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• the impact of the risks associated with international geopolitical conflicts is uncertain, but may prove to negatively impact our business and operations;
−Removed: • our dependency on a limited number of suppliers for materials, component parts, and vehicle chassis could lead to an increase in material costs, disruptions in our supply chain, or reputational costs;
−Removed: • failure to effectively compete against competitors, enhance existing products or develop, manufacture and market new products that respond to consumer needs and preferences and achieve market acceptance could result in a decrease in demand for our products and negatively impact our business and financial results;
−Removed: • our performance-defining products, and the bikes and powered vehicles into which many of them are incorporated, are discretionary purchases and may be adversely impacted by changes in the economy, a shrinking market for these powered vehicles, or a material decline in demand for the high-end bikes that make up a significant portion of our sales;
−Removed: • our business, financial condition and results of operations have been and may continue to be adversely affected by global public health epidemics or pandemics, including the ongoing effects of the COVID-19 pandemic;
+Added: • our dependency on a limited number of suppliers for materials, component parts, and products could lead to an increase in material costs, disruptions in our supply chain, or reputational costs;
+Added: • failure to effectively compete against competitors, effectively to the opportunity presented by new technological applications, enhance existing products or develop, manufacture and market new products that respond to consumer needs and preferences and achieve market acceptance could result in a decrease in demand for our products and negatively impact our business and financial results;
+Added: • our performance-defining products, and the bikes and powered vehicles into which many of them are incorporated, are discretionary purchases and may be adversely impacted by changes in the economy;
+Added: • our business, financial condition and results of operations have been and may continue to be adversely affected by global public health epidemics or pandemics;
• our business depends substantially on our ability to maintain our premium brand image, the continued expansion of the market and demand for our products, and to attract and retain experienced and qualified talent;
• changes in our customer, channel and product mix could place demands that are more rigorous on our infrastructure and cause our profitability percentages to fluctuate;
−Removed: • a disruption in the operations of our facilities or along our global supply chain, such as work stoppages, labor strikes, or infrastructure issues, could have a negative effect on our business, financial condition or results of operations;
+Added: • a disruption in the operations of our facilities or along our global supply chain, such as labor or supply chain issues or infrastructure constraints, could have a negative effect on our business, financial condition or results of operations;
• we may not be able to sustain our past growth or successfully implement our growth strategy, which may have a negative effect on our business, financial condition or results of operations;
• our cost optimization efforts may not succeed or may be significantly delayed;
−Removed: • the loss of the support of professional athletes for our products, or the inability to attract new professional athletes or disruption in relationships with dealers and distributors may harm our business;
• our business is dependent in large part on our relationships with dealers and distributors and their success and the orders we receive from our OEM customers and from their success.
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• if we inaccurately forecast demand for our products or inaccurately predict destocking and restocking cycles and production schedules, we may manufacture insufficient or excess quantities or our manufacturing costs could increase;
−Removed: • product recalls and significant product repair and/or replacement due to product warranty costs and claims have had, and in the future could have, a material adverse impact on our business;
−Removed: • an adverse determination in any material product liability claim against us could adversely affect our operating results or financial condition;
+Added: • product recalls and significant product repair and/or replacement due to product warranty costs and claims, including any material product liability claims, may have a material adverse impact on our business;
• we and our employees are subject to certain risks in our manufacturing and in the testing of our products;
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• we do not control our suppliers, athletic programs, OEMs, other customers, or partners, or require them to comply with a formal code of conduct, and actions that they might take could harm our reputation and sales;
−Removed: • we may incur higher employee costs in the future;
• we rely on increasingly complex information systems for management of our various functions.
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• qualitative data and limited sources support our beliefs regarding the future growth of the performance-defining product market and may not be reliable;
−Removed: • the current inflation and changes in interest rates in response, could negatively impact our cash flows due to higher debt costs or negatively impact our customers’ ability to finance powered vehicles or bikes that include our products;
+Added: • the current inflation and changes in interest rates in response, could harm us in the future;
Risks Related to Our Indebtedness and Liquidity
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• we continue to have the ability to incur debt, and our levels of debt may affect our operations and our ability to pay the principal of and interest on our debt;
−Removed: • we may incur losses on interest rate swap and hedging arrangements;
Risks Related to Laws and Regulations
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• we are subject to extensive U.S.
−Removed: federal and state, foreign and international safety, environmental, employment practices and other government regulations that may require us to incur expenses or modify product offerings in order to maintain compliance with such regulation, which could have a negative effect on our business and results of operations;
+Added: federal and state, foreign and international safety, environmental, employment practices and other government regulations that may require us to incur expenses or modify product offerings in order to maintain compliance with such regulations, which could have a negative effect on our business and results of operations;
• unpredictability in increasingly stringent emission standards and increasing focus on environmental, social and governance responsibility, including climate change, may impose additional costs and new risks on us;
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• we are subject to environmental laws and regulations and potential exposure, costs and liabilities due to laws and regulations regarding conflict minerals, environmental matters, land-use, and noise and air pollution may have a negative impact on our future sales and results of operations;
−Removed: • we retain certain personal information about individuals and are subject to various privacy and consumer protection laws;
−Removed: • our vendors and any potential commercial partners may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements;
+Added: • we retain certain personal data about individuals and are subject to various privacy and consumer protection laws;
policies related to global trade and tariffs could have a material adverse effect on our results of operations;
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• we cannot guarantee that our share repurchase program will be fully consummated or that it will enhance stockholder value, and the volatility of the price of our common stock could increase;
−Removed: • our Amended and Restated Certificate of Incorporation designates the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain actions and proceedings initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees;
+Added: • our Second Amended and Restated Certificate of Incorporation designates the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain actions and proceedings initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees;
General Risk Factors
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RISKS RELATED TO OUR BUSINESS AND OPERATIONS
−Removed: The impact of the risks associated with international geopolitical conflicts—including continuing tensions between Taiwan and China, the Russian war in Ukraine, and the Israel-Palestine conflict—on the global economy, energy supplies, and raw materials is uncertain, and may prove to negatively impact our business and operations.
+Added: The impact of the risks associated with international geopolitical conflicts—including, among others, the continuing tensions between Taiwan and China—on the global economy, energy supplies, and raw materials is uncertain, and may prove to negatively impact our business and operations.
In recent years, diplomatic and trade relationships between the U.S.
−Removed: government and China have become increasingly frayed, and the threat of a takeover of Taiwan by China has increased.
+Added: and China have become increasingly frayed, and the threat of a takeover of Taiwan by China has increased.
Since we have manufacturing in Taiwan and source products globally, our business, operations, and supply chains could be materially and adversely impacted by political, economic or other actions from China, or changes in China-Taiwan relations that impact Taiwan and its economy.
−Removed: In addition, we continue to monitor any adverse impact that the Israeli-Palestinian conflict, the conflict in Ukraine, subsequent sanctions against Russia by the United States and European and Asian countries, and geopolitical tensions or conflict that may arise out of the new U.S.
−Removed: Presidential administration may have on the global economy, our business and operations, and our suppliers and customers.
−Removed: For example, a prolonged conflict may result in ongoing increased inflation, escalating energy prices and constrained availability, thereby increasing the costs of raw materials and production.
+Added: In addition, we continue to monitor other geopolitical tensions or conflicts that have or may have an adverse impact on the global economy, our business and operations, and our suppliers and customers.
To the extent that continuing political tensions may adversely affect our business, it may heighten many of the other risks described in our risk factors, such as those relating to data security, supply chain, volatility of price inputs, and market conditions;
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As the majority of our bike-component manufacturing occurs in Taiwan, we could experience difficulties locating qualified suppliers geographically closer to these facilities.
−Removed: Furthermore, such suppliers could experience difficulties in providing us with some or all of the materials we require, which could result in disruptions in our manufacturing operations.
+Added: Furthermore, such suppliers could experience difficulties in providing us with some or all of the materials we require, which could result in disruptions to our manufacturing operations.
Similarly, all non-wood products sold by Marucci and wheels sold by Custom Wheel House are sourced from third-party suppliers, which could risk supply-chain challenges if those third-party suppliers are unable to fulfill production quotas.
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However, if we experience material price increases of these components or raw materials in the future and are unable to pass on those increases to our customers, it could negatively affect our business, financial condition or operation results.
−Removed: For example, component or raw-material shortages and overall inflationary pressures may increase the prices of those components or raw materials, which could reduce our profit margins if our customers are unwilling to pay higher prices.
−Removed: In addition to our various single-source suppliers, we also rely on one “sole-source” supplier, Miyaki Corporation, or Miyaki.
−Removed: We define a sole-source supplier as a supplier of a raw material or input for which there is no other supplier of the same product or an equivalent substitute.
−Removed: Miyaki is the exclusive producer of the Kashima coating for our suspension component tubes.
−Removed: As part of our agreement with Miyaki, we have been granted the exclusive right to use the trademark “KASHIMACOAT” on products comprising the aluminum finished parts for suspension components (e.g., tubes) and on related sales and marketing material worldwide, subject to certain exclusions.
−Removed: Although we believe we could obtain other coatings of comparable utility from other sources, if necessary, we could no longer obtain this specific Kashima coating or use the trademark “KASHIMACOAT” if Miyaki were to stop supplying us with this coating.
−Removed: The need to replace the Kashima coating could temporarily disrupt our business and harm our business, financial condition, or results of operations.
−Removed: Similarly, Marucci depends on a sole-source supplier for the manufacturing and finishing of select aluminum and composite metal bats.
−Removed: Any disruption or loss of our non-wood finishing supplier for our bats could temporarily diminish overall bat production output, which could negatively impact our business, financials, or results of operations.
−Removed: We also have OEM partners that supply vehicle chassis used in our upfitting operations.
−Removed: An OEM may encounter difficulties and may be unable to deliver chassis according to our production needs, or an OEM may choose to discontinue supplying chassis for other reasons.
−Removed: Any interruption or discontinuation in the availability of chassis may result in increased production costs, delays in the delivery of our products, or lost sales, which could have an adverse effect on our business or financial condition.
If we are unable to continue to enhance existing products and develop, manufacture and market new products that respond to consumer needs and preferences and achieve market acceptance, we may experience a decrease in demand for our products, and our business and financial results could suffer.
Our growth strategy involves the continuous development of innovative performance-defining products.
−Removed: We may not be able to compete as effectively with our competitors and ultimately satisfy the needs and preferences of our customers and the end users of our products, unless we can continue to enhance existing products and develop new, innovative products in the global markets in which we compete.
+Added: We may not be able to compete as effectively with our competitors and ultimately satisfy the needs and preferences of our customers and the end users of our products, unless we continue to enhance existing products and develop new, innovative products in the global markets in which we compete.
In addition, we must continuously compete not only for end users who purchase our products through the dealers and distributors who are our customers, but also for the OEMs, which incorporate our products into their bikes and powered vehicles.
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While we expended approximately $69.4 million, $60.3 million and $53.2 million for our research and development efforts in fiscal years 2025, 2024 and 2023, respectively, there can be no assurance that this level of investment in research and development will be sufficient in the future to maintain our competitive advantage in product innovation, which could cause our business, financial condition or results of operations to suffer.
