SYMS CORP, S-3/A, 1997-11-19

SYMS CORP
S-3/A, 1997-11-19
FAMILY CLOTHING STORES

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As filed with the Securities and Exchange Commission on November 19, 1997.

Registration No. 333-38711

================================================================================

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

----------

AMENDMENT NO. 2

FORM S-3

REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933

----------

SYMS CORP
(Exact name of Registrant as specified in its charter)

----------

NEW JERSEY
(State or other jurisdiction of incorporation or organization)

----------

22-2465228
(I.R.S. Employer Identification No.)

----------

SYMS WAY
SECAUCUS, NEW JERSEY 07094
(201) 902-9600
(Address, Including Zip Code, and Telephone Number, Including Area Code,
of Registrant's Principal Executive Offices)

----------

SY SYMS
SYMS WAY
SECAUCUS, NEW JERSEY 07094
(201) 902-9600
(Name, Address, Including Zip Code, and Telephone Number, Including Area
Code, of Agent for Service)

Copy to:

MATTHEW J. MALLOW, ESQ. STEPHEN H. COOPER, ESQ.
SKADDEN, ARPS, SLATE, WEIL, GOTSHAL & MANGES LLP
MEAGHER & FLOM LLP 767 FIFTH AVENUE
919 THIRD AVENUE NEW YORK, NEW YORK 10153
NEW YORK, NEW YORK 10022 (212) 310-8000
(212) 735-3000

----------

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON
SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY
DETERMINE.

================================================================================
<PAGE>

INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.

SUBJECT TO COMPLETION, DATED NOVEMBER 19, 1997

PROSPECTUS

3,500,000 SHARES

SYMS CORP

COMMON STOCK

All of the shares of Common Stock of Syms Corp (the "Company") offered
hereby will be sold by the Sy Syms Foundation and Sy Syms. See "Principal and
Selling Stockholders." The Company will not receive any proceeds from the sale
of the Common Stock offered hereby.

The Common Stock is listed on the New York Stock Exchange under the symbol
"SYM." On November 18, 1997 the last sale price of the Common Stock as reported
on the New York Stock Exchange Composite Tape was $13.56. See "Price Range of
Common Stock and Dividend Policy."

----------

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

================================================================================
UNDERWRITING PROCEEDS TO
PRICE TO DISCOUNTS AND SELLING
PUBLIC COMMISSIONS(1) STOCKHOLDERS(2)
- --------------------------------------------------------------------------------
Per Share ..................... $ $ $
Total(3) ...................... $ $ $
================================================================================

(1) The Company and the Selling Stockholders have agreed to indemnify the
several Underwriters against certain liabilities, including liabilities
under the Securities Act of 1933, as amended. See "Underwriting."

(2) Before deducting estimated expenses of $__________ payable by the Selling
Stockholders. The Company's expenses in connection with this offering are
estimated at $__________.

(3) Certain Selling Stockholders have granted to the Underwriters a 30-day
option to purchase up to 525,000 additional shares of Common Stock solely
to cover over-allotments, if any. If the option is exercised in full, the
total Price to Public, Underwriting Discounts and Commissions and Proceeds
to Selling Stockholders will be $__________, $__________ and $__________ ,
respectively. See "Underwriting."

----------

The shares of Common Stock are offered by the several Underwriters, subject
to prior sale, when, as and if delivered to and accepted by them, and subject to
certain other conditions. The Underwriters reserve the right to withdraw, cancel
or modify the offer and to reject orders in whole or in part. It is expected
that delivery of the shares will be made against payment thereof on or about
__________________, 1997, at the offices of Bear, Stearns & Co. Inc., 245 Park
Avenue, New York, New York.

----------

BEAR, STEARNS & CO. INC. SALOMON BROTHERS INC

----------

The date of this Prospectus is __________________, 1997

<PAGE>

[GRAPHICS PAGE]

AN EDUCATED CONSUMER IS OUR BEST CUSTOMER(R) [SYMS LOGO]
<PAGE>

CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE COMMON STOCK,
INCLUDING OVER-ALLOTMENT, STABILIZING AND SHORT-COVERING TRANSACTIONS AND THE
IMPOSITION OF PENALTY BIDS. SEE "UNDERWRITING."

AVAILABLE INFORMATION

The Company is subject to the reporting requirements of the Securities and
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith, files reports and other information with the Securities and Exchange
Commission (the "Commission"). Such reports, proxy statements and other
information filed by the Company can be inspected and copied at the public
reference facilities maintained by the Commission at the offices of the
Commission at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington,
D.C. 20549, and at the Commission's regional offices at Northwestern Atrium
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511 and 7
World Trade Center, New York, New York 10048. Copies of such materials can also
be obtained by written request to the Public Reference Section of the Commission
at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, at
prescribed rates, and can be inspected at the offices of the New York Stock
Exchange, 20 Broad Street, New York, New York 10005.

The Company has filed a Registration Statement under the Securities Act
with the Commission with respect to the Common Stock offered hereby. This
Prospectus, which constitutes part of the Registration Statement, omits certain
of the information contained in the Registration Statement and the exhibits
thereto on file with the Commission pursuant to the Securities Act and the rules
and regulations of the Commission. Statements contained in this Prospectus such
as the contents of any contract or other document referred to are not
necessarily complete and in each instance reference is made to the copy of such
contract or other document filed as an exhibit to the Registration Statement,
each such statement being qualified in all respects by such reference. A copy of
the Registration Statement, including the exhibits thereto, may be inspected
without charge at the Commission's principal office at 450 Fifth Street, N.W.,
Judiciary Plaza, Washington, D.C. 20549, and copies of all or any part thereof
may be obtained from the Commission upon the payment of certain fees prescribed
by the Commission. The Commission also maintains a World Wide Web site that
contains reports, proxy and information statements and other information
regarding registrants, such as the Company, that file electronically with the
Commission. The address of the site is http://www.sec.gov.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

The following documents are hereby incorporated herein by reference:

1. The Company's Annual Report on Form 10-K for the fiscal year ended
March 1, 1997.

2. The Company's Quarterly Reports on Form 10-Q for the quarterly
periods ended May 31, 1997 and August 30, 1997.

All reports and other documents filed by the Company pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this
Prospectus and prior to the termination of this offering shall be deemed to be
incorporated by reference herein and to be a part hereof from the date of filing
of such reports and documents. Any statement incorporated herein shall be deemed
to be modified or superseded for purposes of this Prospectus to the extent that
a statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part of this
Prospectus. The Company hereby undertakes to provide without charge to each
person, including any beneficial owner, to whom a copy of this Prospectus has
been delivered, upon written or oral request of such person, a copy of any or
all of the foregoing documents incorporated herein by reference (other than
exhibits to such documents, unless such exhibits are specifically incorporated
by reference into such documents). Requests for such documents should be
submitted to the Chief Financial Officer of the Company, at the Company's
principal executive offices, which are located at Syms Way, Secaucus, New Jersey
07094 (telephone: (201) 902-9600).

3
<PAGE>

PROSPECTUS SUMMARY

THE FOLLOWING SUMMARY IS QUALIFIED IN ITS ENTIRETY BY THE MORE DETAILED
INFORMATION AND THE FINANCIAL STATEMENTS AND NOTES THERETO APPEARING ELSEWHERE
IN THIS PROSPECTUS. UNLESS THE CONTEXT OTHERWISE REQUIRES, THE "COMPANY" AND
"SYMS" REFER TO SYMS CORP AND ITS SUBSIDIARIES. REFERENCES HEREIN TO "COMMON
STOCK" ARE TO THE COMMON STOCK, $.05 PAR VALUE, OF THE COMPANY.

THE COMPANY

Syms operates a chain of forty "off-price" retail apparel stores located
throughout the Northeastern and middle Atlantic regions and in the Midwest,
Southeast and Southwest. The Company's stores feature a wide selection of first
quality, in-season merchandise, bearing nationally-recognized designer or brand
name labels, all of which is offered at prices substantially below those
generally found in department and specialty stores. The Company's merchandise
consists principally of men's tailored clothing and haberdashery and women's
dresses, suits, separates and accessories. For the fiscal year ended March 1,
1997, the Company had net income of approximately $19.1 million on net sales of
approximately $346.8 million, of which over 99% was generated by the sale of
designer and brand name merchandise.

Syms merchandising is predominantly directed toward middle- and
upper-income, fashion-minded and price conscious shoppers and is symbolized by
its widely-recognized slogan: "An Educated Consumer is Our Best Customer." The
Company's stores have a "no frills" atmosphere in order to emphasize Syms focus
on everyday low prices and exceptional value, although the Company's
merchandising approach is to be the off-price equivalent of an upscale specialty
store. For example, the Company is unique among off-price retailers in offering
its customers a relatively high degree of service, including sales associates
(called "Educators") to assist with merchandise selection and sizing and the
convenience of in-store alterations.

The Company is able to consistently offer merchandise at prices
substantially below those found at traditional department and specialty stores
as a result of its substantial purchasing volume and opportunistic and
disciplined buying practices. The Company always seeks the lowest possible price
from its vendors, rather than the special allowances, return privileges and
delayed delivery terms sought by most traditional retailers. Syms ability to
purchase at discounted prices is aided, in many cases, by the Company's
longstanding relationships with its vendors, many of whom have come to view the
Company as an effective and dependable channel for reducing their excess
inventories without compromising brand image.

Syms continues to expand the breadth of its merchandise selection and the
number of designer labels and brand names (currently more than 200) carried in
its stores. Men's and women's apparel accounted for 54% and 31%, respectively,
of the Company's net sales in fiscal 1997. The Company makes a special effort to
consistently carry a wide range of sizes in menswear and women's apparel, with
no pricing differential for special sizes. The Company's stores also carry
children's apparel, accessories (such as hosiery, underwear and sleepwear),
men's, women's and children's shoes, and luggage and smaller leather goods. The
Company believes it offers a wider range and quantity of merchandise in more
styles and sizes than any other off-price retailer.

In 1959, Syms opened its first store, containing 1,600 square feet, in
downtown New York City. Today, the Company's forty stores average 38,400 square
feet of selling space and are found in 28 cities in 16 states, representing 22
radio and television advertising markets. The Company has recently embarked on a
five-year, 19 store expansion program intended to increase its penetration of
various markets in which it currently has a retailing presence and to enter new
markets in Los Angeles, San Francisco, Seattle and Toronto that it does not
currently serve. It is the Company's goal to have at least two stores in each
market that it currently serves with a population greater than two million.
Accordingly, the Company plans to open a second store in suburban Atlanta in
November 1997 and a second store in suburban Detroit in June 1998. Additional
suburban stores are planned for Baltimore, Houston, Miami and New York. The
Company also plans to open center-city stores in Boston, Chicago and Washington,
D.C., where it currently has only a suburban presence.

4
<PAGE>

THE OFFERING

Common Stock to be offered ................ 3,500,000 shares, all of which will
be sold by the Sy Syms Foundation
and Sy Syms.

Common Stock to be outstanding after the
offering ................................ 17,846,090 shares, of which
8,824,536 shares will be held by
the public and 9,021,554 shares
will be held by Sy Syms and members
of the Syms family. (See "Principal
and Selling Stockholders.")(1)

New York Stock Exchange symbol ............ SYM

- ----------

(1) Assumes that the over-allotment option granted to the Underwriters is not
exercised.

5
<PAGE>

SUMMARY FINANCIAL DATA

In 1995, the Company changed its fiscal year end to the Saturday nearest to
the end of February. Prior thereto, the Company's financial statements were
prepared on the basis of a 52-week or 53-week fiscal year ending on the Saturday
closest to the end of December. The following summary income statement and
balance sheet data, other than the data for the interim periods ended August 31,
1996 and August 30, 1997, are derived from the Company's audited financial
statements. All of the financial data presented below should be read in
conjunction with the consolidated financial statements and related notes, and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," appearing elsewhere in this Prospectus.

<TABLE>
<CAPTION>
TWENTY-SIX
FISCAL YEAR ENDED WEEKS ENDED
---------------------------------------------------------------- ---------------------
(UNAUDITED)
JANUARY 2, JANUARY 1, DECEMBER 31, MARCH 2, MARCH 1, AUGUST 31, AUGUST 30,
1993 1994 1994 1996(1) 1997 1996 1997
-------- -------- -------- -------- -------- -------- --------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)

<S> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Net sales ............................ $319,623 $318,939 $326,651 $334,750 $346,792 $158,505 $164,239
Gross profit ......................... 105,161 103,423 108,739 117,189 133,679 56,589 64,444
Income from operations ............... 25,635 18,839 14,429 17,938 33,839 8,570 12,948
Income before income taxes ........... 25,176 19,082 14,370 17,645 33,742 8,534 12,707
Net income ........................... 15,148 10,847 8,491 10,411 19,065 4,822 7,496
Net income per share ................. $0.86 $0.61 $0.48 $0.59 $1.08 $0.27 $0.42
Weighted average shares
outstanding ......................... 17,690 17,690 17,694 17,694 17,694 17,694 17,739

OTHER DATA:
Gross profit margin .................. 32.9% 32.4% 33.3% 35.0% 38.5% 35.7% 39.2%
Operating income margin .............. 8.0 5.9 4.4 5.4 9.8 5.4 7.9
Depreciation and amortization ........ $ 7,747 $ 7,446 $ 8,854 $ 7,751 $ 7,971 $ 3,830 $ 4,290
Capital expenditures ................. 6,713 17,508 14,591 4,777 21,709 12,716 6,792
Number of stores at end
of period ........................... 29 34 39 38 40 39 40

BALANCE SHEET DATA:
Working capital ...................... $ 61,338 $ 59,871 $ 59,918 $ 75,521 $ 78,228 $ 70,425 $ 84,102
Total assets ......................... 204,071 221,152 245,385 260,144 284,018 289,102 306,114
Long-term debt (including
capitalized leases) (2) ............. 2,209 1,974 1,696 1,304 900 1,111 670
Stockholders' equity ................. 180,625 190,605 197,341 207,369 226,434 212,191 234,657
</TABLE>

- ----------

(1) Fiscal year 1996 was comprised of fifty-three weeks.

(2) Excludes current maturities.

6
<PAGE>

FORWARD-LOOKING STATEMENTS

This Prospectus includes "forward-looking statements" within the meaning of
Section 27A of the Securities Act and Section 21E of the Exchange Act. All
statements herein other than statements of historical fact, including, without
limitation, the statements under "Prospectus Summary--The Company,"
"Management's Discussion and Analysis of Financial Condition and Results of
Operations--Liquidity and Capital Resources" and "Business--Expansion Program"
regarding the Company's expansion plans, liquidity and capital requirements, are
forward-looking statements. Although management believes that the expectations
reflected in such forward-looking statements are reasonable, it can give no
assurance that those expectations will prove to have been correct. Important
factors that could cause actual results to differ materially from management's
expectations ("Cautionary Statements") are disclosed in this Prospectus,
including, without limitation, under "Investment Considerations" below. All
written and oral forward-looking statements by or attributable to the Company or
persons acting on its behalf are expressly qualified in their entirety by those
Cautionary Statements.

INVESTMENT CONSIDERATIONS

In evaluating the proposed purchase of Common Stock, investors should
carefully consider all of the information in this Prospectus and, in particular,
the following factors:

CHANGING NATURE OF THE APPAREL RETAILING INDUSTRY

The apparel retailing industry has undergone substantial contraction in
recent years, with the closing of more than thirty major retail chains and
significant consolidation among remaining retailers. According to Dun &
Bradstreet's Business Failure Record, over 9,500 retail apparel and accessories
stores closed or failed in the United States between 1991 and 1995. This period
was characterized by intensified competition, reduced consumer spending and
price deflation, all of which resulted in severe pressure on retailers'
operating margins, including those of the Company. Although the Company believes
that conditions have improved during the past two years, during which the
Company's net income improved following three years of decline, there can be no
assurance that the Company will be able to sustain the levels of sales and
operating margins necessary for continuing growth.

