##### Table of Contents



UNITED
    STATES SECURITIES AND EXCHANGE COMMISSIONWashington D.C.
    20549
  Form 10-K
  ANNUAL REPORT PURSUANT TO
    SECTIONS 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934
  o

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 30, 2006ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          to   Commission file number:
    333-123927
  EASTON-BELL SPORTS,
    INC.
 (Exact name of registrant as
    specified in its certificate of incorporation)
  Delaware

20-1636283(State or other jurisdiction
    of
    incorporation or organization)

(I.R.S. Employer
    Identification No.)       7855
    Haskell Avenue, Suite 200
    Van Nuys, California 91406 (Address
    of Principal Executive Offices)
  800 347-3901 (Registrants
    Telephone Number, Including Area Code)
      Securities registered pursuant to 12(b) of the Act:
    None
 Securities registered pursuant to Section 12(g) of the
    Act:
    None
  o þ
  þ o
  o þ
  Regulation S-K Form 10-K Form 10-K. þ
  Rule 12b-2
 o o þ
  Rule 12b-2 o þ




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##### Table of Contents



PART I
  Item 1.
    Business  800-347-3901. Form 10-K
    Overview
    Easton ® Bell ® Giro ® Riddell ®
    Industry
    Overview
  Sporting
    Goods Industry
     1




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##### Table of Contents



Baseball
    and Softball
    Ice
    Hockey
    Football
    Helmets
    Cycling
    Helmets and Related Accessories
       2




---



##### Table of Contents



Helmets
    for Action Sports, Snow Sports and Powersports
    Sports
    Apparel
    Our
    Brands
  Easton, Bell, Giro Riddell
    Easton. Easton Easton Easton Easton Easton
  Bell. Bell Bell Bell Bell Bell Bell
  Giro. Giro Giro Bell Giro Giro Giro
 3




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##### Table of Contents



Riddell. Riddell Riddell Riddell Riddell
  Blackburn ® Co-Pilot ® Savasa ® MacGregor ®
  Products
    and Services
  Team
    Sports
    Baseball
    and Softball
  Easton
  Ice
    Hockey
  Easton
  Football
  Football Helmets Riddell
  Reconditioning Services and/or
  Collectible Products
 4




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##### Table of Contents



Other
    Products and Licensing
  Riddell Easton
  Riddell, Easton MacGregor Riddell Easton Easton MacGregor
    Action
    Sports
    Cycling
    and Extreme Sports
  Bell Bell and Giro Easton Blackburn Bell Co-Pilot Barbie, Bratz, Batman,
    Sesame Street, Hot Wheels X Games.
  Helmets
  Premium Cycling Components and Accessories Blackburn 2
  Cycling Accessories Bell Co-Pilot
  Snow
    Sports
  Giro
 5




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##### Table of Contents



Powersports
  Bell
  Fitness
    Accessories
  Bell, Savasa Bollinger
  Competition
    Team
    Sports
    Action
    Sports
  Schwinn,
    Mongoose, GT Disney.
  Boeri,
    Carrera, Leedom, Marker, Pro-Tec, R.E.D Sal Arai, Shoei, HJC KBC.
  Sales
   6




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##### Table of Contents



Sales
    of Team Sports Products
  Retail
    Sales
  point-of-purchase
    Institutional
    Sales
    Sales
    of Action Sports Products
     7




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##### Table of Contents



Marketing
  Relationships
    with Athletes, Teams and Organizations
  Easton Bell Giro Riddell
  Riddell Riddell Riddell
  Advertising
    and Promotional Events
    Design
    and Product Development
       8




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##### Table of Contents



Production,
    Sourcing and Distribution
          Seasonality
    Intellectual
    Property
    Easton Bell Giro Riddell Easton Bell Giro Riddell MacGregor
 9




---



##### Table of Contents



Bell Giro Blackburn Riddell Barbie Hot
    Wheels Bratz Batman X Games Sesame Street
  Easton Easton Giro Riddell MacGregor Bell
  Employees
    Insurance
    and Risk Management
    Governmental
    Regulation
    Financial
    Information on Geographical Areas
   10




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##### Table of Contents



Item 1A.
    Risk
    Factors  Our
    substantial indebtedness could adversely affect our financial
    health.
        Despite
    current indebtedness levels, we may still be able to incur
    substantially more debt. This could further exacerbate the risks
    associated with our substantial leverage.
    To
    service our indebtedness, we will require a significant amount
    of cash. Our ability to generate cash depends on many factors
    beyond our control.
    If we
    cannot compete successfully in our industries, our business may
    be adversely affected.
   11




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##### Table of Contents



Sales
    of our products may be adversely affected if we cannot
    effectively introduce new and innovative products.
    The
    value of our brand and sales of our products could be diminished
    if we, the athletes who use our products or the sport categories
    in which we compete, are associated with negative
    publicity.
        The
    success of our business is dependent on our affiliation with
    athletes, athletic associations and leagues.
  Easton Bell Giro Riddell
 12




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##### Table of Contents



Sales
    of our products will be adversely affected if we cannot satisfy
    the standards established by testing and athletic governing
    bodies.
    Our
    results of operations may suffer if we are not able to
    adequately forecast demand for our products.
    The
    loss of one or more key customers could result in a material
    loss of revenues.
    Many
    of our products or components of our products are provided by a
    limited number of third-party suppliers and manufacturers, and,
    because we have limited control over these suppliers and
    manufacturers, we may not be able to obtain quality products on
    a timely basis or in sufficient quantities.
   13




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##### Table of Contents



The
    cost of raw materials could affect our operating
    results.
    The
    success of our business is dependent upon our information
    systems.
    If we
    are unable to enforce and protect our intellectual property
    rights, our competitive position may be harmed.
   14




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##### Table of Contents



Easton Bell Giro Riddell. Easton Easton
    We are
    subject to product liability, warranty and recall claims and our
    insurance coverage may not cover such claims.
      Our
    international sourcing and sales network subjects us to
    additional risks and costs, which may differ in each country in
    which we do business and may cause our profitability to
    decline.
     15




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##### Table of Contents



If we
    lose key personnel and management, we may not be able to
    successfully implement our business strategy.
    We may
    not succeed in integrating Easton or any other acquisition into
    our operations, which could have a material adverse effect on
    our operations, results of operations and financial
    condition.
    The
    seasonality of our sales may have an adverse effect on our
    operations and our ability to service our debt.
    Employment
    related matters, such as unionization, may affect our
    profitability.
    We may
    be subject to potential environmental liability.
   16




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##### Table of Contents



If we
    fail to maintain an effective system of internal controls, we
    may not be able to accurately report our financial results. As a
    result, current and potential investors could lose confidence in
    our financial reporting.
        Item 1B.
    Unresolved
    Staff Comments   17




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##### Table of Contents



Item 2.
    Properties    Leased


OwnedLocation

Primary Use

Business Segment

Sq. Ft.