−Removed: Product improvements and new product introductions require significant planning, design, development, and testing at the technological, product, and manufacturing process levels, and we may experience unanticipated delays introducing our product improvements or new products.
−Removed: Our competitors’ new products may beat our products to market, be more effective and/or less expensive than our products, obtain better market acceptance, or render our products less desirable or obsolete.
−Removed: Any new products that we develop may not receive market acceptance or otherwise generate any meaningful sales or profits for us relative to our expectations.
−Removed: Given the competitive landscape, it is important that we are able to plan and deliver products that will appeal to our customers in a timely manner, in the quantity demanded, and at profitable business costs.
We face intense competition in all product lines, including from some competitors that have greater financial and marketing resources.
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We compete with a number of other manufacturers that produce and sell performance-defining products to OEMs and aftermarket dealers and distributors, including OEMs that produce their own lines of products for their own use.
−Removed: Our continued success depends on our ability to continue to compete effectively against our competitors, some of which have significantly greater financial, marketing and other resources than we have.
+Added: Our continued success depends on our ability to compete effectively against our competitors, some of which have significantly greater financial, marketing and other resources than we have.
Several of our competitors offer broader product lines to OEMs, which they may sell in connection with suspension products as part of a package offering.
In addition, some of our subsidiaries compete in marketplaces that heavily rely on industry-specific brand awareness and distribution channels, and our past performance reaching consumers is not indicative of future results.
−Removed: In the future, our competitors may be able to maintain and grow brand strength and market share more effectively or quickly than we do by anticipating the course of market developments more accurately than we do, developing products that are superior to our products, creating manufacturing or distribution capabilities that are superior to ours, producing similar products at a lower cost than we can, or adapting more quickly than we do to new technologies or evolving regulatory, industry, or customer requirements, among other possibilities.
−Removed: In addition, we may encounter increased competition if our current competitors broaden their product offerings by beginning to produce additional types of performance-defining products or through competitor consolidations.
−Removed: We could also face competition from well-capitalized entrants into these product markets, as well as aggressive pricing tactics by other manufacturers trying to gain market share.
As a result, our products may be unable to compete successfully with our competitors’ products, which could negatively affect our business, financial condition, or results of operations.
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Our technological development projects may also not deliver the benefits we expect once they are completed or may be replaced or become obsolete more quickly than expected, which could result in the accelerated recognition of expenses.
−Removed: If we are unable to develop or implement new technologies as quickly as our competitors, or if our competitors develop more cost-effective technologies or product offerings, we could experience a material adverse effect on business, financial condition or results of operations.
−Removed: Our investments in new products and services may not generate the expected returns, which could hinder our ability to generate organic growth in the future.
+Added: If we are unable to develop or implement new technologies as quickly as our competitors, or if our competitors develop more cost-effective technologies or product offerings, we could experience a material adverse effect on our business, financial condition or results of operations.
Our business is sensitive to economic conditions that impact consumer spending.
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These areas historically experienced recessions, disruptions in banking and/or financial systems, and economic weakness and uncertainty.
−Removed: Today, there appears to be an increasing risk of recessions or inflationary economic impacts related to lingering effects of the global COVID-19 pandemic, geopolitical events, escalating energy costs, global supply chain disruptions, changing interest rates, and other economic changes.
+Added: The risks associated with a U.S.
+Added: or global recession and higher inflation could negatively impact our business.
+Added: The severity and occurrence of these risks depend on a number of factors, including, among others, those related to geopolitical events, fluctuating energy costs, global supply chain disruptions, changing interest rates, and other economic changes.
In addition, many of our products are recreational in nature and are generally discretionary purchases by consumers.
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During periods of unfavorable economic conditions or periods when other negative market factors exist, consumer discretionary spending is typically reduced, which in turn could reduce our product sales and negatively affect our business, financial condition, or results of operations.
−Removed: There could also be a number of secondary effects resulting from an economic downturn, such as insolvency of our suppliers resulting in product delays, an inability of our OEM and distributor and dealer customers to obtain credit to finance purchases of our products, customers delaying payment to us for the purchase of our products due to financial hardship or an increase in bad debt expense.
+Added: There could also be a number of secondary effects resulting from an economic downturn, such as insolvency of our suppliers resulting in product delays, an inability of our OEM, distributor and dealer customers to obtain credit to finance purchases of our products, customers delaying payment to us for the purchase of our products due to financial hardship or an increase in bad debt expense.
Any of these effects could negatively affect our business, financial condition, or results of operations.
−Removed: Our business, financial condition, and results of operations have been and may continue to be adversely affected by global public health epidemics or pandemics, including the ongoing effects of the COVID-19 pandemic.
−Removed: We face various risks related to ongoing and potential public health issues, including epidemics, pandemics, and other outbreaks, including the COVID-19 pandemic.
−Removed: The impact of the COVID-19 pandemic, including changes in consumer behavior, pandemic fears and market downturns, and restrictions on business and individual activities, created significant volatility in the global economy and led to reduced economic activity.
−Removed: Government-mandated closures and “shelter-in-place” directives aimed at combating the spread of COVID-19 or future public health epidemics or pandemics, or an outbreak among, or quarantine of, the employees in any of our facilities caused and could continue to cause significant interruptions to, or temporary closures, of our operations.
−Removed: Additionally, modifications we’ve made and may continue to make to our business practices as a result of COVID-19, including implementing widespread remote arrangements, could negatively impact our operations, the execution of our business plans, productivity, the availability of key personnel and other employees necessary to conduct our business, and of third-party service providers who perform critical services for us, or otherwise cause operational failures due to changes in our normal business practices necessitated by an outbreak and related governmental actions.
−Removed: These impacts affected and could continue to negatively affect our business, financial condition, results of operations, cash flows, and the trading price of our securities.
−Removed: Furthermore, the COVID-19 pandemic impacted and may further impact and disrupt global economies and financial markets.
+Added: Our business, financial condition, and results of operations could be impacted by public health issues and related business interruptions.
+Added: Public health issues, including epidemics, pandemics (such as the COVID-19 pandemic), and other outbreaks adversely affected, and could in the future materially adversely affect, our business, financial condition, and results of operations.
+Added: The impacts of public health issues, including changes in consumer demand and behavior;
+Added: pandemic fears and market downturns;
+Added: the imposition of protective public safety measures, such as stringent travel restrictions, limitations on freight services and the movement of products between regions, quarantine requirements or precautions, and related governmental actions;
+Added: economic volatility and reduced economic activity;
+Added: and disruptions to our supply chain and distribution channels have also adversely affected, and could in the future materially adversely affect, our business and the businesses of our third-party vendors and business partners.
If we are unable to maintain our premium brand image, our business may suffer as a result of brand degradation.
−Removed: Dealers, distributors, and customers select our products in part because of the premium brand reputation we hold with them and our end users.
+Added: Dealers, distributors, and customers select our products in part because of our premium brand reputation.
Therefore, our success depends on our ability to maintain and build the image of our brands.
−Removed: We focused on building our brands through producing products or acquiring businesses that produce products that we believe are innovative, high in performance, and highly reliable.
−Removed: In addition, some of our brands benefit from our strong relationships with our OEM customers and dealers and distributors and through marketing programs aimed at bike and powered vehicle enthusiasts in various media and other channels.
+Added: We focus on building our brands through producing products or acquiring businesses that produce products that we believe are innovative, high in performance, and highly reliable.
+Added: In addition, some of our brands benefit from our strong relationships with our OEM customers, dealers, and distributors and through marketing programs aimed at bike and powered vehicle enthusiasts in various media and other channels.
For example, we sponsor a number of professional athletes, professional race teams, top college programs, and franchise clubs.
−Removed: In order to continue to enhance the image of our brands, we will need to maintain our position in the performance-defining products industry, continue to provide high-quality products and services and preserve our reputation.
−Removed: The rising popularity of social media and other consumer-oriented technologies creates new risks and challenges that could cause damage to our brands and reputation.
−Removed: Social media platforms make it easy for anyone to provide public feedback that can influence perceptions of our brands, and social media platforms can also accelerate and potentially amplify the scope of negative publicity.
−Removed: There can be no assurance that we will be able to maintain or enhance the strength of our brands in the future.
−Removed: Our brands could be adversely impacted by, among other things:
−Removed: • failure to develop new products that are innovative, performance-oriented, and reliable;
−Removed: • internal product quality control issues;
−Removed: • product quality issues on the bikes and powered vehicles on which our products are installed;
−Removed: • product recalls;
−Removed: • high-profile component failures (such as a component failure during a race on a mountain bike ridden by one of our sponsored athletes);
−Removed: • negative publicity regarding our brands or our sponsored athletes or organizations, which could be amplified on social media;
−Removed: • high-profile injury or death to one of our sponsored athletes;
−Removed: • inconsistent uses of our brands and our other intellectual property assets, as well as failure to protect our intellectual property;
−Removed: • changes in consumer trends and perceptions;
−Removed: • lack of investment in sponsorships, marketing, and public relations.
−Removed: Any adverse impact on our brands could in turn negatively affect our business, financial condition, or results of operations.
−Removed: Our growth in the Powered Vehicle and Aftermarket Applications Groups are dependent upon our continued ability to expand our product sales into powered vehicles that require performance-defining products and the continued expansion of the market for these powered vehicles.
−Removed: Our growth in the Powered Vehicle and Aftermarket Applications Groups are in part attributable to the expansion of the market for powered vehicles that require performance-defining products.
−Removed: Such market growth includes the creation of new classes of vehicles that can benefit from our products, such as trucks that are upfitted with products to enhance their off-road capability, and our ability to create products for these vehicles.
−Removed: Additionally, with our acquisitions of SCA, Tuscany, Outside Van, Shock Therapy, and Custom Wheel House, a growing portion of our sales are expected to be generated from providing upfitting solutions.
+Added: In order to continue to enhance the image of our brands, we need to maintain our position in the performance-defining products industry, continue to provide high-quality products and services, and preserve our reputation.
+Added: Social media and other consumer-oriented technologies pose risks and challenges that could cause damage to our brands and reputation.
+Added: Social media may also increase the likelihood, speed, and magnitude of negative publicity.
+Added: Any adverse impact on our brands could negatively affect our business, financial condition, or results of operations.
+Added: Our growth in PVG and AAG depends on our continued ability to expand our product sales into powered vehicles that require performance-defining products and the continued expansion of the market for these powered vehicles.
+Added: Our growth in PVG and AAG is in part attributable to the expansion of the market for powered vehicles that require performance-defining products.
+Added: Such market growth includes the creation of new classes of vehicles that benefit from our products, such as trucks that are upfitted with products to enhance their on-road and off-road capability, and our ability to create products for these vehicles.
In the event these markets stop expanding or contract due to economic factors, changes in consumer preferences, or other reasons, or we are unsuccessful in creating new products for these markets or other competitors successfully enter into these markets, we may fail to achieve future growth or our sales could decrease, and our business, financial condition or results of operations could be negatively affected.
−Removed: A significant portion of our Specialty Sports Group’s sales are highly dependent on the demand for high-end bikes and Marucci products.
