<PAGE>


                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

(Mark one)

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

                   For the quarterly period ended May 4, 2002

                                   OR

[_]  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 000-21543

                        WILSONS THE LEATHER EXPERTS INC.
                        --------------------------------
             (Exact name of registrant as specified in its charter)


                 MINNESOTA                                       41-1839933
                 ---------                                       ----------
     (State or other jurisdiction of                         (I.R.S. Employer
      incorporation or organization)                        Identification No.)


             7401 BOONE AVE. N.
             BROOKLYN PARK, MN                                     55428
             ------------------                                    -----
 (Address of principal executive offices)                        (Zip Code)


                                 (763) 391-4000
                                 --------------
              (Registrant's telephone number, including area code)



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 [_]

As of June 1, 2002, there were 20,266,123 shares of common stock, $0.01 par
value per share, outstanding.

<PAGE>

                        WILSONS THE LEATHER EXPERTS INC.
                                     INDEX

                                                                            PAGE
                                                                            ----
PART I - FINANCIAL INFORMATION

     Item 1.  Consolidated Financial Statements

              Consolidated Balance Sheets as of May 4, 2002 and
              February 2, 2002                                                3

              Consolidated Statements of Operations for the
              three months ended May 4, 2002 and May 5, 2001                  4

              Consolidated Statements of Cash Flows for the
              three months ended May 4, 2002 and May 5, 2001                  5

              Notes to Consolidated Financial Statements                      6

     Item 2.  Management's Discussion and Analysis of Financial
              Condition and Results of Operations                            13

     Item 3.  Quantitative and Qualitative Disclosures About Market Risk     19


PART II - OTHER INFORMATION

     Item 2.  Changes in Securities                                          21

     Item 6.  Exhibits and Reports on Form 8-K                               21

     Signature                                                               24

     Index to Exhibits                                                       25

                                       2

<PAGE>

                WILSONS THE LEATHER EXPERTS INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
               (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

                                                         MAY 4,      FEBRUARY 2,
                   ASSETS                                 2002          2002*
                   ------                               --------     -----------
                                                      (Unaudited)
CURRENT ASSETS:
   Cash and cash equivalents                            $ 14,772      $ 43,329
   Accounts receivable, net                                8,826        10,255
   Inventories                                           111,392       128,555
   Prepaid expenses and other current assets               9,681         4,450
                                                        --------      --------
      Total current assets                               144,671       186,589

Property and equipment, net                              107,050       109,827
Goodwill and other assets, net                            29,896        28,772
Deferred taxes                                             3,584         3,584
                                                        --------      --------
      Total assets                                      $285,201      $328,772
                                                        ========      ========

    LIABILITIES AND SHAREHOLDERS' EQUITY
    ------------------------------------

CURRENT LIABILITIES:
   Accounts payable                                     $ 16,422      $ 38,685
   Accrued expenses                                       25,265        33,572
   Income taxes payable                                    1,085        11,824
   Deferred income taxes                                   1,974         1,974
                                                        --------      --------
      Total current liabilities                           44,746        86,055

Long-term debt                                            55,590        55,590
Other long-term liabilities                                5,267         4,360
                                                        --------      --------
      Total liabilities                                  105,603       146,005
                                                        --------      --------

Commitments and contingencies

SHAREHOLDERS' EQUITY:
   Common stock, $.01 par value; 150,000,000 shares
    authorized, 20,250,748 and 19,204,545 shares
    issued and outstanding on May 4, 2002 and
    February 2, 2002, respectively                           203           192
   Additional paid-in capital                             97,295        85,896
   Retained earnings                                      83,275        97,952
   Unearned compensation                                  (1,145)       (1,243)
   Cumulative other comprehensive income (loss)              (30)          (30)
                                                        --------      --------
      Total shareholders' equity                         179,598       182,767
                                                        --------      --------
      Total liabilities and shareholders' equity        $285,201      $328,772
                                                        ========      ========


              The accompanying notes are an integral part of these
                       consolidated financial statements.

            *Derived from audited consolidated financial statements.


                                       3

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                WILSONS THE LEATHER EXPERTS INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                                   (UNAUDITED)


                                                            THREE MONTHS ENDED
                                                           --------------------
                                                            MAY 4,      MAY 5,
                                                             2002        2001
                                                           --------    --------
NET SALES                                                  $119,261    $117,477
  Cost of goods sold, buying and occupancy costs             94,654      81,827
                                                           --------    --------
  Gross margin                                               24,607      35,650

  Selling, general and administrative expenses               42,398      36,685
  Depreciation and amortization                               4,966       4,333
                                                           --------    --------
     Loss from operations                                   (22,757)     (5,368)
  Interest expense, net                                       1,704         762
                                                           --------    --------
     Loss before income taxes                               (24,461)     (6,130)
  Income tax benefit                                         (9,784)     (2,452)
                                                           --------    --------
     Net loss                                              $(14,677)   $ (3,678)
                                                           ========    ========

NET LOSS PER COMMON SHARE - BASIC AND DILUTED                 (0.76)      (0.22)
                                                           ========    ========

Weighted average common shares outstanding                   19,214      16,940
                                                           ========    ========

              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                       4

<PAGE>

                WILSONS THE LEATHER EXPERTS INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                   (UNAUDITED)

                                                           THREE MONTHS ENDED
                                                         ----------------------
                                                           MAY 4,        MAY 5,
                                                            2002          2001
                                                         ---------     ---------
OPERATING ACTIVITIES:
  Net loss                                               $(14,677)     $ (3,678)
  Adjustments to reconcile net loss to net cash used in
    operating activities-
    Depreciation and amortization                           4,966         4,332
    Amortization of deferred financing costs                  221           157
    Loss on disposal of assets                                331           206
    Restricted stock compensation expense                      98            --
    Deferred income taxes                                      --         2,024
    Changes in operating assets and liabilities:
      Accounts receivable, net                              1,429          (948)
      Inventories                                          17,163        (3,895)
      Prepaid expenses                                     (5,231)         (652)
      Accounts payable and accrued expenses               (30,533)      (16,878)
      Income taxes payable and other liabilities           (9,741)      (18,652)
                                                         --------      --------
        Net cash used in operating activities             (35,974)      (37,984)
                                                         --------      --------

INVESTING ACTIVITIES:
  Additions to property, equipment and other assets        (3,901)       (9,096)
  Acquisitions                                                 --       (33,652)
                                                         --------      --------
    Net cash used in investing activities                  (3,901)      (42,748)
                                                         --------      --------

FINANCING ACTIVITIES:
   Proceeds from issuance of common stock, net             11,318         1,095
   Change in notes payable                                     --        28,140
   Other financing                                             --           (23)
                                                         --------      --------
      Net cash provided by financing activities            11,318        29,212
                                                         --------      --------
NET DECREASE IN CASH AND CASH EQUIVALENTS                 (28,557)      (51,520)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD             43,329        52,122
                                                         --------      --------
CASH AND CASH EQUIVALENTS, END OF PERIOD                 $ 14,772      $    602
                                                         ========      ========

SUPPLEMENTAL CASH FLOW INFORMATION:
  Cash paid during the period for
    Interest                                             $  2,726      $  2,241
                                                         ========      ========
    Income taxes                                         $    786      $ 14,203
                                                         ========      ========

              The accompanying notes are an integral part of these
                       consolidated financial statements.



                                       5

<PAGE>

                WILSONS THE LEATHER EXPERTS INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

1.   NATURE OF ORGANIZATION

     Wilsons The Leather Experts Inc. (Wilsons Leather or the Company), a
Minnesota corporation, is the leading specialty retailer of quality leather
outerwear, accessories, apparel and travel products in the United States. As of
May 4, 2002, the Company operated 757 retail stores located in 46 states, the
District of Columbia, Guam, Puerto Rico and Canada, including 486 mall stores,
97 outlet stores and 30 airport locations under the Wilsons Leather format and
144 premium travel products and accessories stores under the El Portal,
Bentley's Luggage and California Luggage Outlet names. The Company supplemented
permanent mall stores with 281 seasonal stores during its peak selling season
from October through January during the year ended February 2, 2002.

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     BASIS OF FINANCIAL STATEMENT PRESENTATION

     The consolidated financial statements include all accounts of Wilsons
Leather and its wholly owned subsidiaries. All material intercompany balances
and transactions between the entities have been eliminated in consolidation.

     Wilsons Leather operates in one segment: selling leather outerwear,
accessories, apparel and travel-related products. The Company's chief operating
decision-maker evaluates revenue and profitability performance on an enterprise
basis to make operating and strategic decisions.

     The accompanying unaudited consolidated financial statements have been
prepared by the Company pursuant to the rules and regulations of the Securities
and Exchange Commission. Certain information and footnote disclosure, normally
included in consolidated financial statements prepared in accordance with
accounting principles generally accepted in the United States of America, have
been condensed or omitted pursuant to such rules and regulations. Although
management believes that the accompanying disclosures are adequate to make the
information presented not misleading, it is recommended that these interim
consolidated financial statements be read in conjunction with the Company's most
recent audited consolidated financial statements and related notes included in
its 2001 Annual Report on Form 10-K. In the opinion of management, all
adjustments (which include normal recurring adjustments) necessary for a fair
presentation of the financial position, results of operations and cash flows for
the interim periods presented have been made. The Company's business is highly
seasonal, and accordingly, interim operating results are not necessarily
indicative of the results that may be expected for the fiscal year ending
February 1, 2003.


                                       6

<PAGE>

     RECLASSIFICATIONS

     Certain amounts included in the consolidated financial statements have been
reclassified in prior years to conform with the fiscal 2002 financial statement
presentation. These amounts had no effect on previously reported shareholders'
equity or net income (loss).

     INVENTORIES

     The Company values its inventories, which consist primarily of finished
goods held for sale purchased from domestic and foreign vendors, at the lower of
cost or market value, determined by the retail inventory method on the last-in,
first-out (LIFO) basis and approximated first-in, first-out (FIFO) cost as of
May 4, 2002 and February 2, 2002. The cost includes the cost of merchandise and
freight. A periodic review of inventory quantities on hand is performed in order
to determine if inventory is properly stated at the lower of cost or market.
Factors related to current inventories such as future consumer demand and
fashion trends, current aging, current and anticipated retail markdowns, and
class or type of inventory are analyzed to determine estimated net realizable
values. A provision is recorded to reduce the cost of inventories to the
estimated net realizable values, if required. Any significant unanticipated
changes in the factors noted above could have a significant impact on the value
of its inventories and its reported operating results.

     REVENUE RECOGNITION

     The Company recognizes sales upon customer receipt of the merchandise
generally at the point of sale. Shipping and handling revenues are included in
net sales and the related costs are included in costs of goods sold, buying and
occupancy costs. Revenue for gift certificate sales and store credits is
recognized at redemption. A reserve is provided at the time of sale for
projected merchandise returns based upon historical experience.

     INCOME TAXES

     Deferred tax assets and liabilities are recognized for the future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases. Deferred tax assets and liabilities are measured using enacted tax rates
in effect for the year in which those temporary differences are expected to
reverse.

     NET INCOME (LOSS) PER COMMON SHARE

     Basic net income (loss) per common share is computed by dividing net income
(loss) by the weighted average number of common shares outstanding during the
year. Diluted net income (loss) per share is computed by dividing net income
(loss) by the sum of the weighted average number of common shares outstanding
plus all additional common shares that would have been outstanding if
potentially dilutive common shares related to stock options had been issued. The
following table reconciles the number of shares utilized in the net income
(loss) per common share calculations (in thousands):



                                       7

<PAGE>

                                                      Three Months  Three Months
                                                          Ended        Ended
                                                       May 4, 2002  May 5, 2001
                                                      ------------  ------------
     Net loss                                           $(14,677)     $(3,678)
                                                        ========      =======
     Weighted average common shares outstanding -
       basic                                              19,214       16,940
     Weighted average common shares outstanding -
       basic and diluted                                  19,214       16,940
                                                        --------      -------
     Basic and diluted net loss per common share        $  (0.76)     $ (0.22)
                                                        ========      =======

     RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

     Statement of Financial Accounting Standards (SFAS) No. 133, "Accounting for
Derivative Instruments and Hedging Activities," as amended, became effective for
fiscal years beginning after June 15, 2000. SFAS No. 133 establishes accounting
and reporting standards requiring that every derivative instrument, including
certain derivative instruments embedded in other contracts, be recorded in the
balance sheet as either an asset or liability measured at fair value. SFAS No.
133 requires that changes in the derivative's fair value be recognized currently
in earnings unless specific hedge criteria are met. Special accounting for
qualifying hedges allows a derivative's gains or losses to offset related
results on the hedged item in the income statement and requires that a company
must formally document, designate and assess the effectiveness of transactions
that receive hedge accounting. The Company adopted SFAS No. 133 on February 4,
2001, and the adoption did not have a material effect on the Company's financial
position or results of operations.

     On February 3, 2002, new accounting rules for business combinations and
accounting for goodwill and other intangibles, SFAS No. 141, "Business
Combinations," and SFAS No. 142, "Goodwill and Other Intangible Assets," became
effective for the Company. As a result and from that date forward, goodwill will
no longer be amortized against earnings and goodwill balances will be subject to
impairment review on at least an annual basis. The pro forma effect of cessation
of goodwill amortization would have increased earnings from continuing
operations for the first quarter of 2001 by $0.3 million or $0.01 per diluted
common share.

     In connection with the transitional goodwill impairment evaluation, the
Company must perform an assessment by August 3, 2002 to determine whether
goodwill was impaired as of the effective date of SFAS No. 141 and SFAS No. 142.
Any transitional impairment loss will be measured as of February 3, 2002 and
reported as a first quarter 2002 cumulative effect of a change in accounting
principle in the Company's statement of operations as soon as practicable but
not later than February 1, 2003. The Company has not determined the impact of
adopting SFAS No. 142 on its statement of operations and financial position,
including whether it will be required to recognize any transitional impairment
losses as a cumulative effect of a change in accounting principle.

