	473,466	$	464,134	$	536,989	$	526,208	$	1,010,455	$	990,342


Net sales by brand:
MW (1)	$	318,340	$	310,923	$	367,354	$	359,039	$	685,694	$	669,962
K&G		98,260		104,516		87,578		93,597		185,838		198,113
Moores		47,396		39,086		71,550		65,236		118,946		104,322
MW Cleaners (2)		5,789		5,688		5,878		5,551		11,667		11,239
Twin Hill (3)		3,681		3,921		4,629		2,785		8,310		6,706

	$	473,466	$	464,134
Total net sales					$	536,989	$	526,208	$	1,010,455	$	990,342

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(Unaudited)

13. Subsequent Events

On August 6, 2010, subsequent to the end of our 2010 second quarter, we acquired Dimensions Clothing Limited (“Dimensions”) and certain assets of Alexandra plc (“Alexandra”), two leading providers of corporate clothing uniforms and workwear in the United Kingdom, for a total cash consideration of approximately £61 million (US$97.8 million). The acquisition of Dimensions and certain assets of Alexandra will expand our corporate apparel operations. The combined businesses are organized under a UK-based holding company, of which the Company controls 86% and certain existing shareholders of Dimensions control 14%. The Company has the right to acquire the remaining outstanding shares of the UK-based holding company in the future on the terms set forth in the Investment, Shareholders’ and Stock Purchase Agreement. The cash consideration of £61 million (US$97.8 million) was funded through the Company’s cash on hand. Given the recent timing of this acquisition, we have not completed the initial accounting for the Dimensions and Alexandra business combination and we have not made certain disclosures. These disclosures include the fair value of assets acquired and liabilities assumed, intangible asset classifications, and pro-forma information. The initial accounting and related disclosures required for business combinations will be made in a subsequent filing.

In late August 2010, a decision was made by management to cease tuxedo rental distribution operations at four of the ten U.S. facilities that we currently use for that purpose. The tuxedo rental distribution operations at these four facilities will cease in November 2010 and will be assumed by the remaining U.S. tuxedo distribution facilities, which will allow us to perform tuxedo rental distribution requirements more cost effectively. Three of the facilities will be converted to hub locations that redistribute tuxedo rental units and retail apparel merchandise to our Men’s Wearhouse, Men’s Wearhouse and Tux and K&G stores within limited geographic areas. We expect the total pre-tax charge to be incurred in ceasing tuxedo rental distribution operations at these four facilities to be approximately $3.4 million, which consists primarily of severance payments, the write-off of fixed assets and facility remediation costs. We also estimate that approximately $1.6 million of the charge will result in future cash expenditures.

On September 1, 2010, the Company assigned its rights to receive an aggregate of $2.6 million of the proceeds from life insurance policies on the life of George Zimmer to Mr. Zimmer and a trust for the benefit of Mr. Zimmer in exchange for a cash payment of $2.6 million from Mr. Zimmer. The Company acquired the right to receive a portion of the proceeds from the life insurance policies as a result of paying premiums in the amount of $2.6 million on the policies. All such premium payments were made by the Company prior to 2003.

ITEM 2 — MANAGEMENT’S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

General

For supplemental information, it is suggested that “Management’s Discussion and Analysis of Financial Condition and Results of Operations” be read in conjunction with the corresponding section included in our Annual Report on Form 10-K for the year ended January 30, 2010. References herein to years are to our 52-week or 53-week fiscal year which ends on the Saturday nearest January 31 in the following calendar year. For example, references to “2010” mean the 52-week fiscal year ending January 29, 2011.

The following table presents information with respect to retail apparel stores in operation during each of the respective fiscal periods:


							For the Year			For the Three Months						For the Six Months						For the Year
	For the Quarter Ended						Ended			Ended						Ended						Ended
	May 1,			May 2,			January 30,			July 31,			August 1,			July 31,			August 1,			January 30,
	2010			2009			2010			2010			2009			2010			2009			2010
Stores open at beginning of period:		1,259			1,294			1,294			1,252			1,284			1,259			1,294			1,294
Opened		1			2			6			3			1			4			3			6
Closed		(8	)		(12	)		(41	)		(16	)		(7	)		(24	)		(19	)		(41	)

Stores open at end of period		1,252			1,284			1,259			1,239			1,278			1,239			1,278			1,259


Stores open at end of period:
U.S. —
Men’s Wearhouse		582			581			581			584			580			584			580			581
Men’s Wearhouse & Tux		447			478			454			434			473			434			473			454
K&G		106			108			107			104			108			104			108			107

		1,135			1,167			1,142			1,122			1,161			1,122			1,161			1,142

Canada —
Moores		117			117			117			117			117			117			117			117

		1,252			1,284			1,259			1,239			1,278			1,239			1,278			1,259

We had revenues of ~~$473.5~~$537.0 million and net earnings of ~~$13.6~~$42.5 million for the ~~quarter~~three months ended ~~May 1,~~July 31, 2010, compared to revenues of ~~$464.1~~$526.2 million and net earnings of ~~$5.3~~$39.5 million for the ~~quarter~~three months ended ~~May 2,~~August 1, 2009. We had revenues of $1,010.5 million and net earnings of $56.1 million for the six months ended July 31, 2010, compared to revenues of $990.3 million and net earnings of $44.7 million for the six months ended August 1, 2009. Although high unemployment levels and tight credit conditions in the U.S. continued ~~into~~in 2010, we increased our revenues by ~~$9.3~~$10.8 million or 2.0% and our gross margin by ~~$13.1~~$21.8 million or ~~7.0%~~9.2% for the second quarter of 2010, and for the six months ended July 31, 2010, we increased our revenues by $20.1 million or 2.0% and our gross margin by $34.9 million or 8.2%. We closed ~~eight~~24 stores (one Men’s Wearhouse store, three K&G ~~store~~stores and ~~seven~~20 Men’s Wearhouse & Tux stores), of which ~~seven~~16 had reached the end of their lease terms, and opened ~~one~~four Men’s Wearhouse ~~store~~stores during the first ~~quarter~~six months of 2010. We plan to continue our efforts to stimulate sales with discounts and other promotional events, to maintain our cost control efforts and to limit our capital expenditures.