+Added: A significant portion of SSG’s sales is highly dependent on the demand for high-end bikes and Marucci products.
A material decline in the demand for these bikes, bike suspension components, or Marucci products could have a material adverse effect on our business or results of operations.
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Part of our success is attributed to the growth in the high-end bike industry, including increases in average retail sales prices, as better-performing product designs and technologies have been incorporated into these products.
−Removed: If the popularity of high-end or premium-priced bikes does not increase or declines, the number of bike enthusiasts seeking such bikes or premium-priced suspension products, wheels, cranks and other specialty components for their bikes does not increase or declines, or the average price point of these bikes declines, we may fail to achieve future growth or our sales could decrease, and our business, financial condition or results of operations could be negatively affected.
+Added: If the popularity of high-end or premium-priced bikes does not increase or declines;
+Added: the number of bike enthusiasts seeking such bikes or premium-priced suspension products, wheels, cranks and other specialty components for their bikes does not increase or declines;
+Added: or the average price point of these bikes declines;
+Added: we may fail to achieve future growth or our sales could decrease, and our business, financial condition or results of operations could be negatively affected.
In addition, if current bike enthusiasts stop purchasing our products due to changes in preferences, we may fail to achieve future growth or our sales could be decreased, and our business, financial condition or results of operations could be negatively affected.
−Removed: Additionally, in the fourth quarter of 2023, our Specialty Sports Group expanded and diversified with the acquisition of Marucci.
+Added: Additionally, in the fourth quarter of 2023, SSG expanded and diversified with the acquisition of Marucci.
Part of Marucci’s success derives from the demand for high-performing products, notably within the baseball and softball industry.
If professional athletes and performance enthusiasts no longer demand Marucci’s products, we could experience slower or declining growth or sales, which may adversely affect our business.
−Removed: For example, if Marucci experiences a material decline in demand among professional athletes, consumers who seek the same performance as the professionals may no longer desire Marucci equipment.
Similarly, if overall demand for sporting products declines, Marucci sales could decrease and reduce future growth opportunities.
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We believe that the top seven members of our senior management team are crucial to establishing our focus and executing our corporate strategies, as they have extensive knowledge of our business, systems and processes.
−Removed: Given our senior management team’s knowledge of our industry and the limited number of direct competitors in the industry, we believe that it could be difficult to find replacements should any of the members of our senior management team leave.
−Removed: We could also be adversely affected if we fail to attract and retain talent throughout our organization.
−Removed: For instance, we rely on skilled and well-trained engineers for the design and production of our products, as well as in our research and development functions.
−Removed: Competition for such individuals is intense, particularly in Taiwan, California, and Georgia, where several of our facilities are located.
−Removed: Our inability to attract or retain qualified employees in our design, production, or research and development functions or elsewhere in our Company could result in diminished quality of our products and delinquent production schedules or impede our ability to develop new products.
−Removed: Our failure to adequately address any of these issues could have a material adverse effect on our business, operating results, and financial condition.
−Removed: Changes in our customer, channel, and product mix could place demands that are more rigorous on our infrastructure and cause our profitability percentages to fluctuate.
+Added: Given our senior management team’s knowledge of our industry and the limited number of direct competitors in the industry, we believe that it could be difficult to find replacements should any of the members of our senior management team leave and could have a material adverse effect on our business, operating results, and financial condition.
+Added: Changes in our customer base, marketing and distribution channels, or product mix could place demands that are more rigorous on our infrastructure and cause our profitability percentages to fluctuate.
We may encounter changes to our customer base as a result of product alterations or market shifts.
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Our product mix may encounter fluctuations depending on our customers’ purchasing behavior.
−Removed: Moreover, if we develop new products and retire past offerings, our product mix may change.
+Added: Moreover, if we develop new products or discontinue products, our product mix may change.
We may leverage new or experimental sales channels to drive growth within our business.
−Removed: Any such changes to our customers, distribution channels, or product mix may place demands on our business that require more rigorous infrastructure and supply chain solutions.
−Removed: Our overall profitability and profitability percentages may fluctuate as we might have to adapt to any changes.
+Added: Any such changes to our customers, marketing and distribution channels, or product mix may place demands on our business that require more rigorous infrastructure and supply chain solutions.
+Added: Our overall profitability and profitability percentages may fluctuate as adapt to any changes.
For instance, if customers begin to require more lower-margin products from us and fewer higher-margin products, or place demands on our performance that increase our costs, our business, results of operations, and financial condition may be adversely affected.
A disruption in the operations of our facilities could have a negative effect on our business, financial condition, or results of operations.
−Removed: In the fourth quarter of 2021, we completed the construction of the Gainesville Facility in Hall County Georgia, to diversify our manufacturing platform and provide additional long-term capacity to support growth in our Powered Vehicles Group.
−Removed: The Gainesville Facility is being used for manufacturing, warehousing, distribution and office space.
−Removed: In the first quarter of 2022, we completed the transition of our Watsonville Facility and the relocation of our powered vehicles suspension manufacturing to the Gainesville Facility.
−Removed: As a result, we have incurred costs associated with some duplication of facilities, equipment and personnel, the amount of which could vary materially from our projections.
Equipment failures, delivery delays, or catastrophic loss at any of our facilities could lead to production or service disruptions, curtailments, or shutdowns.
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Any significant delay in deliveries to our customers could lead to increased returns or cancellations, expose us to damage claims from our customers or damage our brands, and, in turn, negatively affect our business, financial condition, or results of operations.
−Removed: Work stoppages, infrastructure issues, or other disruptions, including those that involve our customers, could adversely affect our operating results.
−Removed: A portion of our goods move through ports on the coasts of the U.S.
−Removed: We have a global supply chain, and we import products from our third-party vendors and our Fox Taiwan facility into the U.S.
−Removed: largely through these ports.
−Removed: Dockworkers, none of whom are our employees, must offload freight from ships arriving at these ports.
−Removed: We do not control the activities of these employees or seaports, and we could suffer supply chain disruptions due to any disputes, capacity shortages, slowdowns, or shutdowns that may occur, as was experienced in February 2015, in relation to certain ports on the West Coast of the U.S.
−Removed: In October 2024, the International Longshoremen’s Association (“ILA”), which negotiates on behalf of 45,000 dockworkers at three dozen ports from Maine to Texas and collectively handles about half of seaborne imports into the U.S., initiated a three-day member strike due to disagreements with the United States Maritime Alliance over their agreement, which expired on September 30, 2024.
−Removed: The ILA reached a tentative agreement on a new six-year master contract in January 2025, which was ratified by the dockworkers and will be formally signed by both parties in March 2025.
−Removed: However, if for some reason the agreement is not signed in March 2025, the ILA could strike again.
−Removed: The 2015 strike lasted longer than we forecasted, and any similar labor dispute in the future or any slowdown or stoppage relating to the ongoing labor agreement negotiations, including the threatened strike by the ILA, could potentially have a negative effect on both our financial condition and results of operations.
−Removed: Additionally, the Baltimore Francis Scott Key bridge accident in March 2024 leading to the suspension of activity in the Port of Baltimore caused rerouting of shipping vessels, which may create congestion and delays in other ports, including certain East Coast ports through which we import products, increase fuel costs for shipping, and have long-standing impacts on supply chains in the retail and manufacturing industries.
−Removed: While the Port of Baltimore opened to maritime traffic on June 10, 2024, the bridge that is not expected to be fully rebuilt until late 2028 and further work to clear out wreckage and maintenance of the port may continue to cause delays in the Port of Baltimore and other East Coast ports where activities are rerouted.
−Removed: The incident has also raised concerns regarding deteriorating infrastructure throughout the U.S., which may further cause shipping delays and harm results of operation as such infrastructure is replaced or updated with new safety measures.
−Removed: Furthermore, the ongoing effects of the COVID-19 pandemic increased uncertainty for global supply chains, as port congestion and shipping container shortages have become exacerbated, which could adversely affect our operating results.
−Removed: Work stoppages, labor disputes, and other disruptions involving our customers or otherwise could also adversely affect our operating results.
−Removed: For example, the United Auto Workers Union (“UAW”) 2023 strike impacted Ford Motor Company, General Motors, and Stellantis after the UAW was unable to reach a deal with the three automakers.
−Removed: Automotive OEMs are some of the largest customers of our powered vehicle suspension products.
−Removed: In 2024, the UAW again threatened strikes against one of Ford Motor Company’s units and Stellantis.
−Removed: UAW strikes and threatened UAW strikes may have lingering effects that could impact the automotive industry.
−Removed: Any such lingering effects may adversely impact our own business, financial condition, or results of operation.
−Removed: Any future strikes, including any strikes against our customers, are highly unpredictable and may negatively affect our business.
−Removed: The ultimate impact on our business, financial position, and results of operations will depend on factors beyond our control, including the duration and scope of labor strikes.
+Added: Interruptions in operations, infrastructure constraints, labor issues, supply chain issues, or other disruptions, including those affecting our suppliers or customers, could adversely affect our business, financial condition, and results of operations.
+Added: Our operations depend on complex global supply chains;
+Added: transportation networks, including the infrastructure and logistics of certain seaports;
+Added: manufacturing facilities;
+Added: and third-party service providers that are subject to labor disputes, capacity constraints, infrastructure limitations or failures, accidents, natural disasters, and other events that are beyond our control.
+Added: Disruptions to our business or operations may occur as a result of such events impacting our suppliers, customers, or markets in which we operate.
+Added: Labor disputes, production interruptions, supply chain issues, and other operational challenges faced by our customers could also reduce demand for our products, delay purchasing decisions, or negatively impact our business.
+Added: For example, some of our automotive OEM customers have been impacted by, and in the future could be subject to, strikes, work stoppages, or other interruptions due to negotiations with their employees represented by the United Auto Workers Union.
+Added: The effects of such disruptions may continue once the underlying event is resolved.
+Added: Moreover, the timing, severity, and duration of these disruptions are typically unpredictable and beyond our control.
+Added: We may not be able to prevent or mitigate the adverse effects of such events, which could adversely affect our business, financial condition, and results of operations.
We may not be able to sustain our past growth or successfully implement our growth strategy, which may have a negative effect on our business, financial condition, or results of operations.
−Removed: Our future growth will depend upon various factors, including the strength of the image of our brands, our ability to continue to produce innovative performance-defining products, consumer acceptance of our products, competitive conditions in the marketplace, our ability to make strategic acquisitions, the growth in emerging baseball and softball markets for Marucci products, the growth in emerging markets for products requiring high-end suspension products, and, in general, the continued growth of the high-end bike and powered vehicle markets into which we sell the majority of our products.
+Added: Our future growth will depend upon various factors, including the strength of our brands, our ability to continue to produce innovative performance-defining products, consumer acceptance of our products, competitive conditions in the marketplace, our ability to make strategic acquisitions, the growth in emerging baseball and softball markets for Marucci products, the growth in emerging markets for products requiring high-end suspension products, and, in general, the continued growth of the high-end bike and powered vehicle markets.
Our beliefs regarding the future growth of markets for high-end suspension products and sporting equipment are based largely on qualitative judgments and limited sources, which may be unreliable.
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Our cost optimization efforts may not succeed or may be significantly delayed, which may impact our ability to deliver improved margins.
