LOS ANGELES and RICHARDSON, Texas, Aug. 26 /PRNewswire-FirstCall/ -- Guess?, Inc. (NYSE: GES) and Fossil, Inc. (Nasdaq: FOSL) announced today that they are in advanced negotiations for a 10-year global license agreement with an option to renew whereby Fossil would produce and distribute Guess and Guess Collection watches beginning in January 2007.

This agreement would create a powerful partnership between Guess and Fossil. Fossil plans to form a separate company for the Guess business and utilize Fossil's worldwide network to expand the distribution of Guess and Guess Collection watches globally. Current worldwide wholesale sales of Guess and Guess Collection watches are approximately $150 million. The parties plan to base minimum royalties on wholesale sales of $1.36 billion for the initial 10-year term.

"We are very excited about this proposed partnership with Guess," stated Kosta Kartsotis, Fossil's President and CEO. "Guess is a unique global brand with a great heritage and is positioned for substantial long-term growth throughout the world. Guess also has a great history of leadership in the watch business and we are looking forward to expanding the business even further. We anticipate that the agreement will be finalized in the next week."

"Since the inception of the licensed Guess watch business 21 years ago, we have been closely involved in product development with the Callanen organization, a subsidiary of Timex, and plan to continue to be very involved with Fossil," said Paul Marciano, Co-Chairman and Co-CEO of Guess?, Inc. "We want to thank the Callanen team for their contributions to the growth of the Guess watch business. We are confident that our proposed partnership with Fossil will be a strong one and should contribute to the further expansion of the business both domestically and internationally."

Guess?, Inc. designs, markets, distributes and licenses a lifestyle collection of contemporary apparel, accessories and related consumer products. At July 30, 2005 Guess owned and operated 302 retail stores in the United States and Canada. Guess also distributes its products through better department and specialty stores around the world. For more information about Guess, please visit www.guess.com.

Except for historical information contained herein, certain matters discussed in this press release are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are only expectations, and involve known and unknown risks and uncertainties, which may cause actual results in future periods and other future events to differ materially from what is currently anticipated. Factors which may cause actual results in future periods to differ from current expectations include, among other things, the failure of Guess and Fossil to enter into a definitive global license agreement as currently anticipated, the continued desirability and customer acceptance of existing and future product lines (including watches and other licensed product lines), the continued availability of sufficient working capital, the successful integration of acquisitions, new stores and new licensees into existing operations, possible cancellations of wholesale orders, the success of competitive products, the availability of adequate sources of capital, general economic conditions, competition, acts of terrorism or acts of war, government regulation, currency fluctuations and possible future litigation. In addition to these factors, the economic and other factors identified in each Company's most recent annual report on Form 10-K and other filings with the Securities and Exchange Commission, including but not limited to the risk factors discussed therein, could affect the forward-looking statements contained herein and in each Company's other public documents.

Fossil, Inc. is a design, development, marketing and distribution company that specializes in consumer products predicated on fashion and value. Fossil's principal offerings include an extensive line of fashion watches sold under Fossil's proprietary and licensed brands. Fossil also offers complementary lines of small leather goods, belts, handbags, sunglasses, jewelry and apparel. Fossil's products are sold in department stores and specialty retail stores in over 90 countries around the world, in addition to Fossil's e-commerce website at www.fossil.com. Certain product, press release and SEC filing information concerning Fossil is available at the website.

Certain statements contained herein that are not historical facts constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and involve a number of risks and uncertainties. The actual results of the future events described in such forward-looking statements could differ materially from those stated in such forward-looking statements. Among the factors that could cause actual results to differ materially are: the failure of Guess and Fossil to enter into a definitive global license agreement as currently anticipated, general economic conditions, competition, acts of terrorism or acts of war, government regulation, changes in foreign currency valuations in relation to the United States Dollar and possible future litigation, as well as the risks and uncertainties set forth in the Company's Current Report on Form 8-K dated September 14, 2004 and the Company's Form 10-K and Form 10-Q reports filed with the Securities and Exchange Commission.

SOURCE  Guess?, Inc.; Fossil, Inc.
    -0-                             08/26/2005
    /CONTACT:  Carlos Alberini, President & Chief Operating Officer of Guess?,
Inc., +1-213-765-3582; or Mike Kovar, Chief Financial Officer of Fossil, Inc.,
+1-972-699-2229/
    /Web site:  http://www.fossil.com
                http://www.guess.com /
    (GES FOSL)

CO:  Guess?, Inc.; Fossil, Inc.
ST:  California, Texas
IN:  FAS TEX REA
SU:  LIC

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8965 08/26/2005 09:00 EDT http://www.prnewswire.com