<PAGE>
                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549

                                   FORM 10-K

                            -----------------------

           [X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                        SECURITIES EXCHANGE ACT OF 1934.

                  For the fiscal year ended December 31, 1998

          [  ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                      THE SECURITIES EXCHANGE ACT OF 1934

           For the transition period from __________ to _____________

                        Commission file number  0-21335

                                GARGOYLES, INC.
             -----------------------------------------------------
             (Exact name of registrant as specified in its charter)

                            -----------------------

      Washington                                          91-1247269
------------------------                            ----------------------
(State of Incorporation)                               (I.R.S. Employer
                                                    Identification Number)
                            5866 South 194th Street
                            Kent, Washington  98032
                                 (253) 796-2752
   -------------------------------------------------------------------------
   (Address and telephone number of registrant's principal executive offices)

          Securities Registered Pursuant to Section 12(b) of the Act:

                                      None

                            -----------------------

          Securities registered pursuant to Section 12(g) of the Act:

                           Common Stock, no par value
                                (Title of Class)

     Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.   Yes [X]   No  [  ]

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.    [X]

     As of March 22, 1999, 7,822,191 shares of the registrant's common stock,
no par value, were outstanding.  The aggregate market value of the common stock
held by non-affiliates or the registrant on that date was $1,046,922, computed
at the closing price on that date.

     The information called for by Part III is incorporated by reference to the
definitive Proxy Statement for the Annual Meeting of Shareholders of the
Company to be held in June, 1999.

<PAGE>
                                     INDEX
                                                                   Page
                                                                   ----
                                     PART I

Item 2.    Properties .............................................  3

Item 3.    Legal Proceedings ......................................  3

Item 4.    Submission of Matters to a Vote of
           Security Holders .......................................  4

                                    PART II

Item 5.    Market for Registrant's Common Stock and
           Related Shareholder Matters ............................  4

Item 9.    Changes and Disagreements with Accountants
           on Accounting and Financial Disclosures ................  5

                                    PART III

Item 10.   Directors and Executive Officers
           of the Registrant ......................................  6

Item 11.   Executive Compensation .................................  7

Item 12.   Security Ownership of Certain Beneficial
           Owners and Management ................................    8

Item 13.   Certain Relationships and Related
           Transactions ........................................     8

                                    PART IV

Item 14.   Exhibits, Financial Statements and Reports
           on Form 8-K ...........................................   8


<PAGE>

ITEM 1.  BUSINESS
-----------------

         To be filed by amendment.


ITEM 2.  PROPERTIES
-------------------

         With the acquisitions of Sungold and Private Eyes in 1997, the Company
acquired various leased operating facilities and showrooms.  In the same year,
executing on a plan to consolidate its operations to one facility, the Company
leased an approximately 93,000 square foot facility in Lynnwood, Washington
which was anticipated to be its primary assembly, warehousing and shipping
facilities and for use as its corporate headquarters.  As part of the
restructure process, the Company negotiated terminations of many of these
facilities, including the Lynnwood facility, and relocated the Company's
operations in Washington state to its original corporate headquarters in Kent,
Washington and to a new 20,000 sq. ft. leased facility located nearby in Kent,
Washington.  Sungold continues to operate from its facility in Farmingdale, New
York.  The following table sets forth the leases to which the Company was a
party as of January 1, 1998 and the current status of each lease.

<TABLE>
<CAPTION>
LOCATION           SQ. FT.    CORPORATE FUNCTION             STATUS
---------------    -------    ---------------------------    ----------------
<S>                <C>        <C>                            <C>
Lynnwood, WA       93,000     New corporate headquarters;    Lease terminated
                              assembly; warehousing and
                              shipping
Kent, WA           26,000     Current headquarters           No change
Kent, WA           24,000     Formerly shipping and          Lease terminated
                              warehousing
Farmingdale, NY    26,000     Sungold operations             No change
Norwell, MA        16,000     Formerly Private Eyes          Lease terminated
                              operations
Kent, WA           15,000     Vacant office space            Lease terminated
New York, NY       3,500      Private Eyes showroom          No change
London             3,000      International sales and        Sublet
                              marketing office
San Ramon, CA      1,500      Kindling office                Lease terminated
Dallas, TX         N/A        Private Eyes showroom          Lease terminated

</TABLE>

As a result of the restructure of the Company's leased facilities, to date the
Company has reduced its minimum future lease payments under such leases by more
than $7.3 million.  Management believes that its current facilities will be
sufficient to meet the Company's operating needs for the foreseeable future.
See "Business -- Forward Looking Statements."


ITEM 3.  LEGAL PROCEEDINGS
--------------------------

         On October 8, 1998, the Company reached a settlement and full release
from Michele J. Maulden and David B. Maulden in a lawsuit filled against the
Company in the Superior Court of Washington, for King County under Case No. 97-
2-1877-1 KNT.  Payment made by the Company to settle this dispute did not
materially, adversely affect the results of the Company's operations or its
financial position.

         On November 22, 1996, the Company filed an action in the United States
District Court for the District of Massachusetts, under Case No. 996-12344RCL,
against Aearo Corporation, a Delaware corporation, alleging infringement of the
Company's toric curve lens utility patent.  On May 19, the Court ruled in favor
of the Company and found that product manufactured by Aearo Corporation
infringes the Company's toric curve patent.  Following the Court's ruling, the
only significant issues left for trial included the extent of damages to be
awarded to the Company resulting from Aearo's patent infringement and whether
the Company's patent was validly issued.  On October 20, 1998 the Company
reached a settlement agreement with Aearo Corporation.  Under the terms of the
settlement, all claims by and against the parties were fully released and the
Company granted to Aearo Corporation a license to continue to make and sell
certain infringing product into certain markets in exchange for a one-time,
lump sum royalty of $1.2 million, which was paid by Aearo upon execution of the
license agreement.