−Removed: Due to challenges in the OEM market and broader market conditions impacting discretionary consumer spending, we implemented certain immediate and longer-term actions to strengthen our business, including aggressive cost management and strategic operational improvements.
−Removed: We developed a plan to adjust our business structure to operate efficiently in a number of demand environments in order to protect margins and drive significant, and consistent, free cash flow to de-lever our balance sheet.
−Removed: We anticipate implementing this strategy across segments will improve margins, resulting in significant annualized cost reductions to strategically position ourselves to capitalize on opportunities in the future.
+Added: Due to challenges in the OEM market and broader market conditions impacting discretionary consumer spending, we implemented (and are continuing to implement) certain immediate and longer-term actions to strengthen our business, including aggressive cost management and strategic operational improvements.
+Added: We developed a plan to adjust our business structure to operate efficiently in a number of demand environments intended to protect margins and drive significant, and consistent, free cash flow to de-lever our balance sheet.
However, our cost optimization strategy relies on a number of factors and may distract management, slow improvements to our products and services, and limit our ability to increase production quickly if demand accelerates in the future.
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Failure to achieve our cost optimization targets could have a material adverse effect on our results of operations, liquidity and financial condition.
−Removed: The professional athletes, athletic programs, and race teams who use our products are an important aspect of the image of our brands.
−Removed: The loss of the support of professional athletes for our products or the inability to attract new professional athletes may harm our business.
−Removed: If current or future professional athletes, athletic programs, and race teams do not use our products, our brands could lose value and our sales could decline.
−Removed: While our sponsorship agreements typically restrict our sponsored athletes and race teams from promoting, endorsing or using competitors’ products that compete directly within our product categories during the term of the sponsorship agreements, we do not typically have long-term contracts with any of the athletes or race teams whom we sponsor.
−Removed: If we are unable to maintain our current relationships with these professional athletes, athletic programs, and race teams, these professional athletes and race teams are no longer popular, our sponsored athletes and race teams fail to have success, or we are unable to continue to attract the endorsement of new professional athletes and race teams in the future, the value of our brands and our sales could decline.
We depend on our relationships with dealers, distributors, and retailers and their ability to sell and service our products.
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In addition, we do not have long-term contracts with a majority of our dealers, distributors, and retailers, and our dealers, distributors, and retailers are not obligated to purchase specified amounts of our products.
−Removed: In fact, the majority of our dealers, distributors, and retailers buy from us on a purchase-order basis.
Consequently, with little or no notice, many of these dealers, distributors, and retailers may terminate their relationships with us or materially reduce their purchases of our products.
If we were to lose one or more of our dealers, distributors, or retailers we would need to obtain a new dealer, distributor, or retailer, as applicable, to cover the particular location or product line, which may not be possible on favorable terms or at all.
−Removed: Alternatively, we could use our own sales force to replace a dealer, distributor, or retailer, but expanding our sales force into new locations takes significant time and resources and may be unsuccessful.
−Removed: Further, many of our international distribution contracts contain exclusivity arrangements, which may prevent us from replacing or supplementing our current distributors under certain circumstances.
We are a supplier in the high-end bike and powered vehicles markets, and our business largely depends on the orders we receive from our OEM customers and on their success.
As a supplier to OEM customers, we largely depend on the success of our OEM customers’ businesses.
−Removed: Model year changes by our OEM customers or production disruptions or hiatuses may adversely impact our sales or cause our sales to vary from quarter to quarter.
+Added: Model year changes by our OEM customers, production disruptions or hiatuses, or other barriers impacting our OEM customers’ ability or choice to conduct their operations may adversely impact our sales or cause our sales to vary from quarter to quarter.
In addition, losses in market share individually or a decline in the overall market of our OEM customers or the discontinuance by our OEM customers of their products which incorporate our products could negatively impact our business, financial condition, or results of operations.
A relatively small number of customers account for a substantial portion of our sales.
−Removed: The loss of all or a significant portion of our sales to any of these customers, whether through the temporary or permanent discontinuation of their products which incorporate our products or otherwise, or the loss of market share by these customers could have a material adverse impact on us and our results of operations.
+Added: The loss of all or a significant portion of our sales to any of these customers, including but not limited to the losses as a result of (i) the temporary or permanent discontinuation of customer products which incorporate or otherwise relate to our products or (ii) the loss of market share by these customers could have a material adverse impact on us and our results of operations.
Net sales attributable to our five largest customers, which can vary from year to year, collectively accounted for approximately 26%, 28%, and 27% of our net sales in fiscal years 2025, 2024 and 2023.
−Removed: The loss of all or a substantial portion of our sales to any of these customers, whether through the temporary or permanent discontinuation of their products which incorporate our products or otherwise, the loss of market share by these customers, manufacturing or other problems, including disruptions related to the lingering effects of the COVID-19 pandemic or labor strikes, could have a material impact on our business, financial condition, or results of operations.
−Removed: Currency exchange rate fluctuations could impact gross margins and expenses.
+Added: Because our products are complementary in nature to, or reliant on the continued production of, certain products produced by these customers, (i) a temporary or permanent discontinuation of those customers’ products that incorporate or otherwise relate to our products or (ii) the loss of market share by these customers due to manufacturing challenges or other problems, including disruptions related to labor strikes, may result in the loss of all or a substantial portion of our sales to these customers, which in turn, could have a material impact on our business, financial condition, or results of operations.
+Added: Currency exchange rate fluctuations could impact our gross margins and expenses.
Foreign currency fluctuations could have an adverse effect on our business, financial condition, or results of operations.
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Dollar depreciate significantly, this could have the effect of decreasing our gross margins and adversely impact our business, financial condition, or results of operations.
−Removed: With a majority of our manufacturing operations for our bike products occurring in Taiwan, a percentage of our sales and expenses are denominated in the New Taiwan Dollar.
−Removed: Should the New Taiwan Dollar appreciate against the U.S.
−Removed: Dollar, this could have the effect of decreasing our sales, increasing our expenses, and decreasing our profitability.
−Removed: Additionally, a portion of our operations take place in Canada and a percentage of our sales and expenses are denominated in Canadian Dollars.
−Removed: Our operating profitability could be negatively impacted as a result of changes in the exchange rate between the U.S.
−Removed: Dollar and the Canadian Dollar.
Our international operations are exposed to risks associated with conducting business globally.
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In addition to foreign currency risks, these risks include:
−Removed: • difficulty in transporting materials internationally, including labor disputes at East and West Coast ports, which handle a large amount of our products;
+Added: • difficulty in transporting materials internationally, including labor disputes or other interruptions at seaports that handle a large amount of our products;
• political, economic, or other actions from China or changes in China-Taiwan relations could impact Taiwan and its economy, which may adversely affect our operations in Taiwan, our customers, and our supply chain;
−Removed: • geopolitical regional conflicts, including the impact of the Russian war in Ukraine and the Israel-Palestine conflict on the global economy, energy supplies and raw materials, terrorist activity, political unrest, civil strife, acts of war, and other political uncertainty;
+Added: • geopolitical regional conflicts, including the impact of the Russian war in Ukraine, the Israel-Palestine conflict, and the conflict over nuclear facilities between the U.S.
+Added: and Iran on the global economy, energy supplies and raw materials, terrorist activity, political unrest, civil strife, acts of war, and other political uncertainty;
• increased difficulty in protecting our intellectual property rights and trade secrets;
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• unexpected government action or changes in legal or regulatory requirements;
−Removed: • changes in tariffs, quotas, trade barriers, and other similar restrictions on sales;
+Added: • changes in tariffs, quotas, trade barriers (including import bans and other orders issued by the U.S.
+Added: Customs and Border Protection), and other similar restrictions on sales;
• the effects of any anti-American sentiments on our brands or sales of our products;
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However, from time to time, third parties alleged, or may allege in the future, that our products or trademarks infringe upon their proprietary rights.
−Removed: We will evaluate any such claims and, where appropriate, may obtain or seek to obtain licenses or other business arrangements.
+Added: We evaluate any such claims and, where appropriate, may obtain or seek to obtain licenses or other business arrangements.
To date, there have been no significant interruptions in our business as a result of any claims of infringement, and we do not hold patent infringement insurance.
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Additionally, we registered or applied for trademarks and service marks with the U.S.
−Removed: Patent and Trademark Office and a number of foreign countries—including the marks FOX®, RACE FACE®, and MARUCCI®—to be used with certain goods and services.
+Added: Patent and Trademark Office and a number of foreign countries.
When appropriate, we may assert our rights against those who infringe on our patents, trademarks, trade dress, or other intellectual property.
However, we may not be successful in enforcing our patents or asserting trademark, trade name or trade dress protection with respect to our brand names and our product designs, and third parties may seek to oppose or challenge our patents or trademark registrations.
−Removed: Further, these legal efforts may not successfully reduce sales of suspension products by those infringing.
−Removed: In addition, our pending patent applications may not result in the issuance of patents, and even issued patents may be contested, circumvented, or invalidated and may not provide us with proprietary protection or competitive advantages.
If our efforts to develop and enforce our intellectual property are unsuccessful, or if a third party misappropriates our rights, this may adversely affect our business, financial condition, or results of operations.
Additionally, intellectual property protection may be unavailable or limited in some foreign countries where laws or law enforcement practices may not protect our proprietary rights as fully as in the U.S., and it may be more difficult for us to successfully challenge the use of our proprietary rights by other parties in these countries.
−Removed: Furthermore, other competitors may be able to successfully produce products that imitate certain of our products without infringing upon any of our patents, trademarks, or trade dress.
−Removed: The failure to prevent or limit infringements and imitations could have a permanent negative impact on the pricing of our products or reduce our product sales and product
−Removed: margins, even if we are ultimately successful in limiting the distribution of a product that infringes our rights, which in turn may affect our business, financial condition, or results of operations.
−Removed: Although we enter into non-disclosure agreements with employees, OEMs, distributors, and others to protect our confidential information and trade secrets, we may be unable to prevent such parties from breaching these agreements with us and using our intellectual property in an unauthorized manner.
−Removed: If our efforts to protect our intellectual property are unsuccessful or a third party misappropriates our rights, our business may be adversely affected.
−Removed: Defending our intellectual property rights can be very expensive and time-consuming, and there is no assurance that we will be successful.
+Added: The failure to prevent or limit infringements and imitations could have a permanent negative impact on the pricing of our products or reduce our product sales and product margins, even if we are ultimately successful in limiting the distribution of a product that infringes our rights, which in turn may affect our business, financial condition, or results of operations.
If we inaccurately forecast demand for our products or inaccurately predict OEM and dealer destocking and restocking cycles and production schedules, we may manufacture insufficient or excess quantities or our manufacturing costs could increase, which could adversely affect our business.
−Removed: We plan our manufacturing capacity based on the forecasted demand for our products.
−Removed: In the OEM channel, our forecasts are largely based on the number of our product specifications for new bikes and powered vehicles and on projections from our OEM customers.
+Added: We plan our manufacturing capacity based on forecasted demand for our products.
+Added: In the OEM channel, our forecasts are largely based on the number of our product specifications for new bikes and powered vehicles and projections from our OEM customers.
