SECURITIES AND EXCHANGE COMISSION
Washington, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1995
Commission file number: 0-19848
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
Fossil, Inc. Savings and Retirement Plan
B. Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office:
FOSSIL, INC.
2280 N. Greenville
Richardson, Texas 75082
REQUIRED INFORMATION
The following financial statements shall be furnished for the plan:
1. An audited statement of financial condition as of the end of the latest
two fiscal years of the plan (or such lesser period as the plan has been in
existence).
2. An audited statement of income and changes in plan equity for each of
the latest three fiscal years of the plan (or such lesser period as the plan has
been in existence).
3. The statements required by Items 1 and 2 shall be prepared in accordance
with the applicable provisions of Article 6A of Regulation S-X (17 CFR
210.6A-01-6A-05).
4. In lieu of the requirements of Item 1-3 above, plans subject to ERISA
may file plan financial statements and schedules prepared in accordance with the
financial reporting requirements of ERISA. To the extent required by ERISA, the
plan financial statements shall be examined by an independent accountant, except
the the "limited scope exemption" contained in Section 103(a)(3)(C) of ERISA
shall not be available.
Note: A written consent of the accountant is required with respect to the
plan annual financial statements which have been incorporated by reference in a
registration statement on Form S-8 under the Securities Act of 1933. The consent
should be filed as an exhibit to this annual report. Such consent shall be
currently dated and manually signed.
<PAGE>
Fossil, Inc. Savings and Retirement Plan
----------------------------------------
Financial Statements as of and for the Years Ended
December 31, 1995 and 1994, Supplemental Schedules
as of December 31, 1995, and for the year then ended
and Independent Auditors' Report
<PAGE>
FOSSIL, INC. SAVINGS AND RETIREMENT PLAN
Pages
Independent Auditors' Report 2
Financial Statements:
Statements of Net Assets Available for Benefits as
of December 31, 1995 and 1994 3
Statements of Changes in Net Assets Available for
Benefits for the Years Ended December 31, 1995 and
1994 4-5
Notes to Financial Statements 6-10
Supplemental Schedules:
Item 27a - Schedule of Assets Held for Investment
Purposes as of December 31, 1995 11
Item 27d - Schedule of Reportable Transactions for the
Year ended December 31, 1995 12
Independent Auditors' Consent 13
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Advisory Committee
Fossil, Inc.
We have audited the accompanying statements of net assets available for benefits
of the Fossil, Inc. Savings and Retirement Plan (the "Plan") as of December 31,
1995 and 1994, and the related statements of changes in net assets available for
benefits for the years then ended. These financial statements are the
responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted accounting
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan at December 31, 1995
and 1994, and the changes in net assets available for benefits for the years
then ended, in conformity with generally accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental information by fund is
presented for the purpose of additional analysis of the basic financial
statements rather than to present information regarding the net assets available
for benefits and changes in net assets available for benefits of the individual
funds, and the accompanying supplemental schedules of (1) assets held for
investment purposes at December 31, 1995, and (2) reportable transactions for
the year ended December 31, 1995, and are presented for the purpose of
additional analysis and are not a required part of the basic financial
statements. The supplemental schedules are required by the Department of Labor's
Rules and Regulations for Reporting and Disclosure under the Employee Retirement
Income Security Act of 1974. The supplemental information and schedules are the
responsibility of the Plan's management. Such supplemental information and
schedules have been subjected to the auditing procedures applied in our audit of
the basic financial statements and, in our opinion, are fairly stated in all
material respects when considered in relation to the basic financial statements
taken as a whole.
/s/Deloitte & Touche LLP
July 11, 1996
<PAGE>
FOSSIL, INC. SAVINGS AND RETIREMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
December 31,
1995 1994
---- ----
<S> <C> <C>
ASSETS
Investments, at Fair
Value
Fidelity Mutual Funds:
Retirement Gov't Money Market Fund $ 164,358 $199,715
Intermediate Bond Fund 68,671 46,491
Growth and Income Fund 506,666 259,639
Blue Chip Growth Fund 686,429 315,736
Fossil Common Stock 114,730 101,469
------- -------
NET ASSETS AVAILABLE FOR BENEFITS $1,540,854 $923,050
========== ========
</TABLE>
See notes to financial statements.