RELATIONSHIPS WITH VENDORS

The Company is currently purchasing first-quality, in-season designer and
brand name merchandise from more than 1,200 vendors at prices below those
generally available to major department and specialty stores. Although the
Company has maintained long-term business relationships with many of these
vendors, there can be no assurance that it will be able to continue to purchase
first-quality, in-season merchandise from these vendors in the same breadth of
styles and sizes, in the same or greater volumes and at prices as favorable as
those currently available to the Company.

EXPANSION PROGRAM

The Company's proposed expansion program contemplates a nearly 50% increase
in the number of its stores as well as entry into new markets. When entering new
markets, the Company will be required to obtain suitable store sites, hire
personnel and establish distribution systems in geographic areas in which it has
no prior experience. In addition, the Company must advertise the "Syms" name and
its distinguishing characteristics in new markets where the Company may not be
known. There can be no assurance that the Company will be able to open and
operate new stores on a timely and profitable basis, that the Company will be
able to obtain sufficient merchandise from its vendors to adequately stock its
new stores or that the costs associated with opening such stores will not
adversely affect the Company's profitability.

DEPENDENCE ON KEY MANAGEMENT

The success of the Company's business has depended, to a large extent, on
the contributions of its founder, Chairman and Chief Executive Officer, Sy Syms.
Mr. Syms is 71 years old and, in recent years, has turned over increasing
responsibility for the management of the Company's operations to his daughter,
Marcy Syms, who serves as the Company's President and Chief Operating Officer.
Although Ms. Syms and the other members of the Company's management team have
substantial experience in the off-price apparel retailing industry, the
Company's expansion program and future success will depend, in part, upon the
Company's ability to attract, retain and motivate additional qualified
management personnel.

7
<PAGE>

COMPETITION

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

LACK OF ACTIVE TRADING MARKET FOR THE COMMON STOCK

Although the Common Stock has been listed on the New York Stock Exchange
since September 1983, trading in the Common Stock has been limited. In major
part, this has been a result of the relatively small percentage of the
outstanding stock in public hands. Although a principal purpose of this offering
is to increase the amount of Common Stock available for public trading, Mr. Syms
and members of his family will continue to own approximately 50.6% (47.6% if the
Underwriters' over-allotment option is exercised) of the outstanding stock
following this offering and there can be no assurance that a more active trading
market for the Common Stock will develop.

USE OF PROCEEDS

The Company will not receive any proceeds from the sale of the Common Stock
offered hereby. The purpose of this offering is to provide the Selling
Stockholders with greater liquidity and to increase the amount of Common Stock
available for public trading.

PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY

The Common Stock is quoted on the New York Stock Exchange under the symbol
"SYM." The following table sets forth for the periods indicated the high and low
sales prices per share of the Common Stock as reported on the New York Stock
Exchange Composite Tape. At November 17, 1997, the Company had approximately 197
stockholders of record.

HIGH LOW
---- ---
Fiscal Third Quarter
1998 (through November 18, 1997) ......... $14.94 $11.94
Second Quarter ....................... 14.00 9.38
First Quarter ........................ 10.00 9.00

Fiscal Fourth Quarter ....................... $10.25 $ 8.75
1997 Third Quarter ........................ 8.88 8.13
Second Quarter ....................... 8.50 7.13
First Quarter ........................ 8.38 7.63

Fiscal Fourth Quarter ....................... $ 8.25 $ 7.13
1996 Third Quarter ........................ 9.50 7.13
Second Quarter ....................... 8.38 6.75
First Quarter ........................ 7.88 6.88

On November 18, 1997, the last sale price of the Common Stock as reported
on the New York Stock Exchange Composite Tape was $13.56 per share.

Payment of dividends is within the discretion of the Company's Board of
Directors and depends upon various factors, including the earnings, capital
requirements and financial condition of the Company. The Company does not
currently pay dividends on its Common Stock and its policy is to retain earnings
to support the growth of its business.

8
<PAGE>

CAPITALIZATION

The following table sets forth the capitalization of the Company as of the
date indicated:

AUGUST 30, 1997
---------------
Long-term debt:
Obligations under capital leases (1) ................ $ 670,000
------------
Stockholders' equity:
Preferred stock, par value $100 per share,
authorized 1,000,000 shares; none outstanding ...... --
Common stock, par value $.05 per share,
authorized 30,000,000 shares; 17,776,190 shares
issued and outstanding(2) .......................... 889,000
Additional paid-in capital .......................... 12,432,000
Retained earnings ................................... 221,336,000
------------
Total stockholders' equity ....................... 234,657,000
------------
Total capitalization ............................. $235,327,000
============

- ----------

(1) Exclusive of current portion, aggregating $441,000.

(2) Exclusive of 418,800 shares issuable upon the exercise of outstanding stock
options.

9
<PAGE>

SELECTED CONSOLIDATED FINANCIAL AND OPERATING DATA

<TABLE>
<CAPTION>
TWENTY-SIX WEEKS ENDED
FISCAL YEAR ENDED (UNAUDITED)
------------------------------------------------------------ -----------------------------
JANUARY 2, JANUARY 1, DECEMBER 31, MARCH 2, MARCH 1, AUGUST 31, AUGUST 30,
1993 1994 1994 1996(1) 1997 1996 1997
-------- -------- -------- -------- -------- -------- --------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Net sales ..................... $319,623 $318,939 $326,651 $334,750 $346,792 $158,505 $164,239
Gross profit .................. 105,161 103,423 108,739 117,189 133,679 56,589 64,444
Income from operations ........ 25,635 18,839 14,429 17,938 33,839 8,570 12,948
Income before income taxes .... 25,176 19,082 14,370 17,645 33,742 8,534 12,707
Net income .................... 15,148 10,847 8,491 10,411 19,065 4,822 7,496
Net income per share .......... $0.86 $0.61 $0.48 $0.59 $1.08 $0.27 $0.42
Weighted average shares
outstanding .................. 17,690 17,690 17,694 17,694 17,694 17,694 17,739

OTHER DATA:
Gross profit margin ........... 32.9% 32.4% 33.3% 35.0% 38.5% 35.7% 39.2%
Operating income margin ....... 8.0 5.9 4.4 5.4 9.8 5.4 7.9
Depreciation and
amortization ................. $ 7,747 $ 7,446 $ 8,854 $ 7,751 $ 7,971 $ 3,830 $ 4,290
Capital expenditures .......... 6,713 17,508 14,591 4,777 21,709 12,716 6,792
Number of stores at end
of period .................... 29 34 39 38 40 39 40

BALANCE SHEET DATA:
Working capital ............... $ 61,338 $ 59,871 $ 59,918 $ 75,521 $ 78,228 $ 70,425 $ 84,102
Total assets .................. 204,071 221,152 245,385 260,144 284,018 289,102 306,114
Long-term debt (including
capitalized leases)(2) ....... 2,209 1,974 1,696 1,304 900 1,111 670
Stockholders' equity .......... 180,625 190,605 197,341 207,369 226,434 212,191 234,657
</TABLE>
- ----------

(1) Fiscal year 1996 was comprised of fifty-three weeks.

(2) Excludes current maturities.

10
<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

GENERAL

In 1995, the Company changed its fiscal year end to the Saturday nearest to
the end of February. Prior to this change, the Company maintained its records on
the basis of a 52-53 week fiscal year ending the Saturday closest to December
31. The following discussion compares the 26 weeks ended August 30, 1997 to the
26 weeks ended August 31, 1996, the fiscal year ended March 1, 1997 ("fiscal
1997") to the fiscal year ended March 2, 1996 ("fiscal 1996") and the fiscal
year ended March 2, 1996 to the fiscal year ended December 31, 1994 ("fiscal
1994"). The fiscal years ended December 31, 1994 and March 1, 1997 were
comprised of 52 weeks. The fiscal year ended March 2, 1996 was comprised of 53
weeks.

RESULTS OF OPERATIONS

The following table sets forth, for the periods indicated, the respective
percentages of the Company's net sales attributable to various components of its
income statement:

<TABLE>
<CAPTION>
FISCAL YEAR ENDED TWENTY-SIX WEEKS ENDED
------------------------------------ ----------------------------
DECEMBER 31, MARCH 2, MARCH 1, AUGUST 31, AUGUST 30,
1994 1996 1997 1996 1997
------------ -------- -------- ---------- ---------
<S> <C> <C> <C> <C> <C>
Net sales .......................................... 100.0% 100.0% 100.0% 100.0% 100.0%
Cost of sales ...................................... 66.7% 65.0% 61.5% 64.3% 60.8%
----- ----- ----- ----- -----
Gross profit ....................................... 33.3% 35.0% 38.5% 35.7% 39.2%
Selling, general & administrative .................. 20.9% 21.1% 20.5% 21.8% 21.5%
Advertising ........................................ 1.6% 1.8% 1.9% 1.8% 2.4%
Occupancy .......................................... 3.7% 3.7% 4.1% 4.2% 4.8%
Depreciation & amortization ........................ 2.7% 2.3% 2.3% 2.4% 2.6%
Special charges .................................... 0.0% 0.8% 0.0% 0.0% 0.0%
----- ----- ----- ----- -----
Operating income ................................... 4.4% 5.4% 9.8% 5.4% 7.9%
Interest--net ...................................... 0.0% 0.1% 0.0% 0.0% 0.1%
----- ----- ----- ----- -----
Income before income taxes ......................... 4.4% 5.3% 9.7% 5.4% 7.7%
Income taxes ....................................... 1.8% 2.2% 4.2% 2.3% 3.2%
----- ----- ----- ----- -----
Net income ......................................... 2.6% 3.1% 5.5% 3.0% 4.6%
===== ===== ===== ===== =====
</TABLE>

TWENTY-SIX WEEKS ENDED AUGUST 30, 1997 COMPARED TO TWENTY-SIX WEEKS ENDED
AUGUST 31, 1996

For the twenty-six weeks ended August 30, 1997 net sales increased
$5,734,000 (3.6%) to $164,239,000 as compared to net sales of $158,505,000 for
the twenty-six weeks ended August 31, 1996. Comparable store sales decreased
2.2% for the twenty-six weeks ended August 30, 1997 from the 1996 period. The
3.6% increase for the twenty-six week period was, for the most part, the result
of the opening of the Company's new store on Park Avenue in New York City.

Gross profit for the twenty-six weeks ended August 30, 1997 was
$64,444,000, an increase of $7,855,000 (13.9%) as compared to $56,589,000 for
the fiscal period ended August 31, 1996. This increase resulted mainly from
increased net sales of $5,734,000 and the Company's gross margin increasing to
39.2% from 35.7%. The 3.5% improvement in gross margin resulted primarily from
increased levels of opportunistic and in-season purchases which created better
values for the Company's customers and lower markdowns.

<PAGE>

Selling, general and administrative expense increased $753,000 to
$35,376,000 (21.5% as a percentage of net sales) for the twenty-six weeks ended
August 30, 1997 as compared to $34,623,000 (21.8% as a percentage of net sales)
for the twenty-six weeks ended August 31, 1996.

Advertising expense for the twenty-six weeks ended August 30, 1997
increased to $3,900,000 (2.4% as a percentage of net sales), as compared to
$2,883,000 (1.8% as a percentage of net sales) in the twenty-six week period
ended August 31, 1996, resulting from a commitment to expand the Company's
advertising effort through radio and direct mail advertising during the thirteen
weeks ended August 30, 1997 and an increase of television advertising in single
store markets during the first thirteen weeks of this fiscal period. In
addition, in August 1997 the Company advertised its semi-annual sales event
("bash") in the newspaper for the first time.

Occupancy costs were $7,930,000 (4.8% as a percentage of net sales) for the
twenty-six week period ended August 30, 1997, up from $6,683,000 (4.2% as a
percentage of net sales) for the period ended August 31, 1996. This increase in
the twenty-six week period resulted mainly from the addition of the Park Avenue
store.

Depreciation and amortization for the twenty-six weeks ended August 30,
1997 amounted to $4,290,000, an increase of $460,000 as compared to $3,830,000
for the twenty-six weeks ended August 31, 1996. This increase in the twenty-six
week period resulted mainly from the addition of the Park Avenue store.

Income before income taxes for the twenty-six weeks ended August 30, 1997
of $12,707,000 increased $4,173,000 as compared to $8,534,000 for the twenty-six
weeks ended August 31, 1996. As discussed above, the increase in income before
income taxes reflects for the most part higher gross profit, offset somewhat by
increased selling, general and administrative, advertising and occupancy
expense.

For the twenty-six week period ended August 30, 1997 the effective income
tax rate was 41.0% as compared to 43.5% last year. Last year's rate was
adversely affected by additional tax provisions for certain states.

FISCAL YEAR ENDED MARCH 1, 1997 COMPARED TO MARCH 2, 1996

Net sales of $346,792,000 for the fiscal year ended March 1, 1997 increased
$12,042,000 (3.6%) as compared to net sales of $334,750,000 for the fiscal year
ended March 2, 1996. The increase was, for the most part, the result of an
increase in the number of stores in the year ended March 1, 1997. Comparable
store sales decreased by $736,000 (0.2%), caused mainly by fiscal 1996 being
comprised of 53 weeks versus 52 weeks in fiscal 1997. The Company estimates that
the extra week added approximately $5,100,000 in net sales to the 1996 fiscal
year.

Gross profit for the fiscal year ended March 1, 1997 was $133,679,000, an
increase of $16,490,000 (14.1%), as compared to $117,189,000 for the fiscal year
ended March 2, 1996. This increase resulted mainly from increased net sales of
$12,042,000 and the Company's gross margin increasing to 38.5% from 35.0%. The
3.5% improvement in gross margin resulted primarily from increased levels of
opportunistic and in-season purchases which created better values for the
Company's customers.

Selling, general and administrative expense was $71,028,000 (20.5% as a
percentage of net sales) for the period ended March 1, 1997 as compared to
$70,579,000 (21.1% as a percentage of net sales) for the fiscal year ended March
2, 1996. The increase of $449,000 resulted from three additional stores in
fiscal 1997. As a percentage of sales, SG&A expense decreased in fiscal 1997,
due to a continued effort by management to control store and corporate
operational expenses.

Advertising expense for fiscal 1997 increased to $6,626,000 (1.9% as a
percentage of net sales), as compared to $5,905,000 (1.8% as a percentage of net
sales) for the fiscal year ended March 2, 1996, resulting from a continued
commitment to expand the Company's advertising effort.

Occupancy costs were $14,215,000 (4.1% as a percentage of net sales) for
the period ended March 1, 1997, up from $12,330,000 (3.7% as a percentage of net
sales) for the fiscal year ended March 2, 1996. This increase was the result of
three additional leased locations in fiscal 1997.

Depreciation and amortization in fiscal 1997 amounted to $7,971,000, an
increase of $220,000 as compared to $7,751,000 for the fiscal year ended March
2, 1996, resulting from the opening of new stores and a 40,000 square-foot
addition to the Secaucus, New Jersey distribution center.

The provision for contractor advance and special charges for the fiscal
year ended March 2, 1996 includes a $2,200,000 provision made in the fourth
quarter in recognition of then current information that a contractor advance

12
<PAGE>

might not be fully recoverable, a charge in the first quarter of $1,200,000 for
costs associated with closing the store in Sterling Heights, Michigan, offset by
a $714,000 adjustment to the $2,935,000 special charges taken in the two month
period ended February 25, 1995, part of which relates to the write-off of costs
associated with a lease in Cincinnati, Ohio, in which the Company had initially
decided not to open a store. The $714,000 adjustment arose when the Company,
based on subsequent experience with the real estate market in Cincinnati, Ohio,
concluded in November 1995 that the property would not be subleased in a
reasonable time frame and at an acceptable rate. The Company then decided to
open the store in February 1996, operating with a reduced expense structure.

Income before income taxes of $33,742,000 increased $16,097,000 (91.2%) in
fiscal 1997, as compared to $17,645,000 for the fiscal year ended March 2, 1996.
This increase for the most part reflects higher gross profit and no special
charge in the current period, offset by increased selling, general and
administrative expense, advertising, and occupancy expense.