Sq. Ft.Van Nuys, CA

Corporate Headquarters and offices

Team and Action Sports


89,000Irving, TX

Offices

Action Sports


27,000Chicago, IL

Offices and Research and
    Development

Team Sports


21,000York, PA

Warehouse

Action Sports






465,000Rantoul, IL

Offices, Manufacturing and
    Warehouse

Team and Action Sports


315,000Salt Lake City, UT

Warehouse

Team Sports


142,000Elyria, OH

Offices, Reconditioning and
    Warehouse

Team Sports


135,000Van Nuys, CA

Offices and Manufacturing

Team and Action Sports


110,000Canada

Offices, Manufacturing and
    Warehouse

Team Sports


97,000Chicago, IL(1)

Offices, Manufacturing and
    Warehouse

Team Sports






92,000Rantoul, IL

Warehouse

Action Sports


80,000East Stroudsburg, PA

Manufacturing and Reconditioning

Team Sports


70,000Mexico

Offices and Manufacturing

Team and Action Sports


65,000San Antonio, TX

Reconditioning

Team Sports


59,000Santa Cruz, CA

Sales, Marketing and Research and
    Development

Action Sports


50,000         Item 3.
    Legal
    Proceedings     18




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##### Table of Contents



Item 4.
    Submission
    of Matters to a Vote of Security Holders    PART II
  Item 5.
    Market
    For Registrants Common Equity, Related Stockholder Matters
    and Issuer Purchases of Equity Securities    Item 6.
    Selected
    Financial Data    Successor



Predecessor(1)Period from



Period fromFiscal Year


Fiscal Year


Fiscal Year


June 25,



January 1,


Fiscal YearEnded


Ended


Ended


2003 to



2003 to


EndedDecember 30,


December 31,


December 31,


December 31,



June 25,


December 31,2006


2005


2004


2003



2003(2)


2002(Dollars in thousands)Statement of Operations
    Data:Net sales

$
638,973


$
379,855


$
165,927


$
53,713



$
55,032


$
101,632Cost of sales(3)


426,109



244,916



113,813



33,928




34,340



62,644Gross profit


212,864



134,939



52,114



19,785




20,692



38,988Selling, general and
    administrative expenses(4)


164,243



95,421



50,128



14,972




17,196



28,898Restructuring and other infrequent
    expenses


908



1,713
















Amortization of intangibles


12,572



8,515



4,617



1,362








Cost related to June 25, 2003
    Transaction(5)



















19,877



Income (loss) from operations


35,141



29,290



(2,631
)


3,451




(16,381
)


10,090Interest expense, net


42,401



21,887



18,601



4,179




6,270



4,909(Loss) income before taxes


(7,260
)


7,403



(21,232
)


(728
)



(22,651
)


5,181Income tax (benefit) expense


(1,408
)


4,321



(8,121
)


(100
)



(6,700
)


2,070Net (loss) income

$
(5,852
)

$
3,082


$
(13,111
)

$
(628
)


$
(15,951
)

$
3,111Other Financial Data:Capital expenditures

$
12,789


$
4,999


$
1,593


$
728



$
560


$
1,461   19




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##### Table of Contents



Successor



Predecessor(1)As of


As of


As of


As of



As of


As ofDecember 30,


December 31,


December 31,


December 31,



June 25,


December 31,2006


2005


2004


2003



2003


2002(Dollars in thousands)Balance Sheet Data:Cash and cash equivalents

$
9,899


$
3,632


$
1,429


$
3,672



$
2,397


$
209Total assets


948,060



480,703



470,576



164,916




92,512



68,663Total debt(6)


476,198



248,897



250,098



69,931




60,382



32,713Total stockholders equity


318,162



133,934



125,472



69,426




7,493



23,490     (1)
    
    Data as of June 25, 2003 and December 31, 2002 and for
    the period from January 1, 2003 to June 25, 2003 and
    the fiscal year ended December 31, 2002, represent the
    results of Riddell and its subsidiaries prior to their
    acquisition by us. Balance sheet data for June 25, 2003 was
    the closing balance sheet immediately preceding the acquisition
    of the Riddell business and did not include purchase accounting
    adjustments relating to the subsequent acquisition.(2)
    
    Income statement data for the period of January 1, 2003 to
    June 25, 2003 includes charges of $4.7 million from
    the reevaluation of estimates for certain assets and
    liabilities. Some of these charges included a change in
    calculation methodology which is inseparable from the change in
    estimate.(3)
    
    Cost of sales included $19.0 million, $14.2 million,
    $2.2 million and $3.3 million of costs resulting from
    the purchase accounting
    write-up of
    inventories for the periods ended December 30, 2006,
    December 31, 2004, 2003 and 2002, respectively. Expenses of
    $1,989 and $1,731 previously recorded in cost of sales in 2005
    and 2004, respectively, have been reclassified to selling,
    general and administrative expenses to conform to the current
    year presentation.(4)
    
    Selling, general and administrative (SG&A)
    expenses include management expenses.(5)
    
    The period ended June 25, 2003 includes $19.9 million
    of transaction costs related to the sale of the Riddell business.(6)
    
    Total debt as of December 31, 2003, June 25, 2003 and
    December 31, 2002 includes the current maturities of
    long-term debt and loans payable under Riddells existing
    revolving credit facility prior to it being refinanced in
    connection with the acquisition of Bell and put warrants which
    were exercised during 2003. Total debt as of December 31,
    2005 and December 31, 2004 includes long-term debt payable
    under our then existing senior secured credit facility prior to
    it being refinanced in connection with the acquisition of Easton.  Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations    Uncertainty
    of Forward-Looking Statements and Information
   20




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##### Table of Contents



Overview
  Easton Bell Giro Riddell
      How We
    Assess the Performance of Our Business
    Net
    Sales
    Gross
    Profit
   21




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##### Table of Contents



first-in, last-in,
  Selling,
    General and Administrative Expenses
    Results
    of Operations
    Year Ended





Year Ended





Year EndedDecember 30,


% of Net


December 31,


% of Net


December 31,


% of Net2006


Sales


2005


Sales


2004


Sales(Dollars in thousands)Net sales

$
638,973



100.0
%

$
379,855



100.0
%

$
165,927



100.0
%Cost of sales


426,109



66.7



244,916



64.5



113,813



68.6Gross profit


212,864



33.3



134,939



35.5



52,114



31.4Selling, general and
    administrative expenses


155,993



24.4



92,421



24.3



48,578



29.3Management expenses


8,250



1.3



3,000



0.8



1,550



0.9Restructuring and other infrequent
    expenses


908



0.1



1,713



0.4







Amortization of intangibles


12,572



2.0



8,515



2.2



4,617



2.8Income (loss) from operations


35,141



5.5



29,290



7.8



(2,631
)


(1.6
)Interest expense, net


42,401



6.6



21,887



5.8



18,601



11.2(Loss) income before income taxes


(7,260
)


(1.1
)


7,403



2.0



(21,232
)