         On November 18, December 4 and December 9, 1998 the State of
Washington Department of Revenue assessed the Company, in the aggregate,
$475,830 plus interest in business and occupation taxes and use taxes allegedly
due and payable related to the Company's operations during various periods
between January 1, 1993 and June 30, 1997.  At issue in this matter is the
Company's status as a "manufacturer" or "wholesaler" as such terms are defined
by the state of Washington's business and occupation and use tax statutes. The
Company has retained counsel in this matter and intends to appeal and to
vigorously defend the Department's assessment.

         The Company also is a party to various other claims, complaints and
legal actions that have arisen in the ordinary course of business from time to
time.  The Company believes that the outcome of all such pending legal
proceedings, in the aggregate, will not have a material adverse effect on its
results of operations or financial position.  See "Business _ Forward-Looking
Statements" "Business -- Risk Factors -- Litigation Risks."


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
------------------------------------------------------------

         The Company did not submit any matter to a vote of its security
holders during the fourth quarter of its fiscal year ended December 31, 1998.


                                    PART II
                                    -------

ITEM 5.  MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED SHAREHOLDER MATTERS
-----------------------------------------------------------------------------

         The Company effected its initial public offering of Common Stock on
September 27, 1996, at a price to the public of $16.00 per share.  Between
September 27, 1996 and July 13, 1998 the Company's Common Stock traded on the
NASDAQ National Market.  Since July 13, 1998, the Company's Common Stock has
continued to be quoted on the OTC Bulletin Board.  The table below sets forth
for the fiscal quarters indicated the reported high and low last sale prices of
the Company's Common Stock, as reported on the Nasdaq National Market System
and quoted on the OTC Bulletin Board.

<TABLE>
<CAPTION>
            1996                      High              Low
       --------------               -------           -------
<S>    <C>                           <C>               <C>
       Third quarter                 $23.50           $19.75
       (from September 27, 1996)
       Fourth quarter                $21.25           $ 8.00

            1997                      High              Low
       --------------               -------           -------
       First quarter                 $10.00            $6.75
       Second quarter                  9.38             7.19
       Third quarter                   8.00             5.88
       Fourth quarter                  6.13             3.13

            1998                      High              Low
       --------------               -------           -------
       First quarter                  $4.50            $2.63
       Second quarter                  3.50             1.00
       Third quarter                   1.63             0.13
       Fourth quarter                  0.63             0.15
</TABLE>

         As of March 22, 1998, there were 127 record holders of Common Stock,
although the Company believes that the number of beneficial owners of its
Common Stock is much higher.  On March 22, 1998, the Company's Common Stock
traded at a high of $0.28 and a low of $0.28.

         The Company anticipates that for the foreseeable future, all earnings,
if any, will be retained for the operation and expansion of its business and
that it will not pay cash dividends.  The payment of dividends, if any, in the
future will be at the discretion of the Board of Directors and will depend
upon, among other things, future earnings, capital requirements, restrictions
in future financing agreements, the general financial condition of the Company
and general business conditions.  In addition, the Company's current credit
facility with the Bank prohibits the payment of dividends.


ITEM 6.  SELECTED FINANCIAL DATA
--------------------------------

         To be filed by amendment.


ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS
------------------------------------------------------------------------

         To be filed by amendment.


ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
----------------------------------------------------

         To be filed by amendment.


ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURES
------------------------------------------------------------------------

         On February 23, 1999, the client-auditor relationship between the
Company and its principal accountants, Ernst & Young LLP, ceased.  The
resignation of Ernst & Young LLP was effective on February 23, 1999.  At a
meeting held on February 22, 1999, the Board of Directors of the Company
approved the engagement of BDO Seidman, LLP as its independent auditors to
replace Ernst & Young LLP who also resigned as auditors of the Company
effective February 23, 1999.  The Audit Committee of the Board of Directors
approved the change on February 22, 1999.

         The audit reports of Ernst & Young LLP on the financial statements of
the Company for the Company's last two fiscal years did not contain an adverse
opinion or disclaimer of opinion, nor was either opinion qualified or modified
as to uncertainty, audit scope, or accounting principles.  During registrant's
two most recent fiscal years and the subsequent interim periods preceding such
termination, there have been no disagreements with Ernst & Young LLP on any
matter of accounting principles or practices, financial statement disclosure,
or auditing scope or procedure, which disagreements, if not resolved to the
satisfaction of Ernst & Young LLP, would have caused it to make reference to
the subject matter of the disagreements in connection with its report.  There
have occurred no "reportable events" within the meaning of Item 304(a)(1)(v) of
Regulation S-K during registrant's two most recent fiscal years and the
subsequent interim periods preceding such termination.

         During the registrant's two most recent fiscal years, and the
subsequent interim period prior to engaging BDO Seidman, LLP, neither the
registrant nor someone on its behalf consulted BDO Seidman, LLP regarding (i)
either the application of accounting principles to a specified transaction,
either completed or proposed; or the type of audit opinion that might be
rendered on the registrant's financial statements, and neither a written report
was provided to registrant nor oral advice provided that BDO Seidman, LLP
concluded was an important factor considered by the registrant in reaching a
decision as to an accounting, auditing or financial reporting issue; or (ii)
any matter that was either the subject of a disagreement (as defined in
paragraph 304(a)(1)(iv) of Regulation S-K and the related instructions to this
item) or a reportable event (as described in paragraph 304(a)(1)(v) of
Regulation S-K.


                                   PART III.
                                   ---------

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
-----------------------------------------------------------

         The directors and executive officers of the Company, and their ages as
of March 31, 1999, are as follows:

<TABLE>
<CAPTION>
Name                          Age       Position
<S>                           <C>       <C>
Leo Rosenberger                48       Chief Executive Officer, Chief
                                        Financial Officer and Treasurer
Cynthia L. Pope                47       Vice President and General Counsel and
                                        Secretary
Sheldon Goldman                36       President, Sungold
Robert G. Wolfe (1)            42       Chairman of the Board
Timothy C. Potts (1)           50       Director
William D. Ruckelshaus (2)     66       Director
Paul S. Shipman (2)            46       Director
Walter F. Walker (1)           44       Director

--------------------------

(1)  Member of the Audit Committee of the Board of Directors.