     In October 2001, the Financial Accounting Standards Board issued SFAS No.
144, "Accounting for the Impairment or Disposal of Long-Lived Assets." SFAS No.
144 supersedes SFAS No. 121. SFAS No. 144 primarily addresses significant issues
relating to the implementation of SFAS No. 121 and develops a single accounting
model for long-lived assets to be disposed of, whether primarily held, used or
newly acquired. The provisions of SFAS No. 144 were effective for fiscal years
beginning after December 15, 2001. The Company applied this standard beginning
in the first quarter of 2002 and did not expect the adoption to have a material
impact on its financial position or its results of operations.


                                       8

<PAGE>

     In June 2001, the FASB issued Statement of Financial Accounting Standards
No. 143 ("SFAS 143"), "Accounting for Asset Retirement Obligations," which is
effective for fiscal years beginning after June 15, 2002. SFAS 143 addresses the
financial accounting and reporting for obligations and retirement costs related
to the retirement of tangible long-lived assets. We do not expect that the
adoption of SFAS 143 will have a significant impact on our consolidated
financial statements.

     In April 2002, the FASB issued SFAS No. 145 "Rescission of FASB Statements
No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical
Corrections". SFAS No. 145 primarily affects the reporting requirements and
classification of gains and losses from the extinguishment of debt, rescinds the
transitional accounting requirements for intangible assets of motor carriers,
and requires that certain lease modifications with economic effects similar to
sale-leaseback transactions be accounted for in the same manner as
sale-leaseback transactions. SFAS No. 145 is effective for financial statements
issued after April 2002, with the exception of the provisions affecting the
accounting for lease transactions, which should be applied for transactions
entered into after May 15, 2002, and the provisions affecting classification of
gains and losses from the extinguishment of debt, which should be applied in
fiscal years beginning after May 15, 2002. Management has determined that the
adoption of SFAS No. 145 will have no impact on the Company's consolidated
financial statements.

3.   ACQUISITIONS

     The following acquisitions were accounted for as purchases. The purchase
prices assigned to the net assets acquired were based on the fair value of such
assets and liabilities at the respective acquisition dates. Tangible net assets
acquired include accounts receivable, inventories, prepaid expenses, other
current assets and fixed assets. Liabilities assumed principally include
accounts payable and accrued expenses. The operating results of these acquired
companies have been included in the consolidated statements of operations from
the dates of acquisition.

     On October 31, 2000, the Company acquired all of the outstanding common
shares of the El Portal Group, Inc. (El Portal), a specialty retailer of premium
travel products and accessories, for approximately $17.8 million, including
transaction costs.

     ALLOCATION OF THE PURCHASE PRICE (IN MILLIONS):
     Inventory                                                    $13.2
     Other current assets                                           2.6
     Property and equipment                                        11.8
     Goodwill and other assets, net                                25.4
                                                                  -----
              Total assets                                        $53.0

     Accounts payable                                              16.4
     Notes payable                                                 13.8
     Accrued taxes                                                  3.0
     Other current liabilities                                      2.0
                                                                  -----
              Total liabilities                                   $35.2

                   Total purchase price allocation                $17.8
                                                                  =====

     In conjunction with the acquisition, the Company decided to close certain
stores and established a restructuring reserve of $1.5 million. As of May 4,
2002, the balance of restructuring


                                       9

<PAGE>

liabilities recorded in conjunction with the acquisition was approximately $0.4
million. The remaining closures of facilities are expected to be completed by
the end of fiscal year 2002.

     On April 14, 2001, the Company acquired all of the outstanding shares of
Bentley's Luggage Corp. (Bentley's), a specialty retailer of travel products and
accessories, for approximately $34.3 million.

     ALLOCATION OF THE PURCHASE PRICE (IN MILLIONS):
     Inventory                                                    $18.2
     Other current assets                                           6.9
     Property and equipment                                        13.5
     Goodwill and other assets, net                                12.7
                                                                  -----
              Total assets                                        $51.3

     Accounts payable                                             $ 6.9
     Accrued expense                                               10.1
                                                                  -----
              Total liabilities                                   $17.0

                   Total purchase price allocation                $34.3
                                                                  =====

     In conjunction with the acquisition, the Company decided to close certain
stores and facilities as well as terminate certain related employees and
established a restructuring reserve of $4.0 million. The $4.0 million is
comprised of costs associated with the closure of acquired facilities and
termination of employees, which amounted to $2.6 million and $1.4 million,
respectively. As of May 4, 2002, the balance of restructuring liabilities
recorded in conjunction with the acquisition was approximately $1.1 million. The
remaining closures of facilities are expected to be completed by the end of
fiscal year 2002.

     The following additional pro forma information presents the results of
operations of the Company as if the acquisitions had been completed as of
February 3, 2001 (in thousands, except per share amounts):

                                                                   Three months
                                                                       ended
                                                                    May 5, 2001
                                                                   ------------
     Revenue                                                         $133,725
     Net income (loss)                                                 (6,462)
     Net income (loss) per common share--basic and diluted           $  (0.38)

     Weighted average common shares outstanding--basic and diluted     16,940

     This unaudited pro-forma consolidated financial information does not
purport to represent what the Company's financial position or results of
operations would actually have been if these transactions had occurred at such
date or project the Company's future results of operations.



                                       10

<PAGE>

4.   OTHER COMPREHENSIVE INCOME (LOSS)

     The Company reports accumulated other comprehensive income (loss) as a
separate item in the shareholders' equity section of the balance sheet. Other
comprehensive income (loss) consists of foreign currency translation
adjustments. For the quarter ending May 4, 2002, there was no comprehensive
income (loss). For the quarter ending May 5, 2001, there was other comprehensive
loss of $21,000.

5.   LONG-TERM DEBT

     SENIOR NOTES

     On August 18, 1997, the Company issued $75.0 million of 11 1/4% Senior
Notes due August 15, 2004 (the Senior Notes). Interest on the Senior Notes is
payable semiannually in arrears on February 15 and August 15 of each year. The
Company repurchased $44.4 million of the Senior Notes in the years 1998 through
2000. As of May 4, 2002, the outstanding balance on the Senior Notes was $30.6
million.

     The Senior Notes are general unsecured obligations of the Company that rank
senior in right of payment to all existing and future subordinated indebtedness
of the Company, and rank on equal terms in right of payment with all other
current and future unsubordinated indebtedness of the Company. The indenture
governing the Senior Notes contains numerous operating covenants that limit the
discretion of management with respect to certain business matters and that place
significant restrictions on, among other things, the ability of the Company to
incur additional indebtedness, to create liens or other encumbrances, to declare
or pay any dividend, to make certain payments or investments, loans and
guarantees, and to sell or otherwise dispose of assets and merge or consolidate
with another entity. At May 4, 2002, the Company was in compliance with all
covenants of the Senior Notes.

     REVOLVING CREDIT AGREEMENT

     A syndicate of banks originally provided the Company with a $125.0 million
revolving credit agreement (the Revolver) which extended through May 2002 and
included an $85.0 million letter-of-credit subfacility as of January 29, 2000
(collectively referred to as the Senior Credit Facility). In October 2000, the
Company amended the Senior Credit Facility to increase the Revolver to $165.0
million and also to add a $20.5 million seasonal over-advance for November 2000
only, with interest on the over-advance at 100 basis points over the Senior
Credit Facility interest rate. This agreement was amended again on June 19, 2001
to increase the Revolver to $190 million, reduce and extend the seasonal
over-advance to $15 million during July through October and to add a Term B
promissory note of $25 million.

     On April 23, 2002, the Senior Credit Facility was amended again to decrease
the borrowings to $205 million in aggregate principal amount, including a $25
million Term B promissory note and a $75 million letter of credit subfacility.
The aggregate principal amount available for borrowing at any one time is based
on defined levels of inventory and receivables reduced by outstanding and
undrawn trade letters of credit and $10 million ($5 million during the months of
August, September and October) as specified in the agreement. At May 4, 2002,
there were no cash borrowings under the Revolver, and there were $15.3 million
in letters of credit outstanding.


                                       11

<PAGE>

     The Term B note is collateralized by the Company's inventory and buildings
and is due in June 2005. The Senior Credit Facility is collateralized by the
Company's inventory, equipment and credit card receivables and expires in June
2005. Interest on cash borrowings under the Senior Credit Facility is at LIBOR
plus 2.75%, the commercial paper rate plus 2.75%, or prime plus 1.50%. With
respect to the Term B note, the interest rate is prime plus 4%, plus an
additional 5% pursuant to a separate letter agreement with General Electric
Capital Corporation. The Company pays monthly fees on the unused portion of the
Senior Credit Facility and on the average daily amount of letters of credit
outstanding during each month.

     The Senior Credit Facility contains restrictions and covenants which, among
other things, restrict the ability of the Company to make capital expenditures;
acquire or merge with another company; make investments, loans or guarantees;
incur additional indebtedness; prepay, repurchase or pay any principal on the 11
1/4% Senior Notes, except pursuant to a permitted refinancing; create liens or
other encumbrances, and pay dividends or make other distributions. The Senior
Credit Facility also requires the Company to maintain certain financial
covenants. The aggregate principal amount available for borrowing at any one
time is also subject to limitations based on credit card receivables and the
value of inventories as if sold on a going-out-of-business basis, as specified
in the agreement. At May 4, 2002, the Company was in compliance with all
covenants of the Senior Credit Facility.

     The Senior Credit facility contains a requirement that the Company either
amend, refund, renew, extend or refinance the outstanding 11 1/4% Senior Notes
on or before June 15, 2004 so that no principal payment with respect to any such
amended, refunded, renewed, extended or refinanced notes is due on or before
September 1, 2005.

     The terms of the Senior Credit Facility prohibited the Company from
borrowing additional funds, other than letters of credit, until it had received
$10 million in net proceeds from certain permitted financings. On April 12,
2002, the Company received approximately $1.0 million in net proceeds, which was
applied to the $10 million financing requirement, from the exercise of an option
for 100,000 shares of common stock granted to an institutional purchaser. On
April 30, 2002, the Company received $9.9 million, which was also applied to the
$10.0 million financing requirement, from the private placement of 900,000
shares of its common stock at a purchase price of $11.00 per share. This
fulfilled the requirements of the Senior Credit Facility and allows immediate
access to the credit line as needed.


                                       12

<PAGE>

6.   SUBSEQUENT EVENTS

     In May 2002, the Company internally communicated the closing of the El
Portal headquarters in Las Vegas, Nevada, which will reduce the administrative
overhead associated with the Company's travel concept and will result in a
second quarter pretax charge of $2.4 million. The charge would be taken to cover
the one-time costs of reducing excess administrative capacity and is expected to
be completed by August 1, 2002.

     In June 2002, the purchasers in the April 30, 2002 private placement of the
Company's common stock exercised the option under the stock purchase agreement
relating to the placement to purchase an additional 100,000 shares, which sale
was completed on June 13, 2002, for net proceeds of approximately $1.1 million.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
        RESULTS OF OPERATIONS

     The following discussion of our financial condition and results of
operations of Wilsons The Leather Experts Inc. and our wholly owned subsidiaries
should be read in conjunction with our most recent audited consolidated
financial statements and related notes included in our 2001 Annual Report on
Form 10-K.

     OVERVIEW

     We are the leading specialty retailer of high-quality leather outerwear,
apparel and accessories and the leading specialty retailer of travel products
and accessories in the United States. Our multiple store formats for each of our
concepts are designed to reach a broad customer base with a superior level of
customer service. Utilizing our integrated worldwide leather sourcing network
and in-house design capabilities, we are consistently able to provide our
customers high-quality, fashionable merchandise at attractive prices and
minimize fashion risk by reacting quickly to popular and emerging fashion trends
and customer preferences and rapidly replenishing fast-selling merchandise.

     At May 4, 2002, we operated a total of 757 stores located in 46 states, the
District of Columbia, Guam, Puerto Rico and Canada. Our Wilsons Leather concept
included 486 mall stores, 97 outlet stores and 30 airport locations and our
travel concept included 144 El Portal, Bentley's Luggage and California Leather
Outlet stores. Each year we supplement our permanent stores with temporary
holiday stores during our peak holiday season, which totaled 281 in 2001. Our
Wilsons Leather mall stores average approximately 2,100 square feet and feature
a large assortment of both classic and fashion-forward leather outerwear,
apparel and accessories. Our outlet stores are operated primarily under the
Wilsons Leather Outlet name, average approximately 3,200 square feet, and offer
a combination of clearance-priced merchandise from our mall stores, special
outlet-only merchandise and key in-season goods. Our airport stores average
approximately 700 square feet, feature travel products as well as leather
accessories, and provide us the opportunity to showcase our products and the
WILSONS LEATHER brand to millions of potential customers each year in some of
the world's busiest airports. Our proprietary labels, including M. Julian(R),
Maxima(R), Pelle Studio(R) and Wilsons Leather(TM), are positioned to appeal to
identified customer lifestyle segments.


                                       13

<PAGE>

     Through our acquisitions of Bentley's Luggage Corp. ("Bentley's Luggage")
and the El Portal Group, Inc. ("El Portal"), we created the leading specialty
retail chain of travel products and accessories in the United States. At May 4,
2002, we operated 144 premium travel products and accessories stores in 25
states, Puerto Rico and Guam under the El Portal, Bentley's Luggage, and
California Luggage Outlet names. Our travel stores average approximately 2,600
square feet and feature premium nationally branded merchandise, including
Tumi(R), Hartmann(R), Swiss Army(R), Travelpro(R), Kenneth Cole(R), Brighton(R),
Dooney & Bourke(R), Zero Halliburton(R) and Samsonite(R), as well as our growing
assortment of private labels, including El Portal(R), Signature(TM), Bentley's
Luggage(TM) and Priorities(TM).

