SEC Ends Investigation of Zale

September 24, 2006

SEC Ends Investigation of Zale

Zale Corp. announced Sunday that the U.S. Securities and Exchange Commission has ended its investigation of the company with no enforcement action recommended.

In April, Zale announced that the SEC was investigating the company's accounting practices. The SEC subpoenaed materials related to accounting for extended service agreements, leases and accrued payroll, as well as executive pay and severance, earnings forecasts, stock trading and the timing of certain vendor payments. At the time, Zale said it was cooperating fully with the probe and launching its own internal investigation.

"Although we are clearly focused on the business at hand, we are pleased to put this matter behind us," says Betsy Burton, president and CEO, in a release. "I would like to thank our shareholders, customers and employees for continuing to demonstrate their confidence in our organization throughout this process. We remain deeply committed to adhering to the highest standards of corporate governance."

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