(2)  Member of the Compensation Committee of the Board of Directors.

</TABLE>

         The Company's Board of Directors is comprised of five directors and is
divided into three classes.  Each director serves for a three-year term, and
one class will be elected each year by the Company's shareholders.  Directors
hold office until their terms expire and their successors are elected and
qualified.  Executive officers of the Company are appointed by, and serve at
the direction of, the Board of Directors.  There are no family relationships
between any of the directors or executive officers of the Company.

         LEO ROSENBERGER, Chief Executive Officer and Chief Financial Officer,
joined the Company in February 1998.  From January 1996 to January 1998, Mr.
Rosenberger was President and Chief Financial Officer of Pacific Linen, Inc.
Pacific Linen, Inc. filed a voluntary petition for Chapter 11 bankruptcy April
1996 and emerged therefrom in December 1997.  In May 1995, Mr. Rosenberger was
appointed by the court as the Chapter 7 Trustee in Bankruptcy for Waterbed,
Inc.  From August 1994 to February 1995 Mr. Rosenberger served as interim Chief
Financial Officer of Jay Jacobs, Inc., a company which filed a voluntary
petition for Chapter 11 bankruptcy protection in May 1994 and emerged therefrom
in November 1995.  Mr. Rosenberger was a general partner in a national
accounting and consulting firm and has over twenty years experience as a
turnaround crisis manager and financial restructuring and management
consultant.

         CYNTHIA L. POPE joined the Company in February 1998.  From July 1995
until joining the Company, Ms. Pope had a private law practice in Bellingham,
Washington and served as corporate counsel to the Company.  From June 1992
until July 1996, Ms. Pope was a partner in the law firm of Brett & Daugert in
Bellingham, Washington.  From June 1989 until June 1992 Ms. Pope was an
associate with the law firm of Bogle & Gates in Seattle, Washington.  From
January 1985 until June 1989, Ms. Pope was an associate with the law firm of
Ross & Hardies in Chicago, Illinois.

         SHELDON GOLDMAN, President of Sungold, joined the Company in April
1997 with the acquisition of Sungold.  From 1992 until joining the Company, Mr.
Goldman was President and part owner of Sungold Enterprises, Ltd.   From 1985
to 1992 Mr. Goldman was Vice President of Sungold Enterprises, Ltd.

         ROBERT G. WOLFE was appointed by the board of directors of the Company
in January 1998 as a Director and as Chairman of the Board of Directors on an
interim basis until the 1998 annual meeting of the Company's shareholders.
Since February 1999, Mr. Wolfe has served as President of GT Group Telecom,
Inc.  Mr. Wolfe was Chief Financial Officer of Trillium Corporation from 1996
to December 1998.  From 1987 to 1995, Mr. Wolfe was a corporate finance
executive at Goldman Sachs.  Mr. Wolfe serves as a director of Trillium
Corporation, GT Group Telecom, Inc., Babylon Entertainment, and RODI Power
Systems, Inc.

         TIMOTHY C. POTTS has been a Director of the Company since March 1995.
Mr. Potts has been Senior Vice President--Finance of Trillium since July 1994.
From April 1987 to July 1994, Mr. Potts was the Chief Financial Officer of
Trillium.

         WILLIAM D. RUCKELSHAUS has been a Director of the Company since July
1996.  Since March 1996, Mr. Ruckelshaus has been a principal of the Madrona
Investment Group, L.L.C., a private investment firm.  Mr. Ruckelshaus is also
Chairman of the Board of Browning-Ferris Industries, Inc., a waste services
company, and from October 1988 to October 1995 was its Chief Executive Officer.
From 1983 to 1985, Mr. Ruckelshaus was Administrator of the Environmental
Protection Agency and from 1979 to 1983, a Senior Vice President of
Weyerhaeuser Co. Mr. Ruckelshaus is also a director of Cummins Engine Co.,
Monsanto Company, Nordstrom, Inc. and Weyerhaeuser Co.

         PAUL S. SHIPMAN has been a Director of the Company since June 1996.
Mr. Shipman has been President since September 1981, Chairman of the Board
since November 1992 and Chief Executive Officer since June 1993 of Redhook Ale
Brewery, Incorporated ("Redhook"), a brewer of craft beers.

         WALTER F. WALKER has been a Director of the Company since December
1995.  Since September 1994, Mr. Walker has been the President of the Seattle
Supersonics National Basketball Association basketball team, owned by a
subsidiary of Ackerley Communications, Inc. From March to September 1994, he
was President of Walker Capital, Inc., a money management firm.  From July 1987
to March 1994, Mr. Walker was a Vice President of Goldman, Sachs & Co., a
registered broker-dealer.  From 1976 to 1985, Mr. Walker was a professional
basketball player in the National Basketball Association.  Mr. Walker is also a
director of Redhook and Interpoint Corporation.


ITEM 11. EXECUTIVE COMPENSATION
-------------------------------

         Information regarding executive compensation is incorporated by
reference from the Company's 1999 Proxy Statement for its 1999 Annual Meeting
of Shareholders (the "1999 Proxy Statement") under the caption "Executive
Compensation".


ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
-----------------------------------------------------------------------

         Information regarding security ownership of certain beneficial owners
and management is incorporated by reference from the 1999 Proxy Statement under
the caption "Beneficial Ownership of Shares".


ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
--------------------------------------------------------

         Information regarding certain relationships and related transactions
is incorporated by reference from the 1999 Proxy Statement under the caption
"Certain Transactions".


                                    PART IV.
                                    --------

ITEM 14. EXHIBITS, FINANCIAL STATEMENTS AND REPORTS ON FORM 8-K
---------------------------------------------------------------

   (a)   Financial Statements and Financial Statement Schedules

         To be filed by amendment.