For the fiscal year ended March 1, 1997 the effective income tax rate was
43.5% as compared to 41.0% last year. The increase was the result of additional
tax provisions provided for certain states.

FISCAL YEAR ENDED MARCH 2, 1996 COMPARED TO DECEMBER 31, 1994

For the fiscal year ended March 2, 1996, net sales were $334,750,000, an
increase of $8,099,000 or 2.5% from fiscal 1994. The increase was mainly a
result of fiscal 1996 being 53 weeks compared to 52 weeks in the fiscal year
ended December 31, 1994. The extra week added approximately $5,100,000 in net
sales to the 1996 fiscal year.

For the fiscal year ended March 2, 1996, the Company's gross margin
increased to 35.0% from 33.3% in fiscal 1994. The increase was the result of a
higher initial markup partially offset by additional markdowns.

For the fiscal year ended December 31, 1994, the Company's interim gross
margin was estimated based principally upon historical experience. The
determination of cost of sales for that fiscal year was based on a physical
inventory at the end of the fiscal year ended December 31, 1994. Using estimated
gross margins for the first three quarters resulted in upward adjustments to
gross margin in the fourth quarter. In fiscal 1994, the adjustment was due
primarily to a higher initial markup. These adjustments resulted in an increase
to gross profit of approximately $1,787,000 for the fourth quarter ended
December 31, 1994. In January 1995, Syms began utilizing the retail inventory
method for quarterly inventory valuation.

As a percentage of net sales, selling, general and administrative expenses
(excluding occupancy, depreciation and amortization) were 21.1% in fiscal 1996
and 20.9% in fiscal 1994. The increase in the 1996 fiscal year selling, general
and administrative expenses and advertising (excluding occupancy, depreciation
and amortization) was principally due to the added week (53 weeks versus 52
weeks) of payroll and payroll related expenses and higher legal and professional
fees as a result of the change in the fiscal year and the proposed, but
subsequently abandoned, "Going Private" transaction.

Advertising expense for fiscal 1996 increased to $5,905,000 (1.8% as a
percentage of net sales), as compared to $5,069,000 (1.6% as a percentage of net
sales) for fiscal 1994, resulting from an additional expenditure for direct
marketing.

As a percentage of net sales, occupancy expenses were 3.7% in fiscal 1996
and fiscal 1994.

Income before income taxes for fiscal 1996 was $17,645,000 (5.3% as a
percentage of net sales), as compared to $14,370,000 (4.4% as a percentage of
net sales) for fiscal 1994. This increase reflects higher gross profit, offset
by an increase in selling, general and administrative expenses as well as
occupancy expenses and the special charges as discussed above.

In the fiscal year ended March 2, 1996 the effective income tax rate
increased to 41.0% from 40.9% in fiscal 1994.

LIQUIDITY AND CAPITAL RESOURCES

Working capital at August 30, 1997 was $84,102,000, an increase of
$13,677,000 from $70,425,000 at August 31, 1996, and the ratio of current assets
to current liabilities improved to 2.20 to 1 as compared to 1.94 to 1 at August
31, 1996.

Working capital at March 1, 1997 was $78,228,000, an increase of $2,707,000
from March 2, 1996, and the ratio of current assets to current liabilities
decreased to 2.40 to 1 as compared to 2.48 to 1 at March 2, 1996.

13
<PAGE>

Working capital at March 2, 1996 was $75,521,000, an increase of
$15,603,000 from December 31, 1994. The ratio of current assets to current
liabilities improved to 2.48 to 1 at March 2, 1996 as compared to 2.32 to 1 at
December 31, 1994.

Net cash used by operating activities totaled $2,343,000 for the twenty-six
weeks ended August 30, 1997, a decrease of $10,217,000, as compared to
$7,874,000 provided by operating activities for the twenty-six weeks ended
August 31, 1996. Net income for 1997 amounted to $7,496,000 as compared to
$4,822,000 in 1996, an increase of $2,674,000. In the twenty-six week period
ended August 30, 1997, net cash used in operating activities was mainly used to
increase inventory by $16,528,000, offset by an increase in accounts payable of
$8,432,000.

Net cash provided by operating activities totaled $15,573,000 for the
fiscal year ended March 1, 1997 and increased by $4,437,000 compared to
$11,136,000 for the fiscal year ended March 2, 1996. Net income for fiscal 1997
amounted to $19,065,000 compared to $10,411,000 in fiscal 1996, an increase of
$8,654,000. In the period ended March 1, 1997, cash provided by operating
activities was mainly used to increase inventory by $9,586,000.

Net cash provided by operating activities totaled $11,136,000 in fiscal
1996 compared to $12,936,000 in fiscal 1994. Net income for fiscal 1996 amounted
to $10,411,000 compared to $8,491,000 in fiscal 1994, an increase of $1,920,000.
In fiscal 1996, merchandise inventories increased by $2,694,000 and accounts
payable decreased $4,721,000.

Net cash used in investing activities was $6,781,000 and $12,672,000 for
the twenty-six weeks ended August 30, 1997 and August 31, 1996, respectively.
The higher expenditures in 1996 were the result of costs associated with the
opening of the Company's store on Park Avenue in New York City and with the
40,000 square-foot addition to the Company's distribution center in Secaucus,
New Jersey.

Net cash used in investing activities was $21,644,000 for the fiscal year
ended March 1, 1997. Net cash used in investing activities was $4,452,000 in
fiscal 1996 compared to $14,488,000 in fiscal 1994. Purchases of property and
equipment totaled $21,709,000, $4,777,000 and $14,591,000 for the fiscal years
ended March 1, 1997, March 2, 1996 and December 31, 1994, respectively.

Net cash provided by financing activities was $8,983,000 for the twenty-six
weeks ended August 30, 1997, compared to $6,738,000 in fiscal 1996. Both
increases resulted from an increase in revolving line of credit borrowings
amounting to $8,450,000 in 1997 and $6,900,000 in fiscal 1996. At August 30,
1997 and August 31, 1996, the Company had net borrowings of $13,400,000 and
$6,900,000, respectively, under its revolving credit agreement.

Net cash provided by financing activities was $4,611,000 for the fiscal
year ended March 1, 1997, resulting for the most part from the $4,950,000 in
short term borrowings. Net cash used in financing activities was $2,337,000 in
fiscal 1996. Net cash provided by financing activities was $911,000 in fiscal
1994. The Company paid cash dividends of $0.10 per share in fiscal 1994, which
totaled $1,769,000. The Company had net borrowings of $2,900,000 in fiscal 1994.

The Company has a revolving credit agreement with a bank for a line of
credit not to exceed $40,000,000 through December 1, 1997. At December 1, 1997
the Company has the option to reduce this commitment to zero or convert the
revolving credit agreement to a term loan with a maturity date of December 1,
2000. The Company anticipates it will renew this facility for another three
years for the same amount and the same terms, conditions and covenants. Except
for funds provided from this credit agreement, the Company has satisfied its
operating and capital expenditure requirements, including those for the opening
and expansion of stores, from internally generated funds. For the twenty-six
weeks ended August 30, 1997, average borrowings under the revolving credit
agreement were $3,818,000 with a weighted average interest rate of 6.26%. For
the twenty-six weeks ended August 31, 1996, average borrowings under the
revolving credit agreement were $1,214,000 with a weighted average interest rate
of 6.40%. For the fiscal year ended March 1, 1997, under the revolving credit
agreement, the borrowings peaked at $21,450,000 and the average amount of
borrowings was $4,122,000 with a weighted average interest rate of 5.97%. For
the fiscal year ended March 2, 1996, under the revolving credit agreement, the
average amount of borrowings was $3,500,000 with a weighted average interest
rate of 7.3%. For the fiscal year ending December 31, 1994, under the revolving
credit agreement, the average amount of borrowings was $6,800,000 with a
weighted average interest rate of 5.2%.

The Company has planned capital expenditures of approximately $12,000,000
for the fiscal year ended February 28, 1998, which includes plans to open one
new store, and to relocate one store from a leased location to a Company built
store. Through the twenty-six week period ended August 30, 1997, the Company has
incurred $6,792,000 of capital expenditures relating to the $12,000,000.

14
<PAGE>

Management believes that existing cash, internally generated funds, trade
credit and funds available from the revolving credit agreement will be
sufficient for working capital and capital expenditure requirements for the
fiscal year ending March 1, 1999.

SEASONALITY

Like most retailers, the Company's business is subject to seasonal
fluctuations. Historically, over 28% of the Company's net sales and
approximately 45% of its net earnings have been generated during the third
quarter. Because of the seasonality of the Company's business, results for any
quarter are not necessarily indicative of the results that may be achieved for
the full fiscal year.

RECENT ACCOUNTING PRONOUNCEMENTS

In February 1997, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 128, "Earnings per Share" ("SFAS No.
128"), which is effective for the Company for its current fiscal year, which
will end February 28, 1998. SFAS No. 128 simplifies the standards for computing
earnings per share previously found in Accounting Principles Board Opinion No.
15 and establishes new standards for computing and presenting earnings per
share. Application of SFAS No. 128 is not expected to have a significant effect
on the Company's earnings per share.

IMPACT OF INFLATION AND CHANGING PRICES

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

15
<PAGE>

BUSINESS

GENERAL

Syms operates a chain of forty off-price retail apparel stores located
throughout the Northeastern and middle Atlantic regions and in the Midwest,
Southeast and Southwest. The Company's stores feature a wide selection of first
quality, in-season merchandise, bearing nationally-recognized designer or brand
name labels, all of which is offered at prices substantially below those
generally found in department and specialty stores. The Company's merchandise
consists principally of men's tailored clothing and haberdashery and women's
dresses, suits, separates and accessories.

MERCHANDISING

The Company believes that it offers more designer and brand name
merchandise in more styles, sizes and price points than any other off-price
retailer. At present, more than 99% of the Company's net sales are generated by
the sale of designer and brand name merchandise. Syms merchandising focus is
predominantly directed toward middle- and upper-income, fashion-minded and price
conscious shoppers and is symbolized by its widely-recognized slogan: "An
Educated Consumer is Our Best Customer." For the year ended March 1, 1997 and
the twenty-six weeks ended August 30, 1997, net sales were generated by the
following principal merchandise categories:

TWENTY-SIX
YEAR ENDED WEEKS ENDED
MARCH 1, 1997 AUGUST 30, 1997
------------- ---------------
(PERCENTAGE OF NET SALES)

Men's tailored clothing and haberdashery ... 54% 55%
Women's dresses, suits, separates and
accessories .............................. 31 30
Shoes ...................................... 7 8
Children's wear ............................ 6 5
Luggage .................................... 2 2
--- ---
100% 100%
=== ===

The Company's merchandise assortment for men's tailored clothing and
haberdashery features a wide selection of business attire (suits, jackets,
shirts and ties), casual wear (slacks, shorts, polo-style shirts, sweaters and
activewear), formal wear (tuxedos and related furnishings), accessories
(underwear, socks, belts, gloves and scarves), outerwear and shoes. Men's
tailored clothing (suits, tuxedos, sportscoats and dress slacks) represents the
largest percentage of the Company's net sales. The Company maintains between
4,500 and 10,000 suits in each store, depending on store size, in a full array
of sizes. The Company believes that the typical Syms store offers a greater
number and assortment of men's suits, in a wider range of sizes, than any other
store in the United States. Recognizing the trend toward casual dressing in the
workplace, the Company has expanded its selection of men's casual sportswear and
carries a broad selection of designer and brand name sportswear.

Women's clothing is the Company's second largest merchandise category. The
Company's selection of women's apparel includes dresses (evening and day),
suits, pantsuits, separates, corporate casual, weekend wear, activewear,
loungewear, intimate apparel, shoes and accessories. The Company makes a special
effort to carry a broad range of sizes, including both petites up to size 12 and
womens up to size 24.

The Company's line of children's merchandise ranges from infant through
early teens and includes tailored clothing, casual apparel, shoes and sneakers.
In addition, the Company offers designer and brand name luggage, as well as
wallets, handbags and briefcases.

VENDOR RELATIONSHIPS AND PURCHASING

The Company purchases first-quality, in-season, designer and brand name
merchandise directly from manufacturers at prices below those generally paid by
department and specialty stores. Syms estimates that approximately 200 brand
names and designer labels are represented in its stores at any time. During
fiscal 1997, the Company purchased merchandise from approximately 1,200 vendors,
and no single brand name or designer label accounted for more than 4.3% of total
purchases. The Company has enjoyed longstanding relationships with many of its
vendors, some of which have been selling merchandise to the Company for as long
as 30 years. The Company believes that these relationships have contributed to a
continuity of buying opportunities for first-quality, in-season merchandise.
Syms is able to obtain its merchandise at advantageous prices because it is
viewed by its vendors as an

16
<PAGE>

effective and dependable channel for reducing their excess inventories without
compromising brand image. The Company does not request advertising allowances,
avoids merchandise returns (except for damaged or nonconforming goods) and buys
in large volumes. Except for purchase order contracts, the Company has no
written agreements with its vendors. Although Syms typically does not maintain
large out-of-season inventories, the Company occasionally makes opportunistic
purchases of certain items of basic clothing, which do not change in style from
year to year, for storage until the next appropriate selling season.

Purchasing is performed by a staff of twelve buyers and seven assistant
buyers in conjunction with various merchandise managers. Individual store
allocations are made by the Company's buying staff. Buyers are typically former
store employees with a strong understanding of Syms customers' needs and are
highly disciplined with respect to margin requirements and quantity limitations.
The Company's buying staff has, on average, 15 years of experience in the
apparel industry and seven years with the Company. In addition to the buying
staff, the Company has two representatives in Europe who are responsible for
identifying European buying opportunities. The Company's buyers make buying
trips to Europe twice a year.

PRICING

The Company's pricing strategy is to enhance customer value by offering
everyday low prices, which are generally 40% to 60% below those offered at
department and specialty stores. In addition, the Company also offers "dividend"
(in-store, unadvertised promotion) prices that reflect further reductions on
various types of merchandise. Merchandise is offered over a wide range of price
points, which contrasts distinctly with the merchandising approach of many
department and specialty stores.

The Company affixes a ticket to each item displaying Syms selling price as
well as the price the Company believes to be the nationally advertised price
(typically double that of the true wholesale price) of that item at department
or specialty stores. All garments carry the manufacturer's brand name or
designer label. Because women's dresses are subject to considerable style
fluctuation, Syms has long utilized a ten-day automatic markdown pricing policy
to promote sales of certain dresses. Women's dresses represent approximately
4.8% of net sales.

The Company's ability to offer its merchandise at everyday low prices is
strengthened by its attention to minimizing operating costs. Syms stores are low
maintenance, functional facilities that are designed to maximize selling space
and contain overhead. The Company's ownership of 21 of its forty stores enables
it to reduce its overall occupancy costs. The Company's incentive compensation
program encourages store managers to maintain low payrolls. The efficient
implementation and management of the Company's advertising program, primarily
radio and television, has resulted in a ratio of advertising expenditures to net
sales that is below that of the industry as a whole.

MARKETING AND ADVERTISING

In 1974, the Company became one of the first clothing retailers to
advertise on television. The original commercials featured the Company's
founder, Sy Syms. In 1979, Mr. Syms' daughter, Marcy, currently President and
Chief Operating Officer, joined her father in the Company's television
commercials. In 1997, Mr. Syms' son, Stephen, a Vice President of the Company
and its Merchandise Manager -- Men's Tailored Clothing and Shoes, also began
appearing in Syms television commercials. The Company believes that the
appearance of members of the Syms family in the Company's commercials has been
an effective marketing practice and personalizes the Company to its customers.
As a result of the Company's extensive use of television advertising, its slogan
- -- "An Educated Consumer is our Best Customer" -- is one of the best known in
the retail apparel industry. In addition to television, the Company has
historically advertised on radio and, more recently, has begun advertising in
print media as well as by direct mail to its Syms credit card customer base. The
Company occasionally makes special offers in mailings to holders of the Syms
credit card and to others who have used national credit cards at Syms stores
within the previous six months. As part of its marketing and advertising effort,
Syms has historically sponsored programs on public television and charitable
events in the communities in which it does business.