Results of Operations

~~Quarter~~Three Months Ended ~~May~~July 31, 2010 compared to Three Months Ended August 1, ~~2010 and May 2,~~ 2009

The following table sets forth the Company’s results of operations expressed as a percentage of net sales for the periods indicated:


							For the Three Months
	For the Quarter Ended (1)						Ended (1)
	May 1,			May 2,			July 31,			August 1,
	2010			2009			2010			2009
Net sales:
Clothing product		77.8	%		77.4	%		67.5	%		69.2	%
Tuxedo rental services		15.2			15.4			26.5			24.6
Alteration and other services		7.0			7.2			6.0			6.2

Total net sales		100.0	%		100.0	%		100.0	%		100.0	%
Cost of sales:
Clothing product, including buying and distribution costs		35.3			36.1			30.0			32.3
Tuxedo rental services		2.4			2.6			4.1			4.1
Alteration and other services		5.1			5.2			4.6			4.5
Occupancy costs		14.7			15.6			13.0			13.9

Total cost of sales		57.5			59.5			51.7			54.8

Gross margin		42.5			40.5			48.3			45.2
Selling, general and administrative expenses		37.9			38.6			35.6			33.1

Operating income		4.5			1.9			12.7			12.1
Interest income		0.0			0.1			0.0			0.0
Interest expense		(0.1	)		(0.1	)		(0.1	)		(0.0	)

Earnings before income taxes		4.5			1.9			12.7			12.1
Provision for income taxes		1.6			0.8			4.8			4.6

Net earnings		2.9	%		1.1	%		7.9	%		7.5	%

Total gross margin increased ~~7.0%~~9.2% from the same prior year quarter to ~~$201.1~~$259.6 million in the ~~first~~second quarter of 2010. As a percentage of sales, total gross margin increased from ~~40.5%~~45.2% in the ~~first~~second quarter of 2009 to ~~42.5%~~48.3% in the ~~first~~second quarter of 2010. This increase is due mainly to improved clothing product and tuxedo rental margins and a decrease from ~~15.6%~~13.9% in the ~~first~~second quarter of 2009 to ~~14.7%~~13.0% in the ~~first~~second quarter of 2010 for occupancy cost, which is relatively constant on a per store basis and includes store related rent, common area maintenance, utilities, repairs and maintenance, security, property taxes and depreciation. On an absolute dollar basis, occupancy cost decreased by ~~$2.9~~$3.3 million or ~~4.0%~~4.5% from the ~~first~~second quarter of 2009 to the ~~first~~second quarter of 2010 primarily due to fewer open stores in 2010 and reduced depreciation following impairment charges taken in the fourth quarter of 2009. With respect to gross margin as a percentage of related sales, clothing product gross margin increased from ~~53.4%~~53.3% in ~~first~~second quarter 2009 to ~~54.6%~~55.5% in ~~first~~second quarter 2010 due primarily to different promotional offerings, as well as the mix of products on promotion, in 2010 compared to 2009 and lower product costs. The tuxedo rental services gross margin increased from ~~83.2%~~83.4% in ~~first~~second quarter 2009 to ~~84.3%~~84.5% in ~~first~~second quarter 2010 due mainly to a decrease in rental product retirement costs in 2010. The gross margin for alteration and other services decreased from ~~28.4%~~26.7% in ~~first~~second quarter 2009 to ~~26.9%~~24.3% in ~~first~~second quarter 2010 mainly as a result of decreased alteration sales associated with decreased suit unit sales in 2010.


%		Attributed to

~~(0.4~~	)0.9	~~Decrease~~	Increase in advertising expense as a percentage of sales from ~~4.8%~~3.4% in the ~~first~~second quarter of 2009 to ~~4.4%~~4.3% in the ~~first~~second quarter of 2010. On an absolute dollar basis, advertising expense ~~decreased $1.3~~increased $5.1 million.
—		Store salaries as a percentage of sales remained flat at 13.6% for the second quarter of 2010 and 2009. Store salaries on an absolute dollar basis increased $1.8 million.
1.6		Increase in other SG&A expenses as a percentage of sales from 16.1% in the second quarter of 2009 to 17.7% in the second quarter of 2010. On an absolute dollar basis, other SG&A expenses increased $10.4 million primarily due to expenses related to our acquisition of Dimensions and certain assets of Alexandra on August 6, 2010, increased medical insurance costs, and the absence in 2010 of a cumulative adjustment of $3.1 million recognized in the second quarter of 2009 for gift card breakage income.

2.5	%	Total

Interest expense increased from $0.2 million in the second quarter of 2009 to $0.3 million in the second quarter of 2010 while interest income decreased from $0.2 million in the second quarter of 2009 to $46 thousand in the second quarter of 2010. Weighted average borrowings outstanding increased from $41.1 million in the second quarter of 2009 to $44.4 million in the second quarter of 2010, and the weighted average interest rate on outstanding indebtedness increased from 1.0% to 2.0%. The increase in the weighted average borrowings is due to the strengthening of the Canadian dollar in the second quarter of 2010 as compared to the prior year. The weighted average interest rate for the second quarter of 2010 increased mainly due to an increase in the effective interest rate for the Canadian term loan from 1.3% at August 1, 2009 to 1.6% at July 31, 2010. The decrease in interest income was primarily attributable to a shift in our investments and lower interest rates for the second quarter of 2010 as compared to the second quarter of 2009.

Our effective income tax rate was 37.6% for the second quarter of 2010 and 38.2% for the second quarter of 2009. The effective tax rate in 2010 and 2009 was higher than the statutory U.S. federal rate of 35% primarily due to the unfavorable tax rate effect from state income taxes.

These factors resulted in net earnings of $42.5 million or 7.9% of net sales for the second quarter of 2010, compared with net earnings of $39.5 million or 7.5% of net sales for the second quarter of 2009.