(12.8
)Income tax (benefit) expense


(1,408
)


0.2



4,321



1.1



(8,121
)


(4.9
)Net (loss) income


(5,852
)


(0.9
)


3,082



0.9



(13,111
)


(7.9
)Other comprehensive (loss) income:Foreign currency translation
    adjustment


(126
)






158







207



0.1Comprehensive (loss) income

$
(5,978
)


(0.9
)%

$
3,240



0.9
%

$
(12,904
)


(7.8
)%  22




---



##### Table of Contents



2006
    compared to 2005
    
    amortization of $19.0 million of purchase price
    write-up of
    inventory to fair market value, which was charged to cost of
    sales in relation to the Easton acquisition;
    settlement of lawsuits, which resulted in $8.1 million of
    expense;
    expenses of $7.5 million related to severing senior level
    executives and reorganizing the combined company;
    equity compensation expense of $3.1 million, comprising
    $0.8 million related to the redemption of vested units
    under the 2003 Equity Plan and $2.3 million related to the
    new 2006 Equity Plan;
    expenses related to Sarbanes-Oxley compliance program of
    $0.8 million;
    management expenses of $8.3 million, which reflect a
    $7.5 million payment to satisfy our contractual obligations
    to pay future management expenses;
    restructuring and other infrequent expenses of
    $0.9 million, primarily related to the closure of our
    Chicago, Illinois manufacturing facility;
    an increase in amortization of intangible assets of
    $4.1 million related to the Easton acquisition; and
    increased interest expense of $20.5 million related to
    higher debt levels in 2006 as a result of the Easton acquisition.    
    equity compensation expense of $4.6 million, primarily
    related to the vesting of Class B Common Units of our
    parent awarded to certain members of our management and
    directors;
    restructuring and other infrequent expenses of
    $1.7 million, primarily related to the closure of our
    Chicago, Illinois manufacturing facility, as well as other cost
    reduction activities to reduce our overall cost structure;
    an increase in amortization of intangible assets of
    $3.9 million related to amortizing a full year of the Bell
    intangible assets; and
    increased interest expense of $3.3 million related to
    higher debt levels in 2005 as a result of the acquisition of
    Bell.  Net
    Sales
    Change Due toChange


Acquisitions2006


2005


$


%


$


%(Dollars in millions)Team Sports

$
347.8


$
132.8


$
215.0



161.9
%

$
198.5



149.5
%Action Sports


291.2



247.1



44.1



17.8
%


22.0



8.9
%$
639.0


$
379.9


$
259.1



68.2
%

$
220.5



58.0
%    23




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##### Table of Contents



2006


2005% of





% of


Change Due to$


Net Sales


$


Net Sales


Acquisitions(Dollars in millions)Gross profit

$
212.9



33.3
%

$
134.9



35.5
%

$
58.6Selling, general and
    administrative expenses


164.3



25.7
%


95.4



25.1
%


40.0Restructuring and other infrequent
    expenses


0.9



0.1
%


1.7



0.4
%


Amortization of intangibles


12.6



2.0
%


8.5



2.2
%


4.1Income from operations

$
35.1



5.5
%

$
29.3



7.8
%

$
14.5   Gross
    Profit
  write-up
  Selling,
    General and Administrative Expenses
    Restructuring
    and Other Infrequent Expenses
    Amortization
    of Intangibles
    Interest
    Expense, Net
   24




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##### Table of Contents



Income
    Tax (Benefit) Expense
    2005
    compared to 2004
    
    variable equity compensation expense of $4.6 million,
    primarily related to the vesting of Class B Common Units of
    our parent awarded to certain members of our management and
    directors;
    restructuring and other infrequent expenses of
    $1.7 million, primarily related to the closure of our
    Chicago, Illinois manufacturing facility, as well as other cost
    reduction activities to reduce our overall cost structure;
    an increase in amortization of intangible assets of
    $3.9 million related to the Bell acquisition; and
    increased interest expense of $3.3 million related to
    higher debt levels as a result of the acquisition of Bell.    
    cost of sales included $14.2 million of costs resulting
    from the purchase accounting
    write-up of
    inventories to fair market value during the fourth quarter in
    relation to the Bell acquisition;
    an increase in amortization of intangible assets of
    $2.0 million related to the Riddell acquisition; and
    increased interest expense of $5.8 million related to the
    write-off of debt issuance costs related to prior indebtedness
    refinanced during 2004, $2.9 million of interest expense
    related to the 8.375% senior subordinated notes and
    $1.4 million in bridge loan commitment fees related to the
    Bell acquisition.  Net
    Sales
    Change Due to BellChange


Acquisition2005


2004


$


%


$


%(Dollars in millions)Team Sports

$
132.8


$
119.4


$
13.4



11.2
%

$




Action Sports


247.1



46.5



200.6



431.4
%


186.1



400.2
%$
379.9


$
165.9


$
214.0



129.0
%

$
186.1



112.2
%   Revolution
 25




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##### Table of Contents



2005


2004


Change Due to Bell$


% of Net Sales


$


% of Net Sales


Acquisition(Dollars in millions)Gross profit

$
134.9



35.5
%

$
52.1



31.4
%

$
61.0Selling, general and
    administrative expenses


95.4



25.1
%


50.1



30.2
%


42.7Restructuring and other infrequent
    expenses


1.7



0.4
%










Amortization of intangibles


8.5



2.2
%


4.6



2.8
%


3.9Income (loss) from operations

$
29.3



7.8
%

$
(2.6
)


(1.6
)%

$
14.4   Gross
    Profit
  write-up
  Selling,
    General and Administrative Expenses
    Restructuring
    and Other Infrequent Items
    Amortization
    of Intangibles
    Interest
    Expense, Net
    Income
    Tax Benefit (Expense)
   26




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##### Table of Contents



Restructuring
    and Other Infrequent Expenses
  No. 95-3, Recognition of Liabilities in Connection with a
    Purchase Business Combination
  FacilityEmployee


ClosureSeverance


Costs


Total(Dollars in thousands)Balance as of December 31,
    2005

$



$



$
Provision


2,100



2,238



4,338Less: Cash Activity


(210
)






(210
)Balance as of December 30,
    2006

$
1,890


$
2,238


$
4,128     Accounting for Costs Associated
    with Exit or Disposal Activities
  Write-down ofProperty,





Employee


FacilityPlant and


Employee


Retention


ClosureEquipment


Severance


Payments


Costs


Total(Dollars in thousands)Balance as of December 31,
    2004

$



$



$



$



$
Provision


250



542



46



875



1,713Less: Non-cash activity


(250
)










(250
)


(500
)Cash activity






(473
)


(31
)


(625
)


(1,129
)Balance as of December 31,
    2005






69



15







84Provision


164











744



908Less: Non-cash activity


(164
)










(391
)


(555
)Cash activity






(69
)


(15
)


(353
)