The Company generally budgets approximately 1.9% of net sales (equal to
$6.6 million in fiscal 1997), for advertising, but allocates as much as 4.0% of
net sales to advertising for stores in new markets and second stores in existing
markets. The Company does not advertise the brand names of its merchandise.
Management believes that the Company enjoys substantial word-of-mouth publicity
from its customer base, and that this publicity accounts for a significant
portion of the Company's new customers in markets where the Company has existing
stores.

The Company accepts as a form of payment from its customers cash, checks,
national credit cards and its own Syms credit card. At September 30, 1997 there
were approximately 324,000 holders of the Syms credit card.

17
<PAGE>

During fiscal 1997, the Syms credit card accounted for approximately $60.3
million, or 17.4%, of the Company's net sales. Syms credit card receivables are
sold on a non-recourse basis to a third party at a negotiated discount. In lieu
of cash refunds, the Company issues credits toward the Syms credit card or store
credits that may be used toward the purchase of other merchandise. Merchandise
purchased from the Company may be returned within a reasonable amount of time.

CUSTOMER SERVICE

The Company believes that it is distinguished among off-price retailers for
its attentive customer service. The Company's sales associates assist customers
with merchandise selection, including correct sizing. The Company's sales
associates are called "Educators" because their role is to educate customers
about the merchandise. Upon joining the Company, each Educator participates in a
Company-developed training program. In addition to a higher level of customer
service, the Company also offers certain other amenities not typically found in
off-price stores, such as individual fitting rooms for women and in-store
alterations for both men and women. The Company also offers Syms credit card
customers a 10% discount on their initial purchase using the card and a more
favorable return policy than it offers to holders of other credit cards. The
Company believes that, as discounting has become more common, the Company's
customer service and other amenities have become increasingly important factors
in distinguishing the Company from its off-price competitors.

STORE LAYOUT AND OPERATIONS

The Company's store format and merchandise presentation are designed to
emphasize its focus on everyday low prices and exceptional value. However, the
Company seeks to project itself as the off-price equivalent of an upscale
specialty store. In general, Syms stores are designed to convey the impression
of three specialty stores in one building: a men's specialty store, a women's
specialty store and a children's specialty store. The Company has designed its
stores to allow customers to select and purchase apparel with ease and
convenience. Each merchandise category is clearly displayed and organized by
type and size on conveniently arranged racks or counters. Large tickets, each
with a color corresponding to a specific size (for example, yellow always
indicates women's size 8), are attached to each piece of merchandise, allowing
customers to determine sizes from a distance. Unlike other off-price retailers,
the Company does not use printed price tags on its men's suits, relying instead
on handwritten price tickets, which it believes are a more personalized way of
presenting its suits to its customers. In general, no emphasis is placed on any
particular brand or label.

All Syms stores are low maintenance, simple and functional facilities
designed to maximize selling space and contain overhead costs. Store layouts are
flexible so that product groupings can be easily moved or expanded. As the
Company is committed to maintaining virtually all of its in-store inventory on
the selling floor, its stores do not require significant storage space. The
Company considers the ideal selling space of its stores to range from 35,000 to
55,000 square feet. More than 70% of Syms suburban stores are "free standing."
Syms stores are usually located near a major highway or thoroughfare in suburban
areas populated by at least one million people and are readily accessible to
customers by automobile.

Approximately 30 to 100 persons, consisting mostly of Educators, are
employed at each Syms store, depending upon store size and season. All Syms
stores are directly managed and operated by the Company. Each store has a
management team that consists of a store manager, two first assistant store
managers, two second assistant store managers and three department managers, and
is staffed by a core group of Educators during non-peak hours, with additional
Educators added as needed at peak hours. The various managers and Educators
perform all store operations, from receiving and processing merchandise and
arranging it for display to assisting customers. Each store manager reports to a
District Manager who, in turn, reports directly to the Company's senior
management. The Company currently employs five District Managers. District
Managers typically visit each store at least once every ten days to review
merchandise quantities and presentation, staff training and personnel
performance, expense control, security, cleanliness and adherence to Company
operating procedures. District Managers are also responsible for monitoring
store payrolls. Under the Company's "Management by Objective" program, members
of each store's management team are evaluated and are eligible to receive
additional compensation based upon the store's success in meeting certain gross
sales and payroll budgeting goals.

A typical Syms store is open seven days a week, eleven hours on weekdays,
nine hours on Saturdays and six hours on Sundays. Each store has security
personnel on premises during business hours and uses an electronic security
system after business hours. The Company has installed electronic sensor devices
in each store to detect and deter theft of merchandise.

18
<PAGE>

STORE LOCATIONS

The following table sets forth, as of the date hereof, the location,
selling square footage and ownership status of each of the Company's forty
stores:
<TABLE>
<CAPTION>

SELLING SELLING
SQUARE SQUARE
LOCATION FOOTAGE OWNERSHIP LOCATION FOOTAGE OWNERSHIP
-------- ------- --------- -------- ------- ---------
<S> <C> <C> <C> <C> <C>
Connecticut New York
Fairfield 32,000 Owned Buffalo 39,000 Owned
Hartford 31,000 Leased Long Island (Commack) 36,000 Owned
Long Island (Westbury) 72,000 Owned
Florida New York City 39,000 Leased
Fort Lauderdale 44,000 Owned (Manhattan/Park Avenue)
Miami 45,000 Owned New York City 40,000 Owned
Tampa 38,000 Owned (Manhattan/Trinity Place)
West Palm Beach 36,000 Leased Rochester 32,000 Owned
Westchester 50,000 Leased
Georgia
Atlanta (Norcross) 51,000 Owned North Carolina
Charlotte 30,000 Leased
Illinois
Chicago (Addison) 47,000 Owned Ohio
Chicago (Gurnee Mills Mall) 33,000 Leased Cincinnati (Sharonville) 31,000 Leased
Chicago (Niles) 32,000 Leased Cleveland (Highland Heights) 36,000 Leased

Maryland Pennsylvania
Baltimore 43,000 Leased Philadelphia (Franklin Mills 22,000 Leased
Washington, D.C. (Rockville) 56,000 Owned Mall)
Philadelphia (King of Prussia) 41,000 Owned
Massachusetts Pittsburgh 40,000 Leased
Boston (Norwood) 36,000 Leased Pittsburgh (Monroeville) 31,000 Owned
Boston (Peabody) 39,000 Leased
Rhode Island
Michigan Providence (N. Cranston) 27,000 Leased
Detroit (Southfield) 46,000 Owned
Texas
Missouri Dallas 42,000 Owned
St. Louis 33,000 Leased Dallas (Hurst) 38,000 Owned
Houston 34,000 Owned
New Jersey
New York City (Paramus) 56,000 Owned Virginia
New York City (Woodbridge) 32,000 Leased Washington, D.C. (Falls 28,000 Leased
Philadelphia (Cherry Hill) 40,000 Owned Church)
Secaucus 25,000 Owned Washington, D.C. (Potomac 33,000 Leased
Mills Mall)

</TABLE>

In addition to the selling space indicated, each store contains between
approximately 2,000 and 14,000 square feet for receiving, inspecting, holding
and ticketing merchandise and other personnel and administrative functions.
Store leases provide for a base rental of between approximately $2.50 and $34.00
per square foot. In addition, under the "net" terms of all of the leases, the
Company pays maintenance expenses, real estate taxes and other charges. Four of
the Company's leased stores have a percentage of sales rental as well as a fixed
minimum rent. Rental payments for Syms leased stores aggregated $5,868,000 for
the fiscal year ended March 1, 1997.

The Company owns a distribution center, located in Secaucus, New Jersey.
The facility contains approximately 277,000 square feet of warehouse and
distribution space, 34,000 square feet of office space and 29,000 square feet of
retail selling space.

19
<PAGE>

EXPANSION PROGRAM

The Company has recently embarked on a five-year, 19 store expansion
program intended to increase its penetration of certain markets in which it
currently has a retailing presence and to enter new markets in Los Angeles, San
Francisco, Seattle and Toronto that it does not currently serve. Each of these
new markets includes a population of more than two million persons, high income
demographics and significant consumer awareness of designer and brand name
labels. In addition, the Company believes that it possesses a high level of name
recognition in Toronto because it has advertised for twenty years in nearby
Buffalo. It is the Company's goal to have at least two stores in each market
that it currently serves with a population greater than two million.
Accordingly, the Company plans to open a second store in suburban Atlanta in
November 1997 and a second store in suburban Detroit in June 1998. Additional
suburban stores are planned for Baltimore, Houston, Miami and New York. The
Company also plans to open center-city stores in Boston, Chicago and Washington,
D.C., where it currently has only a suburban presence.

MANAGEMENT INFORMATION SYSTEMS

The Company has implemented a merchandise control system that tracks
product inventory in approximately 750 categories from its arrival at the
distribution center to its ultimate sale at the Company's stores. Information is
electronically transmitted daily to the Company's database at its headquarters,
where executives can obtain detailed reports on demand regarding sales and
inventory levels (in units and dollars) on a store-by-store basis.

The Company's merchandise control system enhances management's ability to
make informed buying decisions and to respond to unexpected increases or
decreases in demand for a particular item. The inventory management system is
capable of reporting product information, such as style, fabric, vendor lot,
model number, size and color, and enables management to distribute merchandise
on a store-by-store basis, utilizing geographical selling trends.

The Company believes that its present management information systems can
support substantially expanded operations without significant additional capital
investment.

<PAGE>

MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

The directors and executive officers of the Company are as follows:

NAME AGE TITLE
---- --- -----
Sy Syms 71 Chairman of the Board, Chief Executive
Officer and a Director of the Company

Marcy Syms 46 President, Chief Operating Officer and
a Director of the Company

Ronald Zindman 47 Executive Vice President--General
Merchandise Manager

Antone F. Moreira 61 Vice President, Treasurer, Chief Financial
Officer and a Director of the Company

Stephen A. Merns 44 Vice President, Secretary, Merchandise
Manager--Men's Tailored Clothing and Shoes
and a Director of the Company

Allen Brailsford 53 Vice President--Operations

Douglas C. Meyer 44 Vice President--Marketing, Advertising and
Sales Promotion

Isabel Regan 42 Vice President--Divisional Merchandise
Manager, Ladies

Wilbur L. Ross, Jr. 59 Director of the Company

Harvey A. Weinberg 60 Director of the Company

Philip G. Barach 67 Director of the Company

David A. Messer 36 Director of the Company

The members of the Company's Board of Directors hold office until the next
annual meeting of stockholders and until their successors are duly elected and
qualified. Executive officers are elected annually by the Board of Directors of
the Company and serve at the pleasure of the Board. Marcy Syms and Stephen A.
Merns are the children of Sy Syms. There are no other family relationships
between any directors or executive officers of the Company.

SY SYMS has been Chairman of the Board, Chief Executive Officer and a
Director of the Company (including its predecessors) since 1959. Mr. Syms has
been a Director of Israel Discount Bank of New York since December 1991.

MARCY SYMS has been President and a Director of the Company since 1983,
Chief Operating Officer of the Company (including its predecessors) since 1984.

RONALD ZINDMAN has been Executive Vice President -- General Merchandise
Manager since March 2, 1997. Prior thereto, he was Vice President -- General
Merchandise Manager, Ladies, Mens and Haberdashery from July 1994, Vice
President -- General Merchandise Manager, Ladies from March 1993 to July 1994
and a buyer of men's and women's merchandise from March 1990 to March 1993.

ANTONE F. MOREIRA has been Vice President, Treasurer and Chief Financial
Officer of the Company since May 1997. From 1996 to May 1997 Mr. Moreira was a
financial consultant with Equitable Life Assurance Society of the United States,
a financial services organization. From 1990 to 1995, Mr. Moreira was Executive
Vice President, Chief Financial Officer of Stuarts Department Stores, Inc., a
regional discount department store chain operating in New England.

21
<PAGE>

STEPHEN A. MERNS has been Vice President, Secretary and Merchandise Manager
- -- Men's Tailored Clothing and Shoes of the Company since January 1, 1986. Prior
thereto, he served as an officer of a predecessor of the Company. He has been a
Director of the Company since July 1996.

ALLEN BRAILSFORD has been Vice President -- Operations since January 1993.
Mr. Brailsford served as Director of Operations from March 1992 to January
1993 and as Director of Distribution from March 1985 to March 1992.

DOUGLAS C. MEYER has been Vice President -- Marketing, Advertising and
Sales Promotion since July 1994. He served as Vice President, Marketing and
Creative Services for Loehmann's from 1987 to 1994.

ISABEL REGAN has been Vice President -- Divisional Merchandise Manager,
Ladies since March 1993. She has held various positions at the Company since
November 1972, including buyer of women's apparel.

WILBUR L. ROSS, JR. has been a Managing Director of Rothschild Inc. since
1976. He is a member of the Board of Directors of Mego Corp. He has been a
director of the Company since 1983.

HARVEY A. WEINBERG has been a consultant since April 1994. From April 1992
to April 1994 he was President and Chief Executive Officer of HSSI, Inc., a
retailer of men's and women's apparel. From 1987 to September 1990 he was Chief
Executive Officer and Vice Chairman of the Board of Directors of Hartmarx
Corporation and from 1990 to September 1992 served as Chairman of the Board of
Hartmarx Corporation. He is a trustee of Glimcher Realty Trust (a real estate
investment trust). He has been a Director of the Company since December 1992.
During 1994 HSSI, Inc. filed a voluntary petition for relief under Chapter 11 of
the United States Bankruptcy Code in the United States Bankruptcy Court for the
Northern District of Illinois, Eastern Division.

PHILIP G. BARACH has been a consultant since March 1993. From 1968 to March
1993 he was Chairman of the Board or Chairman of the Board, President and Chief
Executive Officer of the United States Shoe Corp. (manufacturer and retailer of
footwear, apparel and eyewear). He is a member of the Board of Directors of
Bernard Chaus, Inc. (manufacturer of women's apparel), Glimcher Realty Trust (a
real estate investment trust), R.G. Barry Corp. (manufacturer of foldable
slippers and heat/cold preservation products) and Union Central Insurance Co.
(life insurance). He has been a Director of the Company since July 1996.

DAVID A. MESSER has been President of AIG Trading Corporation, a subsidiary
of American International Group, Inc. (New York Stock Exchange: AIG), since
January 1994. Prior to January 1994, Mr. Messer was a Senior Vice President of
AIG Trading Corporation, where he has been employed since March 1990. He has
been a Director of the Company since July 1996.

PRINCIPAL AND SELLING STOCKHOLDERS

Of the 3,500,000 shares of Common Stock offered hereby, 2,500,000 shares
will be sold by the Sy Syms Foundation and 1,000,000 shares will be sold by Mr.
Syms. In addition, Mr. Syms, Marcy Syms and Stephen A. Merns have granted to the
Underwriters an option to purchase an aggregate of up to 525,000 additional
shares of Common Stock solely to cover over-allotments. (See "Underwriting.")

At November 18, 1997, the Sy Syms Foundation owned 2,500,000 shares of
Common Stock, Mr. Syms owned 7,052,145 shares and other members of the Syms
family, including Marcy Syms and Stephen A. Merns, owned 2,969,409 shares,
representing in the aggregate approximately 70.2% of the outstanding Common
Stock. In addition, certain members of the Syms family have currently
exercisable options to purchase up to 115,000 shares of the Company's Common
Stock. After completion of this offering (assuming the Underwriters'
over-allotment option is not exercised), Mr. Syms will own 6,052,145 shares,
representing, together with shares owned by other members of the Syms family,
approximately 50.6% of the outstanding Common Stock. If the Underwriters'
over-allotment option is exercised in full, Mr. Syms will own 5,707,145 shares,
and the percentage of the Company's outstanding Common Stock owned in the
aggregate by the Syms family will be reduced to 47.6%. In addition, at November
17, 1997, 1,226,647 shares (representing 6.9% of the outstanding Common Stock)
were owned by Tweedy, Browne Company, L.P., a private investment partnership.