-3-
<PAGE>
FOSSIL, INC. SAVINGS & RETIREMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<CAPTION>
=========================================================================
SUPPLEMENTAL INFORMATION BY FUND
=========================================================================
Retirement
Government Growth Blue Chip Fossil
Money Intermediate and Income Growth Common
Market Fund Bond Fund Fund Fund Stock Total
=========================================================================
<S> <C> <C> <C> <C> <C> <C>
Net Assets Available for
Benefits, December 31, 1994 $199,715 $46,491 $259,639 $315,736 $101,469 $923,050
-------- ------- -------- -------- -------- --------
Investment Income:
Net Appreciation/(Depreciation)
in Fair Value of Investments - 3,192 89,337 65,921 (59,278) 99,172
Interest and Dividends 11,161 3,669 22,532 51,555 7 88,924
------ ----- ------ ------ - ------
11,161 6,861 111,869 117,476 (59,271) 188,096
------ ----- ------- ------- ------- -------
Additions:
Rollover Transfers 3,239 4,164 8,720 32,930 7,612 56,665
Contributions:
Employer 13,092 7,160 30,805 39,698 17,418 108,173
Employee 33,945 21,320 82,838 120,750 51,449 310,302
------ ------ ------ ------- ------ -------
Total Contributions 47,037 28,480 113,643 160,448 68,867 418,475
------ ------ ------- ------- ------ -------
Total Additions 50,276 32,644 122,363 193,378 76,479 475,140
------ ------ ------- ------- ------ -------
Deductions:
Benefits Paid (3,716) (3,677) (7,863) (24,946) (5,275) (45,477)
Transfers Within Funds/
Forfeitures Released (93,078) (13,648) 20,658 84,785 1,328 45
------- ------- ------ ------ ----- --
(96,794) (17,325) 12,795 59,839 (3,947) (45,432)
------- ------- ------ ------ ------ -------
Net Assets Available for
Benefits,
December 31, 1995 $164,358 $68,671 $506,666 $686,429 $114,730 $1,540,854
======== ======= ======== ======== ======== ==========
</TABLE>
See notes to financial statements.
-4-
<PAGE>
FOSSIL, INC. SAVINGS & RETIREMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1994
<TABLE>
<CAPTION>
=========================================================================
SUPPLEMENTAL INFORMATION BY FUND
=========================================================================
Retirement
Government Growth Blue Chip Fossil
Money Intermediate and Income Growth Common
Market Fund Bond Fund Fund Fund Stock Total
=========================================================================
<S> <C> <C> <C> <C> <C> <C>
Net Assets Available for
Benefits,
December 31, 1993 $68,237 $47,297 $144,729 $134,598 $57,289 $452,150
------- ------- -------- -------- ------- --------
Investment Income:
Net Appreciation/(Depreciation)
in Fair Value of Investments - (4,524) (14,948) 11,569 (52,668) (60,571)
Interest and Dividends 4,635 3,424 17,098 6,623 6 31,786
----- ----- ------ ----- - ------
4,635 (1,100) 2,150 18,192 (52,662) (28,785)
----- ------ ----- ------ ------- -------
Additions:
Rollover Transfers 126,383 1,303 44,543 58,153 38,402 268,784
Contributions:
Employer 6,017 4,520 16,119 20,982 9,621 57,259
Employee 20,670 15,807 64,792 76,756 34,809 212,834
------ ------ ------ ------ ------ -------
Total Contributions 26,687 20,327 80,911 97,738 44,430 270,093
------ ------ ------ ------ ------ -------
Total 153,070 21,630 125,454 155,891 82,832 538,877
------- ------ ------- ------- ------ -------
Additions
Deductions:
Benefits (6,961) (10,895) (10,068) (10,843) (425) (39,192)
Paid
Transfers Within Funds/Forfeitures (19,266) (10,441) (2,626) 17,898 14,435
------- ------- ------ ------ ------
Released (26,227) (21,336) (12,694) 7,055 14,010 (39,192)
------- ------- ------- ----- ------ -------
Net Assets Available for
Benefits,
December 31, 1994 $199,715 $46,491 $259,639 $315,736 $101,469 $923,050
======== ======= ======== ======== ======== ========
</TABLE>
See notes to financial statements.