     Comparable store sales decreased 10.3% in the three months ended May 4,
2002, compared to an increase of 2.1% in the same period of the prior year. A
store is included in the comparable store sales calculation after it has been
opened and operated by us for more than 52 weeks. The percentage change is
computed by comparing total net sales for comparable stores as thus defined at
the end of the applicable reporting period with total net sales from comparable
stores for the comparable period in the prior year.

     CRITICAL ACCOUNTING POLICIES

     We consider our critical accounting policies to be those related to
inventories, recorded goodwill, and property and equipment impairment as
discussed in the section with this title in Item 7, "Management's Discussion and
Analysis of Financial Condition and Results of Operations" that appears on page
24 of our Annual Report on Form 10-K for the year ended February 2, 2002. No
material changes occurred to these policies in the periods covered by this
report.

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MAY 4, 2002 COMPARED TO THE
THREE MONTHS ENDED MAY 5, 2001

     Net sales increased 1.5% to $119.3 million in 2002 from $117.5 million in
2001. This increase reflects additional sales from our travel-related stores,
offset by a 10.3% decline in comparable store sales during the quarter.

     We opened six stores and closed 18 stores in the first quarter ended May 4,
2002, compared to opening 23 stores, acquiring 106 stores with the acquisition
of Bentley's Luggage, and closing nine stores in the first quarter ended May 5,
2001. Included in the six stores opened in the first quarter of 2002 are one
mall, three outlet and two travel stores. As of May 4, 2002, Wilsons Leather
operated 757 stores compared to 731 stores at May 5, 2001.

     Cost of goods sold, buying and occupancy costs for the first quarter of
2002 were 79.4% of net sales, or $94.7 million, compared to 69.7% of sales, or
$81.8 million, for the same period a year ago. The increase of 9.7 points as a
percentage of net sales is related to a decrease in gross margin and an increase
in occupancy and buying costs. Gross margin net of occupancy and buying costs
decreased by 4.2% of net sales for the quarter as compared to last year due
primarily to decreased sales of higher margin fashion merchandise and higher
markdowns as a result of higher levels of clearance merchandise at the beginning
of the quarter. Our inventories are valued under the retail inventory method on
the LIFO basis. The difference in inventories between LIFO and the FIFO method
was not material as of May 4, 2002 and February 2, 2002. Buying and occupancy
costs increased by 5.6% of net sales over the prior year due to the 3.6%
increase in the number of open stores in 2002 versus 2001.


                                       14

<PAGE>

     Selling, general and administrative expenses for the first quarter of 2002
were 35.6% of net sales, or $42.4 million, compared to 31.2% of net sales, or
$36.7 million, for the same period last year. The increase of $5.7 million was
due mainly to payroll expense associated with the operation of an additional 26
stores during the first quarter of 2002 as compared to the same period last
year, as a result of the acquisition of the Bentley's Luggage stores in the last
two weeks of the first quarter of 2001.

     Depreciation and amortization expense increased to $5.0 million from $4.3
million last year, and increased as a percentage of net sales to 4.2% from 3.7%.
The increase in depreciation and amortization resulted primarily from capital
expenditures for new store construction, the Bentley's Luggage stores
acquisition and the renovation of existing stores.

     Net interest expense was $1.7 million for the first quarter of 2002 as
compared to $0.8 million during the same period last year due to the $25 million
in new term debt from the acquisition of Bentley's Luggage.

     LIQUIDITY AND CAPITAL RESOURCES

     Our capital requirements are primarily driven by our seasonal working
capital needs, investments in new stores, remodeling existing stores, enhancing
information systems and increasing capacity for our distribution centers. Our
peak working capital needs typically occur during the period from August through
early December as inventory levels are increased in advance of our peak selling
season from October through January.

     Our future capital requirements depend on the sustained demand for both our
leather and travel products. Many factors affect the level of consumer spending
on our products, including, among others, general business conditions, interest
rates, the availability of consumer credit, weather, the outbreak of war, acts
of terrorism or the threat of either, and interruption in the operation of
corporate offices and distribution centers, other significant national and
international events, taxation and consumer confidence in future economic
conditions. Consumer purchases of discretionary items, such as our products,
tend to decline during recessionary periods when disposable income is lower. The
general slowdown in the United States economy and the uncertain economic outlook
has adversely affected consumer spending habits and mall traffic, causing us to
delay or slow our expansion plans and has resulted in lower net sales than
expected on a quarterly and annual basis.

     Our ability to meet our debt service obligations will be dependent upon our
future performance, which will be subject to general economic conditions and
financial, business and other factors affecting our operations. If we are unable
to generate sufficient cash flow from operations in the future to service our
debt, we may be required to refinance all or a portion of existing debt or to
obtain additional financing. There can be no assurance that any such refinancing
or additional financing would be possible or could be obtained on terms that are
favorable to us.

     General Electric Capital Corporation and a syndicate of banks have provided
us with a senior credit facility that provides for borrowings of up to $205
million in aggregate principal amount, including a $25 million Term B promissory
note and a $75 million letter of credit subfacility. The maximum amount
available under the revolving credit portion of the senior credit facility is
limited to:


                                       15

<PAGE>

     o    65% of net inventories of the type that we sold before the
          acquisitions of El Portal and Bentley's Luggage, which increases to
          70% during the months of August, September and October, provided that
          such percentage at no time may exceed 85% of the discount rate applied
          in appraising such inventories to reflect their value as if sold in an
          orderly liquidation;

     o    plus 55% of net inventories of the type traditionally sold by El
          Portal and Bentley's Luggage, which increases to 65% during the months
          of August, September and October, provided that such percentage at no
          time may exceed 85% of the discount rate applied in appraising such
          inventories to reflect their value as if sold in an orderly
          liquidation;

     o    plus 60% of outstanding and undrawn trade letters of credit, provided
          that such percentage at no time may exceed 85% of the discount rate
          applied in appraising the future inventories related to such letters
          of credit to reflect their value as if sold in an orderly liquidation;

     o    plus 85% of credit card receivables; and

     o    minus $10 million ($5 million during the months of August, September
          and October).

     In addition, borrowings under the senior credit facility are subject to the
further limitations that:

     o    the revolving credit portion of such borrowings cannot exceed the sum
          of 85% of credit card receivables, plus 85% of the appraised value of
          inventory (including inventory subject to trade letters of credit) as
          if sold on a going-out-of business basis; and

     o    the total borrowings cannot exceed the sum of 85% of the book value of
          credit card receivables, plus 95% (100% during August, September and
          October) of the appraised value of inventory (including inventory
          subject to trade letters of credit) as if sold on a going-out-of
          business basis.

     As of May 4, 2002, we had no borrowings under the senior credit facility,
except for the Term B promissory note, and we had $15.3 million in outstanding
letters of credit. The terms of the senior credit facility prohibited us from
borrowing additional funds, other than letters of credit, until we had received
$10 million in net proceeds from certain permitted financings. On April 12,
2002, we received approximately $1.0 million in net proceeds, which was applied
to the $10 million financing requirement, from the exercise of an option for
100,000 shares of common stock granted to an institutional purchaser. On April
30, 2002, we received $9.9 million, which was also applied to the $10.0 million
financing requirement, from the private placement of 900,000 shares of our
common stock at a purchase price of $11.00 per share. This fulfilled the
requirements of the Senior Credit Facility, allowing immediate access to our
credit line as needed.

     Interest is payable on revolving credit borrowings at variable rates
determined by LIBOR plus 2.75%, the commercial paper rate plus 2.75% or the
"prime" rate plus 1.50%. Interest is payable on the $25 million Term B
promissory note at a variable rate equal to the "prime" rate plus 4%, plus an
additional 5% payable pursuant to a separate letter agreement with General
Electric Capital Corporation. We pay monthly fees on the unused portion of the
senior credit facility and on the average daily amount of letters of credit
outstanding during each month. The senior credit facility expires in June 2005,
at which time all borrowings, including the Term B promissory note,


                                       16

<PAGE>


become due and payable. Prepayment of the Term B promissory note is subject to a
2% prepayment fee if prepaid on or after July 1, 2002 but on or prior to
November 30, 2003, and a 1% prepayment fee thereafter. The Term B promissory
note is prepayable on or after July 1, 2002 only with the consent of the senior
lenders under the senior credit facility.

     The senior credit facility contains certain restrictions and covenants
which, among other things, restrict our ability to make capital expenditures;
acquire or merge with another entity; make investments, loans or guarantees;
incur additional indebtedness; prepay, repurchase or pay any principal on any 11
1/4% senior notes, except pursuant to a permitted refinancing; create liens or
other encumbrances; or pay cash dividends or make other distributions. We are
currently in compliance with all covenants under the recently amended senior
credit facility.

     The senior credit facility also contains a requirement that we either
amend, refund, renew, extend or refinance the outstanding 11 1/4% senior notes
on or before June 15, 2004 so that no principal payment with respect to any such
amended, refunded, renewed, extended or refinanced notes is due on or before
September 1, 2005. The terms of any refunded, renewed, extended or refinanced
notes cannot be more burdensome than the terms of the 11 1/4% senior notes and
the rate of interest with respect to any such notes cannot exceed the sum of the
rate of interest on United States treasury obligations of like tenor at the time
of such refunding, renewal, refinancing or extension plus 7% per annum.

     We plan to use the senior credit facility for our immediate and future
working capital needs. Peak borrowings typically occur from October through
December and outstanding letters of credit typically peak from August through
September. We are dependent on the senior credit facility to fund working
capital and letter of credit needs. We are also currently evaluating
opportunities to access the capital markets to replenish working capital
depleted in previous acquisitions, as well as finance our other capital needs.
We believe that borrowing capacity under the senior credit facility, together
with current and anticipated cash flow from operations, will be adequate to meet
our working capital and capital expenditure requirements during the term of the
senior credit facility, provided that we either amend, refund, renew, extend or
refinance the outstanding 11 1/4% senior notes on or before June 15, 2004 so
that no principal payment with respect to any such amended, refunded, renewed,
extended or refinanced notes is due on or before September 1, 2005.

     On August 18, 1997, we completed a private offering of $75 million of 11
1/4% senior notes due 2004, referred to above, to certain institutional buyers.
Interest on the 11 1/4% senior notes is payable semi-annually in arrears on
February 15 and August 15 of each year. The 11 1/4% senior notes mature on
August 15, 2004. The indenture governing the 11 1/4% senior notes contains
numerous operating covenants that limit the discretion of management with
respect to certain business matters and place significant restrictions on, among
other things, our ability to incur additional indebtedness, to create liens or
other encumbrances, to declare or pay any dividends, to make certain payments or
investments, loans and guarantees and to sell or otherwise dispose of assets and
merge or consolidate with another entity. The 11 1/4% senior notes are callable
subsequent to August 15, 2001, at a defined premium. The 11 1/4% senior notes
are our general unsecured obligations and rank senior in right of payment to all
of our existing and future subordinated indebtedness and rank on equal terms in
right of payment with all of our other current and future unsubordinated
indebtedness. During the years 1998-2000, we repurchased $44.4 million of our 11
1/4% senior notes. As of May 4, 2002, we had $30.6 million of 11 1/4% senior
notes outstanding.


                                       17

<PAGE>

     On October 31, 2000, we acquired El Portal, a specialty retailer of premium
travel products and accessories, for approximately $17.8 million. The
acquisition was funded with cash from working capital and our senior credit
facility. On April 13, 2001, we acquired Bentley's Luggage, a specialty retailer
of travel products and accessories, for $34.3 million. The acquisition was
funded with cash from working capital and our senior credit facility.

     During the third quarter of 2001, we completed the offering of unsecured
short-term promissory notes in the principal amount of $20.0 million at an
interest rate of 7.9%, which matured on January 15, 2002. The notes were paid in
full at maturity.

     In January 2002, we sold 1,900,000 shares of common stock to an
institutional investor in a private placement for a price of $11.00 per share
for net proceeds of approximately $20.0 million. In April 2002, affiliates of
the institutional investor exercised the option to purchase 100,000 shares of
our common stock at a purchase price of $11.00 per share, which sale was
completed on April 12, 2002 for net proceeds of approximately $1.0 million.

     On April 30, 2002, we sold 900,000 shares of our common stock in a private
placement at a purchase price of $11.00 per share, for net proceeds of
approximately $9.9 million. The stock purchase agreement provided that the
investors may purchase an additional 100,000 shares of common stock at $11.00
per share at any time within 75 days after the closing of the initial sale. On
June 10, 2002, the purchasers in the April placement exercised the option, which
sale was completed on June 13, 2002, for net proceeds of approximately $1.1
million.

     CASH FLOW ANALYSIS

     Operating activities for the three months ended May 4, 2002 resulted in
cash used of $36.0 million compared to cash used of $38.0 million in the
corresponding period of 2001. We had a net loss of $14.7 million in 2002,
primarily as a result of increased expenses from the Bentley's Luggage
acquisition. Additionally, in 2002 there was a $17.2 million decrease in
inventories, a $30.5 million decrease in accounts payable and accrued expenses,
a $9.7 million decrease in taxes payable, a $5.2 million increase in prepaid
expenses and $6.9 million in cash provided by depreciation, amortization and
other operating activities.

     Changes in certain balance sheet accounts between February 2, 2002, and May
4, 2002, reflect normal seasonal variations within the retail industry. The
level of cash and cash equivalents, inventories, accounts receivable, accounts
payable and certain accrued liabilities fluctuate due to the seasonal nature of
the working capital needs of our operations.

     Investing activities for the three months ended May 4, 2002 were comprised
of $3.9 million in capital expenditures and additions to other assets used
primarily for the construction of new stores, the renovation of and improvements
to existing stores, and the implementation of certain new information systems.
Capital expenditures and additions to other assets for the same period last year
totaled $9.1 million. In addition, for 2001 $34.3 million was used for the
acquisition of Bentley's Luggage. For 2002, we expect capital expenditures to be
approximately $10.0 million.

     Cash provided by financing activities for the three months ended May 4,
2002 was $11.3 million from the issuance of common stock and exercise of stock
options. Cash provided by financing activities for the same period last year was
$28.1 million from the issuance of notes, which was used mainly for the
acquisition of Bentley's Luggage and $1.1 million from the issuance of common
stock and exercise of stock options.