Six Months Ended July 31, 2010 compared to Six Months Ended August 1, 2009

The following table sets forth the Company’s results of operations expressed as a percentage of net sales for the periods indicated:


	For the Six Months
	Ended (1)
	July 31,			August 1,
	2010			2009
Net sales:
Clothing product		72.3	%		73.0	%
Tuxedo rental services		21.2			20.3
Alteration and other services		6.5			6.7

Total net sales		100.0	%		100.0	%
Cost of sales:
Clothing product, including buying and distribution costs		32.5			34.1
Tuxedo rental services		3.3			3.4
Alteration and other services		4.8			4.8
Occupancy costs		13.8			14.7

Total cost of sales		54.4			57.0

Gross margin		45.6			43.0
Selling, general and administrative expenses		36.7			35.7

Operating income		8.9			7.3
Interest income		0.0			0.1
Interest expense		(0.1	)		(0.1	)

Earnings before income taxes		8.8			7.3
Provision for income taxes		3.3			2.8

Net earnings		5.6	%		4.5	%


(1)		Percentage line items may not sum to totals due to the effect of rounding.

The Company’s net sales increased $20.1 million, or 2.0%, to $1,010.5 million for the six months ended July 31, 2010. The increase was due mainly to a $13.6 million increase in tuxedo rental service revenues and a $7.2 million increase in clothing product revenues, and is attributable to the following:


(in millions)			Amount Attributed to
$	7.5		Increase in comparable sales.
	5.1		Increase from net sales of stores opened in 2009, relocated stores and expanded stores not yet included in comparable sales.
	(1.2	)	Decrease in alteration services sales.
	2.6		Increase in corporate apparel and other sales.
	(7.8	)	Decrease in net sales resulting from stores closed.
	0.6		Increase in net sales from 4 new stores opened in 2010.
	13.3		Increase in net sales resulting from change in U.S./Canadian dollar exchange rate.

$	20.1		Total

Our comparable store sales increased 2.6% at Men’s Wearhouse due mainly to continued unit growth in our tuxedo services business, with clothing product sales remaining flat as average ticket and store traffic levels were stable. At Moores, comparable store sales increased a slight 0.5% due mainly to continued unit growth in our tuxedo services business, while clothing product sales remained flat with a higher average transaction value offsetting a decrease in units per transaction and lower store traffic levels. At K&G, comparable store sales decreased 4.8% due mainly to a decrease in the average transaction value. Tuxedo rental service revenues as a percentage of total net sales increased from 20.3% in the first six months of 2009 to 21.2% in the first six months of 2010; in absolute dollars, tuxedo rental service revenues increased $13.6 million or 6.8% due mainly to a 5.5% increase in units rented, offset partially by lower average rental rates in the U.S. Exchange rate changes from a stronger Canadian dollar also caused total sales for the first half of 2010 to be $13.3 million more than the comparable prior year sales.

The Company’s gross margin was as follows:


	For the Six Months Ended
	July 31,			August 1,
	2010			2009
Gross margin (in thousands)	$	460,655		$	425,777

Gross margin as a percentage of related sales:
Clothing product, including buying and distribution costs		55.1	%		53.3	%
Tuxedo rental services		84.5	%		83.3	%
Alteration and other services		25.6	%		27.6	%
Occupancy costs		(13.8	)%		(14.7	)%
Total gross margin		45.6	%		43.0	%

Total gross margin increased 8.2% from the same prior year period to $460.7 million in the first six months of 2010. As a percentage of sales, total gross margin increased from 43.0% in the first six months of 2009 to 45.6% in the first six months of 2010. This increase is due mainly to improved clothing product and tuxedo rental margins and a decrease from 14.7% in the first six months of 2009 to 13.8% in the first six months of 2010 for occupancy cost, which is relatively constant on a per store basis and includes store related rent, common area maintenance, utilities, repairs and maintenance, security, property taxes and depreciation. On an absolute dollar basis, occupancy cost decreased by $6.1 million or 4.2% from the first six months of 2009 to the first six months of 2010 primarily due to fewer open stores in 2010 and reduced depreciation following impairment charges taken in the fourth quarter of 2009. With respect to gross margin as a percentage of related sales, clothing product gross margin increased from 53.3% in first six months of 2009 to 55.1% in the first six months of 2010 due primarily to different promotional offerings, as well as the mix of products on promotion, in 2010 compared to 2009 and lower product costs. The tuxedo rental services gross margin increased from 83.3% in the first six months of 2009 to 84.5% in the first six months of 2010 due mainly to a decrease in rental product retirement costs in 2010. The gross margin for alteration and other services decreased from 27.6% in the first six months of 2009 to 25.6% in first six months of 2010 mainly as a result of decreased alteration sales associated with decreased suit unit sales in 2010.

Selling, general and administrative expenses increased to $370.8 million in the first six months of 2010 from $353.1 million in the first six months of 2009, an increase of $17.7 million or 5.0%. As a percentage of sales, these expenses increased from 35.7% in the first six months of 2009 to 36.7% in the first six months of 2010. The components of this 1.0% net increase in SG&A expenses as a percentage of net sales and the related absolute dollar changes were as follows:


%		Attributed to
0.3		Increase in advertising expense as a percentage of sales from 4.1% in the first six months of 2009 to 4.4% in the first six months of 2010. On an absolute dollar basis, advertising expense increased $3.7 million.
(0.1	)	Decrease in store salaries as a percentage of sales from ~~14.8%~~14.2% in the first ~~quarter~~six months of 2009 to ~~14.7%~~14.1% in the first ~~quarter~~six months of 2010. Store salaries on an absolute dollar basis increased ~~$0.8~~$2.6 million.
~~(0.2~~	)0.8	~~Decrease~~	Increase in other SG&A expenses as a percentage of sales from ~~19.0%~~17.4% in the first ~~quarter~~six months of 2009 to ~~18.8%~~18.2% in the first ~~quarter~~six months of 2010. On an absolute dollar basis, other SG&A expenses increased ~~$0.9 million.~~$11.4 million primarily due to expenses related to our acquisition of Dimensions and certain assets of Alexandra on August 6, 2010, increased medical insurance costs and the absence in 2010 of a cumulative adjustment of $3.1 million recognized in the second quarter of 2009 for gift card breakage income.

