SANTA FE SPRINGS, Calif.–March 6, 2000–Vans, Inc. (Nasdaq: VANS) announced that it has signed three-year extensions of its footwear and apparel license agreements with International Trading Corporation of Japan (“ITC”) which over the three-year period will increase minimum royalty fees from ITC for Japan to more than $12.0 million.(1) ITC has also been granted a license for Korea, Hong Kong, and Taiwan.
Gary H. Schoenfeld, President and CEO, commented, “Over the past few years, ITC has become one of the leading distributors and retailers of footwear and related accessories in Japan. Even during the prolonged economic slow down in Japan our brand has continued to strengthen, and we believe our new agreements will enable us to leverage our success into other parts of Asia.”(1) Mr. Masahiro Miki, President of ITC, said, “Vans has emerged as one of the leading lifestyle brands in the world, and we are excited to continue our relationship and further the growth of Vans in the Far East. We are committed to the future of Vans, and in that regard have purchased nearly 400,000 shares of the Company’s common stock.” ITC has granted Vans an irrevocable proxy to vote ITC’s shares for the length of the agreements and has executed a standstill agreement up to a maximum 20% ownership for the same period of time.
Under the terms of the agreements, ITC will have the Vans footwear license, including sandals in Japan, with added territories of Korea, Taiwan, and Hong Kong. ITC will also have the license for Vans apparel in Japan and will be the distributor for Vans snowboard boots in Japan. The new agreements will begin June 1, 2000, and the new royalty minimums, at more than $4.0 million annually, are expected to provide a more significant and consistent base income stream with the potential for substantial future growth above the minimums.(1) Mr. Schoenfeld concluded, “Our strong momentum continues, as evidenced by the very positive response we received at the recent Western Shoe Association tradeshow in Las Vegas and at ISPO in Munich. The strength of the VANS brand continues to grow around the world and we look forward to capitalizing on the opportunities that lie ahead.”(2) Vans, Inc. is a leading branded lifestyle company for the youth market. Vans reaches its 10 to 24 year-old target consumers through the sponsorship of Core Sports,(TM) such as skateboarding, snowboarding, surfing and wakeboarding, and through major entertainment events and venues, such as the VANS Triple Crown(TM) Series, the VANS Warped Tour,(TM) the VANS World Amateur Skateboarding Championships, the world’s largest VANS skateparks, and the High Cascade Snowboard Camp.(TM) The Company operates 128 stores in the U.S. and Europe, and designs, markets and distributes worldwide active-lifestyle footwear, clothing and accessories, performance footwear for Core Sports,(TM) snowboard boots, step-in bindings, and snowboarding outerwear. Vans’ Internet address is www.vans.com.