   (b)   Reports on Form 8-K

         Form 8-K with respect to the sale of assets of the Company's majority-
         owned subsidiary, the kindling company, was filed with the Securities
         and Exchange Commission on September 8, 1998.

         Form 8-K with respect to an agreement in principal with respect to a
         proposed transaction for a recapitalization of the Company was filed
         with the Securities and Exchange Commission on November 5, 1998.

   (c)   Exhibits

         The following exhibits are filed as a part of, or incorporated by
reference into, this report:

<TABLE>
<S>            <C>
 3.1 (1)       Form of Amended and Restated Articles of Incorporation of the
               registrant currently in effect.
 3.2 (1)       Bylaws of the registrant currently in effect.
10.1 (1)       Stock Purchase Agreement, dated as of March 14, 1995, among
               Gargoyles and certain other parties.
10.2 (1)       Nondisclosure, Noncompetition and Indemnity Agreement, dated as
               of March 22, 1995, among Gargoyles, Inc., Conquest Sports, Inc.,
               Antone Manufacturing, Inc. and the Founder.
10.3 (1)       Stock Purchase Agreement, dated as of January 25, 1996, among
               Gargoyles, Inc., H.S.C., Inc., Douglas B. Hauff, H.S.I., a
               California corporation, dba Hobie Sunglasses and the Sellers
               listed therein.
10.4 (1)       Industrial Real Estate Lease (Single Tenant Facility), dated
               December 16, 1993, between Gargoyles, Inc. and DB&D Partnership.
10.5 (1)       Lease Amendment, dated as of March 17, 1995, between Gargoyles,
               Inc. and DB&D Partnership.
10.6 (1) +     Gargoyles, Inc. Common Stock Purchase Warrant, dated January
               1996, between Gargoyles, Inc. and Wally Walker.
10.7 (1) +     Form of Indemnity Agreement between Gargoyles, Inc. and each of
               its directors.
10.8 (1) +     1995 Stock Incentive Compensation Plan.
10.9 (1)       Amended and Restated Agreement Regarding Claim Rights, dated
               July 3, 1996, by and between the Founder, Gargoyles, Inc. and
               Conquest Sports, Inc.
10.10*(1)      Ratification of Settlement Agreement and General Release, dated
               April 12, 1995.
10.11*(1)      Trademark License Agreement dated as of April 12, 1995.
10.12*(1)      License Agreement, effective January 1, 1989, between Hobie
               Designs, Inc. and H.S.I.
10.13*(1)      License Agreement, dated as of May 31, 1996, among Ixela, Inc.,
               Alexi Lalas and Gargoyles, Inc.
10.14 (2)      Indemnity Agreement, dated September 26, 1996, by Trillium
               Corporation and Douglas B. Hauff in favor of Gargoyles.
10.15 (3)      Agreement, dated January 9, 1997, between Gargoyles and
               International Speedway Corporation.
10.16 (3)      Registration Rights Agreement, dated February 20, 1997, between
               Gargoyles and Douglas B. Hauff.
10.17 (3)      Registration Rights Agreement, dated February 20, 1997, between
               Gargoyles and Trillium Investors II.
10.18 (4)      First Amended and Restated Credit Agreement, dated April 7,
               1997, between U.S. Bank of Washington, National Association and
               Gargoyles, Inc.
10.19 (5)      Second Amendment to First Amended and Restated Credit Agreement,
               dated July 15, 1997, between U.S. Bank of Washington, National
               Association, and Gargoyles, Inc.
10.20 (6)      Third Amendment to First Amended and Restated Credit Agreement,
               dated January 15, 1998, between U.S. Bank of Washington,
               National Association, and Gargoyles, Inc.
10.21 (6)      Fourth Amendment to First Amended and Restated Credit Agreement,
               dated January 30, 1998, between U.S. Bank of Washington,
               National Association, and Gargoyles, Inc.
10.22 (6)      Fifth Amendment to First Amended and Restated Credit Agreement,
               dated March 17, 1998, between U.S. Bank of Washington, National
               Association, and Gargoyles, Inc.
10.23 (6)      Promissory Note, dated April 9, 1997, between Douglas B. Hauff
               in favor of Gargoyles, Inc.
10.24 (7)      Asset Purchase and Sales Agreement, dated as of April 10, 1997,
               between Sungold Enterprises, Ltd., Sheldon Goldman, Lionel
               Goldman and Lionel Goldman, Trustee of The Lionel Goldman Family
               Trust u/a, dated September 30, 1994, and Gargoyles Acquisition
               Corporation (n/k/a Sungold Eyewear, Inc.).
10.25 (6) +    Employment Agreement, dated as of April 10, 1997, between
               Gargoyles Acquisition Corporation (n/k/a Sungold Eyewear, Inc.)
               and Sheldon Goldman.
10.26 (6)      Royalty Agreement, dated April 10, 1997, between Gargoyles
               Acquisition Corporation (n/k/a Sungold Eyewear, Inc.) and
               Sungold Enterprises, Ltd.
10.27 (6)      Nondisclosure and Noncompetition Agreement dated as of April 10,
               1997, between Gargoyles Acquisition Corporation (n/k/a Sungold
               Eyewear, Inc.) and Lionel Goldman.
10.28*(6)      Amended and Restated License Agreement dated April 10, 1997,
               between Stussy, Inc. and Sungold Enterprises, Ltd.
10.29 (8)      Asset Purchase and Sale Agreement, dated as of May 5, 1997,
               between The Private Eyes Sunglass Corporation, Richard W.
               Hammel, Sr., Patricia Lynch, Annette Hammel, Robert Hammel and
               Ronald Hammel and Gargoyles Acquisition Corporation II (n/k/a
               Private Eyes Sunglass Corporation).
10.30 (6)      Contingent Price Agreement, dated as of May 14, 1997, between
               Gargoyles Acquisition Corporation II (n/k/a Private Eyes
               Sunglass Corporation) and The Private Eyes Sunglass Corporation.
10.31*(6)      Exclusive Distributorship Agreement, dated October 25, 1997,
               between Cebe International S.A. and Private Eyes Sunglass
               Corporation.
10.32 (6)      Settlement Agreement, dated as of May 30, 1997, between
               Gargoyles, Inc. and Peter G. and Sandra L. LaHaye, LaHaye
               Laboratories, Inc. and Neoptx, Inc.
10.33 (6)      License Agreement, dated as of June 30, 1997, between Neoptx,
