Dick's Sporting Goods 2010 Annual Report Download - page 39

adequately address some or all of these risks could have a material adverse effect on our business, results of operations and
financial condition.
The loss of our key executives, especially Edward W. Stack, our Chairman of the Board and Chief Executive Officer, could have a
material adverse effect on our business due to the loss of their experience and industry relationships.
Our success depends on the continued services of our senior management, particularly Edward W. Stack, our Chairman of the
Board and Chief Executive Officer. Mr. Stack, in addition to serving as Chairman and Chief Executive Officer of the Company, also
holds a majority of the voting power of our capital stock, and has been operating the Company since 1984. Mr. Stack possesses
detailed and in-depth knowledge of the issues, opportunities and challenges facing the Company and its businesses. If we were to
lose any key senior executive, especially Mr. Stack, our business could be materially adversely affected.
Our costs may change as a result of currency exchange rate fluctuations.
Many of the goods we purchase are manufactured abroad, and the prices charged by foreign manufacturers’ may be affected by
the fluctuation of their local currency against the U.S. dollar. We source goods from various countries, including China, and thus
changes in the value of the U.S. dollar compared to other currencies may affect the costs of goods that we purchase.
We are subject to costs and risks associated with increased or changing laws and regulations affecting our business, including those
relating to the sale of consumer products.
We operate in a complex regulatory and legal environment that exposes us to compliance and litigation risks that could materially
affect our operations and financial results. These laws may change, sometimes significantly, as a result of political, economic or
social events. Some of the federal, state or local laws and regulations that affect us include:
•those relating to consumer products, product liability or consumer protection, including the Consumer Product Safety Act
and the Consumer Product Safety Improvement Act regarding lead and phthalates, as well as similar state laws;
•those relating to the manner in which we advertise, market or sell our products;
•labor and employment laws, including wage and hour laws;
•those that prohibit or limit the sale in certain areas of certain products we offer, such as firearms, ammunition or knives;
•tax laws or interpretations thereof;
•data protection and privacy laws and regulations;
•environmental laws and regulations, such as California’s Safe Drinking Water and Toxic Enforcement Act (known as
Prop 65);
•customs or import laws and regulations; and
•securities and exchange laws and regulations.
Our inability or failure to protect our intellectual property could have a negative impact on our operating results.
Our trademarks, service marks, copyrights, patents, trade secrets, domain names and other intellectual property are valuable
assets that are critical to our success. Effective trademark and other intellectual property protection may not be available in every
country in which our products are or may be made available. The unauthorized reproduction or other misappropriation of our
intellectual property could diminish the value of our brands or goodwill and cause a decline in our revenue. In addition, any
infringement or other intellectual property claim made against us, whether or not it has merit, could be time-consuming, result in
costly litigation, cause product delays, or require us to enter into royalty or licensing agreements. As a result, any such claim or
our failure to protect our intellectual property could have an adverse effect on our operating results.
We face various risks as a multi-channel retailer.
There are various risks relating to operating as a multi-channel retailer that conducts business in stores, on the Internet and
through catalogs, including the need to keep pace with rapid technological change, internet security risks, risks of systems failure
or inadequacy and increased competition. Further, governmental regulation of the Internet and e-commerce continues to evolve in
such areas as taxation, privacy, data protection, pricing, content, copyrights, distribution, mobile communications, electronic
contracts and other communications, consumer protection, the provision of online payment services, the design and operation of
Dick’s Sporting Goods, Inc. ¬2010 Annual Report 19