PART I

Item 1. Business.

Introduction

The Warnaco Group, Inc. (“Warnaco Group”), a Delaware corporation organized in 1986 (collectively with its subsidiaries, the “Company”), designs, sources, markets, licenses and distributes a broad line of intimate apparel, sportswear and swimwear products worldwide. The Company’s products are sold under several highly recognized brand names, including, but not limited to, Calvin Klein®, Speedo®, Chaps®, Warner’s® and Olga®.

The Company’s products are distributed domestically and internationally, primarily to wholesale customers through various distribution channels, including major department stores, independent retailers, chain stores, membership clubs, specialty, off-price and other stores, mass merchandisers and the internet. In addition, the Company distributes its branded products through dedicated retail stores, and as of December 31, 2011, the Company operated 1,759 Calvin Klein retail stores worldwide (consisting of 263 full price free-standing stores, 118 outlet free-standing stores, 1,376 shop-in-shop/concession stores and, in the United States of America or ” U.S.”, two on-line stores: Calvinkleinjeans.com, and CKU.com) and one on- line swimwear store SpeedoUSA.com. There were also 615 Calvin Klein retail stores operated by third parties under retail licenses or franchise and distributor agreements. For the fiscal year ended December 31, 2011 (“Fiscal 2011”), approximately 40.3% of the Company’s net revenues were generated from domestic sales and approximately 59.7% were generated from international sales. In addition, approximately 71.1% of net revenues were generated from sales to customers in the wholesale channel and approximately 28.9% of net revenues were generated from customers in the direct-to-consumer channel.

The Company owns and licenses a portfolio of highly recognized brand names. The trademarks owned or licensed in perpetuity by the Company generated approximately 47% of the Company’s net revenues during Fiscal 2011. Brand names the Company licenses for a term generated approximately 53% of its revenues during Fiscal 2011. Owned brand names and brand names licensed for extended periods (at least through 2044) accounted for over 90% of the Company’s net revenues in Fiscal 2011. The Company’s highly recognized brand names have been established in their respective markets for extended periods and have attained a high level of consumer awareness.

The following table sets forth the Company’s trademarks and licenses as of December 31, 2011:

Owned Trademarks

Calvin Klein and formatives (beneficially owned for men’s/ women’s/children’s underwear, loungewear and sleepwear: see “Trademarks and Licensing Agreements”) Warner’s Olga Body Nancy Ganz®/Bodyslimmers®

Trademarks Licensed in Perpetuity Trademark Territory

Speedo (a) United States, Canada, Mexico, Caribbean Islands Fastskin® (secondary Speedo mark) United States, Canada, Mexico, Caribbean Islands

Trademarks Licensed for a Term Trademark Territory Expires(h)

Calvin Klein Jeans and CK/Calvin Klein Jeans North, South and Central America 12/31/2044 (for men’s/women’s/children’s/juniors’/infants’/toddlers’ jeans and certain jeans-related products) (b)

Calvin Klein Jeans and CK/Calvin Klein Jeans Canada, Mexico and Central and South America 12/31/2044 (for retail stores selling men’s/women’s/juniors’/children’s/infants’/toddlers’ jeans and certain jeans-related products and ancillary products bearing the Calvin Klein marks) (b)

CK/Calvin Klein (for men’s and women’s bridge apparel) All countries constituting European Union, 12/31/2046 (c) Norway, Switzerland Monte Carlo, Vatican City, Liechtenstein, Iceland and parts of Eastern Europe, Russia, Middle East, Africa, India, Central and South America 1