(437
)Balance as of December 30,
    2006

$



$



$



$



$
    27




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##### Table of Contents



Quarterly
    Results
    13-week
    For the Following Quarterly Periods (Unaudited)First


Second


Third


Fourth(Restated)


(Restated)(Dollars in thousands)2006:Net sales

$
111,172


$
198,275


$
186,485


$
143,041Gross profit


36,865



59,917



65,933



50,149Income (loss) from operations


(1,242
)


15,436



19,526



1,421Net income (loss)


(7,744
)


2,885



4,476



(5,469
)2005:Net sales

$
87,233


$
103,781


$
102,947


$
85,894Gross profit


31,779



40,026



37,454



25,680Income from operations


5,333



12,325



10,893



739Net income (loss)


169



3,475



2,430



(2,992
)   Liquidity
    and Capital Resources
    Senior
    Secured Credit Facilities
  Existing
    Senior Secured Credit Facility
   28




---



##### Table of Contents



Prior
    Senior Secured Credit Facility
   29




---



##### Table of Contents



Senior
    Subordinated Notes
      Other
    Matters
         30




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##### Table of Contents



Outlook
    
    Combination with Easton Sports.  In March 2006,
    we completed our acquisition of Easton, a leading manufacturer
    of premium sporting goods equipment, which enhanced our position
    in the team sports market. We expect this combination to affect
    our results of operations in the following manner:
    Amortization of Intangibles.  The purchase
    price for Easton, including the refinancing of Eastons
    existing indebtedness and transaction costs, was
    $405.5 million in cash of which $389.3 million was
    paid at close and $16.2 million of which was paid on
    July 20, 2006 to settle the working capital based purchase
    price adjustment. We accounted for this combination in
    accordance with Statement of Financial Accounting Standards, or
    SFAS, No. 141, Business Combinations
    and, accordingly, we have allocated the purchase price to the
    assets acquired and the liabilities assumed based on an
    independent third party asset valuation analysis as of the
    acquisition date. As a result, we recorded approximately
    $103.9 million of goodwill and approximately
    $166.1 million of other identifiable intangible assets such
    as tradenames, trademarks, patents, and customer relationships
    as part of the purchase price allocation. We expect the
    incremental impact of the amortization of these intangibles to
    reduce our income (loss) before income taxes by
    $4.9 million in 2007. This amortization, however, will also
    be tax deductible, and we expect this additional amortization to
    reduce our cash taxes in 2007.
    Net Sales and Income from Operations.  Our
    results of operations for the fiscal year ended
    December 30, 2006 included the results of operations of
    Easton from March 16, 2006. In the 12 months ended
    November 30, 2005, Eastons prior fiscal year end,
    Easton generated $238.3 million of net sales.
    Seasonality.  Prior to our combination with
    Easton, we experienced significant seasonality in our business.
    As a result, we historically experienced a working capital
    buildup in the first three fiscal quarters of the year as we
    built inventory to meet seasonal demand and record trade
    receivables. During the third fiscal quarter, we typically began
    collecting these receivables and our inventories began to fall,
    reducing working capital. Working capital typically continued to
    fall through the end of the year. However, with our entry into
    the snow sports and powersports markets in recent years, the
    seasonality of our working capital levels has moderated. We
    expect that the sales of baseball, softball and ice hockey
    products following our combination with Easton will further
    moderate the seasonality of our business. 31




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##### Table of Contents




    Integration Progress and Synergies.  At the
    time we acquired Easton, we adopted a comprehensive integration
    plan, which included defining the management team of the
    combined company, communicating a new strategic plan and new
    accountability initiatives to our employees, establishing new
    milestones for our sales representatives, instituting a new
    organizational structure based on our business segments and
    adopting measures designed to integrate the cultures of the two
    companies. We have accomplished all of these immediate goals in
    2006 and are now focused on identifying and capitalizing on
    cost-saving opportunities within our organization. Throughout
    2007, we expect to realize cost savings as a result of the
    integration. We have eliminated numerous positions to reduce our
    annual compensation expense and consolidated our purchase of
    insurance. In addition, we have terminated the North American
    distribution agreement for Eastons cycling products, and
    have started to sell those products through our direct sales
    force, allowing us to expand distribution and increase our
    margins on those products. We also plan to capitalize on other
    opportunities for cost reduction, including leveraging our
    increased purchasing power to secure lower prices from our
    various suppliers, realizing economies of scale in general
    administrative expenses, consolidating facilities and
    transferring more production from higher-cost
    U.S. facilities to Asian factories. The combination with
    Easton also creates opportunities to cross-sell products to
    customers and to create new products by leveraging the research
    and development capabilities of each company. We expect some of
    these cost savings will be offset by increased prices of raw
    materials as well as new investments in our infrastructure,
    distribution capabilities and product development.
    Introduction of New Products.  In 2007, we
    expect to introduce several new products that capitalize on the
    strength of our brands. Those introductions include goggles and
    eyewear under the Girobrand, an expanded line of
    composite bats under the Eastonbrand and new premium
    cycling and skiing helmets under the Belland Girobrands. Successful new product introductions have
    historically driven enthusiasm for our brands and resulted in
    higher average selling prices and higher gross profit margins.
    We also expect that we will enter adjacent categories and sports
    from
    time-to-time
    through either organic initiatives or through acquisitions.
    ERP Implementation.  We continue to plan for
    our long-term growth by investing in our operations management
    and infrastructure. We are in the process of implementing
    SAPs Enterprise Resource Program (ERP), an
    enterprise-wide software platform encompassing finance, sales
    and distribution, manufacturing and materials management. This
    program will ultimately replace the various software platforms
    used in our business operations, many of which are legacy
    platforms used by our predecessor companies. We expect that this
    enterprise-wide software solution will enable management to
    better and more efficiently conduct our operations and gather,
    analyze and assess information across all business segments and
    geographic locations. However, we may experience difficulties in
    implementing ERP in our business operations or in operating our
    business under ERP, any of which could disrupt our operations,
    including our ability to timely ship and track product orders to
    customers, project inventory requirements, manage our supply
    chain and otherwise adequately service our customers. We employ
    an implementation team of engineers and expect to complete our
    phased roll-out of ERP across all of our businesses in 2008.
    When completed, we expect that the system will streamline
    reporting and enhance internal controls.
    Interest Expense and Debt Repayment.  In
    connection with our acquisition of Easton, we entered into a new
    senior secured credit facility providing for a
    $335.0 million term loan facility, a $70.0 million
    U.S. revolving credit facility and a
    Cdn $12.0 million Canadian revolving credit facility.
    As of December 30, 2006, the outstanding principal balance
    under our term loan facility was $332.5 million and we had
    $3.5 million outstanding under our U.S. revolving credit
    facility. We expect our interest expense to increase in 2007, as
    it will reflect a full-year of interest expense from our new
    senior secured credit facility. We presently hedge only a
    portion of our variable interest rate debt, and our actual
    interest expense will be largely determined by trends in the
    London Interbank Offered Rate (LIBOR). 32