               Inc. and Gargoyles, Inc.
10.34 (6)      Settlement Agreement and Mutual Release, dated as of July 14,
               1997, between Adidas America, Inc., Gargoyles, Inc., Conquest
               Sports, Inc., Axcent Sports, Inc., Sports Performance Products,
               Inc., Douglas Hauff, and Trillium Corporation.
10.35 (6) +    Separation and Release Agreement, dated January 30, 1998,
               between Steven R. Kingma and Gargoyles, Inc.
10.36 (6) +    Separation and Release Agreement, dated January 30, 1998,
               between G. Travis Worth and Gargoyles, Inc.
10.37 (6) +    Separation and Release Agreement, dated February 2, 1998,
               between David Jobe and Gargoyles, Inc.
10.38 (6) +    Separation and Release Agreement, dated March 11, 1998, between
               Douglas B. Hauff and Gargoyles, Inc.
10.39 (6) +    Mutual General Release and Payment Agreement, dated as of March
               2, 1998, between HXPE, Inc., f/k/a/ The Private Eyes Sunglass
               Corporation, Richard Hammel, Sr., Patricia Lynch, Gargoyles,
               Inc. and Gargoyles Acquisition Corporation II, a/k/a/ Private
               Eyes Sunglas Corporation.
10.40 (6) +    Employment Agreement, dated as of February 1, 1998, between
               Gargoyles, Inc. and Leo Rosenberger.
10.41 (6)      Lease Agreement, dated November 27, 1996, between Leonard
               Delalio and Robert P. Delalio and Sungold Enterprises Limited.
10.42 (6)      $14,000,000 Renewal Revolving Note, dated January 15, 1998, by
               Gargoyles, Inc. in favor of U.S. Bank National Association.
10.43 (6)      $3,650,000 Renewal Equipment Note, dated January 15, 1998, by
               Gargoyles, Inc. in favor of U.S. Bank National Association.
10.44 (6)      $250,000 Renewal Equipment Note, dated January 15, 1998, by
               Gargoyles, Inc. in favor of U.S. Bank National Association.
10.45 (6)      Security Agreement, dated January 15, 1998, between Sungold
               Eyewear, Inc. and U.S. Bank National Association.
10.46 (6)      Security Agreement, dated January 15, 1998, between Private Eyes
               Sunglass Corp. and U.S. Bank National Association.
10.47*(13)     License Agreement dated October 23, 1998, by and between Dale
               Earnhardt and Gargoyles, Inc.
10.48*(13)     License Agreement dated October 23, 1998, by and between Dale
               Earnhardt, Jr. and Gargoyles, Inc.
10.49 (13)     Agreement dated January 8, 1999 between Golden Bear Golf, Inc.
               and Gargoyles, Inc.
10.50 (13)     Agreement Regarding Hauff Notes dated February 2, 1999 by and
               between Gargoyles, Inc. and Douglas B. Hauff.
10.51 (13)     Letter Agreement between the Susan G. Komen Breast Cancer
               Foundation and the Private Eyes Sunglass Corporation.
10.52 (11)     Renewal Term Note I dated September 17, 1998, made by
               Gargoyles, Inc. in favor of the U.S. Bank National Association.
10.53 (11)     Renewal Term Note II dated September 17, 1998, made by
               Gargoyles, Inc. in favor of the U.S. Bank National Association.
10.54 (9)      Lease Termination Agreement made as of the 13th day of April
               1998, by and between Ronald Gordon, Trustee of A.E.P. Realty
               Trust, as Landlord, and Private Eyes Sunglass Corporation, as
               Tenant.
10.55 (9)      Seventh Amendment to First Amended and Restated Credit Agreement
               dated April 30, 1998 by and between U.S. Bank National
               Association, successor by merger to U.S. Bank of Washington,
               National Association, and Gargoyles, Inc.
10.56 (10)     Lease Agreement dated June 8, 1998, by and between South Valley
               Associates, as Landlord, and Gargoyles, Inc., as Tenant.
10.57 (10)     Eighth Amendment to First Amended and Restated Credit Agreement
               dated April 30, 1998 by and between U.S. Bank National
               Association, successor by merger to U.S. Bank of Washington,
               National Association, and Gargoyles, Inc.
10.58 (11)     Ninth Amendment to First Amended and Restated Credit Agreement
               dated September 17, 1998, by and between U.S. Bank National
               Association, successor by merger to U.S. Bank of Washington
               National Association, and Gargoyles, Inc.
10.59 (11)     Tenth Amendment to First Amended and Restated Credit Agreement
               dated November 2, 1998, by and between U.S. Bank National
               Association, successor by merger to U.S. Bank of Washington
               National Association, and Gargoyles, Inc.
10.60 (13)     Eleventh Amendment to First Amended and Restated Credit
               Agreement dated December 21, 1998, by and between U.S. Bank
               National Association, successor by merger to U.S. Bank of
               Washington National Association, and Gargoyles, Inc.
10.61 (13)     Twelfth Amendment to First Amended and Restated Credit Agreement
               dated March 5, 1999, by and between U.S. Bank National
               Association, successor by merger to U.S. Bank of Washington
               National Association, and Gargoyles, Inc.
10.62 (11)     License Agreement dated October 20, 1998, between Gargoyles,
               Inc. and Aearo Company.
10.63 (11)     Termination and Release dated September 8, 1998, by and among
               The Timberland Company, Gargoyles, Inc. and the kindling
               company.
10.64 (12)     Asset Purchase Agreement among Adventure Optics, LLC, the
               kindling company, Douglas Lauer and Gargoyles, Inc. dated
               September 15, 1998.
10.65 (11)     Letter Agreement dated September 8, 1998, between Ellen Tracy,
               Inc. and Gargoyles, Inc., on behalf of itself and its wholly-
               owned subsidiary, Gargoyles Acquisition Corporation II, now
               known as Private Eyes Sunglass Corporation.
10.66 (11)     Guaranty dated September 8, 1998, made by Gargoyles, Inc. in
               favor of Ellen Tracy, Inc.
21.1  (13)     Subsidiaries of the registrant.
23.1  (14)     Consent of Ernst & Young LLP, Independent Accountants.
23.2  (14)     Consent of BDO Seidman, LLP, Independent Accountants.
27.1  (14)     Financial Data Schedule.

