Fossil Acquires Its Distributor in the UK

Business Wire, Sept 21, 1999

RICHARDSON, Texas--(BUSINESS WIRE)--Sept. 21, 1999--

Fossil, Inc. (Nasdaq NMS:FOSL) announced today that its wholly-owned subsidiary in the United Kingdom ("Fossil UK") has acquired certain assets from a distributor of FOSSIL brand products also serving the United Kingdom ("UK") and Ireland. The total acquisition cost, including contract termination costs, was approximately $2.7 million. This acquisition fully re-establishes the Company as the sole distributor of its products in the UK and Ireland.

Approximately two years ago, the Company signed a three year international marketing and distribution agreement with Junghans Uhren GmbH ("Junghans") to assist the Company in its efforts to establish the FOSSIL brand name in the UK. Over the past two years, the Company's FOSSIL brand and licensed EMPORIO ARMANI brand of watches have significantly increased in brand name awareness within the UK. In fact, the EMPORIO ARMANI brand watches received the coveted Fashion Watch Brand of the Year Award in 1999 at the UK Jewelry Awards Ceremony.

Junghans is best known for their solar powered radio controlled wristwatches that show the exact time based on the Caesium Atomic Clock in Brunswick, Germany. With their extensive range of watches and clocks, Junghans had well established relationships with department stores, jewelry chains and catalog distribution channels throughout the UK and Ireland. These valuable relationships were key elements in helping Fossil UK build the FOSSIL and EMPORIO ARMANI brands in the UK.

"Junghans did a wonderful job in accelerating the establishment of the Company's brands in the UK", said Randy Kercho, Fossil's Chief Financial Officer. "With the continuing unification of Europe, we felt it was the opportune time to take back full control of our product distribution within the UK. Fortunately, the key members of the Junghans UK team will transfer to Fossil UK so we won't miss a beat in Fossil UK's continuing development of the market", added Mr. Kercho.

Certain statements contained herein that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve unknown risks and uncertainties which may cause actual results in future periods or plans for future periods to differ from what is currently anticipated. Those risks include, among others, general economic conditions, competition, political and economic instability, failure to obtain necessary consents or regulatory approvals and the risk that the parties fail to successfully negotiate and execute the definitive agreements.

Fossil is a design and marketing company that specializes in consumer products predicated on fashion and value. In addition to developing its own brands, FOSSIL and RELIC, the Company leverages its development and production expertise by designing and manufacturing private label and licensed products for some of the most prestigious companies in the world. FOSSIL brand products can be found in department stores and other upscale retailers in over eighty countries around the world. Visit the Company's Web site at www.FOSSIL.com for more information.