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##### Table of Contents



Contractual
    Requirements
    Payments Due By PeriodTotal


2007


2008 to 2009


2010 to 2011


2012 and Beyond(Dollars in thousands)Long-term debt(1)

$
472,488


$
3,350


$
6,700


$
6,700


$
455,738Interest payments related to
    long-term debt(2)


188,083



35,213



69,712



68,760



14,398Capital lease obligations


280



57



71



64



88Operating lease obligations


42,403



9,119



12,857



10,052



10,375U.S. revolving credit facility


3,500



3,500











Sponsorship/royalty agreements


16,031



5,682



6,683



2,438



1,228Total contractual cash obligations

$
722,785


$
56,921


$
96,023


$
88,014


$
481,827   Amount of Commitment Expiration per PeriodTotal


2007


2008 to 2009


2010 to 2011


2012 and BeyondStandby letters of credit and
    similar instruments

$
3,540


$
3,540


$



$



$
Total commercial commitments and
    letters of credit

$
3,540


$
3,540


$



$



$
     (1)
    
    Amounts include obligations pursuant to the senior secured
    credit facility that was outstanding on
    December 30, 2006. See Liquidity and Capital
    Resources  Senior Secured Credit Facilities.(2)
    
    Estimated interest payments are calculated assuming current
    interest rates over minimum maturity periods specified in debt
    agreements. Debt may be repaid sooner or later than such minimum
    maturity periods.  Off-Balance
    Sheet Arrangements
    Critical
    Accounting Policies
    Revenue Recognition.
 33




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##### Table of Contents



Accounts Receivable and Allowances.
  Inventories. first-in, product-by-product
  Long-Lived and Finite-Lived Intangible
    Assets. Goodwill and Other Intangible Assets
    Income Taxes. Accounting for Income
    Taxes.
  Product Liability Litigation Matters and
    Contingencies. and/or
 34




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##### Table of Contents



Derivative Instruments and Hedging
    Activity.
  Warranty Liability.
  Stock-Based Compensation.
    Recent
    Accounting Pronouncements
  Accounting for Uncertainty in
    Income Taxes  an Interpretation of FASB Statement
    No. 109. Accounting for Contingencies.
  Fair Value Measurements.
 35




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##### Table of Contents



Item 7A.
    Quantitative
    and Qualitative Disclosure about Market Risk  Foreign
    Currency Risk
        Interest
    Rate Risk
     36




---



##### 



Item 8.
    Financial
    Statements and Supplementary Data    
  PageReport of
    Independent Registered Public Accounting Firm


38Consolidated
    Balance Sheets as of December 30, 2006 and
    December 31, 2005


39Consolidated
    Statements of Operations and Comprehensive Income (Loss) for the
    years ended December 30, 2006, December 31, 2005 and
    December 31, 2004


40Consolidated
    Statements of Stockholders Equity for the years ended
    December 30, 2006, December 31, 2005 and
    December 31, 2004


41Consolidated
    Statements of Cash Flows for the years ended December 30,
    2006, December 31, 2005 and December 31,
    2004


42Notes to
    Consolidated Financial Statements


43Employment AgreementCertification of the CEO Pursuant to Section 302Certification of the CFO Pursuant to Section 302Certification of the CEO and CFO Pursuant to Section 906    Form 10-K
 37




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##### Table of Contents



Report of
    Independent Registered Public Accounting Firm             
    38




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##### Table of Contents



EASTON-BELL
    SPORTS, INC. AND SUBSIDIARIES
  CONSOLIDATED
    BALANCE SHEETS
 (Amounts
    in thousands, except share and per share amount)
  December 30,


December 31,2006


2005ASSETSCurrent assets:Cash and cash equivalents

$
9,899


$
3,632Accounts receivable, net


182,234



87,459Inventories, net


134,847



54,950Prepaid expenses


10,449



7,656Deferred taxes


10,224



9,361Other current assets


1,611



1,758Total current assets


349,264



164,816Property, plant and equipment, net


34,198



18,945Deferred financing fees, net


19,271



11,978Intangible assets, net


330,445



176,544Goodwill


207,327



100,003Other assets


7,555



8,417Total assets

$
948,060


$
480,703LIABILITIES AND
    STOCKHOLDERS EQUITYCurrent liabilities:Current portion of long-term debt

$
3,350


$
1,100Revolving credit facility


3,500



Current portion of capital lease
    obligations


36



64Accounts payable


56,950



23,090Accrued expenses


60,405



38,828Total current liabilities


124,241



63,082Long-term debt, less current
    portion


469,138



247,525Capital lease obligations, less
    current portion


174



208Deferred taxes


23,681



23,151Other noncurrent liabilities


12,664



12,803Total liabilities


629,898



346,769Stockholders Equity:Common stock; $0.01 par
    value, 100 shares authorized, 100 shares issued and
    outstanding at December 30, 2006 and December 31, 2005






Additional paid-in capital


334,432



144,226Accumulated deficit


(16,509
)


(10,657
)Accumulated other comprehensive
    income


239



365Total stockholders equity


318,162



133,934Total liabilities and
    stockholders equity

$
948,060


$
480,703    39




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##### Table of Contents



EASTON-BELL
    SPORTS, INC. AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
    (LOSS)
 (Amounts in thousands)
  Year Ended


Year Ended


Year EndedDecember 30,


December 31,


December 31,2006


2005


2004Net sales

$
638,973


$
379,855


$
165,927Cost of sales


426,109



244,916



113,813Gross profit


212,864



134,939



52,114Selling, general and
    administrative expenses


155,993



92,421



48,578Management expenses


8,250



3,000



1,550Restructuring and other infrequent
    expenses


908



1,713



Amortization of intangibles


12,572



8,515



4,617Income (loss) from operations


35,141



29,290



(2,631
)Interest expense, net


42,401



21,887



18,601Income (loss) before income taxes


(7,260
)


7,403



(21,232
)Income tax (benefit) expense


(1,408
)


4,321



(8,121
)Net (loss) income


(5,852
)


3,082



(13,111
)Other comprehensive (loss) income:Foreign currency translation
    adjustment


(126
)


158



207Comprehensive (loss) income

$
(5,978
)

$
3,240


$
(12,904
)    40




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##### Table of Contents



EASTON-BELL
    SPORTS, INC. AND SUBSIDIARIES



CONSOLIDATED
    STATEMENTS OF STOCKHOLDERS EQUITY

(Amounts in thousands, except share data) TotalAdditional








Cumulative


Stockholders/Common


Paid-in


Members


Accumulated


Translation


MembersShares


Capital


Equity


Deficit


Adjustment


EquityBalance as of December 31,
    2003





$



$
70,054


$
(628
)

$



$
69,426Capital distribution










(160
)










(160
)Common shares issued in September
    2004 reorganization from an LLC to a corporation


100



69,894



(69,894
)










Capital attributable to vesting of
    management equity incentives in Parents equity






