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responsibilities and standards. The Company regularly monitors developments in the area of corporate
governance. Copies of the Company's Corporate Governance Guidelines can be obtained free of charge from the
Company's web site, www.fossil.com, by contacting the Company at the address appearing on the first page of
this proxy statement to the attention of Investor Relations, or by telephone at (972) 234-2525.
Director Independence
The standards relied upon by the Board of Directors in affirmatively determining whether a director is
"independent" in compliance with the rules of the Nasdaq are comprised, in part, of those objective standards set
forth in the Nasdaq Marketplace Rules, which include the following bright line rules: (a) a director who is or was
at any time during the past three years an employee, or whose immediate family member (defined as a spouse,
parent, child, sibling, whether by blood, marriage or adoption, and anyone sharing the director's home) is or was
at any time during the past three years an executive officer of the Company, would not be independent; (b) a
director who received, or whose immediate family member received, from the Company compensation of more
than $120,000 during any twelve consecutive months within the three years preceding the determination of
independence, except for certain permitted payments, would not be independent; (c) a director who is or who has
an immediate family member who is, a current partner of the Company's outside auditor or who was, or who has
an immediate family member who was, a partner or employee of the Company's outside auditor who worked on
the Company's audit at any time during any of the past three years would not be independent; (d) a director who
is, or whose immediate family member is, employed as an executive officer of another entity where at any time
during the past three years any of the Company's executive officers served on the compensation committee
would not be independent; and (e) a director who is, or who has an immediate family member who is, a partner
in, or a controlling shareholder or an executive officer of any organization that, in the current or any of the past
three fiscal years, has made payments to, or received payments from, the Company for property or services in an
amount that, in any single fiscal year, exceeds the greater of $200,000, or 5% of such recipient's consolidated
gross revenues, would not be independent.
The Board of Directors, in applying the above-referenced standards, has affirmatively determined that our
current directors Elaine Agather, Jeffrey N. Boyer, Gary Kusin, Diane Neal, Elysia Holt Ragusa, James E.
Skinner, Michael Steinberg, Donald J. Stone and James M. Zimmerman are "independent." As part of the
Board's process in making such determination, each such director provided written assurances that all of the
above-cited objective criteria for independence are satisfied and such director has no other "material
relationship" with the Company that could interfere with such director's ability to exercise independent
judgment.
Board Leadership Structure
The Board is committed to promoting effective, independent governance of the Company. The Board
strongly believes it is in the best interests of the stockholders and the Company for the Board to have the
flexibility to select the best director to serve as chairman at any given time, regardless of whether that director is
an independent director or the chief executive officer. Consequently, our Corporate Governance Guidelines allow
the Board to determine whether to separate or combine the roles of the chairman and chief executive officer.
To help ensure the independence of the Board, our Corporate Governance Guidelines require that, when the
chairman is a member of management, an independent director shall also act as a Lead Independent Director. The
Lead Independent Director presides over all executive sessions of the non-management directors and other
meetings of the Board in the absence of the chairman of the Board, serves as the principal liaison to the
non-management directors and consults with the chairman of the Board regarding information to be sent to the
Board, meeting agendas and establishing meeting schedules. In order to give a significant voice to our
non-management directors, our Corporate Governance Guidelines also provide that the non-management
directors of the Company meet regularly in executive session. The Company's independent directors held four
formal meetings without management during fiscal 2011.
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