-5-
<PAGE>
FOSSIL, INC. SAVINGS AND RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1995 AND 1994
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING: The accounting records of the Fossil, Inc. Savings and
Retirement Plan (the "Plan"), sponsored by Fossil, Inc. ("Fossil"), are
maintained on the accrual basis of accounting.
INVESTMENTS: Investments are presented in the financial statements at fair value
determined by quoted market prices at the close of business on December 31. The
change in the difference between fair value and the cost of investments,
including realized gains or losses, is reflected in the statement of changes in
net assets available for benefits as net appreciation (depreciation) in fair
value of investments during the year. Interest and dividend income is recorded
on an accrual basis.
EXPENSES: Expenses incurred by the Plan are paid by Fossil.
NOTE 2 - DESCRIPTION OF THE PLAN
The following brief description of the Plan provides only general information.
Participants should refer to the plan document for a more complete description
of the Plan's provisions.
PLAN ORGANIZATION, AMENDMENTS AND GENERAL PROVISIONS: The Plan is a defined
contribution plan covering eligible employees of Fossil. The purpose of the Plan
is to encourage employees to accumulate savings for their retirement. The Plan
is administered by Fossil.
The Plan is subject to the provisions of the Employee Retirement Income Security
Act of 1974 ("ERISA").
CONTRIBUTIONS AND VESTING: The Plan is qualified under Section 401(k) of the
Internal Revenue Code (the "Code"). Employees are eligible to make
contributions, after having been employed by Fossil for at least 12 months, from
amounts subject to income tax and such amounts are characterized as salary
deferral contributions by Fossil. The maximum salary deferral contribution is
the lesser of 15% of gross pay or, according to the Code, $9,240 for 1995 and
1994. The Plan document provides for limitations on salary deferral
contributions in the event of a hardship withdrawal. Fossil generally makes a
matching contribution at the rate of 50% of the first 3% and 25% of the next 3%
of the participant's salary deferral contribution. Fossil may also make
additional profit sharing contributions at the discretion of the Plan's Advisory
Committee. No such additional discretionary contributions were made during the
years ended December 31, 1995 or 1994. Vesting in salary deferral contributions
is 100%. Vesting in matching contributions is 20% per year of service. An
employee is credited with a year of service when 1000 actual hours of service
have been attained during a plan year (the 12 consecutive month period ending
December 31).
-6-
<PAGE>
NOTE 2 - DESCRIPTION OF THE PLAN (CON'T)
Currently, participants can elect to have their contributions invested in any of
several investment options which are described in Note 3. The participant can
change elections and can also reallocate those funds already invested between
available investment options quarterly. The Plan also allows rollover transfers
from other qualified plans. The Plan limits the participants purchase of Fossil
Common Stock to 25% of deferral contributions and in the case of a rollover or
transfer up to 25% of the participants total balance may be allocated to Fossil
Common Stock.
In addition, hardship withdrawals for certain expenses including medical,
tuition, funeral, purchase of or possible eviction from a primary residence, and
the participant's disability are permitted.
Forfeitures of nonvested employer contribution account balances are generally
reallocated each year to the remaining participants based upon the participants
matching contribution for that quarter. The plan additionally allows for
forfeitures to be used to lower future employer contributions.
DISTRIBUTION OF BENEFITS: Distributions of vested benefits may be made to a
participant upon retirement, disability, death or termination of employment.
Prior to age 65, a participant, while employed, may make a withdrawal from his
salary deferral contributions account in the event that the participant has an
immediate and substantial financial need, as defined in Section 401(k) of the
Code, subject to certain conditions contained in the Plan document.