21















21Capital contributed by Parent in
    connection with Bell acquisition






68,180















68,180Capital attributable to
    acquisition costs paid by Parent






909















909Net loss














(13,111
)






(13,111
)Currency translation adjustment


















207



207Balance as of December 31,
    2004


100



139,004







(13,739
)


207



125,472Capital attributable to vesting of
    management equity incentives in Parents equity






4,617















4,617Capital contributed by Parent






605















605Net income














3,082







3,082Currency translation adjustment


















158



158Balance as of December 31,
    2005


100



144,226







(10,657
)


365



133,934Capital contributed in connection
    with the Easton acquisition






191,367















191,367Capital distribution






(4,270
)














(4,270
)Other capital contributions by
    Parent






760















760Equity compensation expense






2,349















2,349Net loss














(5,852
)






(5,852
)Currency translation adjustment


















(126
)


(126
)Balance as of December 30,
    2006


100


$
334,432


$



$
(16,509
)

$
239


$
318,162    41




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##### Table of Contents



EASTON-BELL
    SPORTS, INC. AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF CASH FLOWS
 (Amounts in thousands)
  Year Ended


Year Ended


Year EndedDecember 30,


December 31,


December 31,2006


2005


2004Cash flows from operating
    activities:Net (loss) income

$
(5,852
)

$
3,082


$
(13,111
)Adjustments to reconcile net
    income (loss) to net cash provided by operating activities:Depreciation and amortization


20,879



13,809



7,327Amortization of deferred financing
    fees


3,260



1,913



7,102Deferred financing fees of old
    debt written off


1,613







Accrual of PIK interest










463Stock compensation expense


2,349



4,617



21Deferred income tax (benefit)
    expense


(5,120
)


2,739



(8,602
)Effect of purchase accounting
    inventory
    write-up


19,010







14,201Writedown of inventory


391







Fixed assets written off


164



290



Changes in operating assets and
    liabilities, net of effects from purchase of businesses:Accounts receivable, net


(13,523
)


(20,586
)


2,498Inventories, net


(15,156
)


(5,307
)


6,769Other current and noncurrent assets


1,317



1,584



(9,433
)Accounts payable


21,269



3,397



(53
)Accrued expenses


(6,857
)


3,243



3,483Other current and noncurrent
    liabilities


(139
)


(259
)


9Net cash provided by operating
    activities


23,605



8,522



10,674Cash flows from investing
    activities:Purchase of property, plant and
    equipment


(12,789
)


(4,999
)


(1,593
)Purchase of businesses, net of
    cash acquired


(407,415
)


(363
)


(236,479
)Net cash used in investing
    activities


(420,204
)


(5,362
)


(238,072
)Cash flows from financing
    activities:Proceeds from revolving credit
    facility


104,154



113,669



56,705Payments on revolving credit
    facility


(100,654
)


(113,669
)


(56,705
)Payments on new senior term notes


(2,512
)






(49,063
)Proceeds from issuance of senior
    term notes


335,000







110,000Payments on old senior term notes


(108,625
)


(1,100
)


(275
)Payments on subordinated notes,
    plus PIK interest










(20,774
)Proceeds from issuance of
    subordinated notes










140,000Capital contribution


192,127



605



59,560Capital distribution


(4,270
)






Payments on capital lease
    obligations


(62
)


(101
)


(210
)Payment of debt issuance costs


(12,166
)


(519
)


(14,290
)Net cash provided by (used in)
    financing activities


402,992



(1,115
)


224,948Effect of exchange rate changes on
    cash and cash equivalents


(126
)


158



207Increase (decrease) in cash and
    cash equivalents


6,267



2,203



(2,243
)Cash and cash equivalents,
    beginning of year


3,632



1,429



3,672Cash and cash equivalents, end of
    year

$
9,899


$
3,632


$
1,429    42




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##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes
    to Consolidated Financial Statements
 (Amounts in thousands, except as specified)
  1.
    Business
    and Summary of Significant Accounting Policies  Organization
    and Business
  References to the Company or
    Successor refer to Easton-Bell Sports, Inc. and its
    consolidated subsidiaries. References to Easton,
    Bell and Riddell refer to Easton Sports,
    Inc. and its consolidated subsidiaries, Bell Sports Corp. and
    its consolidated subsidiaries, and Riddell Sports Group and its
    consolidated subsidiaries, respectively, in each case, prior to
    its acquisition by Easton-Bell.
      Easton Bell Giro Riddell
  Reporting
    Period
    Principles
    of Consolidation
    Cash
    and Cash Equivalents
    Accounts
    Receivable and Concentration of Credit Risk
   43




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##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Inventories
  first-in, product-by-product
    2006


2005Raw materials

$
27,348


$
10,470Work-in-process


3,236



463Finished goods


104,263



44,017$
134,847


$
54,950   write-up write-up write-up write-up
  Property,
    Plant and Equipment
    Buildings and leasehold
    improvements

Ten to fourteen yearsMachinery and equipment

Three to seven yearsOffice equipment and furniture

Three to five yearsComputer equipment and software

Three years  44




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##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
    2006


2005Land

$
105


$
105Building and leasehold improvements


9,066



6,928Machinery and equipment


23,252



13,021Office equipment and furniture


2,949



1,836Computer equipment and software


10,613



2,669Construction in progress


5,408



3,27451,393



27,833Less accumulated depreciation


(17,195
)


(8,888
)$
34,198


$
18,945     98-1, Accounting for the Costs of Computer Software Developed
    or Obtained for Internal Use.
  Goodwill
    and Intangible Assets
  Goodwill and Other Intangible Assets
   45




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##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
     December 30, 2006


December 31, 2005Gross





GrossCarrying


Accumulated


Carrying


AccumulatedAmounts


Amortization


Amounts


AmortizationAmortized intangible assets:Trademarks and tradenames

$
1,702


$
(840
)

$
1,702


$
(594
)Customer relationships


59,180



(14,787
)


49,280



(9,262
)Patents


60,345



(10,441
)


38,345



(4,638
)Licensing and other


5,900



(998
)






Total

$
127,127


$
(27,066
)

$
89,327


$
(14,494
)Indefinite-lived intangible assets:Trademarks

$
230,384






$
101,711     Riddell Riddell Riddell
  Bell Giro Blackburn Bell Giro Blackburn Bell Giro Blackburn Bell Giro Blackburn
  Easton Easton
 46




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##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
     Team


ActionSports


Sports


ConsolidatedBalance as of December 31,
    2004

$
41,607


$
59,937


$
101,544Adjustment to purchase price
    allocations


173



(1,904
)


(1,731
)Acquisitions


190







190Balance as of December 31,
    2005


41,970



58,033



100,003Adjustment to purchase price
    allocations


1,029



640



1,669Acquisitions


103,898



1,757



105,655Balance as of December 30,
    2006

$
146,897


$
60,430


$
207,327   Business Combinations
    Long-Lived
    Assets
  Accounting for the Impairment
    or Disposal of Long-Lived Assets
 47