                                       18

<PAGE>

     SEASONALITY AND INFLATION

     A majority of our net sales and operating profit is generated in the peak
selling period from October through January, which includes the holiday selling
season. As a result, our annual operating results have been, and will continue
to be, heavily dependent on the results of our peak selling period. Net sales
are generally lowest during the period from April through July, and we typically
do not become profitable, if at all, until the fourth quarter of a given year.
Most of our stores are unprofitable during the first three quarters. Conversely,
nearly all of our stores are typically profitable during the fourth quarter,
even those that may be unprofitable for the full year. Historically, we have
opened most of our stores during the last half of the year. As a result, new
mall stores opened just prior to the fourth quarter produce profits in excess of
their annualized profits since the stores typically generate losses in the first
nine months of the year.

     We do not believe that inflation has had a material effect on the results
of operations during the past three years, however, there can be no assurance
that our business will not be affected by inflation in the future.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     Our exposure to market risks for changes in interest rates relates
primarily to our short-term investments, short-term borrowings, and long-term
debt obligations. We do not use derivative financial instruments in our
available for sale securities. We are averse to principal loss and ensure the
safety and preservation of our investments by limiting default risk and market
risk.

     We mitigate default risk by investing in high quality credit securities.
Market risk is limited by including only securities with active markets in our
portfolio. All short-term investments mature within one year.

     At May 4, 2002, we had cash and cash equivalents totaling $14.8 million.
The effect of a 100 basis point change in interest rates would have had an
estimated $0.1 million pre-tax earnings and cash flow impact, assuming other
variables are held constant.

     Our senior credit facility carries interest rate risk that is generally
related to either LIBOR, commercial paper rates or the prime rate. The Term B
promissory note also has a fluctuating interest rate. If any of those rates were
to change while we were borrowing under the facility or while we had an
outstanding balance on the Term B promissory note, interest expense would
increase or decrease accordingly. As of May 4, 2002, there were no borrowings
under the senior credit facility, $15.3 million in outstanding letters of
credit, and $25.0 million outstanding under the Term B promissory note.

     We have no earnings or cash flow exposure due to market risks on our
long-term debt obligations as a result of the fixed-rate nature of the debt.
However, interest rate changes would affect the fair market value of the debt.
At May 4, 2002, we had fixed rate debt of $30.6 million maturing in August 2004.


                                       19

<PAGE>

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

     Except for historical information, matters discussed in "Management's
Discussion and Analysis of Financial Condition and Results of Operations" are
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934,
as amended. These statements involve risks and uncertainties, and actual results
may be materially different. Because actual results may differ, readers are
cautioned not to place undue reliance on forward-looking statements. Factors
that could cause actual results to differ include: economic downturns; changes
in customer shopping patterns; unseasonable weather; risks associated with our
debt service; risks associated with future growth; failure of results of
operations to meet expectations of research analysts; change in consumer
preferences and fashion trends away from leather; seasonality of the business;
risks associated with foreign sourcing and international business; disruptions
in product supplies to our travel stores; decreased availability and increased
cost of leather; competition in our markets; loss of key members of our
management team; reliance on third parties for maintaining our management
information systems; concentration of our common stock; anti-takeover effects of
classified board provisions in our articles of incorporation and by-laws;
volatility of our common stock; war, acts of terrorism or the threat of either;
and interruption in the operation of corporate offices and distribution centers.
Certain of these risk factors are more fully discussed in the Company's 2001
Annual Report on Form 10-K for the fiscal year ended February 2, 2002.


                                       20

<PAGE>

PART II - OTHER INFORMATION

ITEM 2.  CHANGES IN SECURITIES

     See "Management's Discussion and Analysis of Financial Condition and
Results of Operations - Liquidity and Capital Resources" in Part I., Item 2., of
the document for a description of limitations upon the payment of dividends.

     Recent Sales of Unregistered Securities

     On April 8, 2002, affiliates of the institutional purchasers in the January
2002 placement exercised the option under the stock purchase agreement to
purchase an additional 100,000 shares of our common stock for an aggregate
purchase price of $1.1 million, which sale was completed on April 12, 2002 for
net proceeds of approximately $1.0 million.

     On April 30, 2002, we sold 900,000 shares of common stock in a private
placement at a purchase price of $11.00 per share, for net proceeds of $9.9
million, to Copwell Holdings LTD and Flying Colours Profits Ltd. The stock
purchase agreement provided that the investors may purchase an additional
100,000 shares of common stock at $11.00 per share at any time within 75 days
after the closing of the initial sale.

         Because these sales of shares were made to accredited investors
pursuant to Rule 506 of Regulation D under the Securities Act of 1933, as
amended (the "Act"), we believe they are exempt from the registration
requirements of the Act.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

     A.   Exhibits

          EXHIBIT     DESCRIPTION

          3.1         Amended and Restated Articles of Incorporation of Wilsons
                      The Leather Experts Inc. adopted June 16, 1998, as amended
                      by the Articles of Amendment dated February 17, 2000 and
                      May 23, 2002.

          3.2         Restated Bylaws of Wilsons The Leather Experts Inc., as
                      amended June 16, 1998, January 25, 2000 and May 23, 2002.

          4.1         Specimen of Common Stock Certificate.

          4.2         Indenture dated as of August 18, 1997 by and among Wilsons
                      The Leather Experts Inc., the other corporations listed on
                      the signature pages thereof, and Norwest Bank Minnesota,
                      National Association, including specimen Certificate of 11
                      1/4% Series A Senior Notes due 2004 and specimen
                      Certificate of 11 1/4% Series B Senior Notes due 2004.


                                       21

<PAGE>

          4.3         Purchase Agreement dated as of August 14, 1997 by and
                      among Wilsons The Leather Experts Inc., the Subsidiary
                      Guarantors party thereto and BancAmerica Securities, Inc.

          4.4         Registration Rights Agreement dated as of May 25, 1996 by
                      and among CVS New York, Inc., Wilsons The Leather Experts
                      Inc., the Managers listed on the signature pages thereto,
                      Leather Investors Limited Partnership I and the Partners
                      listed on the signature pages thereto.

          4.5         Amendment to Registration Rights Agreement dated as of
                      August 12, 1999 by and among Wilsons The Leather Experts
                      Inc. and the Shareholders listed on the attachments
                      thereto.

          4.6         Registration Rights Agreement dated as of January 10,
                      2002, by and among the Company and the investors signatory
                      thereto.

          4.7         Registration Rights Agreement dated as of April 24, 2002,
                      by and among the Company and the investors signatory
                      thereto.

          10.1        Fourth Amended and Restated Credit Agreement dated as of
                      April 23, 2002 among Wilsons Leather Holdings Inc., as
                      Borrower, the Lenders signatory thereto from time to time,
                      as Lenders, General Electric Capital Corporation, as
                      Agent, Lender, Term Lender and Swing Line Lender, GECC
                      Capital Markets Group, Inc., as Lead Arranger, The CIT
                      Group/Business Credit, Inc., as Lender and Documentation
                      Agent and Wells Fargo Retail Finance LLC, as Lender and
                      Syndication Agent.

          10.2        Reaffirmation of Guaranty dated as of April 23, 2002 by
                      Wilsons The Leather Experts Inc., Wilsons Center, Inc.,
                      Rosedale Wilsons, Inc., River Hills Wilsons, Inc. and the
                      Store Guarantors listed on the signature pages thereto in
                      favor of General Electric Capital Corporation as Agent for
                      Lenders.

          10.3        Amendment No. 1 to Mortgage, Security Agreement,
                      Assignment of Leases and Rents and Financing Statement
                      dated as of April 23, 2002 by Bermans The Leather Experts
                      Inc. in favor of General Electric Capital Corporation as
                      Agent for Lenders.


                                       22

<PAGE>


          10.4        Amendment No. 1 to Mortgage, Security Agreement,
                      Assignment of Leases and Rents, Financing Statement and
                      Fixture Filing dated as of April 23, 2002, by Bentley's
                      Luggage Corp. in favor of General Electric Capital
                      Corporation as Agent for Lenders.

          10.5        Wilsons The Leather Experts Inc. Amended Executive and Key
                      Management Incentive Plan, as amended May 23, 2002.


     B.   Exhibits and Reports on Form 8-K: The Company filed two reports on
          Form 8-K during the first quarter ended May 4, 2002, as follows:

          Form 8-K filed May 3, 2002, announcing the sale in a private placement
          of 900,000 shares of newly issued common stock to two investors.

          Form 8-K filed May 15, 2002, announcing that the Company had
          discontinued the engagement of Arthur Andersen LLP and engaged KPMG
          LLP as the Company's independent accountants.


                                       23

<PAGE>

                                    SIGNATURE

Pursuant to the requirements 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.

WILSONS THE LEATHER EXPERTS INC.


By: /s/ Peter G. Michielutti
    -------------------------------------------------
        Peter G. Michielutti
        Senior Vice President and
        Chief Financial Officer

Date:    June 18, 2002


                                       24

<PAGE>

                                INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit No.          Description                                                       Method of Filing
-----------          -----------                                                       ----------------
<S>                  <C>                                                               <C>
3.1                  Amended and Restated Articles of Incorporation of Wilsons The
                     Leather Experts Inc. adopted June 16, 1998, as amended by the
                     Articles of Amendment dated February 17, 2000 and May 23, 2002    Electronic Transmission

3.2                  Restated Bylaws of Wilsons The Leather Experts Inc., as
                     amended June 16, 1998, January 25, 2000 and May 23, 2002 ......   Electronic Transmission

4.1                  Specimen of Common Stock Certificate. (1) .....................   Incorporated by Reference

4.2                  Indenture dated as of August 18, 1997 by and among Wilsons The
                     Leather Experts Inc., the other corporations listed
                     on the signature pages thereof, and Norwest Bank Minnesota,
                     National Association, including specimen Certificate of 11 1/4%
                     Series A Senior Notes due 2004 and specimen Certificate of
                     11 1/4% Series B Senior Notes due 2004. (2) ...................   Incorporated by Reference

4.3                  Purchase Agreement dated as of August 14, 1997 by and among
                     Wilsons The Leather Experts Inc., the Subsidiary Guarantors
                     party thereto and BancAmerica Securities, Inc. (3) ............   Incorporated by Reference

4.4                  Registration Rights Agreement dated as of May 25, 1996 by
                     and among CVS New York, Inc., Wilsons The Leather Experts
                     Inc., the Managers listed on the signature pages thereto,
                     Leather Investors Limited Partnership I and the Partners
                     listed on the signature pages thereto. (4) ....................   Incorporated by Reference

4.5                  Amendment to Registration Rights Agreement dated as of
                     August 12, 1999 by and among Wilsons The Leather Experts Inc.
                     and the Shareholders listed on the attachments thereto. (5)....   Incorporated by Reference

4.6                  Registration Rights Agreement dated as of January 10, 2002,
                     by and among the Company and the investors signatory
                     thereto. (5) ..................................................   Incorporated by Reference
</TABLE>


                                       25

<PAGE>
<TABLE>
<CAPTION>
<S>                  <C>                                                               <C>
4.7                  Registration Rights Agreement dated as of April 24, 2002, by
                     and among the Company and the investors signatory thereto. (4)    Incorporated by Reference

10.1                 Fourth Amended and Restated Credit Agreement dated as of
                     April 23, 2002 among Wilsons Leather Holdings Inc., as
                     Borrower, the Lenders signatory thereto from time to time, as
                     Lenders, General Electric Capital Corporation, as Agent,
                     Lender, Term Lender and Swing Line Lender, GECC Capital
                     Markets Group, Inc., as Lead Arranger, The CIT Group/Business
                     Credit, Inc., as Lender and Documentation Agent and Wells
                     Fargo Retail Finance LLC, as Lender and Syndication Agent......   Electronic Transmission

10.2                 Reaffirmation of Guaranty dated as of April 23, 2002 by
                     Wilsons The Leather Experts Inc., Wilsons Center, Inc.,
                     Rosedale Wilsons, Inc., River Hills Wilsons, Inc. and the
                     Store Guarantors listed on the signature pages thereto in
                     favor of General Electric Capital Corporation as Agent for
                     Lenders. ......................................................    Electronic Transmission

10.3                 Amendment No. 1 to Mortgage, Security Agreement, Assignment
                     of Leases and Rents and Financing Statement dated as of April
                     23, 2002 by Bermans The Leather Experts Inc. in favor of
                     General Electric Capital Corporation as Agent for Lenders. ....   Electronic Transmission

10.4                 Amendment No. 1 to Mortgage, Security Agreement, Assignment
                     of Leases and Rents, Financing Statement and Fixture Filing
                     dated as of April 23, 2002, by Bentley's Luggage Corp. in
                     favor of General Electric Capital Corporation as Agent for
                     Lenders........................................................   Electronic Transmission

10.5                 Wilsons The Leather Experts Inc. Amended Executive and Key
                     Management Incentive Plan, as amended May 23, 2002.............   Electronic Transmission
</TABLE>



(1)  Incorporated by reference to the same numbered exhibit to Amendment No. 1
     to the Company's Registration Statement on Form S-1 (333-13967) filed with
     the Commission on December 24, 1996.

(2)  Incorporated by reference to Exhibit 10.3 to the Company's Report on Form
     10-Q for the quarter ended August 2, 1997 filed with the Commission.


                                       26

<PAGE>

(3)  Incorporated by reference to Exhibit 10.4 to the Company's Report on Form
     10-Q for the quarter ended August 2, 1997 filed with the Commission.

(4)  Incorporated by reference to Exhibit 4.8 to the Company's Registration
     Statement on Form S-1 (333-13967) filed with the Commission on October 11,
     1996.

(5)  Incorporated by reference to Exhibit 4.2 to the Company's Current Report on
     Form 8-K filed with the Commission on January 23, 2002.

(6)  Incorporated by reference to Exhibit 4.2 to the Company's Current Report on
     Form 8-K filed with the Commission on May 3, 2002.