In the aftermarket channel, our forecasts are based partially on discussions with our dealers and distributors as well as our own assessment of markets.
Our forecasts are also dependent on OEM and dealer destocking and restocking cycles and OEM production schedules, which are subject to change.
+Added: In the baseball industry, our production of products is dependent on the demand for and popularity of items.
+Added: If we cannot keep up with the increased demand, we may lose customers to our competitors who have more resources.
If we incorrectly forecast demand, we may incur capacity issues in our manufacturing plant and supply chain, increased material costs, increased freight costs, additional overtime, and costs associated with excess inventory—all of which, in turn, adversely impact our cost of sales and our gross margin.
Economic weakness and uncertainty in the U.S., Europe, and other international markets may make accurate forecasting particularly challenging.
−Removed: In the future, if actual demand for our products exceeds forecasted demand, the margins on our incremental sales in excess of anticipated sales may be lower due to temporary higher costs, which could decrease our overall margins.
−Removed: While we generally manufacture our products upon receipt of customer orders, if actual demand is less than the forecasted demand for our products and we already manufactured the products or committed to purchase materials in support of forecasted demand, we could be forced to hold excess inventories.
−Removed: In short, either excess or insufficient production due to inaccurate forecasting could have a negative effect on our business, financial condition, or results of operations.
−Removed: Product recalls, and significant product repair and/or replacement due to product warranty costs and claims have had, and in the future could have, a material adverse impact on our business.
+Added: Product recalls, and significant product repair and/or replacement due to product warranty costs and claims, including material product liability claims, may have a material adverse impact on our business.
+Added: The use of our products by consumers, often under extreme conditions, exposes us to risks associated with product liability claims.
+Added: If our products are defective or used incorrectly by our customers, bodily injury, property damage or other injury, including death, may result in, and could give rise to product liability claims against us, which could adversely affect our brands’ image or reputation.
+Added: We encountered product liability claims in the past and carry product liability insurance to help protect us against the costs of such claims, although our insurance may be insufficient to cover all losses.
Unless otherwise required by law, we generally provide a limited warranty for our products for a one-, two- or three-year period beginning on:
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If any of our products are, or are alleged to be, defective, we may be required to participate in a recall involving such products.
−Removed: Our products and items where our products are incorporated as original equipment on the purchased item are frequently subject to regulation by various agencies, including, for example, the National Highway Traffic Safety Administration (the “NHTSA”), the U.S.
−Removed: Consumer Product Safety Commission (the “CPSC”) and/or similar state and international regulatory authorities.
−Removed: We have in the past, and may have in the future, recalls (both voluntary and involuntary) of our products or of items that incorporate our products.
−Removed: In the case of OEM sales, each manufacturer has its own practices regarding product recalls and other product liability actions that could involve its suppliers.
−Removed: Additionally, as suppliers become more integrally involved in the design process and assume a greater role in the overall system design, OEMs could potentially look to us to share in the cost if faced with recalls and product liability claims.
+Added: Our products and items where our products are incorporated as original equipment on the purchased item are frequently subject to regulation by various agencies, including, for example, the NHTSA, the CPSC and/or similar state and international regulatory authorities.
+Added: In the past, we had product recalls and may have additional recalls in the future, whether voluntary or involuntary, involving our products or products that incorporate or relate to our products.
Although we carry product liability and product recall insurance, no assurance can be made that such insurance will provide adequate coverage against any potential claims, such insurance is available in the appropriate markets or that we will be able to obtain such insurance on acceptable terms in the future.
In addition to the direct costs related to these or other recalls, our aftermarket and OEM sales could be adversely affected if we do not have a ready replacement product for such recalled products.
−Removed: Such recall events could also adversely affect the image of our brands and have a negative effect on our relationships with our OEMs, sponsored athletes and race teams, or otherwise have a negative effect on our business, financial condition or results of operations.
−Removed: An adverse determination in any material product liability claim against us could adversely affect our operating results or financial condition.
−Removed: The use of our products by consumers, often under extreme conditions, exposes us to risks associated with product liability claims.
−Removed: If our products are defective or used incorrectly by our customers, bodily injury, property damage or other injury, including death, may result in, and could give rise to product liability claims against us, which could adversely affect our brands’ image or reputation.
−Removed: We encountered product liability claims in the past and carry product liability insurance to help protect us against the costs of such claims, although our insurance may be insufficient to cover all losses.
−Removed: Any losses that we may suffer from product liability claims, and the effect that any product liability litigation may have upon the reputation and marketability of our products, may have a negative impact on our business, financial condition, or results of operations.
+Added: Such recall events could also adversely affect our brands and have a negative effect on our relationships with our OEMs, sponsored athletes and race teams, or otherwise have a negative effect on our business, financial condition or results of operations.
We and our employees are subject to certain risks in our manufacturing and in the testing of our products.
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There can be no assurance that the supply of these fuels will continue uninterrupted, that rationing will not be imposed, or that the price of or tax on these petroleum products will not significantly increase.
−Removed: For example, there have been significant increases in gasoline and diesel fuel prices due to geopolitical developments, including the impacts resulting from the Russian war in Ukraine, and there are heightened uncertainties regarding the future price and availability of gasoline and diesel fuel.
Future shortages of gasoline and diesel fuel and substantial increases in the price of fuel could have a material adverse effect on our powered vehicle product category, which could have a negative effect on our business, financial condition, or results of operations.
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Any conduct or actions that our suppliers take could reduce demand for our products, harm our ability to meet demand or harm our reputation, brand image, business, financial condition or results of operations.
−Removed: We may incur higher employee costs in the future.
−Removed: We are subject to government-mandated wage and benefit laws and regulations in various countries and jurisdictions.
−Removed: As we expand internationally, we are also subject to applicable laws in each such jurisdiction.
−Removed: Increases in the mandated wage in any or all of the jurisdictions in which we operate could subject us to increased costs, thereby impacting our business, financial condition, or results of operations.
−Removed: Further, the evolving labor market and increased ability for employees in our industry and other industries to work from home or have remote work arrangements may impact the turnover of our employees, potentially making it more difficult for us to compete.
−Removed: We maintain a self-insured healthcare plan for our employees based in the U.S.
−Removed: We have insurance coverage in place for individual claims above a specified amount in any year.
−Removed: Inflation in healthcare costs, as well as additional costs we may incur as a result of current or future federal or state healthcare legislation and regulations, could significantly increase our employee healthcare costs in the future.
−Removed: Continued increases in our employee costs could adversely affect our earnings, financial condition, and liquidity.
We rely on increasingly complex information systems to manage our manufacturing, distribution, sales, and other functions.
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The failure of any of the information technology systems to perform as anticipated could disrupt our business and could result in transaction errors, processing inefficiencies and the loss of sales and customers, which could materially adversely affect our business, financial condition, or results of operations.
−Removed: The information technology systems described above are also vulnerable to unauthorized access, computer viruses, ransomware attacks and other similar types of malicious activities and cyber-attacks, including attempts by others to gain access to our proprietary or sensitive information, and ranging from individual attempts to advanced persistent threats.
−Removed: Further, ransomware attacks are becoming increasingly prevalent and severe.
+Added: Information technology systems are also vulnerable to unauthorized access, computer viruses, ransomware attacks and other similar types of malicious activities and cyber-attacks, including attempts by others to gain access to our proprietary or sensitive information, and range from individual attempts to advanced persistent threats.
To alleviate the financial, operational, and reputational impact of a ransomware attack, it may be preferable to make extortion payments, but we may be unwilling or unable to do so, including, for example, if applicable laws or regulations prohibit such payments.
−Removed: Given the persistent and advanced nature of cybersecurity threats, we continue to invest in upgraded programs, implement advanced features, and establish adequate controls to stop or curtail these threats.
+Added: Given the persistent and advanced nature of cybersecurity threats, we continue to invest in upgraded programs, implement advanced features, and establish adequate controls designed to stop or curtail these threats.
However, investing in upgraded programs, advanced programs and adequate controls is expensive and an ongoing, rapidly changing challenge and the procedures and controls we use to monitor these threats and mitigate our exposure may not be sufficient to prevent cybersecurity incidents.
+Added: Data and security breaches can also occur as a result of non-technical issues, including intentional or inadvertent breaches by our employees or by persons with whom we have commercial relationships.
The results of these incidents could include misstated financial data, theft of trade secrets or other intellectual property, liability for disclosure of confidential customer, supplier or employee information, increased costs arising from the implementation of additional security protective measures, litigation and reputational damage, which could materially adversely affect our financial condition, business or results of operations.
Any remedial costs or other liabilities related to cybersecurity incidents may not be fully insured or indemnified by other means.
−Removed: Moreover, we or our third-party vendors or business partners may be more vulnerable to such attacks in remote work environments, which increased in response to the COVID-19 pandemic.
We are subject to evolving privacy laws in the U.S.
and other jurisdictions that could adversely impact our business and require that we incur substantial costs.
−Removed: The use of personal information by our business is highly regulated.
+Added: The use of personal data by our business is highly regulated.
We are subject to various laws and regulations that are continuously evolving and developing regarding privacy, data protection, and data security, including those related to the collection, storage, handling, use, disclosure, transfer, and security of personal data.
−Removed: The European Union’s General Data Protection Regulation (“GDPR”), and similar regulations implemented in other non-U.S.
+Added: The European Union’s General Data Protection Regulation (as amended, the “GDPR”), and similar regulations implemented in other non-U.S.
geographies, add a broad array of requirements with respect to personal data, including the public disclosure of significant data breaches, and imposes substantial penalties for noncompliance.
−Removed: The California Consumer Privacy Act (as amended, the “CCPA”) imposes additional obligations and consumer privacy rights with respect to the personal information of California residents.
−Removed: The CCPA provides civil penalties for violations, as well as a private right of action for data breaches.
−Removed: Furthermore, there is a trend toward more stringent privacy legislation in the U.S., as 19 states across the country have enacted privacy laws of broad applicability and others are considering and proposing similar laws.
−Removed: Privacy laws, both domestically and internationally, are changing rapidly, which may add additional complexity, variation in requirements, restrictions, and potential legal risk, require additional investment in resources for compliance programs, and result in increased compliance costs and/or changes in business marketing practices and policies.
−Removed: If we, our third-party service providers, or those with whom we share personal information fail to comply with such laws and regulations, such as the GDPR and the CCPA, our reputation could be damaged, possibly resulting in lost business, and we could be subjected to additional legal risk or financial losses as a result of non-compliance.
+Added: The California Consumer Privacy Act (as amended, the “CCPA”) imposes additional obligations and consumer privacy rights with respect to the personal data of California residents.
+Added: The CCPA provides civil penalties for violations, as well as a private right of action for certain data breaches.
+Added: Furthermore, there is a trend toward more stringent privacy legislation in the U.S., as a number of states across the country enacted privacy laws of broad applicability and others are considering and proposing similar laws.
+Added: If we, our third-party service providers, or those with whom we share personal data fail to comply with such laws and regulations, such as the GDPR and the CCPA, our reputation could be damaged, possibly resulting in lost business, and we could be subjected to additional legal risk or financial losses as a result of non-compliance.