<PAGE>

DESCRIPTION OF CAPITAL STOCK

COMMON STOCK

The Company is authorized to issue 30,000,000 shares of Common Stock.
Subject to any preferences, limitations and relative rights that may be fixed
for any series of Preferred Stock that may be issued as described below, the
holders of Common Stock of the Company are entitled, among other things, (1) to
share ratably in dividends if, when, and as declared by the Board of Directors
out of funds legally available therefor (see "Dividends"), (2) to one vote per
share at all meetings of stockholders, and (3) in the event of liquidation, to
share ratably in the distribution of assets remaining after payment of debts,
expenses and the liquidation preference of any outstanding shares of Preferred
Stock. Holders of shares of Common Stock have no cumulative voting rights or
pre-emptive rights to subscribe for or purchase any additional shares of capital
stock issued by the Company. The Company's Certificate of Incorporation provides
that the affirmative vote of holders of 70% of the outstanding shares of Common
Stock are required to effect or validate any merger or consolidation of the
Company with or into any other corporation, any sale or lease of all or any
substantial part of the assets of the Company or any sale or lease to the
Company of assets (having an aggregate fair market value in excess of
$1,000,000) in exchange for voting securities (or rights to acquire voting
securities or securities convertible into voting securities) of the Company,
except where the merger or similar transaction with another corporation has been
approved by a 75% vote of the entire Board of Directors of the Company or where
the Company owns a majority of every class of voting stock of such other
corporation. The affirmative vote of a majority of the outstanding shares of
Common Stock is required to amend the foregoing provisions of the Certificate of
Incorporation. The Company's Certificate of Incorporation provides that the
affirmative vote of a majority of the outstanding shares of Common Stock is
sufficient to effect the removal of a director with or without cause, and
similar action by a majority of the Board of Directors is sufficient to effect
the removal of a director with cause. Such provisions could be utilized, under
certain circumstances, as a method of preventing a takeover of the Company.

American Stock Transfer & Trust Company is the Transfer Agent and Registrar
for the Common Stock.

PREFERRED STOCK

The Board of Directors is authorized to issue 1,000,000 shares of Preferred
Stock, par value $100, without further action by the stockholders, in one or
more series and to fix as to any such series the dividend rate, redemption
prices, preferences on liquidation or dissolution, sinking fund terms, if any,
conversion rights, voting rights and any other preference or special rights and
qualifications. Shares of Preferred Stock issued by the Board of Directors could
be utilized, under certain circumstances, as a method of preventing a takeover
of the Company. As of the date of this Prospectus, the Board of Directors has
not authorized any series of Preferred Stock. There are no agreements or
understandings for the issuances of any shares of Preferred Stock.

ANTI-TAKEOVER PROVISIONS

The Company is governed by the provisions of Section 14A: 10A-1 et seq.,
the New Jersey Shareholders Protection Act (the "New Jersey Act"), of the New
Jersey Business Corporation Act, an anti-takeover law. In general, the statute
prohibits a publicly-held New Jersey corporation from engaging in a "business
combination" with an "interested shareholder" for a period of five years after
the date of the transaction in which the person became an interested
shareholder, unless the business combination is approved in a prescribed manner.
A "business combination" includes mergers, asset sales and other transactions
resulting in a financial benefit to the interested shareholder. An "interested
shareholder" is a person who, together with affiliates and associates, owns (or
within three years, did own) 10% or more of the corporation's voting stock.
After the five-year waiting period has elapsed, a business combination between a
corporation and an interested shareholder will be prohibited unless the business
combination is approved by the holders of at least two-thirds of the voting
stock not beneficially owned by the interested shareholder, or unless the
business combination satisfies the New Jersey Act. The New Jersey Act's fair
price provision is intended to provide that all shareholders (other than the
interested shareholders) receive a fair price for their shares.

SHARES ELIGIBLE FOR FUTURE SALE

Upon completion of this offering, the Company will have 17,846,090 shares
of Common Stock outstanding. All of the shares to be sold in the offering will
be freely tradeable without restrictions or further registration under the

23
<PAGE>

Securities Act, unless purchased by an "affiliate" of the Company (as that term
is defined in Rule 144 adopted under the Securities Act ("Rule 144")), in which
case such shares would be subject to the resale limitations of Rule 144. None of
the outstanding shares of Common Stock beneficially owned by members of the Syms
family may be publicly sold in the absence of an effective registration
statement under the Securities Act, other than in accordance with Rule 144 or
another exemption from registration.

In general, under Rule 144, a person (or persons whose shares are required
to be aggregated) who has beneficially owned shares of Common Stock for at least
one year, including a person who may be deemed an "affiliate," is entitled to
sell, within any three-month period, a number of shares that does not exceed the
greater of one percent of the total number of shares of the class of stock sold
or the average weekly reported trading volume of the class of stock being sold
or the average weekly reported trading volume of the class of stock being sold
during the four calendar weeks preceding such sale. A person who is not deemed
an "affiliate" of the Company at any time during the three months preceding a
sale and who has beneficially owned shares for at least two years is entitled to
sell such shares under Rule 144 without regard to the volume limitations
described above. As defined in Rule 144, an "affiliate" of an issuer is a person
that directly or indirectly through the use of one or more intermediaries
controls, is controlled by, or is under common control with, such issuer. The
foregoing summary of Rule 144 is not intended to be a complete description
thereof.

Although the Common Stock has been listed on the New York Stock Exchange
since September 1983, trading in the Common Stock has been limited. In major
part, this has been a result of the relatively small percentage of the
outstanding stock in public hands. The Company is unable to predict the effect
that sales made under Rule 144, pursuant to future registration statements, or
otherwise, may have on the market price of the Common Stock prevailing from time
to time. Nevertheless, sales of a substantial amount of Common Stock by the Syms
family in the public market, or the perception that such sales could occur,
could adversely affect prevailing market prices. See "Underwriting" for a
discussion of certain contractual restrictions on resales of the Common Stock by
the Syms family.

The Company has granted options to purchase 348,900 shares of Common Stock
to certain officers, directors and employees of the Company pursuant to the
Company's stock option plan and an additional 458,000 shares are available for
future grant thereunder. As of November 17, 1997, options with respect to
269,200 shares were exercisable and options with respect to 79,700
shares were subject to vesting provisions.

UNDERWRITING

The Underwriters named below, acting through their representatives, Bear,
Stearns & Co. Inc. and Salomon Brothers Inc (the "Representatives"), have
severally agreed, subject to the terms and conditions of the Underwriting
Agreement (the form of which has been filed as an exhibit to the Registration
Statement of which this Prospectus is a part), to purchase from the Sy Syms
Foundation and Sy Syms (collectively, with Marcy Syms and Stephen A. Merns, the
"Selling Stockholders") the numbers of shares of Common Stock set forth opposite
their respective names below:

NUMBER OF
UNDERWRITERS SHARES
------------ ---------
Bear, Stearns & Co. Inc. ..........................
Salomon Brothers Inc ..............................

---------
Total .......................................... 3,500,000
=========

The nature of the obligations of the Underwriters is such that they must
purchase all of such shares if any are purchased. Those obligations are subject,
however, to various conditions, including the approval of certain matters by
counsel.

The Representatives have advised the Company and the Selling Stockholders
that the Underwriters propose to offer the Common Stock to the public initially
at the offering price set forth on the cover page of this Prospectus and to
certain dealers at such price less a concession not to exceed $____ per share.
The Underwriters may allow, and such dealers may reallow, a concession to
certain other dealers not to exceed $___ per share. After the commencement of
the offering, the public offering price and concessions may be changed.

Sy Syms, Marcy Syms and Stephen A. Merns have granted to the Underwriters
an option to purchase up to an aggregate of 525,000 additional shares of Common
Stock at the public offering price less the underwriting discount

24
<PAGE>

set forth on the cover page of this Prospectus, solely to cover over-allotments,
if any. The option may be exercised at any time within 30 days after the date of
this Prospectus. To the extent that the option is exercised, the Underwriters
will be severally committed, subject to certain conditions, to purchase the
additional shares in proportion to their respective purchase commitments as
indicated in the preceding table. Of the shares subject to such option, 345,000
are owned by Sy Syms, 50,000 are owned by Marcy Syms and 130,000 are owned by
Stephen A. Merns.

The Company, the Selling Stockholders and the Company's directors and
executive officers have agreed that, for a period of 90 days following the date
of this Prospectus, they will not, without the prior written consent of Bear,
Stearns & Co. Inc., directly or indirectly offer or agree to sell, sell or
otherwise dispose of any shares of Common Stock (or securities convertible into,
exchangeable for or evidencing the right to purchase shares of Common Stock),
other than, in the case of the Selling Stockholders, the shares to be sold by
them to the Underwriters, and, in the case of the Company, the grant of options
(and the issuance of shares upon the exercise of outstanding options) under the
Company's existing stock option plan.

The Company and the Selling Stockholders have agreed to indemnify the
Underwriters against certain liabilities, including liabilities under the
Securities Act, and, where such indemnification is unavailable, to contribute to
payments that the Underwriters may be required to make in respect of such
liabilities.

In order to facilitate the offering, certain persons participating in the
offering may engage in transactions that stabilize, maintain or otherwise affect
the price of the Common Stock during and after the offering. Specifically, the
Underwriters may over-allot or otherwise create a short position in the Common
Stock for their own account by selling more shares than have been sold to them
by the Company. The Underwriters may elect to cover any such short position by
purchasing shares in the open market or by exercising the over-allotment option
granted to them. In addition, the Representatives, on behalf of the
Underwriters, may stabilize or maintain the price of the Common Stock by bidding
for or purchasing shares in the open market and may impose penalty bids, under
which selling concessions allowed to syndicate members or other broker-dealers
participating in the offering are reclaimed if shares previously distributed in
the offering are repurchased in connection with stabilization transactions or
otherwise. The effect of these transactions may be to stabilize or maintain the
market price of the Common Stock at a level above that which might otherwise
prevail in the open market. The imposition of a penalty bid may also affect the
price of the Common Stock to the extent that it discourages resales thereof. No
representation is made as to the magnitude or effect of any such stabilization
or other transactions. Such transactions may be effected on the New York Stock
Exchange or otherwise and, if commenced, may be discontinued at any time.

Bear, Stearns & Co. Inc. acted as one of the representatives of the
underwriters of the initial public offering of the Company's Common Stock in
September 1983.

Rothschild Inc. has been retained by Sy Syms as his personal financial
advisor in connection with this offering, and will be paid a fee for its
services not to exceed $50,000. Wilbur L. Ross, Jr., a director of the Company,
is a Managing Director of Rothschild Inc.

LEGAL MATTERS

The validity of the Common Stock being offered hereby will be passed upon
for the Company by Skadden, Arps, Slate, Meagher & Flom LLP, New York, New York.
Certain legal matters in connection with this offering will be passed upon for
the Underwriters by Weil, Gotshal & Manges LLP, New York, New York.

EXPERTS

The consolidated balance sheets of the Company and its subsidiaries as of
March 2, 1996 and March 1, 1997 and the related consolidated statements of
income, stockholders' equity and cash flows for each of the three fiscal years
ended December 31, 1994, March 2, 1996 and March 1, 1997, and the two month
period ended February 25, 1995, included herein and in the Company's Annual
Report on Form 10-K for the year ended March 1, 1997 which is incorporated by
reference into this Prospectus, have been audited by Deloitte & Touche LLP,
independent auditors, as stated in their report, which is included and
incorporated herein by reference, and have been so included and incorporated in
reliance upon the reports of such firm given upon their authority as experts in
accounting and auditing.

<PAGE>

INDEX TO FINANCIAL STATEMENTS

PAGE
----

Report of Independent Public Accountants ................................. F-1

Consolidated Balance Sheets as of March 2, 1996 and March 1, 1997 ........ F-2

Consolidated Statements of Income for each of the three fiscal
years ended December 31, 1994, March 2, 1996 and March 1, 1997
and the two months ended February 26, 1994 and February 25, 1995 ....... F-3

Consolidated Statements of Stockholders' Equity for each of the
three fiscal years ended December 31, 1994, March 2, 1996 and
March 1, 1997 .......................................................... F-4

Consolidated Statements of Cash Flows for each of the three
fiscal years ended December 31, 1994, March 2, 1996 and
March 1, 1997 and the two months ended February 26, 1994 and
February 25, 1995 ...................................................... F-5

Notes to Consolidated Financial Statements ............................... F-6

Condensed Consolidated Balance Sheets as of August 31, 1996,
March 1, 1997 and August 30, 1997 ...................................... F-16

Condensed Consolidated Statements of Income for the twenty-six
weeks ended August 31, 1996 and August 30, 1997 ........................ F-17

Consolidated Statements of Cash Flows for the twenty-six
weeks ended August 31, 1996 and August 30, 1997 ........................ F-18

Notes to Condensed Consolidated Financial Statements ..................... F-19

26
<PAGE>

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Stockholders and Board of Directors of Syms Corp
Secaucus, New Jersey

We have audited the accompanying consolidated balance sheets of Syms Corp and
its subsidiaries as of March 2, 1996 and March 1, 1997, and the related
consolidated statements of income, stockholders' equity and cash flows for each
of the three fiscal years ended December 31, 1994, March 2, 1996 and March 1,
1997 and the two month period ended February 25, 1995. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the consolidated financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, such consolidated financial statements present fairly, in all
material respects, the financial position of Syms Corp and subsidiaries as of
March 2, 1996 and March 1, 1997 and the results of their operations and their
cash flows for each of the three fiscal years ended December 31, 1994, March 2,
1996 and March 1, 1997 and the two month period ended February 25, 1995 in
conformity with generally accepted accounting principles.