-------------------
 *    Confidential Treatment Requested
 +    Executive Compensation Plan and Arrangements
(1)   Incorporated by reference to the Company's Registration Statement on
      Form S-1 (Registration No. 333-07573).
(2)   Incorporated by reference to the Company's Quarterly Report on
      Form 10-Q for the Quarterly Period Ended September 30, 1996.
(3)   Incorporated by reference to the Company's Annual Report on Form 10-K
      for the Fiscal Year ended December 31, 1996.
(4)   Incorporated by reference to the Company's Quarterly Report on
      Form 10-Q for the Quarterly Period Ended March 31, 1997.
(5)   Incorporated by reference to the Company's Quarterly Report on Form 10-Q
      for the Quarterly Period Ended June 30, 1997.
(6)   Incorporated by reference to the Company's Annual Report on Form 10-K for
      the Fiscal Year ended December 31, 1997.
(7)   Incorporated by reference to the Company's Report on Form 8-K filed
      April 28, 1997.
(8)   Incorporated by reference to the Company's Report on From 8-K filed
      May 29, 1997.
(9)   Incorporated by reference to the Company's Quarterly Report on
      Form 10-Q for the Quarterly Period Ended March 31, 1998.
(10)  Incorporated by reference to the Company's Quarterly Report on
      Form 10-Q for the Quarterly Period Ended June 30, 1998.
(11)  Incorporated by reference to the Company's Quarterly Report on
      Form 10-Q for the Quarterly Period Ended September 30, 1998.
(12)  Incorporated by reference to the Company's Report on Form 8-K filed
      September 29, 1998.
(13)  Filed herewith.
(14)  To be filed by amendment.

</TABLE>

<PAGE>
                                   SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Report to be signed
on its behalf by the undersigned, thereunto duly authorized, on the 30th day of
March, 1999.

                                GARGOYLES, INC.

                                   /s/ LEO ROSENBERGER
              By:________________________________________________
                                Leo Rosenberger
              Chief Executive Officer and Chief Financial Officer


         Pursuant to the requirements of the Securities Exchange Act of 1934,
this Report has been signed by the following persons on behalf of the
Registrant and in the capacities indicated below on the 30th day of March,
1999.


      SIGNATURE                                  TITLE
      ---------                                  ------

/s/ LEO ROSENBERGER                Chief Executive Officer and Chief Financial
--------------------------         Officer (Principle Executive Officer)
Leo Rosenberger

/s/ CHERYL BECKMAN                 Corporate Comptroller
--------------------------         (Principle Accounting Officer)
Cheryl Beckman

/s/ ROBERT G. WOLFE                Chairman of the Board
--------------------------
Robert G. Wolfe

/s/ TIMOTHY C. POTTS               Director
--------------------------
Timothy C. Potts

/s/ WILLIAM D. RUCKELSHAUS         Director
--------------------------
William D. Ruckelshaus

/s/ PAUL S. SHIPMAN                Director
--------------------------
Paul S. Shipman

/s/ WALTER F. WALKER               Director
--------------------------
Walter F. Walker