~~(0.7~~1.0	)%	Total

Interest expense ~~decreased from $0.4~~remained flat at $0.6 million infor the first ~~quarter~~six months of 2010 and 2009 ~~to $0.3 million in the first quarter of 2010~~ while interest income decreased from ~~$0.3~~$0.5 million in the first ~~quarter~~six months of 2009 to ~~$34 thousand~~$0.1 million in the first ~~quarter~~six months of 2010. Weighted average borrowings outstanding decreased from ~~$61.9~~$51.5 million in the first ~~quarter~~six months of 2009 to ~~$45.4~~$44.9 million in the first ~~quarter~~six months of 2010, and the weighted average interest rate on outstanding indebtedness decreased from ~~2.2%~~1.9% to ~~1.5%~~1.8%. The decrease in the weighted average borrowings and the weighted average interest rate was due to the repayment of our outstanding balance on our revolving credit facility of $25.0 million in the first quarter of 2009. The decrease in interest income was primarily attributable to a shift in our investments and lower interest rates for the first ~~quarter~~six months of 2010 as compared to the first ~~quarter~~six months of 2009.

Our effective income tax rate was ~~35.8%~~37.2% for the first ~~quarter~~six months of 2010 and ~~39.0%~~38.3% for the first ~~quarter~~six months of 2009. The effective tax rate ~~for the~~in 2010 ~~first quarter~~and 2009 was higher than the statutory U.S. federal rate of 35% due ~~mainly~~ to the unfavorable tax rate effect from state income taxes, offset partially in 2010 by the favorable tax rate effect from the recognition of previously unrecognized tax benefits and associated accrued interest resulting from the conclusion of certain income tax audits. ~~The effective tax rate for the first quarter of 2009 was higher than the statutory U.S. federal rate due mainly to state income taxes.~~

These factors resulted in net earnings of ~~$13.6~~$56.1 million or ~~2.9%~~5.6% of net sales for the first ~~quarter~~six months of 2010, compared with net earnings of ~~$5.3~~$44.7 million or ~~1.1%~~4.5% of net sales for the first ~~quarter~~six months of 2009.

Liquidity and Capital Resources

At ~~May 1,~~July 31, 2010, January 30, 2010 and ~~May 2,~~August 1, 2009, cash and cash equivalents totaled ~~$219.6~~$281.5 million, $186.0 million and ~~$107.5~~$144.4 million, respectively. We had working capital of ~~$463.9~~$513.8 million, $484.3 million and ~~$383.6~~$450.0 million at ~~May 1,~~July 31, 2010, January 30, 2010 and ~~May 2,~~August 1, 2009, respectively, which included short-term investments of ~~$17.7~~$19.5 million at ~~May 2,~~August 1, 2009. We held no short-term investments at ~~May 1,~~July 31, 2010 or January 30, 2010. Our primary sources of working capital are cash flows from operations and borrowings under our Credit Agreement. Historically, our working capital has been at its lowest level in January and February, and has increased through November as inventory buildup occurs in preparation for the fourth quarter selling season. The ~~$20.4~~$29.5 million ~~decrease~~increase in working capital at ~~May 1,~~July 31, 2010 compared to January 30, 2010 resulted primarily from increased cash balances, offset partially by the current liability classification at quarter end of our Canadian debt of US$~~45.8~~45.2 million due on February 10, ~~2011, offset partially by increased~~2011.

On August 6, 2010, subsequent to the end of our 2010 second quarter, we acquired Dimensions Clothing Limited and certain assets of Alexandra plc, two leading providers of corporate clothing uniforms and workwear in the United Kingdom, for a total cash ~~balances.~~consideration of approximately £61 million (US$97.8 million). The acquisition of Dimensions and certain assets of Alexandra will expand our corporate apparel operations. The combined businesses are organized under a UK-based holding company, of which the Company controls 86% and certain existing shareholders of Dimensions control 14%. The Company has the right to acquire the remaining outstanding shares of the UK-based holding company in the future on the terms set forth in the Investment, Shareholders’ and Stock Purchase Agreement. The cash consideration of £61 million (US$97.8 million) was funded through the Company’s cash on hand.

Credit Facilities

Our Amended and Restated Credit Agreement (the “Credit Agreement”) with a group of banks, which was last amended on February 2, 2007, provides for a total senior secured revolving credit facility of $200.0 million, which can be expanded to $250.0 million upon additional lender commitments, that matures on February 11, 2012. The Credit Agreement also provided our Canadian subsidiaries with a senior secured term loan used to fund the repatriation of US$74.7 million of Canadian earnings in January 2006 under the American Jobs Creation Act of 2004. The Canadian term loan matures on February 10, 2011. The Credit Agreement is secured by the stock of certain of the Company’s subsidiaries. The Credit Agreement has several borrowing and interest rate options including the following indices: (i) an alternate base rate (equal to the greater of the prime rate or the federal funds rate plus 0.5%) or (ii) LIBO rate or (iii) CDO rate. Advances under the Credit Agreement bear interest at a rate per annum using the applicable indices plus a varying interest rate margin up to 1.125%. The Credit Agreement also provides for fees applicable to unused commitments ranging from 0.100% to 0.175%. As of ~~May 1,~~July 31, 2010, there was US$~~45.8~~45.2 million outstanding under the Canadian term loan, with an effective interest rate of ~~1.2%~~1.6%, and no borrowings outstanding under the revolving credit facility.