DELOITTE & TOUCHE LLP
New York, New York
April 28, 1997

F-1
<PAGE>

SYMS CORP AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)

MARCH 2, MARCH 1,
1996 1997
-------- --------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents ............................... $ 4,804 $ 3,344
Merchandise inventories ................................. 112,954 122,540
Deferred income taxes ................................... 5,221 6,639
Prepaid expenses and other current assets ............... 3,521 1,756
-------- --------
Total current assets ................................. 126,500 134,279
PROPERTY AND EQUIPMENT--Net of accumulated depreciation
and amortization ........................................ 129,235 142,741
DEFERRED INCOME TAXES .................................... -- 197
OTHER ASSETS ............................................. 4,409 6,801
-------- --------
TOTAL ASSETS ............................................. $260,144 $284,018
======== ========

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable ........................................ $ 30,900 $ 28,723
Accrued expenses ........................................ 9,918 11,055
Obligations to customers ................................ 4,490 5,085
Income taxes payable .................................... 5,331 5,833
Short term borrowings ................................... -- 4,950
Current portion of obligations under capital lease ...... 340 405
-------- --------
Total current liabilities ............................ 50,979 56,051
-------- --------
OBLIGATIONS UNDER CAPITAL LEASE .......................... 1,304 900
-------- --------
DEFERRED INCOME TAXES .................................... 255 --
-------- --------
OTHER LONG TERM LIABILITIES .............................. 237 633
-------- --------
COMMITMENTS (Note 7) ..................................... -- --

STOCKHOLDERS' EQUITY
Preferred stock, par value $100 per share
authorized 1,000 shares; none outstanding .............. -- --
Common stock, par value $0.05 per share
authorized 30,000 shares; 17,694 shares issued and
outstanding as of March 2, 1996 and March 1, 1997 ...... 885 885
Additional paid-in capital .............................. 11,709 11,709
Retained earnings ....................................... 194,775 213,840
-------- --------
Total stockholders' equity ........................... 207,369 226,434
-------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY ............... $260,144 $284,018
======== ========

F-2
<PAGE>

<TABLE>
<CAPTION>
SYMS CORP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

FISCAL YEAR ENDED TWO MONTHS ENDED
----------------------------------------- ---------------------------
DECEMBER 31, MARCH 2, MARCH 1, FEBRUARY 26, FEBRUARY 25,
1994 1996 1997 1994 1995
-------- -------- -------- ------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
NET SALES .......................................... $326,651 $334,750 $346,792 $41,642 $ 46,632
Cost of goods sold ................................. 217,912 217,561 213,113 28,108 29,776
-------- -------- -------- ------- --------
Gross profit ....................................... 108,739 117,189 133,679 13,534 16,856

EXPENSES
Selling, general and administrative ................ 68,370 70,579 71,028 10,133 10,652
Advertising ........................................ 5,069 5,905 6,626 364 576
Occupancy .......................................... 12,017 12,330 14,215 1,702 1,841
Depreciation and amortization ...................... 8,854 7,751 7,971 1,190 1,359
Provision for contractor advance
and special charges ............................... -- 2,686 -- -- 2,935
-------- -------- -------- ------- --------
Income (loss) from operations ...................... 14,429 17,938 33,839 145 (507)
Interest expense (income)--net ..................... 59 293 97 61 60
-------- -------- -------- ------- --------
Income (loss) before income taxes .................. 14,370 17,645 33,742 84 (567)

Provision (benefit) for income taxes .............. 5,879 7,234 14,677 34 (184)
-------- -------- -------- ------- --------
NET INCOME (LOSS) .................................. $ 8,491 $ 10,411 $ 19,065 $ 50 $ (383)
======== ======== ======== ======= ========
Net income (loss) per share ........................ $ 0.48 $ 0.59 $ 1.08 $ -- $ (0.02)
======== ======== ======== ======= ========
Weighted average shares
outstanding ....................................... 17,694 17,694 17,694 17,692 17,694
======== ======== ======== ======= ========
Cash dividends per share ........................... $ 0.10 $ -- $ -- $ -- $ --
======== ======== ======== ======= ========
</TABLE>

F-3
<PAGE>

SYMS CORP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

PREFERRED STOCK, COMMON STOCK,
1,000 SHARES; 30,000 SHARES;
$100 PAR VALUE $0.05 PAR VALUE ADDITIONAL
---------------- ----------------- PAID-IN RETAINED
SHARES AMOUNT SHARES AMOUNT CAPITAL EARNINGS TOTAL
------ ------ ------ ------ ------- -------- -----
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE JANUARY 1, 1994 .......................... -- -- 17,692 $885 $11,695 $178,025 $190,605
Exercise of stock options ........................ -- -- 2 -- 14 -- 14
Cash dividend .................................... -- -- -- -- -- (1,769) (1,769)
Net income ....................................... -- -- -- -- -- 8,491 8,491
------ ----- ------ ---- ------- -------- --------
BALANCE DECEMBER 31, 1994 ........................ -- -- 17,694 885 11,709 184,747 197,341
Net loss for the two months ended--
February 25, 1995 ............................... -- -- -- -- -- (383) (383)
Net income for the fiscal year ended--
March 2, 1996 ................................... -- -- -- -- -- 10,411 10,411
------ ----- ------ ---- ------- -------- --------
BALANCE MARCH 2, 1996 ............................ -- -- 17,694 885 11,709 194,775 207,369
Net income ....................................... -- -- -- -- -- 19,065 19,065
------ ----- ------ ---- ------- -------- --------
BALANCE MARCH 1, 1997 ............................ -- -- 17,694 $885 $11,709 $213,840 $226,434
====== ===== ====== ==== ======= ======== ========
</TABLE>

F-4

<PAGE>

<TABLE>
<CAPTION>
SYMS CORP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

FISCAL YEAR ENDED TWO MONTHS ENDED
---------------------------------- -----------------------------
DECEMBER 31, MARCH 2, MARCH 1, FEBRUARY 26, FEBRUARY 25,
1994 1996 1997 1994 1995
------- ------- ------- ------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) ........................................... $ 8,491 $10,411 $19,065 $ 50 $ (383)
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation and amortization .............................. 8,854 7,751 7,971 1,190 1,359
Deferred income taxes ...................................... (1,484) (3,539) (1,870) -- 47
(Gain) loss on sale of property and equipment .............. (73) 10 (52) -- (16)
Loss on disposal of assets ................................. -- 1,142 244 -- 1,360
(Increase) decrease in operating assets:
Merchandising inventories .................................. (17,389) (2,694) (9,586) (9,000) (13,453)
Prepaid expenses and other current assets .................. (418) 2,158 1,765 2,403 (404)
Other assets ............................................... (290) (306) (2,417) (2) 4
Increase (decrease) in operating liabilities:
Accounts payable ........................................... 8,535 (4,721) (2,177) 14,573 12,222
Accrued expenses ........................................... 4,164 1,203 1,137 (2,596) 133
Obligations to customers ................................... 805 (271) 595 (166) 456
Other long term liabilities ................................ -- 237 396 -- --
Income taxes ............................................... 1,741 (245) 502 (3,036) (306)
------- ------- ------- ------- --------
Net cash provided by operating activities ............... 12,936 11,136 15,573 3,416 1,019
------- ------- ------- ------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment .......................... (14,591) (4,777) (21,709) (1,910) (388)
Proceeds from sale of property and equipment ................ 103 325 65 -- 13
------- ------- ------- ------- --------
Net cash used in investing activities ................... (14,488) (4,452) (21,644) (1,910) (375)
------- ------- ------- ------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Payment of dividends ........................................ (1,769) -- -- -- --
Repayments of obligations under capital lease ............... (234) (287) (339) (36) (43)
Revolving line of credit (repayments) borrowings ............ 2,900 (2,050) 4,950 -- (850)
Exercise of options ......................................... 14 -- -- -- --
------- ------- ------- ------- --------
Net cash provided by (used in) financing activities ..... 911 (2,337) 4,611 (36) (893)
------- ------- ------- ------- --------
NET (DECREASE) INCREASE IN CASH AND
CASH EQUIVALENTS ........................................... (641) 4,347 (1,460) 1,470 (249)
CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD ........................................ 1,347 457 4,804 1,347 706
------- ------- ------- ------- --------
CASH AND CASH EQUIVALENTS,
END OF PERIOD .............................................. $ 706 $ 4,804 $ 3,344 $ 2,817 $ 457
======= ======= ======= ======= ========
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid during the period for:
Interest (net of amount capitalized) ....................... $ 253 $ 399 $ 291 $ -- $ --
======= ======= ======= ======= ========
Income taxes paid (refunds received)--net .................. $ 5,106 $11,026 $16,041 $ -- $ (33)
======= ======= ======= ======= ========

See notes to consolidated financial statements.
</TABLE>

F-5
<PAGE>

SYMS CORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FISCAL YEARS ENDED DECEMBER 31, 1994, MARCH 2, 1996, MARCH 1, 1997
AND THE TWO MONTHS ENDED FEBRUARY 25, 1995

NOTE 1--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

a. Principal Business

Syms Corp and subsidiaries (the "Company") operates a chain of forty
"off-price" retail stores (thirty-eight in 1996) located throughout the
Northeastern and Middle Atlantic regions and in the Midwest, Southeast and
Southwest. Each Syms store offers a broad range of first quality, in season
merchandise bearing nationally recognized designer or brand-name labels for men,
women and children.

b. Principles of Consolidation

The consolidated financial statements include the accounts of the Company
and wholly-owned subsidiaries. All significant intercompany accounts and
transactions have been eliminated.

In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. Operating results for the two months ended February 26, 1994 are not
necessarily indicative of the results that may be expected for the entire fiscal
year ended December 31, 1994.

c. Accounting Period

The Company changed its fiscal year end to the Saturday nearest to the end
of February. This change was reported on March 17, 1995. The fiscal years ended
December 31, 1994 and March 1, 1997 were comprised of 52 weeks. The fiscal year
ended March 2, 1996 was comprised of 53 weeks.

d. Merchandise Inventories

Merchandise inventories are stated at the lower of cost or market on a
first-in-first-out (FIFO) basis, as determined by the retail inventory method.
During the fiscal year ended December 31, 1994, the Company changed its method
of valuing inventory by computing separate cost complements for each department
within its five merchandise categories. In the past, the Company computed a
single cost complement for each of its five merchandise categories. Management
believes the change results in a more accurate inventory valuation. This change
resulted in a total increase to gross margin of $780,000 of which approximately
one half relates to prior years. The Company considers that the effect on fiscal
year end 1994 and prior years is not material.

e. Property and Equipment

Property and equipment are stated at cost. Depreciation and amortization
are provided by the straight-line method over the following estimated useful
lives:

Buildings and improvements 15-30 years
Machinery and equipment 5 years
Furniture and fixtures 5 years
Leasehold improvements Lesser of life of the asset or life of lease

Facilities leases (Note 7) having the substance of financing transactions
have been capitalized. The related lease obligations have been included as
obligations under capital lease. The leased assets are being amortized as
described above.

f. Income Taxes

Deferred income taxes reflect the future tax consequences of differences
between the tax basis of assets and liabilities and their financial reporting
amounts at year end.

g. Earnings Per Share

Net income per share is computed by dividing net income by the weighted
average number of common shares and common stock equivalents outstanding during
each period. The Company's common stock equivalents consist of

F-6
<PAGE>

SYMS CORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
FISCAL YEARS ENDED DECEMBER 31, 1994, MARCH 2, 1996, MARCH 1, 1997
AND THE TWO MONTHS ENDED FEBRUARY 25, 1995

outstanding stock options and for the periods ended December 31, 1994, March 2,
1996 and March 1, 1997, the effect of outstanding common stock options was not
dilutive.

h. Cash and Cash Equivalents

Syms Corp considers credit card receivables and all short term investments
with a maturity of three months or less as cash equivalents.

i. Pre-Opening Costs

Store pre-opening costs are deferred until the store's opening, at which
time they are expensed over the first 12 months of store operation.

j. Closed Store Expense

Closed store costs, such as future rent and real estate taxes net of
expected sublease recovery, are accrued when management makes the determination
that no future economic benefit from operations exists and are recorded in
selling, general and administrative expenses.

k. Obligation to Customers

Obligations to customers represent credits issued for returned merchandise
as well as gift certificates. The Company's policy is to allow customers to
exchange credits issued for other merchandise or credit to the Syms charge card.

l. Use of Estimates

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

m. Recent Accounting Pronouncement

In March 1995, the Financial Accounting Standards Board issued SFAS No.
121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to be Disposed of." SFAS No. 121 requires that long-lived assets and
certain identifiable intangibles to be held and used by an entity be reviewed
for impairment whenever events or changes in circumstances indicate that the
carrying amount of an asset may not be recoverable, and is effective for fiscal
years beginning after December 15, 1995. The Company evaluated its investment in
long-lived assets to be held and used in operations on an individual store basis
and determined that, based upon its history of operating results and operating
projections, the adoption of SFAS No. 121 did not have an effect on the
Company's financial position or results of operations.

In February 1997, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 128, "Earnings per Share" ("SFAS No.
128"), which is effective for the Company for the year ended February 28, 1998.
SFAS No. 128 simplifies the standards for computing earnings per share
previously found in Accounting Principles Board Opinion No. 15 and establishes
new standards for computing and presenting earnings per share. Application of
SFAS No. 128 is not expected to have a significant effect on the Company's
earnings per share.

n. Reclassification

Certain items in prior years in specific captions of the accompanying
consolidated financial statements and notes to consolidated financial statements
have been reclassified for comparative purposes.

F-7
<PAGE>

SYMS CORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
FISCAL YEARS ENDED DECEMBER 31, 1994, MARCH 2, 1996, MARCH 1, 1997
AND THE TWO MONTHS ENDED FEBRUARY 25, 1995

NOTE 2--PROPERTY AND EQUIPMENT

Property and equipment consists of:

MARCH 2, MARCH 1,
1996 1997
-------- --------
(IN THOUSANDS)
Land ............................................ $ 34,060 $ 40,061
Buildings and building improvements ............. 102,244 105,511
Leasehold and leasehold improvements ............ 20,365 32,142
Machinery and equipment ......................... 14,893 16,747
Furniture and fixtures .......................... 15,547 15,661
Capital lease ................................... 3,763 3,763
Construction in progress ........................ 2,774 692
-------- --------
193,646 214,577
Less accumulated depreciation and amortization .. 64,411 71,836
-------- --------
$129,235 $142,741
======== ========

NOTE 3--INCOME TAXES

The provision for income taxes is as follows:

FISCAL YEAR ENDED
-------------------------------- TWO MONTHS ENDED
DECEMBER 31, MARCH 2, MARCH 1, FEBRUARY 25,
1994 1996 1997 1995
----------- -------- -------- -----------------
(IN THOUSANDS)
Current:
Federal $5,956 $ 9,109 $13,799 $(223)
State 1,407 1,664 2,748 (8)
------ ------- ------- -----
7,363 10,773 16,547 (231)
------ ------- ------- -----
Deferred:
Federal (1,202) (2,622) (1,560) 43
State (282) (917) (310) 4
------ ------- ------- -----
(1,484) (3,539) (1,870) 47
------ ------- ------- -----
$5,879 $ 7,234 $14,677 $(184)
====== ======= ======= =====

F-8
<PAGE>

SYMS CORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
FISCAL YEARS ENDED DECEMBER 31, 1994, MARCH 2, 1996, MARCH 1, 1997
AND THE TWO MONTHS ENDED FEBRUARY 25, 1995

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

<TABLE>
<CAPTION>
FISCAL YEAR ENDED
----------------------------------- TWO MONTHS ENDED
DECEMBER 31, MARCH 2, MARCH 1, February 25,
1994 1996 1997 1995
------------ -------- -------- ----------------
<S> <C> <C> <C> <C>
Statutory Federal income tax rate .......... 35.0% 35.0% 35.0% (35.0)%
State taxes, net of Federal income
tax benefits .............................. 5.5 5.3 8.4 (3.2)
Officers' life insurance ................... 0.4 0.7 0.1 5.2
Other, net ................................. -- -- -- 0.6
---- ---- ---- -----
Effective income tax rate .................. 40.9% 41.0% 43.5% (32.4)
==== ==== ==== =====

</TABLE>

The composition of the Company's deferred tax assets and liabilities is as
follows:

<TABLE>
<CAPTION>
MARCH 2, MARCH 1,
1996 1997
-------- --------
(IN THOUSANDS)
<S> <C> <C>
Deferred tax assets:
Capitalization of inventory costs ................................... $3,800 $4,085
Capital lease ....................................................... 333 404
Accounts receivable ................................................. 1,018 1,143
Other ............................................................... 650 2,645
------ ------
Total deferred tax assets .......................................... 5,801 8,277
------ ------
Deferred tax liability:
Depreciation method and different estimated lives ................... (835) (425)
Other ............................................................... -- (1,016)
------ ------
Total deferred tax liabilities ...................................... (835) (1,441)
------ ------
Net .................................................................. ($4,966) $6,836
Classified in balance sheet as follows:
Current deferred tax asset .......................................... $5,221 $6,639
Long term deferred tax asset (net of non-current
deferred tax liability) ............................................ -- 197
Long term deferred tax liability (net of non-current tax asset) ..... (255) --
------ ------
Net ................................................................. $4,966 $6,836
====== ======
</TABLE>

NOTE 4--BANK CREDIT FACILITIES

The Company has an unsecured revolving credit agreement with a bank for a
line of credit not to exceed $40,000,000 through December 1, 1997. Interest on
individual advances is payable quarterly at 1-1/2% per annum below the bank's
base rate, except that at the time of advance, the Company has the option to
select an interest rate based upon one of two other alternative calculations,
with such rate to be fixed for a period not to exceed 90 days. The average daily
unused portion is subject to a commitment fee of 1/8 of 1% per annum. The
interest rate on short term borrowings was 6.75% at March 1, 1997. At March 2,
1996 there were no outstanding borrowings, and at March 1, 1997 there was
$4,905,000 in outstanding borrowings.