                                       27
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{"company-data": {"conformed-name": "WILSONS THE LEATHER EXPERTS INC", "cik": "0001016607", "assigned-sic": "5651", "irs-number": "411839933", "state-of-incorporation": "MN", "fiscal-year-end": "0201"}, "filing-values": {"form-type": "10-Q", "act": "34", "file-number": "333-13967", "film-number": "02681713"}, "business-address": {"street1": "7401 BOONE AVENUE NORTH", "street2": "ST LOUIS PARK", "city": "BROOKLYN PARK", "state": "MN", "zip": "55428", "phone": "6123914000"}}
UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

(Mark one)

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

                   For the quarterly period ended May 4, 2002

                                   OR

[_]  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 000-21543

                        WILSONS THE LEATHER EXPERTS INC.
                        --------------------------------
             (Exact name of registrant as specified in its charter)

                 MINNESOTA                                       41-1839933
                 ---------                                       ----------
     (State or other jurisdiction of                         (I.R.S. Employer
      incorporation or organization)                        Identification No.)

             7401 BOONE AVE. N.
             BROOKLYN PARK, MN                                     55428
             ------------------                                    -----
 (Address of principal executive offices)                        (Zip Code)

                                 (763) 391-4000
                                 --------------
              (Registrant's telephone number, including area code)

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 [_]

As of June 1, 2002, there were 20,266,123 shares of common stock, $0.01 par
value per share, outstanding.
WILSONS THE LEATHER EXPERTS INC.
                                     INDEX

                                                                            PAGE
                                                                            ----
PART I - FINANCIAL INFORMATION

     Item 1.  Consolidated Financial Statements

              Consolidated Balance Sheets as of May 4, 2002 and
              February 2, 2002                                                3

              Consolidated Statements of Operations for the
              three months ended May 4, 2002 and May 5, 2001                  4

              Consolidated Statements of Cash Flows for the
              three months ended May 4, 2002 and May 5, 2001                  5

              Notes to Consolidated Financial Statements                      6

     Item 2.  Management's Discussion and Analysis of Financial
              Condition and Results of Operations                            13

     Item 3.  Quantitative and Qualitative Disclosures About Market Risk     19

PART II - OTHER INFORMATION

     Item 2.  Changes in Securities                                          21

     Item 6.  Exhibits and Reports on Form 8-K                               21

     Signature                                                               24

     Index to Exhibits                                                       25

                                       2
WILSONS THE LEATHER EXPERTS INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
               (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

                                                         MAY 4,      FEBRUARY 2,
                   ASSETS                                 2002          2002*
                   ------                               --------     -----------
                                                      (Unaudited)
CURRENT ASSETS:
   Cash and cash equivalents                            $ 14,772      $ 43,329
   Accounts receivable, net                                8,826        10,255
   Inventories                                           111,392       128,555
   Prepaid expenses and other current assets               9,681         4,450
                                                        --------      --------
      Total current assets                               144,671       186,589

Property and equipment, net                              107,050       109,827
Goodwill and other assets, net                            29,896        28,772
Deferred taxes                                             3,584         3,584
                                                        --------      --------
      Total assets                                      $285,201      $328,772
                                                        ========      ========

    LIABILITIES AND SHAREHOLDERS' EQUITY
    ------------------------------------

CURRENT LIABILITIES:
   Accounts payable                                     $ 16,422      $ 38,685
   Accrued expenses                                       25,265        33,572
   Income taxes payable                                    1,085        11,824
   Deferred income taxes                                   1,974         1,974
                                                        --------      --------
      Total current liabilities                           44,746        86,055

Long-term debt                                            55,590        55,590
Other long-term liabilities                                5,267         4,360
                                                        --------      --------
      Total liabilities                                  105,603       146,005
                                                        --------      --------

Commitments and contingencies

SHAREHOLDERS' EQUITY:
   Common stock, $.01 par value; 150,000,000 shares
    authorized, 20,250,748 and 19,204,545 shares
    issued and outstanding on May 4, 2002 and
    February 2, 2002, respectively                           203           192
   Additional paid-in capital                             97,295        85,896
   Retained earnings                                      83,275        97,952
   Unearned compensation                                  (1,145)       (1,243)
   Cumulative other comprehensive income (loss)              (30)          (30)
                                                        --------      --------
      Total shareholders' equity                         179,598       182,767
                                                        --------      --------
      Total liabilities and shareholders' equity        $285,201      $328,772
                                                        ========      ========

              The accompanying notes are an integral part of these
                       consolidated financial statements.

            *Derived from audited consolidated financial statements.

                                       3
WILSONS THE LEATHER EXPERTS INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                                   (UNAUDITED)

                                                            THREE MONTHS ENDED
                                                           --------------------
                                                            MAY 4,      MAY 5,
                                                             2002        2001
                                                           --------    --------
NET SALES                                                  $119,261    $117,477
  Cost of goods sold, buying and occupancy costs             94,654      81,827
                                                           --------    --------
  Gross margin                                               24,607      35,650

  Selling, general and administrative expenses               42,398      36,685
  Depreciation and amortization                               4,966       4,333
                                                           --------    --------
     Loss from operations                                   (22,757)     (5,368)
  Interest expense, net                                       1,704         762
                                                           --------    --------
     Loss before income taxes                               (24,461)     (6,130)
  Income tax benefit                                         (9,784)     (2,452)
                                                           --------    --------
     Net loss                                              $(14,677)   $ (3,678)
                                                           ========    ========

NET LOSS PER COMMON SHARE - BASIC AND DILUTED                 (0.76)      (0.22)
                                                           ========    ========

Weighted average common shares outstanding                   19,214      16,940
                                                           ========    ========

              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                       4
WILSONS THE LEATHER EXPERTS INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                   (UNAUDITED)

                                                           THREE MONTHS ENDED
                                                         ----------------------
                                                           MAY 4,        MAY 5,
                                                            2002          2001
                                                         ---------     ---------
OPERATING ACTIVITIES:
  Net loss                                               $(14,677)     $ (3,678)
  Adjustments to reconcile net loss to net cash used in
    operating activities-
    Depreciation and amortization                           4,966         4,332
    Amortization of deferred financing costs                  221           157
    Loss on disposal of assets                                331           206
    Restricted stock compensation expense                      98            --
    Deferred income taxes                                      --         2,024
    Changes in operating assets and liabilities:
      Accounts receivable, net                              1,429          (948)
      Inventories                                          17,163        (3,895)
      Prepaid expenses                                     (5,231)         (652)
      Accounts payable and accrued expenses               (30,533)      (16,878)
      Income taxes payable and other liabilities           (9,741)      (18,652)
                                                         --------      --------
        Net cash used in operating activities             (35,974)      (37,984)
                                                         --------      --------

INVESTING ACTIVITIES:
  Additions to property, equipment and other assets        (3,901)       (9,096)
  Acquisitions                                                 --       (33,652)
                                                         --------      --------
    Net cash used in investing activities                  (3,901)      (42,748)
                                                         --------      --------

FINANCING ACTIVITIES:
   Proceeds from issuance of common stock, net             11,318         1,095
   Change in notes payable                                     --        28,140
   Other financing                                             --           (23)
                                                         --------      --------
      Net cash provided by financing activities            11,318        29,212
                                                         --------      --------
NET DECREASE IN CASH AND CASH EQUIVALENTS                 (28,557)      (51,520)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD             43,329        52,122
                                                         --------      --------
CASH AND CASH EQUIVALENTS, END OF PERIOD                 $ 14,772      $    602
                                                         ========      ========

SUPPLEMENTAL CASH FLOW INFORMATION:
  Cash paid during the period for
    Interest                                             $  2,726      $  2,241
                                                         ========      ========
    Income taxes                                         $    786      $ 14,203
                                                         ========      ========

              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                       5
WILSONS THE LEATHER EXPERTS INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

1.   NATURE OF ORGANIZATION

     Wilsons The Leather Experts Inc. (Wilsons Leather or the Company), a
Minnesota corporation, is the leading specialty retailer of quality leather
outerwear, accessories, apparel and travel products in the United States. As of
May 4, 2002, the Company operated 757 retail stores located in 46 states, the
District of Columbia, Guam, Puerto Rico and Canada, including 486 mall stores,
97 outlet stores and 30 airport locations under the Wilsons Leather format and
144 premium travel products and accessories stores under the El Portal,
Bentley's Luggage and California Luggage Outlet names. The Company supplemented
permanent mall stores with 281 seasonal stores during its peak selling season
from October through January during the year ended February 2, 2002.

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     BASIS OF FINANCIAL STATEMENT PRESENTATION

     The consolidated financial statements include all accounts of Wilsons
Leather and its wholly owned subsidiaries. All material intercompany balances
and transactions between the entities have been eliminated in consolidation.

     Wilsons Leather operates in one segment: selling leather outerwear,
accessories, apparel and travel-related products. The Company's chief operating
decision-maker evaluates revenue and profitability performance on an enterprise
basis to make operating and strategic decisions.

     The accompanying unaudited consolidated financial statements have been
prepared by the Company pursuant to the rules and regulations of the Securities
and Exchange Commission. Certain information and footnote disclosure, normally
included in consolidated financial statements prepared in accordance with
accounting principles generally accepted in the United States of America, have
been condensed or omitted pursuant to such rules and regulations. Although
management believes that the accompanying disclosures are adequate to make the
information presented not misleading, it is recommended that these interim
consolidated financial statements be read in conjunction with the Company's most
recent audited consolidated financial statements and related notes included in
its 2001 Annual Report on Form 10-K. In the opinion of management, all
adjustments (which include normal recurring adjustments) necessary for a fair
presentation of the financial position, results of operations and cash flows for
the interim periods presented have been made. The Company's business is highly
seasonal, and accordingly, interim operating results are not necessarily
indicative of the results that may be expected for the fiscal year ending
February 1, 2003.

                                       6
RECLASSIFICATIONS

     Certain amounts included in the consolidated financial statements have been
reclassified in prior years to conform with the fiscal 2002 financial statement
presentation. These amounts had no effect on previously reported shareholders'
equity or net income (loss).

     INVENTORIES

     The Company values its inventories, which consist primarily of finished
goods held for sale purchased from domestic and foreign vendors, at the lower of
cost or market value, determined by the retail inventory method on the last-in,
first-out (LIFO) basis and approximated first-in, first-out (FIFO) cost as of
May 4, 2002 and February 2, 2002. The cost includes the cost of merchandise and
freight. A periodic review of inventory quantities on hand is performed in order
to determine if inventory is properly stated at the lower of cost or market.
Factors related to current inventories such as future consumer demand and
fashion trends, current aging, current and anticipated retail markdowns, and
class or type of inventory are analyzed to determine estimated net realizable
values. A provision is recorded to reduce the cost of inventories to the
estimated net realizable values, if required. Any significant unanticipated
changes in the factors noted above could have a significant impact on the value
of its inventories and its reported operating results.

     REVENUE RECOGNITION

     The Company recognizes sales upon customer receipt of the merchandise
generally at the point of sale. Shipping and handling revenues are included in
net sales and the related costs are included in costs of goods sold, buying and
occupancy costs. Revenue for gift certificate sales and store credits is
recognized at redemption. A reserve is provided at the time of sale for
projected merchandise returns based upon historical experience.

     INCOME TAXES

     Deferred tax assets and liabilities are recognized for the future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases. Deferred tax assets and liabilities are measured using enacted tax rates
in effect for the year in which those temporary differences are expected to
reverse.

     NET INCOME (LOSS) PER COMMON SHARE

     Basic net income (loss) per common share is computed by dividing net income
(loss) by the weighted average number of common shares outstanding during the
year. Diluted net income (loss) per share is computed by dividing net income
(loss) by the sum of the weighted average number of common shares outstanding
plus all additional common shares that would have been outstanding if
potentially dilutive common shares related to stock options had been issued. The
following table reconciles the number of shares utilized in the net income
(loss) per common share calculations (in thousands):

                                       7
Three Months  Three Months
                                                          Ended        Ended
                                                       May 4, 2002  May 5, 2001
                                                      ------------  ------------
     Net loss                                           $(14,677)     $(3,678)
                                                        ========      =======
     Weighted average common shares outstanding -
       basic                                              19,214       16,940
     Weighted average common shares outstanding -
       basic and diluted                                  19,214       16,940
                                                        --------      -------
     Basic and diluted net loss per common share        $  (0.76)     $ (0.22)
                                                        ========      =======

     RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

     Statement of Financial Accounting Standards (SFAS) No. 133, "Accounting for
Derivative Instruments and Hedging Activities," as amended, became effective for
fiscal years beginning after June 15, 2000. SFAS No. 133 establishes accounting
and reporting standards requiring that every derivative instrument, including
certain derivative instruments embedded in other contracts, be recorded in the
balance sheet as either an asset or liability measured at fair value. SFAS No.
133 requires that changes in the derivative's fair value be recognized currently
in earnings unless specific hedge criteria are met. Special accounting for
qualifying hedges allows a derivative's gains or losses to offset related
results on the hedged item in the income statement and requires that a company
must formally document, designate and assess the effectiveness of transactions
that receive hedge accounting. The Company adopted SFAS No. 133 on February 4,
2001, and the adoption did not have a material effect on the Company's financial
position or results of operations.

     On February 3, 2002, new accounting rules for business combinations and
accounting for goodwill and other intangibles, SFAS No. 141, "Business
Combinations," and SFAS No. 142, "Goodwill and Other Intangible Assets," became
effective for the Company. As a result and from that date forward, goodwill will
no longer be amortized against earnings and goodwill balances will be subject to
impairment review on at least an annual basis. The pro forma effect of cessation
of goodwill amortization would have increased earnings from continuing
operations for the first quarter of 2001 by $0.3 million or $0.01 per diluted
common share.