Cash flow activities

Operating activities –—Our primary source of operating cash flow is from sales to our customers. Our primary uses of cash include merchandise inventory and tuxedo rental product purchases, personnel related expenses, occupancy costs, advertising costs and income tax payments. Our operating activities provided net cash of ~~$49.3~~$130.3 million ~~for~~in the first ~~quarter~~six months of 2010, due mainly to net earnings, adjusted for non-cash charges, a decrease in inventories and an increase in accounts payable, accrued expenses and other current liabilities, offset by increases in tuxedo rental product and ~~accounts receivable and~~ a decrease in income taxes payable. During the first ~~quarter~~six months of 2009, our operating activities provided net cash of ~~$63.3~~$110.1 million, due mainly to net earnings, adjusted for non-cash charges, a decrease in inventories and ~~increases~~other assets and an increase in income taxes payable, offset by a decrease in accounts payable, accrued expenses and other current liabilities and ~~income taxes payable, offset by increases~~an increase in tuxedo rental ~~product and accounts receivable.~~product. The ~~increase~~decrease in ~~accounts~~

~~receivable in~~inventories during the first ~~quarter~~six months of 2010 and 2009 was primarily due ~~mainly~~ to ~~the seasonal increase at quarter end for receivables from third-party credit card providers for prom~~lower inventory purchases as a result of decreased clothing sales in 2009 and ~~other tuxedo rentals.~~our continued efforts in 2010 to align our inventory purchases with sales expectations. Tuxedo rental product increased in each of the periods to support the continued growth inof our tuxedo rental business and, in 2009, to replenish and replace a portion of our tuxedo rental product offerings. The ~~increase~~decrease in accounts payable, accrued expenses and other current liabilities infor the first ~~quarter~~six months of 2009 was primarily due to the timing of vendor payments ~~increased amounts due for~~and reduced purchases ~~of tuxedo rental product and the seasonal increase in tuxedo rental deposits,~~associated with decreased clothing sales, while the increase in income taxes payable was due to the timing and amounts of required tax ~~payments and refunds received.~~payments. The increase in accounts payable, accrued expenses and other current liabilities in the first ~~quarter~~six months of 2010 was primarily due to the timing of vendor payments and the seasonal increase in tuxedo rental deposits, while the decrease in income taxes payable was due to the timing of required tax payments. The decrease in other assets in the first six months of 2009 was due mainly to tax refunds received.

Investing activities –—Our cash outflows from investing activities are primarily for capital expenditures. During the first ~~quarter~~six months of 2010 and 2009, our investing activities used net cash of ~~$11.1~~$25.8 and $28.8 million, ~~and $15.0 million,~~ respectively, primarily for capital expenditures. Our capital expenditures relate to costs incurred for stores opened, remodeled ~~relocated~~ or ~~opened~~relocated during the period or under construction at the end of the period, ~~infrastructure technology investments and~~ office and distribution facility ~~additions.~~additions and infrastructure technology investments.

Financing activities –—Our cash outflows from financing activities consist primarily of cash dividend payments and debt payments, while cash inflows from financing activities consist primarily of proceeds from our revolving credit facility. During the first ~~quarter~~six months of 2010, our financing activities used net cash of ~~$6.0~~$10.2 million due mainly to cash dividends paid of ~~$4.8~~$9.5 million. Our financing activities used net cash of ~~$29.9~~$33.0 million for the first ~~quarter~~six months of 2009, due mainly to payments on our revolving credit facility of $25.0 million and cash dividends paid of ~~$3.7~~$7.3 million.

Share repurchase program –—In January 2006, the Board of Directors authorized a $100.0 million share repurchase program of our common stock. This authorization superceded any remaining previous authorizations. In August 2007, the Company’s Board of Directors approved a replenishment of the Company’s share repurchase program to $100 million by authorizing $90.3 million to be added to the remaining $9.7 million of the then current program. No shares were purchased under the August 2007 authorization during the first ~~quarter~~six months of 2010 or 2009. At ~~May 1,~~July 31, 2010, the remaining balance available under the August 2007 authorization was $44.3 million.

Dividends –—Cash dividends paid were approximately ~~$4.8~~$9.5 million and ~~$3.7~~$7.3 million for the ~~quarter~~six months ended ~~May 1,~~July 31, 2010 and ~~May 2,~~August 1, 2009, respectively.

In ~~April~~June 2010, our Board of Directors declared a quarterly cash dividend of $0.09 per share payable on ~~June 25,~~September 24, 2010 to shareholders of record at close of business on ~~June 15,~~September 14, 2010. The dividend payout is estimated to be approximately $4.8 million and is included in accrued expenses and other current liabilities on the condensed consolidated balance sheet as of ~~May 1,~~July 31, 2010.

Future cash flow

Current domestic and global economic conditions, including high unemployment levels and tightened credit markets, could negatively affect our future operating results as well as our existing cash and cash equivalents balances. In addition, conditions in the financial markets could limit our access to additional capital resources, if needed, and could increase associated costs. We believe based on our current business plan that our existing cash and cash flows from operations will be sufficient to fund our planned store openings, relocations and remodelings, other capital expenditures and operating cash requirements, including integration costs and other requirements related to our August 6, 2010 Dimensions and Alexandra acquisition, and that we will be able to maintain compliance with the covenants in our Credit Agreement for at least the next 12 months. In addition, as of ~~May 1,~~July 31, 2010, borrowings available under our Credit Agreement were $188.4 million. However, current economic conditions are creating potential acquisition opportunities. If such acquisition opportunities develop, we may need to raise additional capital in order to complete such acquisitions and our Credit Agreement may need to be modified or expanded.

As a substantial portion of our cash and cash equivalents, which are primarily governmental agencies and U.S. treasuries, ~~and other interest bearing accounts,~~ is held by four financial institutions (three U.S. and one Canadian), we are exposed to risk of loss in the event of failure of any of these parties. However, due to the creditworthiness of these financial institutions, we anticipate full performance and access to our deposits and liquid investments.

In connection with our direct sourcing program, we may enter into purchase commitments that are denominated in a foreign currency (primarily the Euro). We generally enter into forward exchange contracts to reduce the risk of currency fluctuations related to such commitments. As these forward exchange contracts are with one financial institution, we are exposed to credit risk in the event of nonperformance by this party. However, due to the creditworthiness of this major financial institution, full performance is anticipated. We may also be exposed to market risk as a result of changes in foreign exchange rates. This market risk should be substantially offset by changes in the valuation of the underlying transactions.

