Oakley Agrees to Acquire The Optical Shop of Aspen: 14 Retail Locations Cater to Luxury Eyewear Market
FOOTHILL RANCH, Calif., March 14, 2006 (PRIMEZONE) --

Oakley, Inc. (NYSE:OO) today announced it has signed a definitive agreement to acquire all of the outstanding stock of privately held OSA Holding, Inc. and its wholly owned subsidiary, The Optical Shop of Aspen (OSA), one of the world's most respected retailers of luxury eyewear. Included in this acquisition are The Optical Shop of Aspen's 14 retail locations.

"Oakley has established a renewed focus on optics and is implementing strategies to build business platforms for sustainable growth and profitability," said Scott Olivet, chief executive officer, Oakley, Inc. "The Optical Shop of Aspen, along with our recent acquisition of Oliver Peoples, strengthens our premium eyewear platform. In addition, OSA will help build Oakley's prescription eyewear business and further develop the company's retail capabilities."

"OSA is one of the country's most prestigious optical retail chains, known for its unique first-class products and exceptional service," said Cos Lykos, vice president of business development, Oakley, Inc. "This acquisition provides us with direct access to the premium eyewear consumer and we are very excited to add The Optical Shop of Aspen's premier eyewear destinations to our retail lineup."

"For more than 30 years we have cultivated a loyal consumer following based on innovative eyewear collections, outstanding customer service and unique retail environments," said Larry Sands, founder and chief executive officer, The Optical Shop of Aspen. "I am passionate about the success of our business. I care about my employees, their future and the future of this brand. I am confident this partnership will help elevate OSA to new heights and allow us to realize the significant opportunities before us."

The Optical Shop of Aspen currently has 14 retail stores located in Arizona, California, Colorado, Florida, New Mexico and Missouri, and will operate as a wholly owned subsidiary of Oakley, Inc. After the completion of the merger, Sands will continue as chief executive officer of OSA and maintain independent ownership and operation of OSA International, a separate wholesale company.

Specific terms of the agreement were not disclosed. The company expects the acquisition to be closed during the second quarter of 2006. Oakley expects the acquisition to be slightly accretive to earnings in 2006.

About The Optical Shop of Aspen

Headquartered in Aliso Viejo, CA, The Optical Shop of Aspen was founded in 1970 by Larry Sands who sought to define eyewear as a high-end fashion accessory. The Optical Shop of Aspen stocks its stores with innovative, high-end labels such as Cartier, Chanel, Christian Dior, Chrome Hearts, Oakley, Oliver Peoples and Paul Smith. Optical Shop of Aspen International, the company's wholesale division, designs, distributes and owns the licenses to the Blinde, Chrome Hearts, Hiero, Kieselstein-Cord and Matsuda eyewear brands. Under the direction of Optical Shop of Aspen International's in-house design team, each collection pushes the boundaries of technology and style, further bringing the concept of 'luxury' to eyewear. For more information on OSA's retail stores and eyewear collections, please visit http://www.osainternational.com/web/top/index-corp-top.html.

About Oakley, Inc.

Oakley, Inc. designs, manufactures and distributes high-performance sunglasses, prescription lenses and frames, goggles and technology-enabled eyewear that utilize the company's High Definition Optics(r) (HDO(r)), a collective platform of patented technologies that offer unbeatable optical performance. The company also produces technical and active apparel, footwear and accessories. Trailing-12-month net sales through December 31, 2005 totaled US $648.1 million. Oakley, Inc. press releases, SEC filings and the company's annual report are available at investor.oakley.com.

The Oakley, Inc. logo is available at: http://www.primezone.com/newsroom/prs/?pkgid=1533

Safe Harbor Disclaimer

This press release contains certain statements of a forward-looking nature. Such statements are made pursuant to the "forward-looking statements" and "safe harbor" provisions within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Forward-looking statements include, but are limited to growth and strategies, future operating and financial results, financial expectations and current business indicators and typically identified by the use of terms such as "look," "may," "will," "should," "might," "believe," "plan," "expect," "anticipate," "estimate" and similar words, although some forward-looking statements are expressed differently. The accuracy of such statements may be affected by a number of business risks and uncertainties that could cause actual results to differ materially from those projected or anticipated, including but not limited to: risks related to the successful implementation and operation of the company's multi-branded eyewear growth strategy, the company's ability to optimize manufacturing processes, incorporate Oakley's High Definition Optics and expand the brands into additional international markets; the company's ability to integrate the acquisition and benefit from accretive earnings in 2006; the company's ability to manage rapid growth; risks related to the limited visibility of future sunglass orders associated with the company's "at once" production and fulfillment business model; the ability to identify qualified manufacturing partners; the ability to coordinate product development and production processes with those partners; the ability of those manufacturing partners and the company's internal production operations to increase production volumes on raw materials and finished goods in a timely fashion in response to increasing demand and enable the company to achieve timely delivery of finished goods to its retail customers; the ability to provide adequate fixturing to existing and future retail customers to meet anticipated needs and schedules; the dependence on eyewear sales to Luxottica Group S.p.A, which, as a major competitor, could materially alter or terminate its relationship with the company; the company's ability to expand and grow its distribution channels and its own retail operations; unanticipated changes in general market conditions or other factors, which may result in cancellations of advance orders or a reduction in the rate of reorders placed by retailers; a weakening of economic conditions could continue to reduce demand for products sold by the company and could adversely affect profitability, especially of the company's retail operations; terrorist acts, or the threat thereof, could adversely affect consumer confidence and spending, could interrupt production and distribution of product and raw materials and could, as a result, adversely affect the company's operations and financial performance; the ability of the company to integrate licensing arrangements without adversely affecting operations and the success of such initiatives; the ability to continue to develop and produce innovative new products and introduce them in a timely manner; the acceptance in the marketplace of the company's new products and changes in consumer preferences; reductions in sales of products, either as the result of economic or other conditions or reduced consumer acceptance of a product, could result in a buildup of inventory; the ability to source raw materials and finished products at favorable prices to the company; the potential impact of periodic power crises on the company's operations including temporary blackouts at the company's facilities; foreign currency exchange rate fluctuations; earthquakes or other natural disasters; the company's ability to identify and execute successfully cost control initiatives; and other risks outlined in the company's SEC filings, including but not limited to its Annual Report on Form 10-K for the year ended December 31, 2004, its Quarterly Report on From 10-Q for the quarter ended September 30, 2005 and other filings made periodically by the company. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The company undertakes no obligation to update this forward-looking information, except as it is required to do so by securities laws. Nonetheless, the company reserves the right to make such updates from time to time by press release, periodic report or other method of public disclosure without the need for specific reference to this press release. No such update shall be deemed to indicate that other statements not addressed by such update remain correct or create an obligation to provide any other updates.