The agreement contains financial covenants, with respect to consolidated
tangible net worth, as defined, working capital and maximum capital
expenditures, including dividends, as well as other financial ratios.

Total interest charges incurred for the years ended December 31, 1994,
March 2, 1996 and March 1, 1997 including amounts related to capital leases,
were $865,000, $623,000 and $586,000, respectively, of which $612,000, $105,000
and $152,000 were capitalized in fiscals 1994, 1996 and 1997, respectively, in
connection with the purchase and construction of new facilities.

F-9
<PAGE>

SYMS CORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
FISCAL YEARS ENDED DECEMBER 31, 1994, MARCH 2, 1996, MARCH 1, 1997
AND THE TWO MONTHS ENDED FEBRUARY 25, 1995

In addition, the Company has a separate $10,000,000 credit facility with
another bank available for the issuance of letters of credit for the purchase of
merchandise. This agreement may be cancelled at any time by either party. At
March 2, 1996 and at March 1, 1997, the Company had $3,786,000 and $6,094,000,
respectively, in outstanding letters of credit.

NOTE 5--FAIR VALUE DISCLOSURES

The estimated fair values of financial instruments which are presented
herein have been determined by the Company using available market information
and appropriate valuation methodologies. However, considerable judgement is
required in interpreting market data to develop estimates of fair value.
Accordingly, the estimates presented herein are not necessarily indicative of
amounts the Company could realize in a current market exchange.

The fair value of the Company's cash and cash equivalents, accounts
receivable and short-term borrowings approximates their carrying values at March
2, 1996 and at March 1, 1997 due to the short-term maturities of these
instruments.

NOTE 6--PENSION AND PROFIT SHARING PLANS

a. PENSION PLAN--The Company has a defined benefit pension plan for all
employees other than those covered under collective bargaining agreements.

The benefits are based on years of service and the employee's highest
average pay during any five consecutive years within the ten-year period prior
to retirement. Pension plan costs are funded annually. Contributions are
intended to provide not only for benefits attributed to service to date, but
also for those expected to be earned in the future.

The following table sets forth the Plan's funded status and amounts
recognized in the Company's consolidated balance sheet:

<TABLE>
<CAPTION>
MARCH 2, MARCH 1,
1996 1997
-------- --------
(IN THOUSANDS)
<S> <C> <C>
Actuarial present value of benefit obligation:
Accumulated benefit obligation, including vested benefits of
$2,552 at March 2, 1996 and $3,128 at March 1, 1997 .................................. $2,711 $3,254
====== ======
Projected benefit obligation ........................................................... $3,592 $4,180
Plan assets at fair value, primarily mutual funds and United States Treasury bills ..... 3,249 3,869
------ ------
Plan assets less than projected benefit obligation ..................................... (343) (311)
Unrecognized net loss .................................................................. 186 147
Unamortized net asset at transition .................................................... (152) (127)
------ ------
Accrued pension cost (included in accrued expenses) .................................... $ (309) $ (291)
====== ======
</TABLE>

F-10
<PAGE>

SYMS CORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
FISCAL YEARS ENDED DECEMBER 31, 1994, MARCH 2, 1996, MARCH 1, 1997
AND THE TWO MONTHS ENDED FEBRUARY 25, 1995

Pension expense includes the following components:

<TABLE>
<CAPTION>
FISCAL YEAR ENDED
-----------------------------------------------------------
DECEMBER 31, MARCH 2, MARCH 1,
1994 1996 1997
------------ ------------------ ---------
(in thousands)
<S> <C> <C> <C>
Service cost benefits earned during the period ............... $384 $330 $326
Interest cost on the projected benefit obligation ............ 248 242 282
Actual return on plan assets ................................. (193) (191) (159)
Net amortization and deferral ................................ (82) (80) (155)
---- ---- ----
Net periodic pension cost .................................... $357 $301 $294
==== ==== ====
</TABLE>

The weighted average discount rate and rate of increase in future
compensation levels used in determining the actuarial present value of the
projected benefit obligation was 7.75% during each of the years ended December
31, 1994, March 2, 1996 and March 1, 1997. The expected long-term rate of return
on plan assets was 8.5% during each of the years ended December 31, 1994, March
2, 1996 and March 1, 1997.

b. PROFIT-SHARING AND 401(K) PLAN--The Company has a profit-sharing and
401(K) plan for all employees other than those covered under collective
bargaining agreements. In 1995, the Company established a defined contribution
savings plan 401(K) for substantially all of its eligible employees. Employees
may contribute a percentage of their salary to the plan subject to statutory
limits. The Company has not made any matching contributions to this plan.
However, profit-sharing contributions were made in the amounts of $130,000 for
each of the years ended December 31, 1994 and March 2, 1996, $200,000 for year
ended March 1, 1997 and $39,000 for the two months ended February 25, 1995.

NOTE 7--COMMITMENTS

a. LEASES--The Company has various operating leases and one capital lease
for its retail stores, with terms expiring between 1997 and 2016. The Company
also has a ground lease that expires in 2276. Under most lease agreements, the
Company pays real estate taxes, maintenance and other operating expenses.
Certain store leases also provide for additional contingent rentals based upon a
percentage of sales in excess of certain minimum amounts.

F-11
<PAGE>

SYMS CORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
FISCAL YEARS ENDED DECEMBER 31, 1994, MARCH 2, 1996, MARCH 1, 1997
AND THE TWO MONTHS ENDED FEBRUARY 25, 1995

Future minimum lease payments at March 1, 1997 are as follows:

CAPITAL
LEASE
REAL OPERATING
ESTATE LEASES
-------- ----------
(IN THOUSANDS)

1998 ................................................. $ 600 $ 6,974
1999 ................................................. 600 6,158
2000 ................................................. 450 5,442
2001 ................................................. -- 5,062
2002 ................................................. -- 5,171
2003 and thereafter--cumulative ...................... -- 39,785
----- -------
Total minimum payments ............................... 1,650 $68,592
=======
Less amount representing interest .................... 345
------
Present value of net minimum lease payments .......... 1,305
Less current maturities .............................. 405
------
$ 900
======

Payments under the real estate capital lease, which expires in 1999, are
payable to the Company's principal shareholder. Rental payments were $600,000
during each of the years ended December 31, 1994, March 2, 1996, and March 1,
1997 and $100,000 for the two months ended February 25, 1995.

Rent expense for operating leases is as follows:

FISCAL YEAR ENDED TWO MONTHS
-------------------------------- ENDED
DECEMBER 31, MARCH 2, MARCH 1, FEBRUARY 25,
1994 1996 1997 1995
----------- -------- -------- -----------
(IN THOUSANDS)

Minimum rentals ................. $4,030 $4,308 $5,832 $ 698
Escalation rentals .............. 9 24 413 28
Contingent rentals .............. 25 40 36 4
Sublease rentals ................ (192) (386) (743) (32)
------ ------ ------ ------
$3,872 $3,986 $5,538 $ 698
====== ====== ====== ======

b. EMPLOYMENT AGREEMENT--At March 1, 1997 the Company had an employment
agreement with its General Merchandising Manager, expiring 2009, pursuant to
which annual compensation of approximately $300,000 is required. In addition,
that employee is entitled to additional compensation upon occurrence of certain
events.

c. LEGAL PROCEEDINGS--The Company is a party to routine litigation incident
to its business. Management of the Company believes, based upon its assessment
of the actions and claims outstanding against the Company, and after discussion
with counsel, that there are no legal proceedings that will have a material
adverse effect on the financial statements of the Company. Some of the lawsuits
to which the Company is a party are covered by insurance and are being defended
by the Company's insurance carriers.

F-12
<PAGE>

SYMS CORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
FISCAL YEARS ENDED DECEMBER 31, 1994, MARCH 2, 1996, MARCH 1, 1997
AND THE TWO MONTHS ENDED FEBRUARY 25, 1995

NOTE 8--PREFERRED STOCK

The Company is authorized to issue up to 1,000,000 shares of preferred
stock, in one or more series of preferred stock. The Board of Directors is
authorized to establish the number of shares to be included in each such series,
and to fix the designation, relative rights, preferences, qualifications and
limitations of the shares of each such series.

NOTE 9--STOCK OPTION PLAN

The Company's Stock Option Plan allows for the granting of incentive stock
options, as defined in Section 422A of the Internal Revenue Code of 1986 (as
amended), non-qualified stock options or stock appreciation rights. The plan
requires that incentive stock options be granted at an exercise price not less
than the fair market value of the common shares on the date the option is
granted. The exercise price of the option for holders of more than 10% of the
voting rights of the Company must be not less than 110% of the fair market value
of the common shares on the date of grant. Non-qualified options and stock
appreciation rights may be granted at any exercise price. The Company has
reserved 1,000,000 shares of common stock for issuance thereunder.

No option or stock appreciation rights may be granted under the stock
option plan after July 2003. The maximum exercise period for any option or stock
appreciation right under the plan is ten years from the date the option is
granted (five years for any optionee who holds more than 10% of the voting
rights of the Company).

Statement of Financial Accounting Standards No. 123, "Accounting for
Stock-Based Compensation" ("SFAS No. 123"), was effective for the Company for
fiscal 1997. SFAS No. 123 encourages (but does not require) compensation expense
to be measured based on the fair value of the equity instrument awarded. In
accordance with APB No. 25, no compensation cost has been recognized in the
Consolidated Statements of Income for the Company's stock option plans. If
compensation cost for the Company's stock option plans had been determined in
accordance with the fair value method prescribed by SFAS No. 123, the Company's
net income would have been $10,411,000 and $19,042,000 for 1996 and 1997,
respectively, and the earnings per share would have been $0.59 and $1.08 for
1996 and 1997, respectively. This pro forma information may not be
representative of the amounts to be expected in future years as the fair value
method of accounting prescribed by SFAS No. 123 has not been applied to options
granted prior to 1997.

Stock option transactions are summarized below:

<TABLE>
<CAPTION>
FISCAL YEAR ENDED TWO MONTHS ENDED
-------------------------------------------------------------------------- ------------------
DECEMBER 31, 1994 MARCH 2, 1996 MARCH 1, 1997 FEBRUARY 25, 1995
------------------- -------------------- ------------------- -------------------
WEIGHTED WEIGHTED WEIGHTED WEIGHTED
AVERAGE AVERAGE AVERAGE AVERAGE
EXERCISE EXERCISE EXERCISE EXERCISE
SHARES PRICE SHARES PRICE SHARES PRICE SHARES PRICE
------ ------- ------ ------- ------ ------- ------ ------
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
FIXED OPTIONS
Outstanding beginning
of year ..................... 547 $10.04 464 $ 9.90 426 $ 9.83 496 $ 9.96
Granted .................... 57 8.50 -- -- 100 8.00 -- --
Exercised .................. (2) 8.63 -- -- -- -- -- --
Cancelled .................. (106) 9.81 (38) 9.53 (36) 10.27 (32) 10.65
--- ------ --- ------ --- ------ --- ------
Outstanding, end of
period ...................... 496 $ 9.96 426 $ 9.94 490 $ 9.52 464 $ 9.91
=== ====== === ====== === ====== === ======
Options exercisable
at year end ................. 288 $10.11 320 $10.02 360 $ 9.83 256 $10.04
Weighted-average
fair value of
options granted
during the year ............ $ 4.99 -- $ 4.99 --
</TABLE>

F-13
<PAGE>

SYMS CORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
FISCAL YEARS ENDED DECEMBER 31, 1994, MARCH 2, 1996, MARCH 1, 1997
AND THE TWO MONTHS ENDED FEBRUARY 25, 1995

The following table summarizes information about stock options outstanding
at March 1, 1997:

<TABLE>
<CAPTION>
OPTIONS OUTSTANDING OPTIONS EXERCISABLE
- ----------------------------------------------------------------------------------- ----------------------------------------
WEIGHTED-AVERAGE
NUMBER REMAINING NUMBER
RANGE OF OUTSTANDING AT CONTRACTUAL WEIGHTED-AVERAGE EXERCISABLE AT WEIGHTED-AVERAGE
EXERCISE PRICES MARCH 1, 1997 LIFE (YEARS) EXERCISE PRICE MARCH 1, 1997 EXERCISE PRICE
- --------------- ------------- ------------ -------------- ------------- --------------
<S> <C> <C> <C> <C> <C>
$7.125-$12.250 490,625 4.8 $9.52 359,815 $9.83
</TABLE>

The fair value of each option grant is estimated on the date of each grant
using the Black-Scholes option-pricing model with the following weighted average
assumptions used for grants in 1997: risk-free interest rate of 6.83%, expected
life of 10 years, expected volatility of 33.29% and dividend yield of 0%. The
fair value generated by the Black-Scholes model may not be indicative of the
future benefit, if any, that may be received by the option holder.

NOTE 10--OTHER TRANSACTIONS

Included in cost of sales for the three fiscal years ended December 31,
1994, March 2, 1996 and March 1, 1997 are purchases of approximately $6,322,000,
$5,139,000 and $5,471,000, respectively, from a company related to the principal
shareholder, as well as a licensee of the related company. In 1991 the Company
entered into an agreement with the licensee to purchase annually approximately
$4,200,000 of suits. Included in prepaid expenses and other current assets at
March 2, 1996 and March 1, 1997 are advances to the licensee totaling
approximately $2,182,000 and $3,438,000, respectively. The advances at March 1,
1997 are for purchases to be received in the Spring and Fall of 1997 and are to
be received by the Company prior to December 31, 1997. A $2,200,000 provision
was made for the fiscal year and fourth quarter ended March 2, 1996 in
recognition of current information that the licensee advance may not be fully
recoverable. In addition, the Company has guaranteed a letter of credit on
behalf of the licensee totaling approximately $150,000, which expires on July 5,
1997 and at March 1, 1997 has advanced fabric in the approximate amount of
$311,000.

F-14
<PAGE>

SYMS CORP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)
FISCAL YEARS ENDED DECEMBER 31, 1994, MARCH 2, 1996, MARCH 1, 1997
AND THE TWO MONTHS ENDED FEBRUARY 25, 1995

The Company has entered into a capital lease with the Chief Executive
Officer. Included in the Statement of Income are the following expenses relating
to this agreement:

<TABLE>
<CAPTION>
FISCAL YEAR ENDED TWO MONTHS
-------------------------------------------------- ENDED
DECEMBER 31, MARCH 2, MARCH 1, FEBRUARY 25,
1994 1996 1997 1995
-------------------------------------------------- ------------
(IN THOUSANDS)
<S> <C> <C> <C> <C>
Depreciation .......... $ 238 $ 238 $ 238 $ 40
Interest .............. 366 313 261 57
</TABLE>

The balance sheet includes the following items relating to this agreement:

MARCH 2, MARCH 1,
1996 1997
-------- --------
(IN THOUSANDS)

Assets under Capital Lease .................. $ 3,763 $ 3,763
Accumulated Depreciation .................... (3,101) (3,339)
Capital Lease Obligation .................... 1,644 1,305

On November 22, 1996 the Company loaned the Marcy Syms Revocable Trust
$500,000 toward the purchase of a house for Ms. Syms in Westchester County, New
York. The loan is evidenced by the Trust's note, which is guaranteed by Ms.
Syms, and is secured by a first priority mortgage on the real estate purchased.
The note bears interest at the rate of 6.6% per annum (the then Federal Mid-Term
Rate) payable annually, and the principal of the note is due November 22, 2001.