ITEM 3 — QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Foreign Currency Risk

We are subject to exposure from fluctuations in U.S. dollar/Euro exchange rates. As further described in Note 10 of Notes to Condensed Consolidated Financial Statements and “Management’s Discussion and Analysis of Financial Information and Results of Operations — Liquidity and Capital Resources”, we utilize foreign currency forward exchange contracts to limit exposure to changes in currency exchange rates. At July 31, 2010, we had three contracts maturing in varying increments to purchase an aggregate notional amount of $2.9 million in foreign currency, maturing at various dates through March 2011. We held no outstanding contracts at August 1, 2009. Unrealized pretax gains on these forward contracts totaled approximately $0.2 million at July 31, 2010. A hypothetical 10% change in applicable July 31, 2010 forward rates could increase or decrease the July 31, 2010 unrealized pretax gain by approximately $0.3 million related to these positions. However, it should be noted that any change in the value of these contracts, whether real or hypothetical, would be significantly offset by an inverse change in the value of the underlying hedged item.

Subsequent to our August 6, 2010 Dimensions and Alexandra acquisition, we will be subject to exposure from fluctuations in U.S. dollar/ Pounds Sterling (“GBP”) exchange rates as Dimensions and Alexandra sell their products and services primarily in GBP but acquire a significant part of their goods in transactions paid in U.S. dollars. A decline in the value of the GBP as compared to the U.S. dollar will adversely impact their operating results, particularly in relation to longer term customer contracts that have little or no pricing adjustment provisions. Dimensions and Alexandra utilize foreign currency hedging contracts to limit exposure to changes in U.S. dollar/GBP exchange rates.

Moores conducts its business in Canadian dollars. The exchange rate between Canadian dollars and U.S. dollars has fluctuated over the last ten years. If the value of the Canadian dollar against the U.S. dollar weakens, then the revenues and earnings of our Canadian operations will be reduced when they are translated to U.S. dollars. Also, the value of our Canadian net assets in U.S. dollars may decline.

Interest Rate Risk

We are also subject to market risk as a result of the outstanding balance of US$~~45.8~~45.2 million under our Canadian term loan at ~~May 1,~~July 31, 2010, which bears a variable interest rate (see Note 3 of Notes to Condensed Consolidated Financial Statements). An increase in market interest rates would increase our interest expense and our cash requirements for interest payments. For example, an average increase of 0.5% in the variable interest rate would increase our interest expense and payments by approximately $0.2 million. At ~~May 1,~~July 31, 2010, there were no borrowings outstanding under our revolving credit facility.

We also have exposure to market rate risk for changes in interest rates as those rates relate to our investment portfolio. The primary objective of our investment activities is to preserve principal while at the same time maximizing yields without significantly increasing risk. As of ~~May 1,~~July 31, 2010, we have highly liquid investments classified as cash equivalents in our condensed consolidated balance sheet. Future investment income earned on our cash equivalents will fluctuate in line with short-term interest rates.

ITEM 4 — CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

The Company’s management, with the participation of the Company’s ~~chief~~principal executive officer (“CEO”) and ~~chief~~principal financial officer (“CFO”), evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) promulgated under the Securities Exchange Act of 1934, as ~~amended)~~amended (the “Exchange Act”)) as of the end of the ~~fiscal quarter ended May 1, 2010.~~period covered by this report. Based on this evaluation, the CEO and CFO have concluded that, as of the end of such period, the Company’s disclosure controls and procedures were effective ~~as of the end of the fiscal quarter ended May 1, 2010~~ to ensure that information that is required to be disclosed by the Company in the reports it files or submits under the Exchange Act is (i) recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and ~~forms.~~forms and (ii) accumulated and communicated to the Company’s management, including the CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure.

PART II. OTHER INFORMATION

ITEM 1 — LEGAL PROCEEDINGS

ITEM 21A — ~~UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS~~RISK FACTORS

~~(c)~~ ~~The~~In addition to the general risk factors described in our Annual Report on Form 10-K, including those related to acquisition integration and to general economic conditions, our acquisition of Dimensions and Alexandra on August 6, 2010 involves the following ~~table presents information with respect to purchases of common stock~~risks:

A reduction in the value of the Pound Sterling against the U.S. dollar can significantly impact the acquired businesses.

The acquired businesses sell their products and services in Pound Sterling but acquire a significant part of their goods in transactions paid in U.S. dollars. Therefore a decline in the value of the Pound Sterling as compared to the U.S. dollar will adversely impact their operating results, particularly in relation to longer term customer contracts that have little or no pricing adjustment provisions. The acquired businesses have taken steps through hedging and price renegotiations to mitigate some of this risk.

The general economic conditions in the United Kingdom and particularly service cut backs being put forth by the current government may reduce demand for the businesses of Dimensions and Alexandra.

The United Kingdom has experienced and is continuing to experience an economic slow down. As a result of expected deficits, the UK government has announced significant reductions in public services including reductions in employment. Employees in the public service in the UK are a significant target market for the acquired businesses and a substantial reduction in the number of these employees could adversely affect the acquired businesses.

The competition authorities in the UK will review the combination of Dimensions and Alexandra and this could result in a requirement to divest some assets.

The combination of Dimensions and Alexandra has been noticed to the Office of Fair Trading in the UK for review. The Company ~~made during~~believes for a variety of reasons that upon completion of its review, the ~~quarter ended May 1, 2010 as defined by Rule 10b-18(a)(3) under~~Office of Fair Trading will unconditionally clear the ~~Exchange Act:~~combination. However, no assurance can be given that this will be the case and the Office of Fair Trading could refer the combination to the Competition Commission in the UK for a more detailed investigation. The Competition Commission could require the divestiture of some of the acquired assets if it were to conclude that the combination resulted, or may be expected to result, in a substantial lessening of competition.