     In connection with the transitional goodwill impairment evaluation, the
Company must perform an assessment by August 3, 2002 to determine whether
goodwill was impaired as of the effective date of SFAS No. 141 and SFAS No. 142.
Any transitional impairment loss will be measured as of February 3, 2002 and
reported as a first quarter 2002 cumulative effect of a change in accounting
principle in the Company's statement of operations as soon as practicable but
not later than February 1, 2003. The Company has not determined the impact of
adopting SFAS No. 142 on its statement of operations and financial position,
including whether it will be required to recognize any transitional impairment
losses as a cumulative effect of a change in accounting principle.

     In October 2001, the Financial Accounting Standards Board issued SFAS No.
144, "Accounting for the Impairment or Disposal of Long-Lived Assets." SFAS No.
144 supersedes SFAS No. 121. SFAS No. 144 primarily addresses significant issues
relating to the implementation of SFAS No. 121 and develops a single accounting
model for long-lived assets to be disposed of, whether primarily held, used or
newly acquired. The provisions of SFAS No. 144 were effective for fiscal years
beginning after December 15, 2001. The Company applied this standard beginning
in the first quarter of 2002 and did not expect the adoption to have a material
impact on its financial position or its results of operations.

                                       8
In June 2001, the FASB issued Statement of Financial Accounting Standards
No. 143 ("SFAS 143"), "Accounting for Asset Retirement Obligations," which is
effective for fiscal years beginning after June 15, 2002. SFAS 143 addresses the
financial accounting and reporting for obligations and retirement costs related
to the retirement of tangible long-lived assets. We do not expect that the
adoption of SFAS 143 will have a significant impact on our consolidated
financial statements.

     In April 2002, the FASB issued SFAS No. 145 "Rescission of FASB Statements
No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical
Corrections". SFAS No. 145 primarily affects the reporting requirements and
classification of gains and losses from the extinguishment of debt, rescinds the
transitional accounting requirements for intangible assets of motor carriers,
and requires that certain lease modifications with economic effects similar to
sale-leaseback transactions be accounted for in the same manner as
sale-leaseback transactions. SFAS No. 145 is effective for financial statements
issued after April 2002, with the exception of the provisions affecting the
accounting for lease transactions, which should be applied for transactions
entered into after May 15, 2002, and the provisions affecting classification of
gains and losses from the extinguishment of debt, which should be applied in
fiscal years beginning after May 15, 2002. Management has determined that the
adoption of SFAS No. 145 will have no impact on the Company's consolidated
financial statements.

3.   ACQUISITIONS

     The following acquisitions were accounted for as purchases. The purchase
prices assigned to the net assets acquired were based on the fair value of such
assets and liabilities at the respective acquisition dates. Tangible net assets
acquired include accounts receivable, inventories, prepaid expenses, other
current assets and fixed assets. Liabilities assumed principally include
accounts payable and accrued expenses. The operating results of these acquired
companies have been included in the consolidated statements of operations from
the dates of acquisition.

     On October 31, 2000, the Company acquired all of the outstanding common
shares of the El Portal Group, Inc. (El Portal), a specialty retailer of premium
travel products and accessories, for approximately $17.8 million, including
transaction costs.

     ALLOCATION OF THE PURCHASE PRICE (IN MILLIONS):
     Inventory                                                    $13.2
     Other current assets                                           2.6
     Property and equipment                                        11.8
     Goodwill and other assets, net                                25.4
                                                                  -----
              Total assets                                        $53.0

     Accounts payable                                              16.4
     Notes payable                                                 13.8
     Accrued taxes                                                  3.0
     Other current liabilities                                      2.0
                                                                  -----
              Total liabilities                                   $35.2

                   Total purchase price allocation                $17.8
                                                                  =====

     In conjunction with the acquisition, the Company decided to close certain
stores and established a restructuring reserve of $1.5 million. As of May 4,
2002, the balance of restructuring

                                       9
liabilities recorded in conjunction with the acquisition was approximately $0.4
million. The remaining closures of facilities are expected to be completed by
the end of fiscal year 2002.

     On April 14, 2001, the Company acquired all of the outstanding shares of
Bentley's Luggage Corp. (Bentley's), a specialty retailer of travel products and
accessories, for approximately $34.3 million.

     ALLOCATION OF THE PURCHASE PRICE (IN MILLIONS):
     Inventory                                                    $18.2
     Other current assets                                           6.9
     Property and equipment                                        13.5
     Goodwill and other assets, net                                12.7
                                                                  -----
              Total assets                                        $51.3

     Accounts payable                                             $ 6.9
     Accrued expense                                               10.1
                                                                  -----
              Total liabilities                                   $17.0

                   Total purchase price allocation                $34.3
                                                                  =====

     In conjunction with the acquisition, the Company decided to close certain
stores and facilities as well as terminate certain related employees and
established a restructuring reserve of $4.0 million. The $4.0 million is
comprised of costs associated with the closure of acquired facilities and
termination of employees, which amounted to $2.6 million and $1.4 million,
respectively. As of May 4, 2002, the balance of restructuring liabilities
recorded in conjunction with the acquisition was approximately $1.1 million. The
remaining closures of facilities are expected to be completed by the end of
fiscal year 2002.

     The following additional pro forma information presents the results of
operations of the Company as if the acquisitions had been completed as of
February 3, 2001 (in thousands, except per share amounts):

                                                                   Three months
                                                                       ended
                                                                    May 5, 2001
                                                                   ------------
     Revenue                                                         $133,725
     Net income (loss)                                                 (6,462)
     Net income (loss) per common share--basic and diluted           $  (0.38)

     Weighted average common shares outstanding--basic and diluted     16,940

     This unaudited pro-forma consolidated financial information does not
purport to represent what the Company's financial position or results of
operations would actually have been if these transactions had occurred at such
date or project the Company's future results of operations.

                                       10
4.   OTHER COMPREHENSIVE INCOME (LOSS)

     The Company reports accumulated other comprehensive income (loss) as a
separate item in the shareholders' equity section of the balance sheet. Other
comprehensive income (loss) consists of foreign currency translation
adjustments. For the quarter ending May 4, 2002, there was no comprehensive
income (loss). For the quarter ending May 5, 2001, there was other comprehensive
loss of $21,000.

5.   LONG-TERM DEBT

     SENIOR NOTES

     On August 18, 1997, the Company issued $75.0 million of 11 1/4% Senior
Notes due August 15, 2004 (the Senior Notes). Interest on the Senior Notes is
payable semiannually in arrears on February 15 and August 15 of each year. The
Company repurchased $44.4 million of the Senior Notes in the years 1998 through
2000. As of May 4, 2002, the outstanding balance on the Senior Notes was $30.6
million.

     The Senior Notes are general unsecured obligations of the Company that rank
senior in right of payment to all existing and future subordinated indebtedness
of the Company, and rank on equal terms in right of payment with all other
current and future unsubordinated indebtedness of the Company. The indenture
governing the Senior Notes contains numerous operating covenants that limit the
discretion of management with respect to certain business matters and that place
significant restrictions on, among other things, the ability of the Company to
incur additional indebtedness, to create liens or other encumbrances, to declare
or pay any dividend, to make certain payments or investments, loans and
guarantees, and to sell or otherwise dispose of assets and merge or consolidate
with another entity. At May 4, 2002, the Company was in compliance with all
covenants of the Senior Notes.

     REVOLVING CREDIT AGREEMENT

     A syndicate of banks originally provided the Company with a $125.0 million
revolving credit agreement (the Revolver) which extended through May 2002 and
included an $85.0 million letter-of-credit subfacility as of January 29, 2000
(collectively referred to as the Senior Credit Facility). In October 2000, the
Company amended the Senior Credit Facility to increase the Revolver to $165.0
million and also to add a $20.5 million seasonal over-advance for November 2000
only, with interest on the over-advance at 100 basis points over the Senior
Credit Facility interest rate. This agreement was amended again on June 19, 2001
to increase the Revolver to $190 million, reduce and extend the seasonal
over-advance to $15 million during July through October and to add a Term B
promissory note of $25 million.

     On April 23, 2002, the Senior Credit Facility was amended again to decrease
the borrowings to $205 million in aggregate principal amount, including a $25
million Term B promissory note and a $75 million letter of credit subfacility.
The aggregate principal amount available for borrowing at any one time is based
on defined levels of inventory and receivables reduced by outstanding and
undrawn trade letters of credit and $10 million ($5 million during the months of
August, September and October) as specified in the agreement. At May 4, 2002,
there were no cash borrowings under the Revolver, and there were $15.3 million
in letters of credit outstanding.

                                       11
The Term B note is collateralized by the Company's inventory and buildings
and is due in June 2005. The Senior Credit Facility is collateralized by the
Company's inventory, equipment and credit card receivables and expires in June
2005. Interest on cash borrowings under the Senior Credit Facility is at LIBOR
plus 2.75%, the commercial paper rate plus 2.75%, or prime plus 1.50%. With
respect to the Term B note, the interest rate is prime plus 4%, plus an
additional 5% pursuant to a separate letter agreement with General Electric
Capital Corporation. The Company pays monthly fees on the unused portion of the
Senior Credit Facility and on the average daily amount of letters of credit
outstanding during each month.

     The Senior Credit Facility contains restrictions and covenants which, among
other things, restrict the ability of the Company to make capital expenditures;
acquire or merge with another company; make investments, loans or guarantees;
incur additional indebtedness; prepay, repurchase or pay any principal on the 11
1/4% Senior Notes, except pursuant to a permitted refinancing; create liens or
other encumbrances, and pay dividends or make other distributions. The Senior
Credit Facility also requires the Company to maintain certain financial
covenants. The aggregate principal amount available for borrowing at any one
time is also subject to limitations based on credit card receivables and the
value of inventories as if sold on a going-out-of-business basis, as specified
in the agreement. At May 4, 2002, the Company was in compliance with all
covenants of the Senior Credit Facility.

     The Senior Credit facility contains a requirement that the Company either
amend, refund, renew, extend or refinance the outstanding 11 1/4% Senior Notes
on or before June 15, 2004 so that no principal payment with respect to any such
amended, refunded, renewed, extended or refinanced notes is due on or before
September 1, 2005.

     The terms of the Senior Credit Facility prohibited the Company from
borrowing additional funds, other than letters of credit, until it had received
$10 million in net proceeds from certain permitted financings. On April 12,
2002, the Company received approximately $1.0 million in net proceeds, which was
applied to the $10 million financing requirement, from the exercise of an option
for 100,000 shares of common stock granted to an institutional purchaser. On
April 30, 2002, the Company received $9.9 million, which was also applied to the
$10.0 million financing requirement, from the private placement of 900,000
shares of its common stock at a purchase price of $11.00 per share. This
fulfilled the requirements of the Senior Credit Facility and allows immediate
access to the credit line as needed.

                                       12
6.   SUBSEQUENT EVENTS

     In May 2002, the Company internally communicated the closing of the El
Portal headquarters in Las Vegas, Nevada, which will reduce the administrative
overhead associated with the Company's travel concept and will result in a
second quarter pretax charge of $2.4 million. The charge would be taken to cover
the one-time costs of reducing excess administrative capacity and is expected to
be completed by August 1, 2002.

     In June 2002, the purchasers in the April 30, 2002 private placement of the
Company's common stock exercised the option under the stock purchase agreement
relating to the placement to purchase an additional 100,000 shares, which sale
was completed on June 13, 2002, for net proceeds of approximately $1.1 million.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
        RESULTS OF OPERATIONS

     The following discussion of our financial condition and results of
operations of Wilsons The Leather Experts Inc. and our wholly owned subsidiaries
should be read in conjunction with our most recent audited consolidated
financial statements and related notes included in our 2001 Annual Report on
Form 10-K.

     OVERVIEW

     We are the leading specialty retailer of high-quality leather outerwear,
apparel and accessories and the leading specialty retailer of travel products
and accessories in the United States. Our multiple store formats for each of our
concepts are designed to reach a broad customer base with a superior level of
customer service. Utilizing our integrated worldwide leather sourcing network
and in-house design capabilities, we are consistently able to provide our
customers high-quality, fashionable merchandise at attractive prices and
minimize fashion risk by reacting quickly to popular and emerging fashion trends
and customer preferences and rapidly replenishing fast-selling merchandise.

     At May 4, 2002, we operated a total of 757 stores located in 46 states, the
District of Columbia, Guam, Puerto Rico and Canada. Our Wilsons Leather concept
included 486 mall stores, 97 outlet stores and 30 airport locations and our
travel concept included 144 El Portal, Bentley's Luggage and California Leather
Outlet stores. Each year we supplement our permanent stores with temporary
holiday stores during our peak holiday season, which totaled 281 in 2001. Our
Wilsons Leather mall stores average approximately 2,100 square feet and feature
a large assortment of both classic and fashion-forward leather outerwear,
apparel and accessories. Our outlet stores are operated primarily under the
Wilsons Leather Outlet name, average approximately 3,200 square feet, and offer
a combination of clearance-priced merchandise from our mall stores, special
outlet-only merchandise and key in-season goods. Our airport stores average
approximately 700 square feet, feature travel products as well as leather
accessories, and provide us the opportunity to showcase our products and the
WILSONS LEATHER brand to millions of potential customers each year in some of
the world's busiest airports. Our proprietary labels, including M. Julian(R),
Maxima(R), Pelle Studio(R) and Wilsons Leather(TM), are positioned to appeal to
identified customer lifestyle segments.

                                       13
Through our acquisitions of Bentley's Luggage Corp. ("Bentley's Luggage")
and the El Portal Group, Inc. ("El Portal"), we created the leading specialty
retail chain of travel products and accessories in the United States. At May 4,
2002, we operated 144 premium travel products and accessories stores in 25
states, Puerto Rico and Guam under the El Portal, Bentley's Luggage, and
California Luggage Outlet names. Our travel stores average approximately 2,600
square feet and feature premium nationally branded merchandise, including
Tumi(R), Hartmann(R), Swiss Army(R), Travelpro(R), Kenneth Cole(R), Brighton(R),
Dooney & Bourke(R), Zero Halliburton(R) and Samsonite(R), as well as our growing
assortment of private labels, including El Portal(R), Signature(TM), Bentley's
Luggage(TM) and Priorities(TM).