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##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Deferred
    Financing Fees
    Income
    Taxes
  Accounting for Income Taxes.
  Revenues
    Warranty
    Obligations
      Year Ended2006


2005Beginning of year

$
283


$
283Warranty liability acquired
    through Easton acquisition


2,764



Warranty costs incurred during the
    period


(4,174
)


(182
)Warranty cost liability recorded
    during the period


4,108



182End of year

$
2,981


$
283   Advertising
    Costs
   48




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##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
   Shipping
    and Handling
    Research
    and Development Expenses
    Use of
    Estimates
    Foreign
    Currency Translation
    Fair
    Values of Financial Instruments
    Stock-Based
    Employee Compensation
   49




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##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
     Recent
    Accounting Pronouncements
  Accounting for Uncertainty in
    Income Taxes  an Interpretation of FASB Statement
    No. 109. Accounting for Contingencies.
  Fair Value Measurements.
  2.
    Acquisitions       50




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##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
        Business
    Combinations,
   51




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##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
     Net purchase price including cost
    of the transaction

$
405,466Add:Liabilities assumed (mainly
    accounts payable and accrued expenses)


40,799Less amounts allocated to specific
    asset categories:Accounts receivable


(81,123
)Inventory


(83,888
)Other current assets


(3,434
)Property, plant and equipment


(11,273
)Other assets


(696
)Patents


(22,000
)Licensing agreements


(4,300
)Trademarks/Tradenames
    (indefinite-lived)


(128,300
)Non-compete agreement


(1,600
)Customer relationships


(9,900
)Net deferred tax liabilities
    relating to differences in the financial statements and the tax
    basis of certain assets and liabilities


4,147Excess of cost over net assets
    acquired (goodwill)

$
103,898     Business Combinations
    Year Ended


Year EndedDecember 30,


December 31,2006


2005(In thousands)(Unaudited)Net sales

$
694,348


$
619,337Net loss


(2,953
)


(4,388
)    52




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##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
   Business Combinations,
    Net purchase price including cost
    of the transaction

$
242,925Add:Liabilities assumed (mainly
    accounts payable and accrued expenses)


49,429Less:Current assets


(101,580
)Property, plant and equipment


(13,906
)Other assets


(182
)Trademarks


(62,419
)Patents


(32,496
)Customer relationships


(31,700
)Deferred tax assets relating to
    estimated value of tax net operating loss


(49,608
)Net deferred tax liabilities
    relating to differences in the financial statements and the tax
    basis of certain assets and liabilities


55,837Excess of cost over net assets
    acquired (goodwill)

$
56,300   3.
    Restructuring    No. 95-3, Recognition of Liabilities in Connection with a
    Purchase Business Combination
  FacilityEmployee


ClosureSeverance


Costs


TotalBalance as of December 31,
    2005

$



$



$
Costs accrued during purchase
    accounting


2,100



2,238



4,338Less: Paid during the year


(210
)






(210
)Balance as of December 30,
    2006

$
1,890


$
2,238


$
4,128  53




---



##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
      Accounting for Costs Associated
    with Exit or Disposal Activities
  Write-downof Property,





Employee


FacilityPlant and


Employee


Retention


ClosureEquipment


Severance


Payments


Costs


TotalBalance as of December 31,
    2004

$



$



$



$



$
Provision


250



542



46



875



1,713Less: Non-cash activity


(250
)










(250
)


(500
)Cash activity






(473
)


(31
)


(625
)


(1,129
)Balance as of December 31,
    2005






69



15







84Provision


164











744



908Less: Non-cash activity


(164
)










(391
)


(555
)Cash activity






(69
)


(15
)


(353
)


(437
)Balance as of December 30,
    2006

$



$



$



$



$
    54




---



##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
   4.
    Long-term
    Debt    2006


2005Senior Secured Credit Facility:Term loan facility

$
332,488


$
108,625U.S. revolving credit facility


3,500



8.375% Senior subordinated
    notes due 2012


140,000



140,000Capital lease obligations


210



272Total long-term debt


476,198



248,897Less current maturities of
    long-term debt


(6,886
)


(1,164
)Long-term debt, less current
    portion

$
469,312


$
247,733        55




---



##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
             Revolving


CapitalFiscal Year Ending

Term Loan


Credit


Leases


Total2007

$
3,350


$
3,500


$
36


$
6,8862008


3,350







24



3,3742009


3,350







24



3,3742010


3,350







22



3,3722011


3,350







22



3,372Thereafter


455,738







82



455,820$
472,488


$
3,500


$
210


$
476,198      56




---



##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
   EITF 96-19, Debtors Accounting for a Modification or Exchange
    of Debt Instruments
      5.
    Accrued
    Expenses    2006


2005Salaries, wages, commissions and
    bonuses

$
13,902


$
9,224Advertising


6,009



9,754Restructuring


4,128



84Defective products


1,990



3,566Rebates


2,634



2,129Warranty


2,981



283Product liability 
    current portion


2,162



2,057Royalties


2,458



1,586Interest


3,604



3,100Other


20,537



7,045$
60,405


$
38,828  57




---



##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
  6.
    Leases    Capital


OperatingFiscal Year Ending

Leases


Leases2007

$
57


$
9,1192008


37



6,8452009


34



6,0122010


32



5,5052011


32



4,547Thereafter


88



10,375Total minimum lease payments


280


$
42,403Less amount representing interest


(70
)Present value of minimum lease
    payments, including current maturities of $36

$
210     2006


2005Leasehold improvements

$
246


$
212Machinery and equipment


4



35Furniture and fixtures


158



178408



425Less accumulated depreciation


(242
)


(206
)$
166


$
219     7.
    Employee
    Benefit Plans      8.
    Segment
    Information   58




---



##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
      Team


ActionSports


Sports


ConsolidatedYear ended December 30, 2006:Net sales

$
347,791


$
291,182


$
638,973Income from operations


38,637



32,849



71,486Depreciation


4,219



4,088



8,307Capital expenditures


2,828



9,961



12,789Year ended December 31, 2005:Net sales

$
132,798


$
247,057


$
379,855Income from operations


19,045



31,005



50,050Depreciation


1,742



3,552



5,294Capital expenditures


2,122



2,877



4,999Year ended December 31, 2004:Net sales

$
119,407


$
46,520


$
165,927Income (loss) from operations


12,737



(9,007
)


3,730Depreciation


1,956



754



2,710Capital expenditures


660



933



1,593   As of December 30, 2006 and

Team


ActionDecember 31, 2005, Respectively

Sports


Sports


ConsolidatedAssets2006

$
587,267


$
360,793


$
948,0602005


158,778



321,925



480,703   For 2006, 2005 and 2004, Respectively

2006


2005


2004Segment income from operations

$
71,486


$
50,050


$
3,730Stock compensation expense


(3,097
)


(4,617
)


(21
)Restructuring and other infrequent
    expenses


(908
)


