Under Armour 2009 Annual Report Download - page 27

expand our product line and the geographic scope of our marketing. From time to time, we have received claims
relating to the intellectual property rights of others, and we expect that third parties will continue to assert
intellectual property claims against us, particularly as we expand our business and the number of products we
offer. Any claim, regardless of its merit, could be expensive and time consuming to defend. Successful
infringement claims against us could result in significant monetary liability or prevent us from selling some of
our products. In addition, resolution of claims may require us to redesign our products, license rights belonging
to third parties or cease using those rights altogether. Any of these events could harm our business and have a
material adverse effect on our results of operations and financial condition.
Our failure to protect our intellectual property rights could diminish the value of our brand, weaken our
competitive position and reduce our revenues.
We currently rely on a combination of copyright, trademark and trade dress laws, patent laws, unfair
competition laws, confidentiality procedures and licensing arrangements to establish and protect our intellectual
property rights. The steps taken by us to protect our proprietary rights may not be adequate to prevent
infringement of our trademarks and proprietary rights by others, including imitation of our products and
misappropriation of our brand. In addition, 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 United States, and it may be more difficult for us to successfully challenge the use of our proprietary rights
by other parties in these countries. If we fail to protect and maintain our intellectual property rights, the value of
our brand could be diminished and our competitive position may suffer.
From time to time, we discover unauthorized products in the marketplace that are either counterfeit
reproductions of our products or unauthorized irregulars that do not meet our quality control standards. If we are
unsuccessful in challenging a third party’s products on the basis of trademark infringement, continued sales of
their products could adversely impact our brand, result in the shift of consumer preferences away from our
products and adversely affect our business.
We have licensed in the past, and expect to license in the future, certain of our proprietary rights, such as
trademarks or copyrighted material, to third parties. These licensees may take actions that diminish the value of
our proprietary rights or harm our reputation.
ITEM 1B. UNRESOLVED STAFF COMMENTS
Not applicable.
ITEM 2. PROPERTIES
Our principal executive and administrative offices are located at an office complex in Baltimore, Maryland.
Beginning in November 2009, we occupied expanded office space at this complex, increasing the leased space by
approximately 90.0 thousand square feet. During 2010, we will begin to occupy an additional 50.0 thousand
square feet at this location. We believe that our current location and the additional 50.0 thousand square feet of
office space at our current location will be sufficient for the operation of our business over the next twelve
months. We opened our primary distribution facility in Glen Burnie, Maryland in 2004, and opened an additional
distribution facility in Glen Burnie, Maryland during 2007. We believe our distribution facilities and space
available through our third-party logistics providers will be adequate to meet our short term needs. We expect to
expand to additional distribution facilities in the future.
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