     Comparable store sales decreased 10.3% in the three months ended May 4,
2002, compared to an increase of 2.1% in the same period of the prior year. A
store is included in the comparable store sales calculation after it has been
opened and operated by us for more than 52 weeks. The percentage change is
computed by comparing total net sales for comparable stores as thus defined at
the end of the applicable reporting period with total net sales from comparable
stores for the comparable period in the prior year.

     CRITICAL ACCOUNTING POLICIES

     We consider our critical accounting policies to be those related to
inventories, recorded goodwill, and property and equipment impairment as
discussed in the section with this title in Item 7, "Management's Discussion and
Analysis of Financial Condition and Results of Operations" that appears on page
24 of our Annual Report on Form 10-K for the year ended February 2, 2002. No
material changes occurred to these policies in the periods covered by this
report.

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MAY 4, 2002 COMPARED TO THE
THREE MONTHS ENDED MAY 5, 2001

     Net sales increased 1.5% to $119.3 million in 2002 from $117.5 million in
2001. This increase reflects additional sales from our travel-related stores,
offset by a 10.3% decline in comparable store sales during the quarter.

     We opened six stores and closed 18 stores in the first quarter ended May 4,
2002, compared to opening 23 stores, acquiring 106 stores with the acquisition
of Bentley's Luggage, and closing nine stores in the first quarter ended May 5,
2001. Included in the six stores opened in the first quarter of 2002 are one
mall, three outlet and two travel stores. As of May 4, 2002, Wilsons Leather
operated 757 stores compared to 731 stores at May 5, 2001.

     Cost of goods sold, buying and occupancy costs for the first quarter of
2002 were 79.4% of net sales, or $94.7 million, compared to 69.7% of sales, or
$81.8 million, for the same period a year ago. The increase of 9.7 points as a
percentage of net sales is related to a decrease in gross margin and an increase
in occupancy and buying costs. Gross margin net of occupancy and buying costs
decreased by 4.2% of net sales for the quarter as compared to last year due
primarily to decreased sales of higher margin fashion merchandise and higher
markdowns as a result of higher levels of clearance merchandise at the beginning
of the quarter. Our inventories are valued under the retail inventory method on
the LIFO basis. The difference in inventories between LIFO and the FIFO method
was not material as of May 4, 2002 and February 2, 2002. Buying and occupancy
costs increased by 5.6% of net sales over the prior year due to the 3.6%
increase in the number of open stores in 2002 versus 2001.

                                       14
Selling, general and administrative expenses for the first quarter of 2002
were 35.6% of net sales, or $42.4 million, compared to 31.2% of net sales, or
$36.7 million, for the same period last year. The increase of $5.7 million was
due mainly to payroll expense associated with the operation of an additional 26
stores during the first quarter of 2002 as compared to the same period last
year, as a result of the acquisition of the Bentley's Luggage stores in the last
two weeks of the first quarter of 2001.

     Depreciation and amortization expense increased to $5.0 million from $4.3
million last year, and increased as a percentage of net sales to 4.2% from 3.7%.
The increase in depreciation and amortization resulted primarily from capital
expenditures for new store construction, the Bentley's Luggage stores
acquisition and the renovation of existing stores.

     Net interest expense was $1.7 million for the first quarter of 2002 as
compared to $0.8 million during the same period last year due to the $25 million
in new term debt from the acquisition of Bentley's Luggage.

     LIQUIDITY AND CAPITAL RESOURCES

     Our capital requirements are primarily driven by our seasonal working
capital needs, investments in new stores, remodeling existing stores, enhancing
information systems and increasing capacity for our distribution centers. Our
peak working capital needs typically occur during the period from August through
early December as inventory levels are increased in advance of our peak selling
season from October through January.

     Our future capital requirements depend on the sustained demand for both our
leather and travel products. Many factors affect the level of consumer spending
on our products, including, among others, general business conditions, interest
rates, the availability of consumer credit, weather, the outbreak of war, acts
of terrorism or the threat of either, and interruption in the operation of
corporate offices and distribution centers, other significant national and
international events, taxation and consumer confidence in future economic
conditions. Consumer purchases of discretionary items, such as our products,
tend to decline during recessionary periods when disposable income is lower. The
general slowdown in the United States economy and the uncertain economic outlook
has adversely affected consumer spending habits and mall traffic, causing us to
delay or slow our expansion plans and has resulted in lower net sales than
expected on a quarterly and annual basis.

     Our ability to meet our debt service obligations will be dependent upon our
future performance, which will be subject to general economic conditions and
financial, business and other factors affecting our operations. If we are unable
to generate sufficient cash flow from operations in the future to service our
debt, we may be required to refinance all or a portion of existing debt or to
obtain additional financing. There can be no assurance that any such refinancing
or additional financing would be possible or could be obtained on terms that are
favorable to us.

     General Electric Capital Corporation and a syndicate of banks have provided
us with a senior credit facility that provides for borrowings of up to $205
million in aggregate principal amount, including a $25 million Term B promissory
note and a $75 million letter of credit subfacility. The maximum amount
available under the revolving credit portion of the senior credit facility is
limited to:

                                       15
o    65% of net inventories of the type that we sold before the
          acquisitions of El Portal and Bentley's Luggage, which increases to
          70% during the months of August, September and October, provided that
          such percentage at no time may exceed 85% of the discount rate applied
          in appraising such inventories to reflect their value as if sold in an
          orderly liquidation;

     o    plus 55% of net inventories of the type traditionally sold by El
          Portal and Bentley's Luggage, which increases to 65% during the months
          of August, September and October, provided that such percentage at no
          time may exceed 85% of the discount rate applied in appraising such
          inventories to reflect their value as if sold in an orderly
          liquidation;

     o    plus 60% of outstanding and undrawn trade letters of credit, provided
          that such percentage at no time may exceed 85% of the discount rate
          applied in appraising the future inventories related to such letters
          of credit to reflect their value as if sold in an orderly liquidation;

     o    plus 85% of credit card receivables; and

     o    minus $10 million ($5 million during the months of August, September
          and October).

     In addition, borrowings under the senior credit facility are subject to the
further limitations that:

     o    the revolving credit portion of such borrowings cannot exceed the sum
          of 85% of credit card receivables, plus 85% of the appraised value of
          inventory (including inventory subject to trade letters of credit) as
          if sold on a going-out-of business basis; and

     o    the total borrowings cannot exceed the sum of 85% of the book value of
          credit card receivables, plus 95% (100% during August, September and
          October) of the appraised value of inventory (including inventory
          subject to trade letters of credit) as if sold on a going-out-of
          business basis.

     As of May 4, 2002, we had no borrowings under the senior credit facility,
except for the Term B promissory note, and we had $15.3 million in outstanding
letters of credit. The terms of the senior credit facility prohibited us from
borrowing additional funds, other than letters of credit, until we had received
$10 million in net proceeds from certain permitted financings. On April 12,
2002, we received approximately $1.0 million in net proceeds, which was applied
to the $10 million financing requirement, from the exercise of an option for
100,000 shares of common stock granted to an institutional purchaser. On April
30, 2002, we received $9.9 million, which was also applied to the $10.0 million
financing requirement, from the private placement of 900,000 shares of our
common stock at a purchase price of $11.00 per share. This fulfilled the
requirements of the Senior Credit Facility, allowing immediate access to our
credit line as needed.

     Interest is payable on revolving credit borrowings at variable rates
determined by LIBOR plus 2.75%, the commercial paper rate plus 2.75% or the
"prime" rate plus 1.50%. Interest is payable on the $25 million Term B
promissory note at a variable rate equal to the "prime" rate plus 4%, plus an
additional 5% payable pursuant to a separate letter agreement with General
Electric Capital Corporation. We pay monthly fees on the unused portion of the
senior credit facility and on the average daily amount of letters of credit
outstanding during each month. The senior credit facility expires in June 2005,
at which time all borrowings, including the Term B promissory note,

                                       16
become due and payable. Prepayment of the Term B promissory note is subject to a
2% prepayment fee if prepaid on or after July 1, 2002 but on or prior to
November 30, 2003, and a 1% prepayment fee thereafter. The Term B promissory
note is prepayable on or after July 1, 2002 only with the consent of the senior
lenders under the senior credit facility.

     The senior credit facility contains certain restrictions and covenants
which, among other things, restrict our ability to make capital expenditures;
acquire or merge with another entity; make investments, loans or guarantees;
incur additional indebtedness; prepay, repurchase or pay any principal on any 11
1/4% senior notes, except pursuant to a permitted refinancing; create liens or
other encumbrances; or pay cash dividends or make other distributions. We are
currently in compliance with all covenants under the recently amended senior
credit facility.

     The senior credit facility also contains a requirement that we either
amend, refund, renew, extend or refinance the outstanding 11 1/4% senior notes
on or before June 15, 2004 so that no principal payment with respect to any such
amended, refunded, renewed, extended or refinanced notes is due on or before
September 1, 2005. The terms of any refunded, renewed, extended or refinanced
notes cannot be more burdensome than the terms of the 11 1/4% senior notes and
the rate of interest with respect to any such notes cannot exceed the sum of the
rate of interest on United States treasury obligations of like tenor at the time
of such refunding, renewal, refinancing or extension plus 7% per annum.

     We plan to use the senior credit facility for our immediate and future
working capital needs. Peak borrowings typically occur from October through
December and outstanding letters of credit typically peak from August through
September. We are dependent on the senior credit facility to fund working
capital and letter of credit needs. We are also currently evaluating
opportunities to access the capital markets to replenish working capital
depleted in previous acquisitions, as well as finance our other capital needs.
We believe that borrowing capacity under the senior credit facility, together
with current and anticipated cash flow from operations, will be adequate to meet
our working capital and capital expenditure requirements during the term of the
senior credit facility, provided that we either amend, refund, renew, extend or
refinance the outstanding 11 1/4% senior notes on or before June 15, 2004 so
that no principal payment with respect to any such amended, refunded, renewed,
extended or refinanced notes is due on or before September 1, 2005.

     On August 18, 1997, we completed a private offering of $75 million of 11
1/4% senior notes due 2004, referred to above, to certain institutional buyers.
Interest on the 11 1/4% senior notes is payable semi-annually in arrears on
February 15 and August 15 of each year. The 11 1/4% senior notes mature on
August 15, 2004. The indenture governing the 11 1/4% senior notes contains
numerous operating covenants that limit the discretion of management with
respect to certain business matters and place significant restrictions on, among
other things, our ability to incur additional indebtedness, to create liens or
other encumbrances, to declare or pay any dividends, to make certain payments or
investments, loans and guarantees and to sell or otherwise dispose of assets and
merge or consolidate with another entity. The 11 1/4% senior notes are callable
subsequent to August 15, 2001, at a defined premium. The 11 1/4% senior notes
are our general unsecured obligations and rank senior in right of payment to all
of our existing and future subordinated indebtedness and rank on equal terms in
right of payment with all of our other current and future unsubordinated
indebtedness. During the years 1998-2000, we repurchased $44.4 million of our 11
1/4% senior notes. As of May 4, 2002, we had $30.6 million of 11 1/4% senior
notes outstanding.

                                       17
On October 31, 2000, we acquired El Portal, a specialty retailer of premium
travel products and accessories, for approximately $17.8 million. The
acquisition was funded with cash from working capital and our senior credit
facility. On April 13, 2001, we acquired Bentley's Luggage, a specialty retailer
of travel products and accessories, for $34.3 million. The acquisition was
funded with cash from working capital and our senior credit facility.

     During the third quarter of 2001, we completed the offering of unsecured
short-term promissory notes in the principal amount of $20.0 million at an
interest rate of 7.9%, which matured on January 15, 2002. The notes were paid in
full at maturity.

     In January 2002, we sold 1,900,000 shares of common stock to an
institutional investor in a private placement for a price of $11.00 per share
for net proceeds of approximately $20.0 million. In April 2002, affiliates of
the institutional investor exercised the option to purchase 100,000 shares of
our common stock at a purchase price of $11.00 per share, which sale was
completed on April 12, 2002 for net proceeds of approximately $1.0 million.

     On April 30, 2002, we sold 900,000 shares of our common stock in a private
placement at a purchase price of $11.00 per share, for net proceeds of
approximately $9.9 million. The stock purchase agreement provided that the
investors may purchase an additional 100,000 shares of common stock at $11.00
per share at any time within 75 days after the closing of the initial sale. On
June 10, 2002, the purchasers in the April placement exercised the option, which
sale was completed on June 13, 2002, for net proceeds of approximately $1.1
million.

     CASH FLOW ANALYSIS

     Operating activities for the three months ended May 4, 2002 resulted in
cash used of $36.0 million compared to cash used of $38.0 million in the
corresponding period of 2001. We had a net loss of $14.7 million in 2002,
primarily as a result of increased expenses from the Bentley's Luggage
acquisition. Additionally, in 2002 there was a $17.2 million decrease in
inventories, a $30.5 million decrease in accounts payable and accrued expenses,
a $9.7 million decrease in taxes payable, a $5.2 million increase in prepaid
expenses and $6.9 million in cash provided by depreciation, amortization and
other operating activities.

     Changes in certain balance sheet accounts between February 2, 2002, and May
4, 2002, reflect normal seasonal variations within the retail industry. The
level of cash and cash equivalents, inventories, accounts receivable, accounts
payable and certain accrued liabilities fluctuate due to the seasonal nature of
the working capital needs of our operations.

     Investing activities for the three months ended May 4, 2002 were comprised
of $3.9 million in capital expenditures and additions to other assets used
primarily for the construction of new stores, the renovation of and improvements
to existing stores, and the implementation of certain new information systems.
Capital expenditures and additions to other assets for the same period last year
totaled $9.1 million. In addition, for 2001 $34.3 million was used for the
acquisition of Bentley's Luggage. For 2002, we expect capital expenditures to be
approximately $10.0 million.

