Gymboree to Support Greater Workplace Monitoring Standards; Company Settles Lawsuits.

BURLINGAME, Calif.--(BUSINESS WIRE)--Aug. 9, 1999--

The Gymboree Corporation (Nasdaq:GYMB) today announced its support for a new monitoring program to protect the welfare of workers in Saipan factories producing clothing for sale in its stores.

Together with UNITE!, an organization representing United States needletrade and textile workers, Global Exchange, Sweatshop Watch, and the Asian Law Caucus, Gymboree has selected Verite, an independent monitoring organization to ensure that factories and housing for workers in Saipan comply with all applicable laws. Further, the monitors will conduct regular meetings with workers and management at factories to maintain a high level of education and follow through.

In connection with this announcement, Gymboree said that it has settled all claims made against the company in two lawsuits related to factory conditions in Saipan. Gymboree was denied having liability under these lawsuits.

"Three years ago we created Terms of Vendor of Agreement so we could stay in the forefront of protecting worker rights at our apparel factories worldwide. We are now pleased to take another step to ensure we do an even better job protecting the people who work so hard for us," said Gary White, Gymboree Vice Chair and Chief Executive Officer. "We believe the new arrangement will take the protection right to the factory floors."

All of the Saipan factories in which Gymboree places work will be monitored at all times, whether or not Gymboree work is being done at any given time.

"We are encouraged by Gymboree's support of the new monitoring program. Gymboree has helped us create a thorough monitoring system that goes farther than any existing rules to protect the well-being of factory workers in Saipan," said Al Meyerhof, an attorney for the plaintiffs in the suits. "Our standards include provisions for random workplace checks, inspection of payroll and other records, and access to living quarters, among others things. Gymboree's support in funding these monitoring programs is pivotal to providing the highest level of protection for these workers."

Mr. White continued, "We have checked and double-checked our own monitoring of vendors to assure ourselves that our manufacturing partners were treating workers well. While we are comfortable with the processes we had in place, we are pleased to support the greater safeguards embodied in this agreement."

All Gymboree clothing manufactured in the Northern Marianas will be made in factories governed by these new monitoring standards.

The Gymboree Corporation designs, manufactures and retails unique, high-quality apparel and accessories for children. As of July 31, Gymboree operated 588 stores, including 542 stores in the United States, 18 stores in Canada and 28 in Europe, as well as an online store at www.gymboree.com. The company also offers directed parent-child developmental play programs at 406 franchised and company-operated centers in the United States and 9 foreign countries.