(c)
Total (d)
Number of Approximate
Shares Dollar Value of
Purchased Shares that
as Part of May Yet Be
(a) (b) Publicly Purchased
Total Number Average Announced Under the
of Shares Price Paid Plans or Plans or
Period Purchased Per Share Programs Programs
(In thousands)
(1) (2)

January 31, 2010 through February 27, 2010 7,134 $ 20.24 — $ 44,319
February 28, 2010 through April 3, 2010 — — — $ 44,319
April 4, 2010 through May 1, 2010 — — — $ 44,319
Total 7,134 $ 20.24 — $ 44,319


~~(1)~~		~~Represents restricted shares repurchased to satisfy tax withholding obligations arising upon the vesting of certain restricted shares.~~

~~(2)~~		~~Refer to Note 7 of Notes to Condensed Consolidated Financial Statements for information regarding our share repurchase program.~~

1925

ITEM 6 — EXHIBITS

(a) Exhibits.


Exhibit
Number		Exhibit Index
~~10.1~~
2.1	—	~~Forms of Deferred~~Investment, Shareholders’ and Stock ~~Unit Award~~Purchase Agreement ~~Restricted Stock Award Agreement~~dated August 6, 2010, by and ~~Nonqualified Stock Option Award Agreement under~~among The Men’s Wearhouse, Inc. ~~1996 Long-Term Incentive Plan (as amended~~, Moores The Suit People Inc., MWUK Holding Company Limited, Ensco 648 Limited, Gresham 4A and ~~restated~~Gresham 4B and the stockholders of Ensco 648 Limited (incorporated by reference from Exhibit 2.1 to the Company’s Current Report on Form 8-K/A filed with the Commission on August 16, 2010).

4.1	—	Amended and Restated Credit Agreement, dated as of December 21, 2005, by and among The Men’s Wearhouse, Inc., Moores The Suit People Inc., Golden Brand Clothing (Canada) Ltd., the financial institutions from time to time parties thereto, JPMorgan Chase Bank, N.A., as Administrative Agent, and JPMorgan Chase Bank, N.A. as Canadian Agent (filed herewith).

4.2	—	Agreement and Amendment to Amended and Restated Credit Agreement effective as of ~~April 1, 2008)~~January 31, 2007, by and among the Company, Moores The Suit People Inc., Golden Brand Clothing (Canada) Ltd., the financial institutions from time to time party thereto, and JPMorgan Chase Bank, N.A., as Administrative Agent (filed herewith).

31.1	—	Certification of Periodic Report Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Chief Executive Officer (filed herewith).

31.2	—	Certification of Periodic Report Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Chief Financial Officer (filed herewith).

32.1	—	Certification of Periodic Report Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by the Chief Executive Officer (filed herewith).

32.2	—	Certification of Periodic Report Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by the Chief Financial Officer (filed herewith).

101.1	—	The following financial information from The Men’s Wearhouse, Inc.’s Quarterly Report on Form 10-Q for the quarter and six months ended July 31, 2010, formatted in XBRL (Extensible Business Reporting Language) and furnished electronically herewith: (i) the Condensed Consolidated Balance Sheets; (ii) the Condensed Consolidated Statements of Earnings; (iii) the Condensed Consolidated Statements of Cash Flows; and (iv) the Notes to Condensed Consolidated Financial Statements, tagged as blocks of text.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant, The Men’s Wearhouse, Inc., has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

2026

EXHIBIT INDEX


Exhibit
Number		Exhibit Index
~~10.1~~
2.1	—	~~Forms of Deferred~~Investment, Shareholders’ and Stock ~~Unit Award~~Purchase Agreement ~~Restricted Stock Award Agreement~~dated August 6, 2010, by and ~~Nonqualified Stock Option Award Agreement under~~among The Men’s Wearhouse, Inc. ~~1996 Long-Term Incentive Plan (as amended~~, Moores The Suit People Inc., MWUK Holding Company Limited, Ensco 648 Limited, Gresham 4A and ~~restated~~Gresham 4B and the stockholders of Ensco 648 Limited (incorporated by reference from Exhibit 2.1 to the Company’s Current Report on Form 8-K/A filed with the Commission on August 16, 2010).

4.1	—	Amended and Restated Credit Agreement, dated as of December 21, 2005, by and among The Men’s Wearhouse, Inc., Moores The Suit People Inc., Golden Brand Clothing (Canada) Ltd., the financial institutions from time to time parties thereto, JPMorgan Chase Bank, N.A., as Administrative Agent, and JPMorgan Chase Bank, N.A. as Canadian Agent (filed herewith).

4.2	—	Agreement and Amendment to Amended and Restated Credit Agreement effective as of ~~April 1, 2008)~~January 31, 2007, by and among the Company, Moores The Suit People Inc., Golden Brand Clothing (Canada) Ltd., the financial institutions from time to time party thereto, and JPMorgan Chase Bank, N.A., as Administrative Agent (filed herewith).

31.1	—	Certification of Periodic Report Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Chief Executive Officer (filed herewith).

31.2	—	Certification of Periodic Report Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 by the Chief Financial Officer (filed herewith).

32.1	—	Certification of Periodic Report Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by the Chief Executive Officer (filed herewith).

32.2	—	Certification of Periodic Report Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by the Chief Financial Officer (filed herewith).

101.1	—	The following financial information from The Men’s Wearhouse, Inc.’s Quarterly Report on Form 10-Q for the quarter and six months ended July 31, 2010, formatted in XBRL (Extensible Business Reporting Language) and furnished electronically herewith: (i) the Condensed Consolidated Balance Sheets; (ii) the Condensed Consolidated Statements of Earnings; (iii) the Condensed Consolidated Statements of Cash Flows; and (iv) the Notes to Condensed Consolidated Financial Statements, tagged as blocks of text.