NOTE 11--UNAUDITED SELECTED QUARTERLY FINANCIAL DATA

QUARTER
-------------------------------------------
FIRST SECOND THIRD FOURTH
------- ------- ------- -------
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

YEAR ENDED MARCH 2, 1996
Net sales ....................... $79,252 $72,814 $93,439 $89,245
Gross profit .................... $27,174 $24,535 $34,577 $30,903
Net income ...................... $ 1,036 $ 741 $ 5,561 $ 3,073
Net income per share ............ $ 0.06 $ 0.04 $ 0.32 $ 0.17

YEAR ENDED MARCH 1, 1997
Net Sales ....................... $83,377 $75,128 $96,225 $92,062
Gross profit .................... $30,456 $26,133 $41,494 $35,596
Net income ...................... $ 3,381 $ 1,441 $ 8,637 $ 5,606
Net income per share ............ $ 0.19 $ 0.08 $ 0.49 $ 0.32

F-15

<PAGE>

SYMS CORP AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)

<TABLE>
<CAPTION>
AUGUST 31, MARCH 1, AUGUST 30,
1996 1997 1997
-------- -------- --------
(UNAUDITED) (NOTE) (UNAUDITED)
<S> <C> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents ................................. $ 6,744 $ 3,344 $ 3,203
Merchandise inventories ................................... 128,867 122,540 139,068
Deferred income taxes ..................................... 5,977 6,639 5,170
Prepaid expenses and other current assets ................. 3,501 1,756 6,647
-------- -------- --------
TOTAL CURRENT ASSETS .................................... 145,089 134,279 154,088
PROPERTY AND EQUIPMENT--
Net of accumulated depreciation and amortization .......... 137,870 142,741 145,266
DEFERRED INCOME TAXES ...................................... 686 197 222
OTHER ASSETS--Net of accumulated amortization .............. 5,457 6,801 6,538
-------- -------- --------
TOTAL ASSETS ............................................. $289,102 $284,018 $306,114
======== ======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable .......................................... $ 49,748 $ 28,723 $ 37,155
Accrued expenses .......................................... 9,734 11,055 11,508
Obligations to customers .................................. 4,313 5,085 4,174
Income taxes payable ...................................... 3,598 5,833 3,308
Short term borrowings ..................................... 6,900 4,950 13,400
Current portion of obligations under capital lease ........ 371 405 441
-------- -------- --------
Total current liabilities ................................ 74,664 56,051 69,986
-------- -------- --------
OBLIGATIONS UNDER CAPITAL LEASE ............................ 1,111 900 670
-------- -------- --------
DEFERRED INCOME TAXES ...................................... 667 -- --
-------- -------- --------
OTHER LONG TERM LIABILITIES ................................ 469 633 801
-------- -------- --------
COMMITMENTS ................................................ -- -- --

STOCKHOLDERS' EQUITY
Preferred stock, par value; $100 per share
authorized 1,000 shares; none outstanding ................ -- -- --
Common stock, par value; $0.05 per share
authorized 30,000 shares; 17,776 issued and
outstanding as of August 31, 1996, March1,1997
and August 30, 1997 ...................................... 885 885 889
Additional paid-in capital ................................ 11,709 11,709 12,432
Retained earnings ......................................... 199,597 213,840 221,336
-------- -------- --------
Total Stockholders' Equity ............................... 212,191 226,434 234,657
-------- -------- --------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY ................................... $289,102 $284,018 $306,114
======== ======== ========
</TABLE>

Note: The balance sheet at March 1, 1997 has been derived from the audited
financial statements at that date but does not include all of the information
and footnotes required by generally accepted accounting principles for complete
financial statements.

F-16
<PAGE>

SYMS CORP AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)

TWENTY-SIX WEEKS ENDED
----------------------
AUGUST 31, AUGUST 30,
1996 1997
-------- --------
(UNAUDITED)

NET SALES .......................................... $158,505 $164,239
Cost of goods sold ................................. 101,916 99,795
-------- --------
Gross profit ....................................... 56,589 64,444

EXPENSES
Selling, general and administrative ................ 34,623 35,376
Advertising ........................................ 2,883 3,900
Occupancy .......................................... 6,683 7,930
Depreciation and amortization ...................... 3,830 4,290
-------- --------
Income from operations ............................. 8,570 12,948
Interest expense--net .............................. 36 241
Income before income taxes ......................... 8,534 12,707
Provision for income taxes ......................... 3,712 5,211
-------- --------
NET INCOME ......................................... $ 4,822 $ 7,496
======= =======
Net income per shares .............................. $ 0.27 $ 0.42
======= =======
Weighted average shares outstanding ................ 17,694 17,739
======= =======

F-17
<PAGE>

SYMS CORP AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

<TABLE>
<CAPTION>
TWENTY-SIX WEEKS ENDED
-----------------------------
AUGUST 31, AUGUST 30,
1996 1997
---------- ----------
(UNAUDITED)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
NET INCOME .......................................................... $ 4,822 $ 7,496
Adjustments to reconcile net income to net cash provided by
(used in) operating activities:
Depreciation and amortization ....................................... 3,830 4,290
Deferred income taxes ............................................... (710) 1,444
(Gain) on sale of property and equipment ............................ (37) (8)
Loss on disposal of assets .......................................... 244 --
(Increase) decrease in operating assets:
Merchandise inventories ............................................ (15,913) (16,528)
Prepaid expenses and other current assets .......................... 20 (4,891)
Other assets ....................................................... (1,048) 237
Increase (decrease) in operating liabilities:
Accounts payable ................................................... 18,848 8,432
Accrued expenses ................................................... (184) 453
Obligations to customers ........................................... (177) (911)
Other long term liabilities ........................................ 232 168
Income taxes ....................................................... (2,053) (2,525)
------- -------
Net cash (used in) provided by operating activities ............... 7,874 (2,343)
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Expenditures for property and equipment ............................. (12,716) (6,792)
Proceeds from sale of property and equipment ........................ 44 11
------- -------
Net cash used in investing activities ............................. (12,672) (6,781)
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments of obligations under capital lease ....................... (162) (194)
Revolving line of credit borrowings--net ............................ 6,900 8,450
Proceeds from exercise of stock options ............................. -- 727
------- -------
Net cash provided by financing activities ......................... 6,738 8,983
------- -------
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS ................. 1,940 (141)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD ....................... 4,804 3,344
------- -------
CASH AND CASH EQUIVALENTS, END OF PERIOD ............................. $ 6,744 $ 3,203
======= =======
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid during the period for:
Interest (net of amount capitalized) ............................... $ 57 $ 169
======= =======
Income taxes paid--net ............................................. $ 3,977 $10,846
======= =======
</TABLE>

F-18
<PAGE>

SYMS CORP AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
THIRTEEN AND TWENTY-SIX WEEKS ENDED AUGUST 30, 1997 AND AUGUST 31, 1996
(Unaudited)

NOTE 1--THE COMPANY

Syms Corp (the "Company") operates a chain of forty "off-price" retail
stores located throughout the Northeastern and Middle Atlantic regions and in
the Midwest, Southeast and Southwest. Each store offers a broad range of first
quality, in-season merchandise bearing nationally recognized designer or
brand-name labels for men, women and children.

NOTE 2--BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and Article
10 of Regulation S-X. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for annual
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the thirteen and twenty-six week periods
ended August 30, 1997 are not necessarily indicative of the results that may be
expected for the entire fiscal year ending February 28, 1998. For further
information, refer to the consolidated financial statements and footnotes
thereto included in the Company's annual report on Form 10-K for the fiscal year
ended March 1, 1997.

NOTE 3--ACCOUNTING PERIOD

The Company maintains its records on the basis of a 52-53 week fiscal year
ending the Saturday closest to the end of February. The fiscal year ending
February 28, 1998 and March 1, 1997 are both comprised of 52 weeks.

NOTE 4--MERCHANDISE INVENTORIES

Merchandise inventories are stated at the lower of cost (first in, first
out) or market, as determined by the retail inventory method.

NOTE 5--BANK CREDIT FACILITIES

The Company has an unsecured revolving credit agreement with a bank for a
line of credit not to exceed $40,000,000 through December 1, 1997. Interest on
individual advances is payable quarterly at 1 1/2% per annum below the bank's
base rate, except that at the time of advance, the Company has the option to
select an interest rate based upon one of two other alternative calculations,
with such rate to be fixed for a period not to exceed 90 days. The Company
anticipates it will renew this facility for another three years for the same
amount and the same terms, conditions and covenants. The average interest rate
on short term borrowings was 6.13% at August 30, 1997. The average daily unused
portion is subject to a commitment fee of 1/8 of 1% per annum. The Company had
outstanding borrowings of $13,400,000, $4,950,000, and $6,900,000 as of August
30, 1997, March 1, 1997 and August 31, 1996, respectively.

In addition, the Company has a separate $10,000,000 credit facility with
another bank available for the issuance of letters of credit for the purchase of
merchandise. This agreement may be cancelled at any time by either party. At
August 30, 1997, March 1, 1997 and August 31, 1996 the Company had $7,436,000,
$6,094,000 and $7,896,000, respectively, in outstanding letters of credit.

F-19
<PAGE>

[GRAPHICS PAGE]

AN EDUCATED CONSUMER
IS OUR BEST CUSTOMER(R)
[SYMS LOGO]

<PAGE>

================================================================================

NO DEALER, SALESMAN, OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY, OR THE UNDERWRITERS. NEITHER THE DELIVERY OF THIS
PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE AN
IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE
THE DATE HEREOF. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR
SOLICITATION TO ANYONE TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION.

----------

TABLE OF CONTENTS

PAGE
----

Available Information ..................................................... 3
Incorporation of Certain Documents by Reference ........................... 3
Prospectus Summary ........................................................ 4
Forward-Looking Statements ................................................ 7
Investment Considerations ................................................. 7
Use of Proceeds ........................................................... 8
Price Range of Common Stock and Dividend Policy ........................... 8
Capitalization ............................................................ 9
Selected Consolidated Financial and Operating Data ........................ 10
Management's Discussion and Analysis of Financial
Condition and Results of Operations ...................................... 11
Business .................................................................. 16
Management ................................................................ 21
Principal and Selling Stockholders ........................................ 22
Description of Capital Stock .............................................. 23
Shares Eligible for Future Sale ........................................... 23
Underwriting .............................................................. 24
Legal Matters ............................................................. 25
Experts ................................................................... 25
Index to Financial Statements ............................................. 26
Report of Independent Public Accountants .................................. F-1

================================================================================

3,500,000 SHARES

SYMS CORP

COMMON STOCK

----------
PROSPECTUS
----------

BEAR, STEARNS & CO. INC.

SALOMON BROTHERS INC

________________, 1997

================================================================================

<PAGE>

PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The following table sets forth the expenses to be borne by the Company in
connection with the offering described in this Registration Statement. All such
expenses other than the Securities and Exchange Commission registration fee are
estimates.

Securities and Exchange Commission Registration Fee ..... $ 15,588
NASD Filing and Expenses ................................ $ 5,644
Transfer Agent's Fees and Expenses ...................... $ 3,500
Printing Fees and Expenses .............................. $100,000
Accounting Fees and Expenses ............................ $ 70,000
Legal Fees and Expenses ................................. $250,000
Miscellaneous ........................................... $ 55,268
--------

Total ................................................ $500,000
========

The Selling Stockholders shall bear approximately $300,000 of the foregoing
expenses.

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS

Article Seven of the Company's Certificate of Incorporation and Article 10
of the Company's By-Laws each require the Company to indemnify, to the fullest
extent permitted by Section 14A:3-5 of the Business Corporation Act of New
Jersey, as the same may be amended or supplemented, any and all persons whom it
shall have power to indemnify under such Section from and against any and all of
the expenses, liabilities or other matters referred to in or covered by such
Section.

Section 14A:3-5 of the Business Corporation Act of New Jersey permits a
corporation to indemnify all corporate agents, defined to include (among other
persons) current and former officers and directors of the indemnifying
corporation, against proceedings by or in the right of the corporation, if such
corporate agent acted in good faith and in a manner he reasonably believed to be
in or not opposed to the best interests of the corporation. With respect to
proceedings other than those in the right of the corporation, which are criminal
in nature, such right to indemnify is further conditioned on such corporate
agent's having had no reasonable belief that his conduct was unlawful.

Each of the directors has entered into an agreement with the Company that
provides that the Company will indemnify such director to the fullest extent
permitted by the Business Corporation Act of New Jersey. The Company maintains
directors and officers liability insurance which insures against liabilities
that directors or officers of the Company may incur in such capacities.

ITEM 16. EXHIBITS

The following is a list of all exhibits filed as a part of this
Registration Statement on Form S-3, including those incorporated herein by
reference.

Exhibit
Number Description of Exhibits
- ------- -----------------------

1.1 Form of Underwriting Agreement**

4.1 Specimen Certificate of Common Stock (incorporated by reference to the
Company's Registration Statement on Form S-1 under the Securities Act of
1933 (Registration No. 2-85554) filed August 2, 1983 and declared
effective September 23, 1983)**

5.1 Opinion of Skadden, Arps, Slate, Meagher & Flom LLP**

23.1 Consent of Skadden, Arps, Slate, Meagher & Flom LLP (included in Exhibit
5.1)

23.2 Consent of Deloitte & Touche LLP*

24.1 Power of Attorney (included on signature page)**

- ----------
* Filed herewith.
** Previously filed.

II-1
<PAGE>

ITEM 17. UNDERTAKINGS

The Registrant hereby undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing of the Registrant's
annual report pursuant to Section 13(a) or Section 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in the registration
statement shall be deemed to be a new registration statement relating to the
securities offered herein, and the offering of such securities at that time
shall be deemed to be the initial BONA FIDE offering thereof.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions set forth in Item 15, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.

The undersigned registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.

(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial BONA FIDE offering thereof.

II-2
<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement or amendment thereto to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of New York, in the State of New York, on
November 19, 1997.

SYMS CORP

By /s/ SY SYMS
----------------------------
Name: Sy Syms
Title: Chairman & Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.

SIGNATURE TITLE DATE
--------- ----- ----

/s/ SY SYMS Chairman of the Board, Chief Executive November 19, 1997
- -------------------- Officer and a Director of the Company
Sy Syms

* President, Chief Operating Officer and November 19, 1997
- -------------------- a Director of the Company
Marcy Syms

* Vice President, Treasurer, Chief November 19, 1997
- -------------------- Financial Officer and a Director
Antone F. Moreira of the Company

* Vice President, Secretary, November 19, 1997
- -------------------- Merchandise Manager Men's Tailored
Stephen A. Merns Clothing and Shoes, and a Director of
the Company

* Director of the Company November 19, 1997
- --------------------
Wilbur L. Ross, Jr.

* Director of the Company November 19, 1997
- --------------------
Philip G. Barach

Director of the Company November __, 1997
- --------------------
David A. Messer

Director of the Company November __, 1997
- --------------------
Harvey A. Weinberg

*By: /s/ SY SYMS
----------------
Attorney-in-Fact

II-3
<PAGE>

EXHIBIT INDEX

Exhibit
Number Description of Exhibits
- ------ -----------------------

1.1 Form of Underwriting Agreement**

4.1 Specimen Certificate of Common Stock (incorporated by reference to the
Company's Registration Statement on Form S-1 under the Securities Act
of 1933 (Registration No. 2-85554) filed August 2, 1983 and declared
effective September 23, 1983)**

5.1 Opinion of Skadden, Arps, Slate, Meagher & Flom LLP**

23.1 Consent of Skadden, Arps, Slate, Meagher & Flom LLP (included in
Exhibit 5.1)

23.2 Consent of Deloitte & Touche LLP*

24.1 Power of Attorney (included on signature page)**

- ----------

* Filed herewith.
** Previously filed.

II-4

INDEPENDENT AUDITORS' CONSENT

We consent to the incorporation by reference in this Registration Statement of
Syms Corp on Form S-3 of our report dated April 28, 1997, including in the
Annual Report on Form 10-K of Syms Corp for the year ended March 1, 1997, and to
the use of our report dated April 28, 1997, appearing in the Prospectus, which
is part of such Registration Statement. We also consent to the reference to us
under the heading "Experts" in such Prospectus.

/s/ DELOITTE & TOUCHE LLP

New York, New York
November 19, 1997