1065837--3/16/2007--SKECHERS_USA

related topics

{operation, international, foreign}

{customer, product, revenue}

{property, intellectual, protect}

{stock, price, operating}

{acquisition, growth, future}

{condition, economic, financial}

{loan, real, estate}

{personnel, key, retain}

{competitive, industry, competition}

{debt, indebtedness, cash}

{operation, natural, condition}

{cost, regulation, environmental}

Our Business And The Success Of Our Products Could Be Harmed If We Are Unable To Maintain Our Brand Image. Our Business Could Be Harmed If We Fail To Maintain Proper Inventory Levels. We Face Intense Competition, Including Competition From Companies With Significantly Greater Resources Than Ours, And If We Are Unable To Compete Effectively With These Companies, Our Market Share May Decline And Our Business Could Be Harmed. We Depend Upon A Relatively Small Group Of Customers For A Large Portion Of Our Sales. Our International Sales And Manufacturing Operations Are Subject To The Risks Of Doing Business Abroad, Particularly In China, Which Could Affect Our Ability To Sell Or Manufacture Our Products In International Markets, Obtain Products From Foreign Suppliers Or Control The Costs Of Our Products. The Potential Imposition Of Additional Duties, Tariffs And Other Trade Restrictions Could Have An Adverse Impact On Our Sales And Profitability. We May Be Unable To Successfully Execute Our Growth Strategy Or Maintain Our Growth. Our Business May Be Negatively Impacted As A Result Of Changes In The Economy. Economic, Political, Military Or Other Events In The United States Or In A Country Where We Make Significant Sales Or Have Significant Operations Could Interfere With Our Success Or Operations There And Harm Our Business. Our Quarterly Revenues And Operating Results Fluctuate As A Result Of A Variety Of Factors, Including Seasonal Fluctuations In Demand For Footwear, Delivery Date Delays And Potential Fluctuations In Our Annualized Tax Rate, Which May Result In Volatility Of Our Stock Price. We Rely On Independent Contract Manufacturers And, As A Result, Are Exposed To Potential Disruptions In Product Supply. Our Business Could Be Harmed If Our Contract Manufacturers, Suppliers Or Licensees Violate Labor, Trade Or Other Laws. Our Operating Results Could Be Negatively Impacted If Our Sales Are Concentrated In Any One Style Or Group Of Styles. Our Strategies Involve A Number Of Risks That Could Prevent Or Delay Any Successful Opening Of New Stores As Well As Impact The Performance Of Our Existing Stores. Many Of Our Retail Stores Depend Heavily On The Customer Traffic Generated By Shopping And Factory Outlet Malls Or By Tourism. We Depend On Key Personnel To Manage Our Business Effectively In A Rapidly Changing Market, And If We Are Unable To Retain Existing Personnel, Our Business Could Be Harmed. The Disruption, Expense And Potential Liability Associated With Existing And Unanticipated Future Litigation Against Us Could Have A Material Adverse Effect On Our Business, Results Of Operations And Financial Condition. Our Trademarks, Design Patents And Other Intellectual Property Rights May Not Be Adequately Protected Outside The United States. Our Ability To Compete Could Be Jeopardized If We Are Unable To Protect Our Intellectual Property Rights Or If We Are Sued For Intellectual Property Infringement. Natural Disasters Or A Decline In Economic Conditions In California Could Increase Our Operating Expenses Or Adversely Affect Our Sales Revenue. Failure By Us To Comply With Any Of The Financial Covenants In Our Long-Term Debt Agreements And $150.0 Million Line Of Credit Facility Could Have A Material Adverse Impact On Our Business. One Principal Stockholder Is Able To Control Substantially All Matters Requiring A Vote Of Our Stockholders And His Interests May Differ From The Interests Of Our Other Stockholders.

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1065837--3/16/2007--SKECHERS_USA_INC