<PAGE>
                                    EXHIBITS
                                    --------
<TABLE>
<S>            <C>
3.1 (1)        Form of Amended and Restated Articles of Incorporation of the
               registrant currently in effect.
 3.2 (1)       Bylaws of the registrant currently in effect.
10.1 (1)       Stock Purchase Agreement, dated as of March 14, 1995, among
               Gargoyles and certain other parties.
10.2 (1)       Nondisclosure, Noncompetition and Indemnity Agreement, dated as
               of March 22, 1995, among Gargoyles, Inc., Conquest Sports, Inc.,
               Antone Manufacturing, Inc. and the Founder.
10.3 (1)       Stock Purchase Agreement, dated as of January 25, 1996, among
               Gargoyles, Inc., H.S.C., Inc., Douglas B. Hauff, H.S.I., a
               California corporation, dba Hobie Sunglasses and the Sellers
               listed therein.
10.4 (1)       Industrial Real Estate Lease (Single Tenant Facility), dated
               December 16, 1993, between Gargoyles, Inc. and DB&D Partnership.
10.5 (1)       Lease Amendment, dated as of March 17, 1995, between Gargoyles,
               Inc. and DB&D Partnership.
10.6 (1) +     Gargoyles, Inc. Common Stock Purchase Warrant, dated January
               1996, between Gargoyles, Inc. and Wally Walker.
10.7 (1) +     Form of Indemnity Agreement between Gargoyles, Inc. and each of
               its directors.
10.8 (1) +     1995 Stock Incentive Compensation Plan.
10.9 (1)       Amended and Restated Agreement Regarding Claim Rights, dated
               July 3, 1996, by and between the Founder, Gargoyles, Inc. and
               Conquest Sports, Inc.
10.10*(1)      Ratification of Settlement Agreement and General Release, dated
               April 12, 1995.
10.11*(1)      Trademark License Agreement dated as of April 12, 1995.
10.12*(1)      License Agreement, effective January 1, 1989, between Hobie
               Designs, Inc. and H.S.I.
10.13*(1)      License Agreement, dated as of May 31, 1996, among Ixela, Inc.,
               Alexi Lalas and Gargoyles, Inc.
10.14 (2)      Indemnity Agreement, dated September 26, 1996, by Trillium
               Corporation and Douglas B. Hauff in favor of Gargoyles.
10.15 (3)      Agreement, dated January 9, 1997, between Gargoyles and
               International Speedway Corporation.
10.16 (3)      Registration Rights Agreement, dated February 20, 1997, between
               Gargoyles and Douglas B. Hauff.
10.17 (3)      Registration Rights Agreement, dated February 20, 1997, between
               Gargoyles and Trillium Investors II.
10.18 (4)      First Amended and Restated Credit Agreement, dated April 7,
               1997, between U.S. Bank of Washington, National Association and
               Gargoyles, Inc.
10.19 (5)      Second Amendment to First Amended and Restated Credit Agreement,
               dated July 15, 1997, between U.S. Bank of Washington, National
               Association, and Gargoyles, Inc.
10.20 (6)      Third Amendment to First Amended and Restated Credit Agreement,
               dated January 15, 1998, between U.S. Bank of Washington,
               National Association, and Gargoyles, Inc.
10.21 (6)      Fourth Amendment to First Amended and Restated Credit Agreement,
               dated January 30, 1998, between U.S. Bank of Washington,
               National Association, and Gargoyles, Inc.
10.22 (6)      Fifth Amendment to First Amended and Restated Credit Agreement,
               dated March 17, 1998, between U.S. Bank of Washington, National
               Association, and Gargoyles, Inc.
10.23 (6)      Promissory Note, dated April 9, 1997, between Douglas B. Hauff
               in favor of Gargoyles, Inc.
10.24 (7)      Asset Purchase and Sales Agreement, dated as of April 10, 1997,
               between Sungold Enterprises, Ltd., Sheldon Goldman, Lionel
               Goldman and Lionel Goldman, Trustee of The Lionel Goldman Family
               Trust u/a, dated September 30, 1994, and Gargoyles Acquisition
               Corporation (n/k/a Sungold Eyewear, Inc.).
10.25 (6) +    Employment Agreement, dated as of April 10, 1997, between
               Gargoyles Acquisition Corporation (n/k/a Sungold Eyewear, Inc.)
               and Sheldon Goldman.
10.26 (6)      Royalty Agreement, dated April 10, 1997, between Gargoyles
               Acquisition Corporation (n/k/a Sungold Eyewear, Inc.) and
               Sungold Enterprises, Ltd.
10.27 (6)      Nondisclosure and Noncompetition Agreement dated as of April 10,
               1997, between Gargoyles Acquisition Corporation (n/k/a Sungold
               Eyewear, Inc.) and Lionel Goldman.
10.28*(6)      Amended and Restated License Agreement dated April 10, 1997,
               between Stussy, Inc. and Sungold Enterprises, Ltd.
10.29 (8)      Asset Purchase and Sale Agreement, dated as of May 5, 1997,
               between The Private Eyes Sunglass Corporation, Richard W.
               Hammel, Sr., Patricia Lynch, Annette Hammel, Robert Hammel and
               Ronald Hammel and Gargoyles Acquisition Corporation II (n/k/a
               Private Eyes Sunglass Corporation).
10.30 (6)      Contingent Price Agreement, dated as of May 14, 1997, between
               Gargoyles Acquisition Corporation II (n/k/a Private Eyes
               Sunglass Corporation) and The Private Eyes Sunglass Corporation.
10.31*(6)      Exclusive Distributorship Agreement, dated October 25, 1997,
               between Cebe International S.A. and Private Eyes Sunglass
               Corporation.
10.32 (6)      Settlement Agreement, dated as of May 30, 1997, between
               Gargoyles, Inc. and Peter G. and Sandra L. LaHaye, LaHaye
               Laboratories, Inc. and Neoptx, Inc.
10.33 (6)      License Agreement, dated as of June 30, 1997, between Neoptx,
               Inc. and Gargoyles, Inc.
10.34 (6)      Settlement Agreement and Mutual Release, dated as of July 14,
               1997, between Adidas America, Inc., Gargoyles, Inc., Conquest
               Sports, Inc., Axcent Sports, Inc., Sports Performance Products,
               Inc., Douglas Hauff, and Trillium Corporation.
10.35 (6) +    Separation and Release Agreement, dated January 30, 1998,
               between Steven R. Kingma and Gargoyles, Inc.
10.36 (6) +    Separation and Release Agreement, dated January 30, 1998,
               between G. Travis Worth and Gargoyles, Inc.
10.37 (6) +    Separation and Release Agreement, dated February 2, 1998,
               between David Jobe and Gargoyles, Inc.
10.38 (6) +    Separation and Release Agreement, dated March 11, 1998, between
               Douglas B. Hauff and Gargoyles, Inc.
10.39 (6) +    Mutual General Release and Payment Agreement, dated as of March
               2, 1998, between HXPE, Inc., f/k/a/ The Private Eyes Sunglass
               Corporation, Richard Hammel, Sr., Patricia Lynch, Gargoyles,
               Inc. and Gargoyles Acquisition Corporation II, a/k/a/ Private
               Eyes Sunglas Corporation.
10.40 (6) +    Employment Agreement, dated as of February 1, 1998, between
               Gargoyles, Inc. and Leo Rosenberger.
10.41 (6)      Lease Agreement, dated November 27, 1996, between Leonard
               Delalio and Robert P. Delalio and Sungold Enterprises Limited.
10.42 (6)      $14,000,000 Renewal Revolving Note, dated January 15, 1998, by
               Gargoyles, Inc. in favor of U.S. Bank National Association.
10.43 (6)      $3,650,000 Renewal Equipment Note, dated January 15, 1998, by
               Gargoyles, Inc. in favor of U.S. Bank National Association.
10.44 (6)      $250,000 Renewal Equipment Note, dated January 15, 1998, by
               Gargoyles, Inc. in favor of U.S. Bank National Association.
10.45 (6)      Security Agreement, dated January 15, 1998, between Sungold
               Eyewear, Inc. and U.S. Bank National Association.
10.46 (6)      Security Agreement, dated January 15, 1998, between Private Eyes
               Sunglass Corp. and U.S. Bank National Association.
10.47*(13)     License Agreement dated October 23, 1998, by and between Dale
               Earnhardt and Gargoyles, Inc.
10.48*(13)     License Agreement dated October 23, 1998, by and between Dale
               Earnhardt, Jr. and Gargoyles, Inc.
10.49 (13)     Agreement dated January 8, 1999 between Golden Bear Golf, Inc.
               and Gargoyles, Inc.
10.50 (13)     Agreement Regarding Hauff Notes dated February 2, 1999 by and
               between Gargoyles, Inc. and Douglas B. Hauff.
10.51 (13)     Letter Agreement between the Susan G. Komen Breast Cancer
               Foundation and the Private Eyes Sunglass Corporation.
10.52 (11)     Renewal Term Note I dated September 17, 1998,  made by
               Gargoyles, Inc. in favor of the U.S. Bank National Association.
10.53 (11)     Renewal Term Note II dated September 17, 1998,  made by
               Gargoyles, Inc. in favor of the U.S. Bank National Association.
10.54 (9)      Lease Termination Agreement made as of the 13th day of April
               1998, by and between Ronald Gordon, Trustee of A.E.P. Realty
               Trust, as Landlord, and Private Eyes Sunglass Corporation, as
               Tenant.
10.55 (9)      Seventh Amendment to First Amended and Restated Credit Agreement
               dated April 30, 1998 by and between U.S. Bank National
               Association, successor by merger to U.S. Bank of Washington,
               National Association, and Gargoyles, Inc.
10.56 (10)     Lease Agreement dated June 8, 1998, by and between South Valley
               Associates, as Landlord, and Gargoyles, Inc., as Tenant.
10.57 (10)     Eighth Amendment to First Amended and Restated Credit Agreement
               dated April 30, 1998 by and between U.S. Bank National
               Association, successor by merger to U.S. Bank of Washington,
               National Association, and Gargoyles, Inc.
10.58 (11)     Ninth Amendment to First Amended and Restated Credit Agreement
               dated September 17, 1998, by and between U.S. Bank National
               Association, successor by merger to U.S. Bank of Washington
               National Association, and Gargoyles, Inc.
10.59 (11)     Tenth Amendment to First Amended and Restated Credit Agreement
               dated November 2, 1998, by and between U.S. Bank National
               Association, successor by merger to U.S. Bank of Washington
               National Association, and Gargoyles, Inc.
10.60 (13)     Eleventh Amendment to First Amended and Restated Credit
               Agreement dated December 21, 1998, by and between U.S. Bank
               National Association, successor by merger to U.S. Bank of
               Washington National Association, and Gargoyles, Inc.
10.61 (13)     Twelfth Amendment to First Amended and Restated Credit Agreement
               dated March 5, 1999, by and between U.S. Bank National
               Association, successor by merger to U.S. Bank of Washington
               National Association, and Gargoyles, Inc.
10.62 (11)     License Agreement dated October 20, 1998, between Gargoyles,
               Inc. and Aearo Company.
10.63 (11)     Termination and Release dated September 8, 1998, by and among
               The Timberland Company, Gargoyles, Inc. and the kindling
               company.
10.64 (12)     Asset Purchase Agreement among Adventure Optics, LLC, the
               kindling company, Douglas Lauer and Gargoyles, Inc. dated
               September 15, 1998.
10.65 (11)     Letter Agreement dated September 8, 1998, between Ellen Tracy,
               Inc. and Gargoyles, Inc., on behalf of itself and its wholly-
               owned subsidiary, Gargoyles Acquisition Corporation II, now
               known as Private Eyes Sunglass Corporation.
10.66 (11)     Guaranty dated September 8, 1998, made by Gargoyles, Inc. in
               favor of Ellen Tracy, Inc.
21.1  (13)     Subsidiaries of the registrant.
23.1  (14)     Consent of Ernst & Young LLP, Independent Accountants.
23.2  (14)     Consent of BDO Seidman, LLP, Independent Accountants.
27.1  (14)     Financial Data Schedule.