Our vendors’ and commercial partners’ information technology systems may fail or suffer security breaches, which could result in a material disruption of our operations.
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Growth by acquisitions involves risks, and we may not be able to effectively integrate businesses we acquire, or we may not be able to identify or consummate any future acquisitions on favorable terms, or at all.
−Removed: We completed several acquisitions over the past several years, including our acquisition of SCA Performance Holdings, Inc.
−Removed: in March 2020, Outside Van and Sola Sport Pty Ltd.
−Removed: (“Sola Sport”) in May 2021, Shock Therapy in December 2021, Custom Wheel House, LLC in March 2023, Marucci Sports, LLC in November 2023, and Marzocchi Suspension S.r.l.
−Removed: in December 2024.
+Added: We have opportunistically expanded our business platform through acquisitions.
Additionally, we intend to selectively evaluate additional acquisitions in the future.
−Removed: Any acquisitions that we made and might make are subject to various risks and uncertainties and could have a negative impact on our business, financial condition, or results of operations.
+Added: Acquisitions are subject to various risks and uncertainties and could have a negative impact on our business, financial condition, or results of operations.
These risks include the inability to integrate effectively the operations, products, technologies, and personnel of the acquired companies (some of which may be spread out in different geographic regions), the inability to achieve anticipated cost savings or operating synergies, the earn-outs we may contractually obligate ourselves to pay, and the risk we may not be able to effectively manage our operations at an increased scale of operations resulting from such acquisitions.
−Removed: In the event we do complete acquisitions in the future, such acquisitions could affect our cash flows and net income as we expend funds, increase indebtedness, and incur additional expenses in connection with pursuing acquisitions.
+Added: In the event we complete acquisitions in the future, such acquisitions could affect our cash flows and net income as we expend funds, increase indebtedness, and incur additional expenses in connection with pursuing acquisitions.
We may also issue shares of our common stock or other securities from time to time as consideration for future acquisitions and investments.
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We experienced, and expect to continue to experience, substantial quarterly variations in our sales and net income.
−Removed: Our quarterly results of operations fluctuate, in some cases significantly, as a result of a variety of other factors, including, among other things:
+Added: Our quarterly results of operations fluctuate, in some cases significantly, as a result of a variety of factors, including, among other things:
• the timing of new product releases or other significant announcements by us or our competitors;
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Any future quarterly fluctuations that we report may differ from the expectations of market analysts and investors, which could cause the price of our common stock to fluctuate significantly.
−Removed: We also believe that the seasonal nature of our business may have been overshadowed throughout the past few years due to the rapid growth in sales we experienced during those periods.
Qualitative data and limited sources support our beliefs regarding the future growth of the performance-defining product market and may not be reliable.
−Removed: A reduction or lack of continued growth in the popularity of high-end bikes, powered vehicles, diamond sports, or in the number of consumers who are willing to pay premium prices for well-designed, performance-oriented equipment in the markets in which we sell our products could adversely affect our product sales and profits, financial condition, or results of operations.
We generate virtually all of our revenues from sales of performance-defining products.
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We believe inflation, and actions taken by the Federal Reserve in response, currently pose a risk to us in a number of ways.
−Removed: General inflation in the United States has risen to levels not experienced in recent decades, including rising energy prices, prices for consumer goods, interest rates, wages, and currency volatility and downgrades by rating agencies to the U.S.
+Added: General inflation in the U.S.
+Added: has risen to levels not experienced in recent decades, including rising energy prices, prices for consumer goods, interest rates, wages, and currency volatility and downgrades by rating agencies to the U.S.
government’s credit rating or concerns about its credit and deficit levels in general, could cause interest rates and borrowing costs to rise.
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government in reaction to such events could negatively impact our business by increasing our operating costs and our borrowing costs as well as decreasing capital.
−Removed: Specifically, the Federal Reserve increased benchmark interest rates multiple times in 2022 and 2023.
−Removed: While the Federal Reserve reduced benchmark interest rates in 2024, it may decide to raise benchmark interest rates in 2025 in an effort to curb the upward inflationary pressure on the cost of goods and services across the U.S.
+Added: The Federal Reserve reduced benchmark interest rates in 2025 and could enact further reduction(s) to benchmark interest rates in 2026, which could lead to an increase in inflation and the overall cost of goods and services across the U.S.
The raw materials and other supplies we use to produce our products experienced increasing prices during recent periods as a result of inflation.
In response, we increased the prices we charge customers for our products.
−Removed: While these price adjustments have not caused a reduction in sales thus far, continued increases in inflation rates may result in a reduction of customers or sales volumes.
−Removed: Additionally, if the Federal Reserve resumes raising interest rates, the result could be a recession, which could slow demand for our products, hinder our sales growth, or cause sales to decline in future periods.
+Added: These price adjustments could have a negative effect on sales and continued increases in inflation rates may result in a reduction of customers or sales volumes.
+Added: Additionally, if the Federal Reserve raises interest rates in the future, the result could be a recession, which could slow demand for our products, hinder our sales growth, or cause sales to decline in future periods.
As of the date of this Annual Report, we cannot predict how extensive the inflation or the effects of the Federal Reserve’s responses thereto will be, its duration, or the ultimate impact on us.
Additionally, the U.S.
−Removed: government’s credit and deficit concerns, the European sovereign debt crisis, and the potential trade war with China, could further cause interest rates to be volatile, which may negatively impact our ability to access the debt markets on favorable terms.
+Added: government’s credit and deficit concerns, the European sovereign debt crisis, and the trade war with China and other countries, could further cause interest rates to be volatile, which may negatively impact our ability to access the debt markets on favorable terms.
RISKS RELATED TO OUR INDEBTEDNESS AND LIQUIDITY
−Removed: The 2022 Credit Facility places operating restrictions on us and creates default risks.
−Removed: The 2022 Credit Facility with Wells Fargo Bank, National Association, and other named lenders contains covenants that restrict our operating activities.
+Added: The Amended Credit Agreement places operating restrictions on us and creates default risks.
+Added: The Amended Credit Agreement with Wells Fargo Bank, National Association, and other named lenders contains covenants that restrict our operating activities.
These covenants, among other things, limit our ability to:
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These restrictions may interfere with our ability to obtain financing or engage in other business activities, which may have a material adverse effect on our business, financial condition, or results of operations.
−Removed: If we are unable to comply with the covenants contained in the 2022 Credit Facility, it could constitute an event of default, and our lenders could declare all borrowings outstanding, together with accrued and unpaid interest, to be immediately due and payable.
−Removed: If we are unable to repay or otherwise refinance these borrowings when due, our lenders could sell the collateral securing the 2022 Credit Facility, which constitutes substantially all of our assets.
+Added: If we are unable to comply with the covenants contained in the Amended Credit Agreement, it could constitute an event of default, and our lenders could declare all borrowings outstanding, together with accrued and unpaid interest, to be immediately due and payable.
+Added: If we are unable to repay or otherwise refinance these borrowings when due, our lenders could sell the collateral securing the Amended Credit Agreement, which constitutes substantially all of our assets.
We continue to have the ability to incur debt, and our levels of debt may affect our operations and our ability to pay the principal of and interest on our debt.
−Removed: In the future, we may be able to incur substantial additional debt from amendments to the 2022 Credit Facility, additional lending sources subject to the restrictions contained in the 2022 Credit Facility, or because of certain debt instruments we may issue.
−Removed: As of January 3, 2025, we had $705.1 million of indebtedness and $496.8 million in revolving credit available to borrow under the 2022 Credit Facility.
−Removed: Our ability to borrow under the 2022 Credit Facility fluctuates from time to time due to, among other factors, our borrowings under the 2022 Credit Facility.
+Added: In the future, we may be able to incur substantial additional debt from amendments to the Amended Credit Agreement, additional lending sources subject to the restrictions contained in the Amended Credit Agreement, or because of certain debt instruments we may issue.
+Added: As of January 2, 2026, we had $673.5 million of indebtedness and $349.8 million in revolving credit available to borrow under the Amended Credit Agreement.
+Added: Our ability to borrow under the Amended Credit Agreement fluctuates from time to time due to, among other factors, our borrowings under the Amended Credit Agreement.
Our indebtedness could be costly or have adverse consequences, such as:
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If we incur substantial additional indebtedness in the future, these higher levels of indebtedness may affect our ability to pay the principal of and interest on existing indebtedness and our creditworthiness generally.
−Removed: Our outstanding indebtedness under the 2022 Credit Facility bears interest at a variable rate, which makes us more vulnerable to increases in interest rates and could cause our interest expense to increase and decrease cash available for operations and other purposes.
−Removed: Borrowings under the 2022 Credit Facility bear interest on a variable rate, which increases and decreases based upon changes in the underlying interest rate and/or our leverage ratio.
−Removed: Any such increases in the interest rate or increases of our borrowings under the 2022 Credit Facility will increase our interest expense.
−Removed: The Federal Reserve increased benchmark interest rates multiple times in 2022 and 2023.
−Removed: While the Federal Reserve reduced benchmark interest rates in 2024, it may decide to raise benchmark interest rates in 2025 in an effort to curb the upward inflationary pressure on the cost of goods and services across the U.S.
−Removed: Increases in these rates increase our interest expense and reduce our funds available for operations and other purposes.
+Added: Our outstanding indebtedness under the Amended Credit Agreement bears interest at a variable rate, which makes us more vulnerable to increases in interest rates and could cause our interest expense to increase and decrease cash available for operations and other purposes.
+Added: Borrowings under the Amended Credit Agreement bear interest on a variable rate, which increases and decreases based upon changes in the underlying interest rate and/or our leverage ratio.
+Added: Any such increases in the interest rate or increases of our borrowings under the Amended Credit Agreement will increase our interest expense.
+Added: While the Federal Reserve decreased benchmark interest rates multiple times in 2025, interest rates remain subject to change in 2026.
+Added: Any future increases in these rates increase our interest expense and reduce our funds available for operations and other purposes.
Although from time to time we may enter into agreements to hedge a portion of our interest rate exposure, such as the 2022 Interest Rate Swap Agreement, these agreements may be costly and may not protect against all interest rate fluctuations.
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Derivatives and Hedging for additional information regarding the interest rate swap arrangement.
−Removed: As of January 3, 2025, we had $713.7 million of interest-bearing indebtedness outstanding under the 2022 Credit Facility.
−Removed: Based on the $213.7 million of variable interest rate indebtedness that was outstanding under the 2022 Credit Facility as of January 3, 2025, after giving effect to our interest rate swap, a hypothetical 100 basis point increase or decrease in the interest rate would have resulted in an approximately $2.1 million increase or decrease in interest expense for the year ended January 3, 2025, respectively.
−Removed: We may incur losses on interest rate swap and hedging arrangements.
−Removed: We may periodically enter into agreements to reduce the risks associated with increases in interest rates, such as our swap agreements.
−Removed: Although these agreements may partially protect against rising interest rates, they also may reduce the benefits to us if interest rates decline.
+Added: As of January 2, 2026, we had $680.8 million of interest-bearing indebtedness outstanding under the Amended Credit Agreement.
