Bontrager Aquisition By Trek - Bontrager Press Release

March 10, 1995

Dear Bontrager Dealer,

We wanted to let you know that Bontrager Cycles, Inc. has just completed an agreement to be acquired by Trek Bicycle Corp. The acquisition is being announced to the media today. Bontrager is now a subsidiary of Trek.

We see this acquisition as offering our dealers a great opportunity to improve sales and profits. First, we will be keeping all our current dealers. We expect to expand our dealer network, primarily into areas where Bontrager is not currently represented. New dealers will be added on a case-by-case basis.

Second, our partnership with Trek will give us the financial resources we need to do a number of things we haven't been able to as a small company. These include expanding our product offering, improving product availability and delivery, and increasing brand promotion. You will see most of these changes take effect for the 1996 product year, though a few products may come through the pipeline a little earlier.

Bontrager will keep its design and production operation based at our current location in Santa Cruz, Calif., directly supervised by me. I will continue as president of Bontrager Cycles. Sales and marketing for the brand will probobly be consolidated in Waterloo.

Trek is a great supplier and provides great customer service, which we expect will benefit your business and sell-throughs. As we take a look at our vendor relationships in the wake of the acquisition, there may be some short-term disruption in product delivery, but long-term we think this agreement will improve product availability and service to our dealers at every level.

We're commotted to our dealer network and we appreciate your support. If you have any questions, please feel free to call me at (408) 427-2121.

Keith Bontrager
Bontrager Cycles, Inc.

Bontrager Cycles, Inc.
104 Bronson Street #5,
Santa Cruz, California 95062 USA
PH (408) 427-2121
FAX (408) 427-2669

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