Distributions of vested benefits under the Plan are paid to the participant or a
beneficiary in the form of a lump sum or partial distribution.
Any withdrawals from the Plan will generally be subject to federal income tax.
Taxes may be postponed by "rolling over" the proceeds to an individual
retirement plan or to another qualified plan. An additional 10% excise tax may
be imposed on the taxable portion of distributions and withdrawals before
attaining age 65. The additional tax is not imposed for distributions on death,
disability, termination of employment after age 59 1/2, pursuant to a qualified
domestic order, and for other reasons enumerated in the Code.
AMENDMENT OR TERMINATION: Fossil has reserved the right to amend, modify or
terminate the Plan at any time, subject to the Plan document and applicable laws
and regulations. Fossil has no intentions of terminating the Plan nor is aware
of any occurrences that could result in the termination of the Plan.
-7-
<PAGE>
NOTE 3 - PLAN INVESTMENTS
The Plan's investments are held by Fidelity Institutional Retirement Services
Company (several of Fidelity's mutual funds) and Montgomery Securities (Fossil
Common Stock). The initial purchase of Fossil Common Stock by the Plan was
through a stock issuance by Fossil and is in the Plan's name and on record at
the transfer agent.
FIDELITY RETIREMENT GOVERNMENT MONEY MARKET FUND - A money market fund which
seeks as high a level of current income as is consistent with the preservation
of capital and liquidity by investing in U.S. government and its agencies
obligations.
FIDELITY INTERMEDIATE BOND FUND - A fund which seeks a high level of income by
investing in high quality, fixed income obligations with a dollar weighted
average portfolio maturing in three to five years.
FIDELITY GROWTH AND INCOME FUND - A fund which seeks long-term capital growth,
current income and growth of income consistent with reasonable investment risk
by investing in securities of companies that offer growth of earnings potential
while paying current dividends. Invests in any combination of common stock,
convertible securities, preferred stock, and corporate bonds. Securities may be
of foreign and domestic issuers.
FIDELITY BLUE CHIP GROWTH FUND - A fund which seeks growth of capital over the
long term by investing primarily in a diversified portfolio of common stocks of
well-known and established companies with at least 65% of these securities
issued by "blue-chip" companies.
FOSSIL COMMON STOCK - A fund which invests in the common stock of Fossil.
-8-
<PAGE>
December 31, 1995
Number of Number of
Plan Units Held
Participants in
Unit with Participant Fair
Fund Valuation Balances Accounts Value
---- --------- -------- -------- -----
Fidelity Mutual Funds:
Retirement Gov't $ 1.00 86 164,358 $164,358
Money Mkt
Intermediate Bond 10.41 87 6,597 68,671
Growth and Income 27.05 143 18,731 506,666
Blue Chip 30.77 160 22,308 686,429
Fossil Common Stock 8.38 123 13,699 114,730
===========================================================================
December 31, 1994
Number of Number of
Plan Units Held
Participants in
Unit with Participant Fair
Fund Valuation Balances Accounts Value
---- --------- -------- -------- -----
Fidelity Mutual Funds:
Retirement Gov't $ 1.00 44 199,715 $199,715
Money Mkt
Intermediate Bond 9.83 44 4,729 46,491
Growth and Income 21.09 84 12,311 259,639
Blue Chip 25.95 86 12,167 315,736
Fossil Common Stock 13.13 75 7,731 101,469
-9-
<PAGE>
NOTE 4 - INCOME TAX STATUS
The Internal Revenue Service has issued a determination letter that the Plan
qualifies under 401a of the Internal Revenue Code of 1986, as amended, and is
exempt from federal income tax under section 501a thereof.
Elective contributions made by participants, matching employer contributions,
interest, dividends and profit from the sale of securities need not be reported
by participants for federal income tax purposes until their account is withdrawn
or distributed, wholly or partially.