+Added: Based on the $180.8 million of variable interest rate indebtedness that was outstanding under the Amended Credit Agreement as of January 2, 2026, after giving effect to our interest rate swaps, a hypothetical 100 basis point increase or decrease in the interest rate would have resulted in an approximately $1.8 million increase or decrease in interest expense for the year ended January 2, 2026, respectively.
RISKS RELATED TO LAWS AND REGULATIONS
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federal and state governments, as well as foreign and international regulatory authorities.
−Removed: Although we believe that our products, policies, and processes comply with applicable safety, environmental, and other standards and related regulations, future regulations may require additional safety standards that would require additional expenses and/or modification of product offerings to maintain such compliance.
+Added: Future regulations may require additional safety standards that would require additional expenses and/or modification of product offerings to maintain such compliance.
Failure to comply with applicable regulations could result in fines, increased expenses to modify our products, and reputational harm, all of which could have an adverse effect on our business, financial condition, or results of operations.
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We work cooperatively with consultants and CARB to comply with current CARB regulations that may apply to our modified vehicles.
−Removed: Depending on the results of modified vehicle emissions testing, there is some chance that we could be limited in types of modifications and products sold into California, or have to adjust our business model for California sales in a way that makes such modified vehicles uneconomical and/or unachievable.
+Added: Depending on the results of modified vehicle emissions testing, we could be limited in types of modifications and products sold into California or have to adjust our business model for California sales in a way that makes such modified vehicles uneconomical and/or unachievable.
The successful development and introduction of new and enhanced products in order to comply with new regulatory requirements are subject to other risks, such as delays in product development, cost overruns, and unanticipated technical and manufacturing difficulties.
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Following a number of challenges to the rules by federal courts and prior statements that the SEC would vigorously defend the validity of the rule, the SEC, under new administration, changed course in February 2025, stating that it would no longer defend the rules and the rules would be removed under new leadership.
−Removed: While we may no longer face the stringent reporting requirements under SEC rules, our customers may require us to implement environmental, social, or governance responsibility procedures or standards before they will continue to do business with us.
−Removed: Additionally, we may face reputational challenges in the event our environmental, social, or governance responsibility procedures or standards do not meet the standards set by certain constituencies.
+Added: While we may no longer face the stringent reporting requirements under SEC rules, our customers may require us to implement environmental, social, or governance responsibility procedures or standards before conducting business with us.
+Added: Additionally, we may face reputational challenges in the event that our environmental, social, or governance responsibility procedures or standards do not meet the standards set by certain constituencies.
The occurrence of any of the foregoing could have a material adverse effect on the price of our shares and our business, financial condition, and results of operations.
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As a result, the effects of climate change could have a long-term adverse impact on our business and results of operations.
−Removed: In many of the countries in which we operate, governmental bodies are increasingly enacting legislation and regulations in response to the potential impacts of climate change.
−Removed: For example, many nations agreed to limit greenhouse gas emissions pursuant to the United Nations Framework Convention on Climate Change, also known as the “Kyoto Protocol” and other initiatives.
−Removed: In December 2015, the U.S.
−Removed: and 194 other countries adopted the Paris Agreement, committing to work towards addressing climate change and agreeing to a monitoring and review process for greenhouse gas emissions.
−Removed: Although the U.S.
−Removed: withdrew from the Paris Agreement in November 2020, rejoined the Paris Agreement in February 2021, and then announced an intent to again withdraw from the Paris Agreement following the change in Presidential administration, the U.S.
−Removed: may, in the future, choose to join other international agreements targeting greenhouse gas emissions.
−Removed: The adoption of legislation or regulatory programs at the federal level or other government action to reduce emissions of greenhouse gases, such as the programs implemented under the Biden Administration to address the climate crises, could have the potential to impact our operations directly or indirectly as a result of required compliance by our suppliers and us.
+Added: Laws, regulations, and policies addressing concerns regarding climate change, greenhouse gases, air quality, and other concerns related to the environment continue to develop or be enacted in areas in which we operate.
+Added: These laws, regulations, and policies may differ by global region, country, and within national boundaries.
+Added: Regulators can also propose and enact different standards on short notice.
+Added: As this regulatory landscape evolves, it could have the potential to impact our operations directly or indirectly as a result of required compliance by our suppliers and us.
In addition, we may choose to take voluntary steps to mitigate our impact on climate change.
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however, we are subject to risks of litigation by employees and others that might involve allegations of illegal, unfair, or inconsistent employment practices, including wage and hour violations, employment discrimination, misclassification of independent contractors as employees, wrongful termination, and other concerns, which could require additional expenditures.
−Removed: We are subject to environmental laws and regulation and potential exposure for environmental costs and liabilities.
+Added: As we expand internationally, we are also subject to applicable laws in each such jurisdiction.
+Added: Increases in the mandated wage in any or all of the jurisdictions in which we operate could subject us to increased costs, thereby impacting our business, financial condition, or results of operations.
+Added: Further, the evolving labor market and increased ability for employees in our industry and other industries to work from home or have remote work arrangements may impact the turnover of our employees, potentially making it more difficult for us to compete.
+Added: We maintain a self-insured healthcare plan for our employees based in the U.S.
+Added: We have insurance coverage in place for individual claims above a specified amount in any year.
+Added: Inflation in healthcare costs, as well as additional costs we may incur as a result of current or future federal or state healthcare legislation and regulations, could significantly increase our employee healthcare costs in the future.
+Added: Continued increases in our employee costs could adversely affect our earnings, financial condition, and liquidity.
+Added: We are subject to environmental laws and regulations and potential exposure for environmental costs and liabilities.
Our operations, facilities, and properties are subject to a variety of foreign, federal, state, and local laws and regulations relating to health, safety, and the protection of the environment.
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From time to time, we have been involved in administrative or legal proceedings relating to environmental, health, or safety matters and incurred expenditures relating to such matters in the past.
−Removed: We believe that our operations are in substantial compliance with applicable environmental laws and regulations.
−Removed: However, additional environmental issues relating to presently known or unknown matters could give rise to currently unanticipated investigation, assessment, or expenditures.
+Added: Environmental issues relating to presently known or unknown matters could give rise to currently unanticipated investigation, assessment, or expenditures.
Compliance with laws or regulations that are more stringent, as well as different interpretations of existing laws, more vigorous enforcement by regulators or unanticipated events, could require additional expenditures that may materially affect our business, financial condition, or results of operations.
Federal, state, local, foreign, and international laws and regulations relating to environmental matters, land-use, and noise and air pollution may have a negative impact on our future sales and results of operations.
−Removed: The products in our powered vehicles category are used in vehicles that are subject to numerous federal, state, local, foreign, and international laws and regulations relating to noise and air pollution.
+Added: Our PVG products are used in vehicles that are subject to numerous federal, state, local, foreign, and international laws and regulations relating to noise and air pollution.
Powered vehicles, and even bikes, have become subject to laws and regulations prohibiting their use on certain lands and trails.
For example, in San Mateo County, California, mountain bikes are not allowed on county trails, and ATV and side-by-sides riding is not allowed in Zion National Park, among many other national and state parks.
−Removed: In addition, recreational snowmobiling has been restricted in some national parks and federal lands in Canada, the U.S., and other countries.
If more of these laws and regulations are passed and the users of our products lose convenient locations to ride their mountain bikes and powered vehicles, our sales could decrease, and our business, financial condition, or results of operations could suffer.
−Removed: Regulations related to conflict minerals may force us to continue to incur additional expenses and otherwise adversely impact our business.
−Removed: The SEC rules regarding disclosure of the use of tin, tantalum, tungsten, and gold, known as conflict minerals, in products manufactured by public companies require ongoing due diligence to determine whether such minerals originated from the Democratic Republic of Congo (“DRC”), or an adjoining country and whether such minerals helped finance the armed conflict in the DRC.
−Removed: As a public company, we are required to comply with the reporting obligations annually.
−Removed: There are costs associated with complying with these disclosure requirements, including costs to determine the origin of conflict minerals in our products.
−Removed: The effect of such rules on customer, supplier, or consumer behavior could adversely affect the sourcing, supply, and pricing of materials used in our products.
−Removed: As a result, we may also incur costs with respect to potential changes to products, processes, or sources of supply.
−Removed: We may face disqualification as a supplier for customers and reputational challenges if our due diligence procedures do not enable us to verify the origins for all conflict minerals used in our products or to determine if such conflict minerals are conflict-free.
−Removed: Accordingly, these rules could have a material adverse effect on our business, results of operations, or financial condition.
−Removed: We retain certain personal information about individuals and are subject to various privacy and consumer protection laws.
−Removed: We collect personal information for various purposes and through various methods, including from third parties and directly from consumers through our website, at events and sales, and via telephone and email.
+Added: We retain certain personal data about individuals and are subject to various privacy and consumer protection laws.
+Added: We collect personal data for various purposes and through various methods, including from third parties and directly from consumers through our website, at events and sales, and via telephone and email.
Certain individuals may object to the processing of this data, request the deletion of this data, or opt out of the sharing of this data, any of which may negatively impact our ability to provide effective customer service or otherwise impact our operations.
−Removed: Collection and use of personal information in conducting our business may be subject to federal and/or state laws and regulations in the U.S.
−Removed: and foreign jurisdictions including, in particular, various jurisdictions in Europe, and such laws and regulations may restrict our processing of such personal information and may hinder our ability to attract new customers or market to existing customers.
+Added: Collection and use of personal data in conducting our business may be subject to federal and/or state laws and regulations in the U.S.
+Added: and foreign jurisdictions including, in particular, various jurisdictions in Europe, and such laws and regulations may restrict our processing of such personal data and may hinder our ability to attract new customers or market to existing customers.
We may incur significant expenses to comply with privacy, consumer protection, and security standards and protocols imposed by law, regulation, industry standards, or contractual obligations.
−Removed: Our vendors and any potential commercial partners may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements.
−Removed: Our vendors and any potential commercial partners expose us to the risk of fraud or other misconduct.
−Removed: Misconduct by these parties could include intentional, reckless, and/or negligent conduct or disclosure of unauthorized activities to us that violate federal and/or state data privacy, security, and consumer protection laws and regulations in the U.S.
−Removed: Such misconduct could result in regulatory sanctions and cause serious harm to our reputation.
policies related to global trade and tariffs could have a material adverse effect on our results of operations.
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imposed tariffs of 25% on steel and 10% on aluminum, with only a handful of countries exempt from the increase.
−Removed: The new Trump administration recently enhanced these measures by increasing the tariff on aluminum to 25%, expanding the products on which the tariffs will be assessed to include derivative products containing steel or aluminum, and terminating all countrywide exemptions and the product specific exemption process.
−Removed: Throughout the first Trump administration, the U.S.
−Removed: and China imposed a variety of tariffs on most goods traded between the two countries.
−Removed: and the European Union also imposed tariffs on each other’s products stemming from a dispute at the World Trade Organization related to aircraft.
−Removed: The Biden administration and U.S.
−Removed: Congress created significant uncertainty about their review of tariffs and future relationships between the U.S.
−Removed: and other countries with respect to regulations.
−Removed: Since taking office, the new Trump administration has implemented various new strategies regarding tariffs.