-------------------
 *    Confidential Treatment Requested
 +    Executive Compensation Plan and Arrangements
(1)   Incorporated by reference to the Company's Registration Statement on
      Form S-1 (Registration No. 333-07573).
(2)   Incorporated by reference to the Company's Quarterly Report on
      Form 10-Q for the Quarterly Period Ended September 30, 1996.
(3)   Incorporated by reference to the Company's Annual Report on Form 10-K
      for the Fiscal Year ended December 31, 1996.
(4)   Incorporated by reference to the Company's Quarterly Report on
      Form 10-Q for the Quarterly Period Ended March 31, 1997.
(5)   Incorporated by reference to the Company's Quarterly Report on Form 10-Q
      for the Quarterly Period Ended June 30, 1997.
(6)   Incorporated by reference to the Company's Annual Report on Form 10-K for
      the Fiscal Year ended December 31, 1997.
(7)   Incorporated by reference to the Company's Report on Form 8-K filed
      April 28, 1997.
(8)   Incorporated by reference to the Company's Report on From 8-K filed
      May 29, 1997.
(9)   Incorporated by reference to the Company's Quarterly Report on
      Form 10-Q for the Quarterly Period Ended March 31, 1998.
(10)  Incorporated by reference to the Company's Quarterly Report on
      Form 10-Q for the Quarterly Period Ended June 30, 1998.
(11)  Incorporated by reference to the Company's Quarterly Report on
      Form 10-Q for the Quarterly Period Ended September 30, 1998.
(12)  Incorporated by reference to the Company's Report on Form 8-K filed
      September 29, 1998.
(13)  Filed herewith.
(14)  To be filed by amendment.

</TABLE>