     Cash provided by financing activities for the three months ended May 4,
2002 was $11.3 million from the issuance of common stock and exercise of stock
options. Cash provided by financing activities for the same period last year was
$28.1 million from the issuance of notes, which was used mainly for the
acquisition of Bentley's Luggage and $1.1 million from the issuance of common
stock and exercise of stock options.

                                       18
SEASONALITY AND INFLATION

     A majority of our net sales and operating profit is generated in the peak
selling period from October through January, which includes the holiday selling
season. As a result, our annual operating results have been, and will continue
to be, heavily dependent on the results of our peak selling period. Net sales
are generally lowest during the period from April through July, and we typically
do not become profitable, if at all, until the fourth quarter of a given year.
Most of our stores are unprofitable during the first three quarters. Conversely,
nearly all of our stores are typically profitable during the fourth quarter,
even those that may be unprofitable for the full year. Historically, we have
opened most of our stores during the last half of the year. As a result, new
mall stores opened just prior to the fourth quarter produce profits in excess of
their annualized profits since the stores typically generate losses in the first
nine months of the year.

     We do not believe that inflation has had a material effect on the results
of operations during the past three years, however, there can be no assurance
that our business will not be affected by inflation in the future.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     Our exposure to market risks for changes in interest rates relates
primarily to our short-term investments, short-term borrowings, and long-term
debt obligations. We do not use derivative financial instruments in our
available for sale securities. We are averse to principal loss and ensure the
safety and preservation of our investments by limiting default risk and market
risk.

     We mitigate default risk by investing in high quality credit securities.
Market risk is limited by including only securities with active markets in our
portfolio. All short-term investments mature within one year.

     At May 4, 2002, we had cash and cash equivalents totaling $14.8 million.
The effect of a 100 basis point change in interest rates would have had an
estimated $0.1 million pre-tax earnings and cash flow impact, assuming other
variables are held constant.

     Our senior credit facility carries interest rate risk that is generally
related to either LIBOR, commercial paper rates or the prime rate. The Term B
promissory note also has a fluctuating interest rate. If any of those rates were
to change while we were borrowing under the facility or while we had an
outstanding balance on the Term B promissory note, interest expense would
increase or decrease accordingly. As of May 4, 2002, there were no borrowings
under the senior credit facility, $15.3 million in outstanding letters of
credit, and $25.0 million outstanding under the Term B promissory note.

     We have no earnings or cash flow exposure due to market risks on our
long-term debt obligations as a result of the fixed-rate nature of the debt.
However, interest rate changes would affect the fair market value of the debt.
At May 4, 2002, we had fixed rate debt of $30.6 million maturing in August 2004.

                                       19
----------------------------

     Except for historical information, matters discussed in "Management's
Discussion and Analysis of Financial Condition and Results of Operations" are
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934,
as amended. These statements involve risks and uncertainties, and actual results
may be materially different. Because actual results may differ, readers are
cautioned not to place undue reliance on forward-looking statements. Factors
that could cause actual results to differ include: economic downturns; changes
in customer shopping patterns; unseasonable weather; risks associated with our
debt service; risks associated with future growth; failure of results of
operations to meet expectations of research analysts; change in consumer
preferences and fashion trends away from leather; seasonality of the business;
risks associated with foreign sourcing and international business; disruptions
in product supplies to our travel stores; decreased availability and increased
cost of leather; competition in our markets; loss of key members of our
management team; reliance on third parties for maintaining our management
information systems; concentration of our common stock; anti-takeover effects of
classified board provisions in our articles of incorporation and by-laws;
volatility of our common stock; war, acts of terrorism or the threat of either;
and interruption in the operation of corporate offices and distribution centers.
Certain of these risk factors are more fully discussed in the Company's 2001
Annual Report on Form 10-K for the fiscal year ended February 2, 2002.

                                       20
PART II - OTHER INFORMATION

ITEM 2.  CHANGES IN SECURITIES

     See "Management's Discussion and Analysis of Financial Condition and
Results of Operations - Liquidity and Capital Resources" in Part I., Item 2., of
the document for a description of limitations upon the payment of dividends.

     Recent Sales of Unregistered Securities

     On April 8, 2002, affiliates of the institutional purchasers in the January
2002 placement exercised the option under the stock purchase agreement to
purchase an additional 100,000 shares of our common stock for an aggregate
purchase price of $1.1 million, which sale was completed on April 12, 2002 for
net proceeds of approximately $1.0 million.

     On April 30, 2002, we sold 900,000 shares of common stock in a private
placement at a purchase price of $11.00 per share, for net proceeds of $9.9
million, to Copwell Holdings LTD and Flying Colours Profits Ltd. The stock
purchase agreement provided that the investors may purchase an additional
100,000 shares of common stock at $11.00 per share at any time within 75 days
after the closing of the initial sale.

         Because these sales of shares were made to accredited investors
pursuant to Rule 506 of Regulation D under the Securities Act of 1933, as
amended (the "Act"), we believe they are exempt from the registration
requirements of the Act.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

     A.   Exhibits

          EXHIBIT     DESCRIPTION

          3.1         Amended and Restated Articles of Incorporation of Wilsons
                      The Leather Experts Inc. adopted June 16, 1998, as amended
                      by the Articles of Amendment dated February 17, 2000 and
                      May 23, 2002.

          3.2         Restated Bylaws of Wilsons The Leather Experts Inc., as
                      amended June 16, 1998, January 25, 2000 and May 23, 2002.

          4.1         Specimen of Common Stock Certificate.

          4.2         Indenture dated as of August 18, 1997 by and among Wilsons
                      The Leather Experts Inc., the other corporations listed on
                      the signature pages thereof, and Norwest Bank Minnesota,
                      National Association, including specimen Certificate of 11
                      1/4% Series A Senior Notes due 2004 and specimen
                      Certificate of 11 1/4% Series B Senior Notes due 2004.

                                       21
4.3         Purchase Agreement dated as of August 14, 1997 by and
                      among Wilsons The Leather Experts Inc., the Subsidiary
                      Guarantors party thereto and BancAmerica Securities, Inc.

          4.4         Registration Rights Agreement dated as of May 25, 1996 by
                      and among CVS New York, Inc., Wilsons The Leather Experts
                      Inc., the Managers listed on the signature pages thereto,
                      Leather Investors Limited Partnership I and the Partners
                      listed on the signature pages thereto.

          4.5         Amendment to Registration Rights Agreement dated as of
                      August 12, 1999 by and among Wilsons The Leather Experts
                      Inc. and the Shareholders listed on the attachments
                      thereto.

          4.6         Registration Rights Agreement dated as of January 10,
                      2002, by and among the Company and the investors signatory
                      thereto.

          4.7         Registration Rights Agreement dated as of April 24, 2002,
                      by and among the Company and the investors signatory
                      thereto.

          10.1        Fourth Amended and Restated Credit Agreement dated as of
                      April 23, 2002 among Wilsons Leather Holdings Inc., as
                      Borrower, the Lenders signatory thereto from time to time,
                      as Lenders, General Electric Capital Corporation, as
                      Agent, Lender, Term Lender and Swing Line Lender, GECC
                      Capital Markets Group, Inc., as Lead Arranger, The CIT
                      Group/Business Credit, Inc., as Lender and Documentation
                      Agent and Wells Fargo Retail Finance LLC, as Lender and
                      Syndication Agent.

          10.2        Reaffirmation of Guaranty dated as of April 23, 2002 by
                      Wilsons The Leather Experts Inc., Wilsons Center, Inc.,
                      Rosedale Wilsons, Inc., River Hills Wilsons, Inc. and the
                      Store Guarantors listed on the signature pages thereto in
                      favor of General Electric Capital Corporation as Agent for
                      Lenders.

          10.3        Amendment No. 1 to Mortgage, Security Agreement,
                      Assignment of Leases and Rents and Financing Statement
                      dated as of April 23, 2002 by Bermans The Leather Experts
                      Inc. in favor of General Electric Capital Corporation as
                      Agent for Lenders.

                                       22
10.4        Amendment No. 1 to Mortgage, Security Agreement,
                      Assignment of Leases and Rents, Financing Statement and
                      Fixture Filing dated as of April 23, 2002, by Bentley's
                      Luggage Corp. in favor of General Electric Capital
                      Corporation as Agent for Lenders.

          10.5        Wilsons The Leather Experts Inc. Amended Executive and Key
                      Management Incentive Plan, as amended May 23, 2002.

     B.   Exhibits and Reports on Form 8-K: The Company filed two reports on
          Form 8-K during the first quarter ended May 4, 2002, as follows:

          Form 8-K filed May 3, 2002, announcing the sale in a private placement
          of 900,000 shares of newly issued common stock to two investors.

          Form 8-K filed May 15, 2002, announcing that the Company had
          discontinued the engagement of Arthur Andersen LLP and engaged KPMG
          LLP as the Company's independent accountants.

                                       23
SIGNATURE

Pursuant to the requirements 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.

WILSONS THE LEATHER EXPERTS INC.

By: /s/ Peter G. Michielutti
    -------------------------------------------------
        Peter G. Michielutti
        Senior Vice President and
        Chief Financial Officer

Date:    June 18, 2002

                                       24
INDEX TO EXHIBITS
Exhibit No.          Description                                                       Method of Filing
-----------          -----------                                                       ----------------
3.1                  Amended and Restated Articles of Incorporation of Wilsons The
                     Leather Experts Inc. adopted June 16, 1998, as amended by the
                     Articles of Amendment dated February 17, 2000 and May 23, 2002    Electronic Transmission

3.2                  Restated Bylaws of Wilsons The Leather Experts Inc., as
                     amended June 16, 1998, January 25, 2000 and May 23, 2002 ......   Electronic Transmission

4.1                  Specimen of Common Stock Certificate. (1) .....................   Incorporated by Reference

4.2                  Indenture dated as of August 18, 1997 by and among Wilsons The
                     Leather Experts Inc., the other corporations listed
                     on the signature pages thereof, and Norwest Bank Minnesota,
                     National Association, including specimen Certificate of 11 1/4%
                     Series A Senior Notes due 2004 and specimen Certificate of
                     11 1/4% Series B Senior Notes due 2004. (2) ...................   Incorporated by Reference

4.3                  Purchase Agreement dated as of August 14, 1997 by and among
                     Wilsons The Leather Experts Inc., the Subsidiary Guarantors
                     party thereto and BancAmerica Securities, Inc. (3) ............   Incorporated by Reference

4.4                  Registration Rights Agreement dated as of May 25, 1996 by
                     and among CVS New York, Inc., Wilsons The Leather Experts
                     Inc., the Managers listed on the signature pages thereto,
                     Leather Investors Limited Partnership I and the Partners
                     listed on the signature pages thereto. (4) ....................   Incorporated by Reference

4.5                  Amendment to Registration Rights Agreement dated as of
                     August 12, 1999 by and among Wilsons The Leather Experts Inc.
                     and the Shareholders listed on the attachments thereto. (5)....   Incorporated by Reference

4.6                  Registration Rights Agreement dated as of January 10, 2002,
                     by and among the Company and the investors signatory
                     thereto. (5) ..................................................   Incorporated by Reference
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4.7                  Registration Rights Agreement dated as of April 24, 2002, by
                     and among the Company and the investors signatory thereto. (4)    Incorporated by Reference

10.1                 Fourth Amended and Restated Credit Agreement dated as of
                     April 23, 2002 among Wilsons Leather Holdings Inc., as
                     Borrower, the Lenders signatory thereto from time to time, as
                     Lenders, General Electric Capital Corporation, as Agent,
                     Lender, Term Lender and Swing Line Lender, GECC Capital
                     Markets Group, Inc., as Lead Arranger, The CIT Group/Business
                     Credit, Inc., as Lender and Documentation Agent and Wells
                     Fargo Retail Finance LLC, as Lender and Syndication Agent......   Electronic Transmission

10.2                 Reaffirmation of Guaranty dated as of April 23, 2002 by
                     Wilsons The Leather Experts Inc., Wilsons Center, Inc.,
                     Rosedale Wilsons, Inc., River Hills Wilsons, Inc. and the
                     Store Guarantors listed on the signature pages thereto in
                     favor of General Electric Capital Corporation as Agent for
                     Lenders. ......................................................    Electronic Transmission

10.3                 Amendment No. 1 to Mortgage, Security Agreement, Assignment
                     of Leases and Rents and Financing Statement dated as of April
                     23, 2002 by Bermans The Leather Experts Inc. in favor of
                     General Electric Capital Corporation as Agent for Lenders. ....   Electronic Transmission

10.4                 Amendment No. 1 to Mortgage, Security Agreement, Assignment
                     of Leases and Rents, Financing Statement and Fixture Filing
                     dated as of April 23, 2002, by Bentley's Luggage Corp. in
                     favor of General Electric Capital Corporation as Agent for
                     Lenders........................................................   Electronic Transmission

10.5                 Wilsons The Leather Experts Inc. Amended Executive and Key
                     Management Incentive Plan, as amended May 23, 2002.............   Electronic Transmission
(1)  Incorporated by reference to the same numbered exhibit to Amendment No. 1
     to the Company's Registration Statement on Form S-1 (333-13967) filed with
     the Commission on December 24, 1996.

(2)  Incorporated by reference to Exhibit 10.3 to the Company's Report on Form
     10-Q for the quarter ended August 2, 1997 filed with the Commission.

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(3)  Incorporated by reference to Exhibit 10.4 to the Company's Report on Form
     10-Q for the quarter ended August 2, 1997 filed with the Commission.

(4)  Incorporated by reference to Exhibit 4.8 to the Company's Registration
     Statement on Form S-1 (333-13967) filed with the Commission on October 11,
     1996.

(5)  Incorporated by reference to Exhibit 4.2 to the Company's Current Report on
     Form 8-K filed with the Commission on January 23, 2002.

(6)  Incorporated by reference to Exhibit 4.2 to the Company's Current Report on
     Form 8-K filed with the Commission on May 3, 2002.

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