−Removed: President Trump invoked the International Emergency Economic Powers Act to impose 25% tariffs on products from Mexico and 25% tariffs on products from Canada (with a lower 10% tariff on Canadian energy and energy resources) but delayed implementation of those tariffs based on agreed actions by both countries.
+Added: The new Trump administration enhanced these measures beginning in 2025 by increasing the tariffs on aluminum and steel to 50% for all countries except the United Kingdom, expanding the products on which the tariffs will be assessed to include derivative products containing steel or aluminum, and terminating all countrywide exemptions and the product specific exemption process.
+Added: There is an inclusion process through which domestic industry can request the U.S.
+Added: include new derivative steel and aluminum products that will be subject to the increased tariffs.
+Added: Since taking office, the new Trump administration implemented various new strategies regarding tariffs.
+Added: President Trump invoked the International Emergency Economic Powers Act (“IEEPA”) to impose 25% tariffs on products from Mexico and 25% tariffs on products from Canada (with a lower 10% tariff on Canadian energy and energy resources) but exempted from the tariffs those products that are entitled to preferential treatment under the United States-Mexico-Canada Agreement.
President Trump also imposed a 20% tariff on all imports from China and Hong Kong under the International Emergency Economic Powers Act.
−Removed: Most recently, the Trump administration suggested the idea of “reciprocal taxes”, in which the U.S.
−Removed: matches the import duties levied by other countries, which is an alternative to standard “universal tariffs,” where all imports are taxed at the same punitive rate.
−Removed: While reciprocal tariffs are thought be lower than universal tax rates, and therefore to have a lower impact on consumers, reciprocal tariffs may create an administrative burden and will cause retailers to make difficult decisions as to how to pay the tariff or absorb the cost into their profit margins.
−Removed: Recently, a coalition of U.S.
−Removed: producers of aluminum extrusions filed a petition with U.S.
−Removed: trade authorities requesting the imposition of anti-dumping duties against imports of aluminum extrusions from 15 countries.
−Removed: Following hearings in October 2024, the U.S.
−Removed: International Trade Commission determined that the aluminum extrusions do not harm U.S.
−Removed: industry and, therefore, the U.S.
−Removed: Department of Commerce will not issue antidumping or countervailing duty orders for applicable countries.
−Removed: While we face no immediate consequences on the import of aluminum extrusions, because the U.S.
−Removed: producers challenged the USITC determination at the U.S.
−Removed: Court of International Trade and aluminum is one of the primary raw materials used in the production of our products, our operating results could be adversely impacted by the future imposition of duties on extruded aluminum.
−Removed: While we have limited exposure to implemented tariffs at this time, any expansion in the types of tariffs implemented has the potential to negatively impact our supply chain costs and the operating performance of our customers, which in turn may negatively affect our sales, gross margin, and operating performance.
+Added: Acting on an investigation concluded during the first Trump administration, the current Trump administration-imposed tariffs of 25% on certain passenger vehicles and light trucks and parts for those vehicles.
+Added: In April 2024, the Trump administration imposed a universal “reciprocal” tariff of at least 10% on all countries and higher rates for certain countries, which took effect on August 1, 2025.
+Added: On February 20, 2026, the U.S.
+Added: Supreme Court issued a decision finding that IEEPA does not authorize the President to impose tariffs.
+Added: The Company continues to evaluate the potential ramifications of the U.S.
+Added: Supreme Court’s ruling and any impacts on the Company from that ruling, including refunds from the government, and any contractual obligations arising from such refunds.
+Added: Responding to that ruling, President Trump rescinded the tariff actions based on IEEPA and signed a new proclamation imposing, effective February 24, 2026, a 10% global tariff (to be increased to 15%) under Section 122 of the Trade Act of 1974 (“Section 122”).
+Added: There are various exemptions to this Section 122 tariff, and, by statute, the tariff will remain in effect for only 150 days, unless extended by the Congress.
+Added: The Trump administration also announced that it will conduct additional investigations on an expedited basis under Section 301 of the Trade Act of 1974, while President Trump also cited taking actions using authorities already enacted by Congress.
+Added: The tariff actions by the U.S.
+Added: may result in a decrease of global trade volumes due to uncertainty, may create an administrative burden and will cause retailers to make difficult decisions as to how to pay the tariff or absorb the cost into their profit margins.
+Added: While we have exposure to implemented tariffs at this time, in regard to our supply chain and end-user demand, any expansion in the types of tariffs implemented has the potential to negatively impact our supply chain costs and the operating performance of our customers, which in turn may negatively affect our sales, gross margin, and operating performance.
Additionally, there is a risk that continued U.S.
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Additionally, the Uyghur Forced Labor Prevention Act (“UFLPA”) empowers the U.S.
−Removed: Customs and Border Protection Agency (the “U.S.
CBP to withhold release of items produced in whole or in part in countries or by companies included on the UFLPA entities list, creating a presumption that such goods were produced using forced labor.
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However, we are continuously working to enhance our due diligence processes, leveraging available data and supplier engagement to ensure compliance to the fullest extent possible.
−Removed: While any detentions or detainments we have experienced have not resulted in any material impact on our business to date, future detentions, as result of noncompliance or in connection with forced labor enforcement (including noncompliance by or enforcement against our suppliers and manufacturers), could result in unexpected (i) delays or rejections of products scheduled for delivery to us, which could in turn affect the timing or our ability to deliver products to our customers;
−Removed: (ii) supply chain disruptions and increased operating costs;
−Removed: (iii) damage to our customer relationships;
−Removed: and/or (iv) negative publicity that harms our reputation, any of which could have a material impact on our business and negatively affect our ultimate financial results.
+Added: Recently, in September 2025, the U.S.
+Added: CBP issued a Withhold Release Order against bicycles, bicycle parts, and accessories manufactured in Taiwan by Giant Manufacturing Co.
+Added: Ltd., based on information of possible forced labor use.
+Added: The similarity in product offerings and our company’s products being associated with Giant Manufacturing Co.
+Added: may subject our Taiwan-based or other operations to increased scrutiny and review, which could result in compliance and reporting costs and hinder or delay the importation and delivery of our products manufactured in Taiwan.
+Added: With the majority of our manufacturing operations for our bike products occurring in Taiwan, any adverse order issued by the U.S.
+Added: CBP on our company or other manufacturers of bicycles, bicycle parts, and related accessories could negatively affect our business, financial condition or results of operations.
We are, and may in the future be, subject to legal proceedings.
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Claims arising out of actual or alleged violations of law could be asserted against us by individuals, either individually or through class actions, by governmental entities in civil or criminal investigations and proceedings or by other entities.
−Removed: These claims could be asserted under a variety of laws, including but not limited to consumer protection laws and regulations, product liability laws, intellectual property laws, environmental laws, privacy laws, labor and employment laws, securities laws and employee benefit laws.
These actions could expose us to adverse publicity and to substantial monetary damages and legal defense costs, injunctive relief and criminal and civil fines and penalties, including but not limited to suspension or revocation of licenses to conduct business.
−Removed: For example, a class action and two stockholder derivative complaints are pending in the United States District Court for the Northern District of Georgia in Atlanta asserting claims on behalf of a putative class of Company stockholders against the Company and certain of its current and former officers alleging violations of federal securities laws and fiduciary duties.
−Removed: See Part I, Item 3.
−Removed: “Legal Proceedings” for more information about this class action and stockholder derivative complaints and other legal proceedings to which we may be subject.
RISKS RELATED TO OWNERSHIP OF OUR COMMON STOCK
The trading price of our common stock may be volatile, and you might be unable to sell your shares at or above the price you pay for the shares.
−Removed: The trading price of our common stock could be volatile, and you could lose all or part of your investment in our common stock.
−Removed: For example, from January 1, 2022 through January 3, 2025, our stock price fluctuated between $171.80 and $28.33 per share, and such volatility may continue in the future.
−Removed: Factors affecting the trading price of our common stock could include:
+Added: The trading price of our common stock could be volatile, and investors could lose all or part of their investment in our common stock.
+Added: For example, from December 31, 2022 through January 2, 2026, our stock price fluctuated between $127.54 and $13.08 per share, and such volatility may continue in the future.
+Added: Factors affecting the trading price of our common stock could include, among others:
• variations in our operating results or those of our competitors;
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Fluctuations in the overall stock market generally or with respect to companies in our industry could cause the trading price of our common stock to fluctuate for reasons unrelated to our business, operating results, or financial condition.
−Removed: Further, some companies with volatile market prices for their securities have had securities class actions filed against them.
+Added: Further, some companies with volatile market prices for their securities had securities class actions filed against them.
A lawsuit filed against us, regardless of its merits or outcome, could cause us to incur substantial costs and divert management’s attention.
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The issuance of additional shares of our common stock, such as the follow-on offering of approximately 2.8 million shares of common stock that we completed in June 2020, could dilute the ownership interest of our common stockholders and could depress the market price of shares of our common stock.
−Removed: Our Amended and Restated Certificate of Incorporation authorizes us to issue 90,000,000 shares of common stock, 41,683,905 of which shares were outstanding as of January 3, 2025.
+Added: Our Second Amended and Restated Certificate of Incorporation authorizes us to issue 90,000,000 shares of common stock, 41,802,023 of which shares were outstanding as of January 2, 2026.
In the future, we may issue additional shares of common stock or other equity or debt securities convertible into common stock in connection with financings, acquisitions, registration statements, or otherwise.
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The trading market for our common stock depends in part on the research and reports that securities or industry analysts publish about our business or us.
−Removed: If one or more of the analysts who covers us downgrades our stock or publishes unfavorable research about our business or our industry, our stock price would likely decline.
−Removed: If one or more of these analysts ceases coverage of our Company or fails to publish reports on us regularly, demand for our stock could decrease, which could cause our stock price and trading volume to decline.
+Added: If one or more of the analysts who cover us downgrades our stock or publishes unfavorable research about our business or our industry, our stock price would likely decline.
+Added: If one or more of these analysts cease coverage of our Company or fail to publish reports on us regularly, demand for our stock could decrease, which could cause our stock price and trading volume to decline.
Anti-takeover provisions in our charter documents and Delaware law could discourage, delay, or prevent a change in control of our Company.
−Removed: Our Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws (together, our “Charter Documents”), as well as Delaware law, contain provisions that may discourage, delay or prevent a change in our management or control over us that stockholders may consider favorable.
+Added: Our Second Amended and Restated Certificate of Incorporation and Second Amended and Restated Bylaws (together, our “Charter Documents”), as well as Delaware law, contain provisions that may discourage, delay or prevent a change in our management or control over us that stockholders may consider favorable.
Among other things, these provisions:
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If our financial condition deteriorates or we decide to use our cash for other purposes, we may suspend repurchase activity at any time.
−Removed: Our Amended and Restated Certificate of Incorporation designates the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or other employees.
−Removed: Our Amended and Restated Certificate of Incorporation provides that, with certain limited exceptions, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for:
+Added: Our Second Amended and Restated Certificate of Incorporation designates the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or other employees.
+Added: Our Second Amended and Restated Certificate of Incorporation provides that, with certain limited exceptions, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for:
(i) any derivative action or proceeding brought on our behalf;
16 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.