Swatch CEO

SWATCH GROUP U.S.
September 8, 2011
Mr. Andre Fleury
Swiss Watch Company, LLC
1050 Northgate Drive Suite 230
San Rafael, CA 94903

Dear Mr. Fleury,

Your e-mail addressed to our headquarters in Switzerland has been forwarded to me for reply. I can assure you that your comments have been carefully considered with our management and our legal department.
We put our Service Provider Training Program in place in October 2010 for the purpose of protecting the goodwill of the Swatch Group brand names. With this purpose in mind the program allows us to assess the skills of all watchmakers who have, or desire, parts purchasing privileges for the applicable brands of
our Group. The Program provides these watchmakers with the latest training techniques and skills to best service the customers and products of our Group.

The response to this training program has been overwhelmingly positive from other watchmakers, who like yourself, have been in the industry for many years.

Our industry has a long history of evolving technology, and we have an obligation to the owners of Swatch Group manufactured watches to ensure a proper distribution of after sales serice components. This is why we only provide spare parts to watchmakers (and/or the companies they work for) that have the proper equipment, as well as techniques to match the technical specifications required of the movements and other components of our watches.

I hope that you will share our concerns for our brand names and decide to enroll in one of the Service Provider Trainings that we offer so we may continue our relationship of spare parts distribution to your company.

As noted in prior correspondence with Mr. Foster, who has correctly set out our requirements, these trainings are offered on an almost weekly basis in one of our regional service centers at no cost for the training segment; only transportation and/or boarding costs need to be borne by the participant.

Caroline Faivet
President & CEO
The Swatch Group (U.S.) Inc.

THE SWATCH GROUP (U.S.) INC.
1200 Harbor Boulevard, Weehawken, NJ 07086 . Telephone 201-271-1400 . Telefax: 201-558-5042