Candie's, Inc. Provides Further Detail On Licensing Plan.

Business Editors

NEW YORK--(BUSINESS WIRE)--May 20, 2003

Candie's, Inc. (Nasdaq:CAND) (the "Company") provided additional information today about its new licensing plan following the Company's announcements earlier this month that it had licensed the exclusive right to manufacture, sell and distribute footwear under the CANDIE'S(R) brand to Steven Madden, Ltd. (Nasdaq: SHOO) ("Steve Madden") and under the BONGO(R) brand to Kenneth Cole Productions, Ltd. ("KCP").

With the addition of the Candie's and Bongo footwear licenses, the Company now has granted 14 licenses, five for the Candie's brand for footwear, apparel, fragrance, eyewear and watches, and nine for the Bongo brand for footwear, tops, kids jeans wear, eyewear, handbags, cold weather accessories, swimwear, belts and jewelry. Together these licenses guarantee the Company over $40 million in minimum guaranteed royalty and advertising revenue over the current term of the licenses, not including any renewal terms. These guaranteed amounts do not include any licensing income from CANDIE'S apparel after the end of the license with Gadzooks, Inc., which is exclusive through the end of the fiscal year and terminates in August 2004, and are in addition to the guaranteed minimum income to the Company of $1.7 million guaranteed by Sweet Sportswear LLC ("Sweet"), the third party manager of the BONGO jeans wear business.

Neil Cole, President and CEO stated, "Exciting opportunities for growth still exist with respect to our ability to license or enter into other profitable arrangements for CANDIE'S and BONGO for jeans wear and a variety of other apparel categories. These areas have typically offer significant revenue streams because of the large range of products that can be developed. Consumers already see both the CANDIE'S and BONGO brands as representing cutting edge fashion at competitive prices, which we believe will translate very well into valuable licenses for a variety of products."

The Company believes that the transition from its footwear operating business will be complete by the end of July following shipment of Spring 2003 goods. Both Steve Madden and KCP will commence shipments with the Fall 2003 season. The Company plans to close its Valhalla office by that time and relocate all remaining employees to a smaller office in New York City. The Company anticipates operating the new licensing company initially with no more than 15 employees, with the largest department being the advertising and marketing department. Under all licenses for both CANDIE'S and BONGO, the Company retains full rights to advertise and market the brands and will be collecting guaranteed contributions from its licensees to carry out those functions.

"We believe that the licensing model will allow us to capitalize on our core competencies of marketing and brand development, while substantially reducing our overhead and the risks of inventory management. Under this new plan, we are projecting increased net profits and reduced cash requirements, which will allow the Company to use its cash more strategically and position us for growth and profitability," Mr. Cole stated.

With respect to its retail operations, the Company is planning on closing its 11 concept stores, which have not performed according to expectations. It will continue to operate 10 outlet stores at least through the end of the year. The Company will be able to purchase CANDIE'S footwear from Steven Madden and BONGO footwear from KCP for those stores at discounted prices. As to seven of those stores the Company has no long term lease obligations but operates through a contractual arrangement with Casual Male Retail Group ("CMRG") pursuant to which the Company has the option to return the operations of the stores to CMRG with no additional obligation in February 2004.

The Company will also continue to design and manufacture jeans wear under the BONGO brand through its wholly owned subsidiary, Unzipped Apparel, LLC, which is managed by Sweet. Over the past year, BONGO jeans has grown to a $70 million business and is projecting continued growth in the future.

The Company will continue to own and operate Bright Star Footwear, LLC its wholly owned subsidiary, which arranges for the manufacture of casual and outdoor men's footwear products for mass market and discount retailers under the private label brand of the retailer.

The Company filed its Report on Form 10-K for the year ended January 31, 2003 on May 16, and plans on releasing results for the first quarter of the year ending January 31, 2004 during the second week of June. Additional information about the licensing plan and its anticipated revenues will be included in the conference call for the first quarter results.

About Candie's, Inc.

Candie's, Inc. is in the business of licensing the Candie's and Bongo name on a variety of young women's footwear, apparel and fashion products, and is a leading designer, distributor and marketer of jeans wear under the Bongo brand through its wholly owned subsidiary, Unzipped Apparel, LLC. Candie's also arranges for the manufacture of footwear products for mass market and discount retailers under the private label brand of the retailer or other trademarks owned or licensed by Candie's. The Company operates 21 Candie's retail stores across the United States. For investor information please visit the corporate web site at http://www.candiesinc.com.

Forward-Looking Statement Disclosure

The statements which are not historical facts contained in this press release are forward-looking statements that involve a number of known and unknown risks, uncertainties and other factors all of which are difficult or impossible to predict and many of which are beyond the control of the Company, which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, but are not limited to the risks detailed in the Company's Securities and Exchange Commission filings, and uncertainty associated with the impact on the company in relation to recent events discussed in the Company's form 10-K for fiscal 2003. Readers are cautioned not to place undue reliance on these forward-looking statements.