2127


Part and Item No.	Page No.
PART I — Financial Information

Item 1 — Condensed Consolidated Financial Statements

General Information		1

Condensed Consolidated Balance Sheets as of ~~May 1,~~July 31, 2010 (unaudited), ~~May 2,~~August 1, 2009 (unaudited) and January 30, 2010		2

Condensed Consolidated Statements of Earnings for the ~~Quarter~~Three and Six Months Ended ~~May 1,~~July 31, 2010 (unaudited) and ~~May 2,~~August 1, 2009 (unaudited)		3

Condensed Consolidated Statements of Cash Flows for the ~~Quarter~~Six Months Ended ~~May 1,~~July 31, 2010 (unaudited) and ~~May 2,~~August 1, 2009 (unaudited)		4

Notes to Condensed Consolidated Financial Statements (unaudited)		5

Item 2 — Management’s Discussion and Analysis of Financial Condition and Results of Operations		1316

Item 3 — Quantitative and Qualitative Disclosures about Market Risk		1824

Item 4 — Controls and Procedures		1824

PART II — Other Information

Item 1 — Legal Proceedings		1925

Item ~~2 — Unregistered Sales of Equity Securities and Use of Proceeds~~1A— Risk Factors		1925

Item 6 — Exhibits		2026

SIGNATURES		20
		26
~~EX-10.1~~EX-4.1
EX-4.2
EX-31.1
EX-31.2
EX-32.1
EX-32.2
EX-101 INSTANCE DOCUMENT
EX-101 SCHEMA DOCUMENT
EX-101 CALCULATION LINKBASE DOCUMENT
EX-101 LABELS LINKBASE DOCUMENT
EX-101 PRESENTATION LINKBASE DOCUMENT


Balance, January 31, 2009	$	57,561		$	57,561
Translation adjustment		3,330			3,330
Adjustment for excess of tax deductible goodwill		(1,477	)		(1,477	)

Balance, January 30, 2010	$	59,414		$	59,414
Translation adjustment		1,366			1,035

Balance, May 1, 2010	$	60,780
Balance, July 31, 2010				$	60,449


		May 1,		May 2,		January 30,			July 31,		August 1,		January 30,
		2010		2009		2010			2010		2009		2010
Prepaid expenses		$	29,787	$	25,773	$	30,896		$	29,695	$	25,691	$	30,896
Current deferred tax asset			31,804		11,113		37,751			26,945		16,549		37,751
Income taxes receivable			4,123		17,171		1,309			174		5,339		1,309
Other			3,116		5,695		4,119			4,948		4,297		4,119


Total other current assets		$	68,830	$	59,752	$	74,075		$	61,762	$	51,876	$	74,075


Accrued expenses and other current liabilities consist of the following (in thousands):	Accrued expenses and other current liabilities consist of the following (in thousands):							Accrued expenses and other current liabilities consist of the following (in thousands):

Accrued salary, bonus, sabbatical and vacation		$	31,497	$	30,504	$	40,032		$	32,125	$	31,152	$	40,032
Sales, payroll and property taxes payable			20,229		16,168		12,524			19,251		14,385		12,524
Unredeemed gift certificates			13,393		16,322		14,980			12,590		13,025		14,980
Accrued workers compensation and medical costs			16,544		15,766		17,484			16,731		16,157		17,484
Tuxedo rental deposits			37,288		32,399		9,523			26,021		22,228		9,523
Cash dividends declared			4,757		3,664		4,753			4,779		3,680		4,753
Loyalty program reward certificates										6,427		5,635		6,342
Other			12,475		13,045		17,751			12,047		9,226		11,409


Total accrued expenses and other current liabilities		$	136,183	$	127,868	$	117,047		$	129,971	$	115,488	$	117,047


Deferred taxes and other liabilities consist of the following (in thousands):	Deferred taxes and other liabilities consist of the following (in thousands):							Deferred taxes and other liabilities consist of the following (in thousands):

Deferred rent and landlord incentives		$	45,282	$	43,996	$	44,656		$	46,703	$	44,223	$	44,656
Non-current deferred and other income tax liabilities			11,380		13,323		10,976			11,209		12,506		10,976
Other			6,079		6,636		6,604			6,490		6,560		6,604


Total deferred taxes and other liabilities		$	62,741	$	63,955	$	62,236		$	64,402	$	63,289	$	62,236


(1)		Includes 104,839 shares relinquished for tax payments related to vested deferred stock units for the ~~quarter~~six months ended ~~May 1,~~July 31, 2010.


(1)		MW includes Men’s Wearhouse and Men’s Wearhouse and Tux stores.

(2)		MW Cleaners is our retail dry cleaning and laundry facilities in Houston, Texas.

(3)		Twin Hill is our corporate apparel and uniform program.


( in millions)			Amount Attributed to

(in millions)				(in millions)		Amount Attributed to
$	2.6		Increase in comparable sales	5.3		Increase in comparable sales.
	2.3		Increase from net sales of stores opened in 2009, relocated stores and expanded stores not yet included in comparable sales	2.3		Increase from net sales of stores opened in 2009, relocated stores and expanded stores not yet included in comparable sales.
	(0.8	)	Decrease in alteration services and other sales	(0.4	)	Decrease in alteration services sales.
	(2.8	)	Decrease in net sales resulting from stores closed	2.6		Increase in corporate apparel and other sales.
	0.2		Increase in net sales from one new store opened in 2010	(5.0	)	Decrease in net sales resulting from stores closed.
	7.8		Increase in net sales resulting from change in U.S./Canadian dollar exchange rate	0.5		Increase in net sales from 4 new stores opened in 2010.
		5.5		Increase in net sales resulting from change in U.S./Canadian dollar exchange rate.

$	9.3		Total	10.8		Total


					(c)
					Total		(d)
					Number of		Approximate
					Shares		Dollar Value of
					Purchased		Shares that
					as Part of		May Yet Be
	(a)		(b)		Publicly		Purchased
	Total Number		Average		Announced		Under the
	of Shares		Price Paid		Plans or		Plans or
Period	Purchased		Per Share		Programs		Programs
							(In thousands)
	(1)						(2)

January 31, 2010 through February 27, 2010		7,134	$	20.24		—	$	44,319
February 28, 2010 through April 3, 2010		—		—		—	$	44,319
April 4, 2010 through May 1, 2010		—		—		—	$	44,319
Total		7,134	$	20.24		—	$	44,319

Dated: ~~June 10,~~September 9, 2010

THE MEN’S WEARHOUSE, INC.

/s/ NEILL P. DAVIS

Neill P. Davis

Executive Vice President, Chief Financial Officer,
Treasurer and Principal Financial Officer