932372--3/26/2010--Orange_21

related topics

{product, market, service}

{customer, product, revenue}

{property, intellectual, protect}

{acquisition, growth, future}

{stock, price, share}

{stock, price, operating}

{control, financial, internal}

{operation, international, foreign}

{condition, economic, financial}

{debt, indebtedness, cash}

{product, liability, claim}

{personnel, key, retain}

{cost, regulation, environmental}

Risks Related to Our Business Economic conditions and the resulting decline in consumer spending could continue to adversely affect our business and financial performance. Current economic conditions could adversely impact our liquidity and our ability to obtain financing, including counterparty risk. Fluctuations in foreign currency exchange rates could harm our results of operations. We have a history of significant losses. If we do not achieve or sustain profitability, our financial condition and stock price could suffer. Our future capital needs are uncertain, and we may need to raise additional funds in the future which may not be available on acceptable terms or at all. If we are unable to continue to develop innovative and stylish products, demand for our products may decrease. We may not be able to compete effectively, which will cause our net sales and market share to decline. If our marketing efforts are not effective, our brands may not achieve the broad recognition necessary to our success. If we fail to develop new products that are received favorably by our target customer audience, our business may suffer. Substantially all of our assets are pledged to secure obligations under our outstanding indebtedness. Our business could be harmed if we fail to maintain proper inventory levels. Our manufacturers must be able to continue to procure raw materials and we must continue to receive timely deliveries from our manufacturers to sell our products profitably. If we are unable to recruit and retain key personnel necessary to operate our business, our ability to develop and market our products successfully may be harmed. If we are unable to maintain and expand our endorsements by professional athletes, our ability to market and sell our products may be harmed. Any interruption or termination of our relationships with our manufacturers could harm our business. Any failure to maintain ongoing sales through our independent sales representatives or maintain our international distributor relationships could harm our business. We face business, political, operational, financial and economic risks because a significant portion of our operations and sales are to customers outside of the United States. If we fail to secure or protect our intellectual property rights, or upon expiration of our intellectual property rights, competitors may be able to use our technologies, which could weaken our competitive position, reduce our net sales or increase our costs. We may be subject to claims by third parties for alleged infringement of their proprietary rights, which are costly to defend, could require us to pay damages and could limit our ability to use certain technologies in the future. If we fail to manage any growth that we might experience, our business could be harmed and we may have to incur significant expenditures to address this growth. Our eyewear products and business may subject us to product liability claims or other litigation, which are expensive to defend, distracting to our management and may require us to pay damages. We could incur substantial costs to comply with foreign environmental laws, and violations of such laws may increase our costs or require us to change certain business practices. In the event we are unable to remedy any deficiency we identify in our system of internal controls over financial reporting, or if our internal controls are not effective, our business and our stock price could suffer. We may not successfully integrate any future acquisitions, which could result in operating difficulties and other harmful consequences. We will be unable to compete effectively if we fail to anticipate product opportunities based upon emerging technologies and standards and fail to develop products and solutions that incorporate these technologies and standards in a timely manner. Risks Related to the Market for Our Common Stock Our common stock now trades on the over-the-counter market, which may impact the liquidity of our common stock and our ability to raise additional capital. Our stock price may be volatile, and you may not be able to resell our shares at a profit or at all. Fluctuations in our operating results on a quarterly and annual basis could cause the market price of our common stock to decline. Because of their significant stock ownership, some of our existing stockholders are able to exert control over us and our significant corporate decisions.

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932372--3/26/2010--Orange_21_Inc.