NOTE 5 - NET APPRECIATION IN FAIR VALUE OF INVESTMENTS
The following table details the net change in fair value by type of investment:
================================================================================
1995 1994
---- ----
Fidelity Mutual Funds $158,450 $ (7,903)
Fossil Common Stock (59,278) (52,668)
--------- ----------
Net appreciation/(depreciation)
in fair value of investments $ 99,172 $ (60,571)
======== ==========
NOTE 6 - WITHDRAWALS
Net assets available for Plan benefits at December 31, 1995 and 1994 included
$7,883 and $3,254, respectively, primarily for participants who have withdrawn
from the Plan.
-10-
<PAGE>
FOSSIL, INC. SAVINGS AND RETIREMENT PLAN
Item 27a - Schedule of Assets Held for Investment Purposes
December 31, 1995
Identity of Current
issue Description of investment Cost Value
- - --------------- ---------------------------- ---------- ----------
Fidelity Mutual Retirement Government Money
Market Fund $164,358 $164,358
Fidelity Mutual Intermediate Bond Fund 68,851 68,671
Fidelity Mutual Growth and Income Fund 425,436 506,666
Fidelity Mutual Blue Chip Growth Fund 608,106 686,429
Fossil, Inc. Common Stock $.01 par 204,302 114,730
-11-
<PAGE>
FOSSIL, INC. SAVINGS AND RETIREMENT PLAN
Item 27d - Schedule of Reportable
Transactions
Year Ended December 31, 1995
<TABLE>
<CAPTION>
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Identity of Description of asset Purchase Selling Lease Expense Cost Current value Net gain
party involved Price Price Rental incurred with of asset of asset on or(loss)
transaction transaction date
- - ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Series
Fidelity Mutual Retirement Government
Money Market Fund $ 55,211 $ 90,552 - - $ 90,552 $ 90,552 $ 0
Fidelity Mutual Intermediate Bond Fund 33,016 14,863 - - 14,392 14,863 471
Fidelity Mutual Growth and Income Fund 173,378 15,553 - - 13,996 15,553 1,557
Fidelity Mutual Blue Chip Growth Fund 330,458 24,946 - - 20,411 24,946 4,535
Fossil, Inc. Common Stock $.01 par 89,157 14,374 - - 7,822 14,374 6,552
Single
Fidelity Mutual Blue Chip Growth Fund 53,070 - - - - - -
</TABLE>
-12-
<PAGE>
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement No.
33-65980 of Fossil, Inc. on Form S-8 of our report dated July 11, 1996, included
in this Annual Report on Form 11-K of the Fossil, Inc. Savings and Retirement
Plan for the year ended December 31, 1995.
/s/Deloitte & Touche LLP
Dallas, Texas
July 11, 1996
-13-
<PAGE>
SIGNATURES
The Plan. Pursuant to the requirements of Securities Exchange Act of 1934,
the Advisory Committee which administers the Plan has duly caused this annual
report to be signed on its behalf by the undersigned, thereunto duly authorized
in the City of Dallas, State of Texas, on July 11, 1996.
FOSSIL, INC. SAVINGS AND RETIREMENT PLAN
/s/ Randy S. Kercho
Randy S. Kercho, Member of the Advisory Committee
Pursuant to the requirements of the Securities Exchange Act of 1934, this
annual report has been signed below by the following persons in their capacities
as members of the Advisory Committee of the Fossil, Inc. Savings and Retirement
Plan and on the dates indicated.
Signature Date
- - --------- ----
/s/ Randy S. Kercho July 11, 1996
- - -------------------
Randy S. Kercho
/s/Monica Nicholson
- - ------------------- July 11, 1996
Monica Nicholson
/s/ Michael W. Barnes July 11, 1996
- - ---------------------
Michael W. Barnes
-14-
<PAGE>
Exhibit Index
Exhibit Page
Number Document Description Number
- - ------ -------------------- ------
23(b) Consent of Deloitte & Touche 17
-15-
Exhibit 23(b)
<PAGE>
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration No. 33-65980 of
Fossil, Inc.on Form S-8 of our report dated July 11,1996, appearing in this
Annual Report on Form 11-K of the Fossil, Inc. Savings and Retirement Plan for
the year ended December 31, 1995.
/s/Deloitte & Touche LLP
Dallas, Texas
July 11, 1996