(1,713
)


Amortization of intangibles


(12,572
)


(8,515
)


(4,617
)Management expenses


(8,250
)


(3,000
)


(1,550
)Corporate expenses


(11,518
)


(2,915
)


(173
)Consolidated income (loss) from
    operations

$
35,141


$
29,290


$
(2,631
)  59




---



##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
    2006


2005


2004Net sales:North America

$
546,778


$
343,000


$
157,002Europe


77,841



32,470



7,419Other


14,354



4,385



1,506$
638,973


$
379,855


$
165,927     2006


2005North America

$
33,837


$
18,564Other


361



381$
34,198


$
18,945     2006


2005North America

$
943,009


$
479,004Other


5,051



1,699$
948,060


$
480,703   9.
    Product
    Liability, Litigation and Other Contingencies  Product
    Liability
  and/or
    Litigation
    and Other Contingencies
   60




---



##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
     10.
    Income
    Taxes    2006


2005


2004Current tax expense:Federal

$



$
628


$
42State


800



514



87Foreign


2,912



440



3523,712



1,582



481Deferred tax expense (benefit):Federal


(2,916
)


2,439



(7,306
)State


(1,082
)


(419
)


(1,296
)Foreign


(1,122
)


719



(5,120
)


2,739



(8,602
)$
(1,408
)

$
4,321


$
(8,121
)     2006


2005


2004Provision for income taxes at
    United States federal statutory rate of 35%

$
(2,541
)

$
2,569


$
(7,431
)State and local income taxes, net
    of federal income tax effect


247



(61
)


(832
)Taxes on foreign income which
    differ from the United States statutory rate


(160
)


39



345Non-deductible equity compensation
    expense


1,084



1,616



Tax effect of other permanent items


329



112



(203
)Other


(367
)


46



$
(1,408
)

$
4,321


$
(8,121
)  61




---



##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
    2006


2005Deferred income tax assets:Receivable reserves

$
1,601


$
2,018Inventory


2,714



3,277Accrued expenses and reserves


8,756



7,923Net operating loss carryforwards


45,319



39,678Other


2,097



541Total deferred tax assets


60,487



53,437Deferred income tax liabilities:Property, plant and equipment


197



405Intangible assets


66,724



59,063Other


510



1,246Total deferred tax liabilities


67,431



60,714Valuation allowance


(6,513
)


(6,513
)Total net deferred income tax
    liability

$
(13,457
)

$
(13,790
)       2006


2005


2004Domestic

$
(16,515
)

$
4,191


$
(21,093
)Foreign


9,255



3,212



(139
)(Loss) Income before income taxes

$
(7,260
)

$
7,403


$
(21,232
)       11.
    Derivative
    Instruments and Hedging Activity  Accounting for Derivative
    Instruments and Hedging Activities,
 62




---



##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
        12.
    Stock-Based
    Employee Compensation         63




---



##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
              Weighted AverageNumber of


Grant DateUnits


Fair ValueOutstanding at December 31,
    2005


20,233,228


$
1.36Redeemed


(4,987,176
)

$
1.41Cancelled


(13,988,442
)

$
1.35Granted


32,198,435


$
2.14Forfeited


(2,568,309
)

$
2.09Outstanding at December 30,
    2006


30,887,736


$
2.11Vested Units at December 30,
    2006


841,078


$
1.50  64




---



##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
  13.
    Related
    Party Transactions          Easton Easton
   65




---



##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Notes to
    Consolidated Financial
    Statements  (Continued)
          14.
    Supplemental
    Guarantor Condensed Financial Information    Rule 3-10 Regulation S-X
 66




---



##### Table of Contents



Easton-Bell
    Sports, Inc.
  Condensed
    Consolidating Balance Sheet
 December 30,
    2006
  Guarantor


Non-GuarantorIssuer


Subsidiaries


Subsidiaries


Eliminations


ConsolidatedAssetsCurrent assets:Cash and cash equivalents

$
1,527


$
2,685


$
5,687


$



$
9,899Accounts receivable, net






164,428



17,806







182,234Inventories, net






122,686



12,161







134,847Prepaid expenses


2,301



7,811



337







10,449Deferred taxes


5,205



5,019











10,224Other current assets






1,131



480







1,611Total current assets


9,033



303,760



36,471







349,264Property, plant and equipment, net


5,094



27,680



1,424







34,198Deferred financing fees, net


19,271















19,271Investments and intercompany
    receivables


749,737



23,899



9,210



(782,846
)


Intangible assets, net






323,945



6,500







330,445Goodwill


16,195



185,941



5,191







207,327Other assets






7,555











7,555Total assets

$
799,330


$
872,780


$
58,796


$
(782,846
)

$
948,060Liabilities &
    Stockholders EquityCurrent liabilities:Current portion of long-term debt

$
3,350


$



$



$



$
3,350Revolving credit facility


3,500















3,500Current portion of capital lease
    obligations






36











36Accounts payable






55,214



1,736







56,950Accrued expenses


4,620



48,549



7,236







60,405Total current liabilities


11,470



103,799



8,972







124,241Long-term debt, less current portion


469,138















469,138Capital lease obligations, less
    current portion






174











174Deferred taxes






19,879



3,802







23,681Other noncurrent liabilities






7,330



5,334







12,664Long-term intercompany payables


560



659,396







(659,956
)


Total liabilities


481,168



790,578



18,108



(659,956
)


629,898Total stockholders equity


318,162



82,202



40,688



(122,890
)


318,162Total liabilities &
    stockholders equity

$
799,330


$
872,780


$
58,796


$
(782,846
)

$
948,060  67




---



##### Table of Contents



Easton-Bell
    Sports, Inc.
  Condensed
    Consolidating Statement of Operations
 Year
    Ended December 30, 2006
  Non-Guarantor


GuarantorIssuer


Subsidiaries


Subsidiaries


Eliminations


ConsolidatedNet sales

$



$
590,662


$
75,318


$
(27,007
)

$
638,973Cost of sales






399,554



54,518



(27,963
)


426,109Gross profit






191,108



20,800



956



212,864Selling, general and
    administrative expenses


14,304



132,319



8,464



906



155,993Management expenses


8,250















8,250Restructuring and other infrequent
    expenses






908











908Amortization of intangibles






12,572











12,572Income (loss) from operations


(22,554
)


45,309



12,336



50



35,141Interest expense, net


25,549



17,219



(145
)


(222
)


42,401Share of net income of
    subsidiaries under equity method


37,875



8,591







(46,466
)


Income (loss) before income taxes


(10,228
)


36,681



12,481



(46,194
)


(7,260
)Income tax (benefit) expense


(9,190
)


(1,194
)


3,890



5,086



(1,408
)Net income (loss)

$
(1,038
)

$
37,875


$
8,591


$
(51,280
)

$
(5,852
)  68




---



##### Table of Contents



Easton-Bell
    Sports, Inc. and Subsidiaries
  Condensed
    Consolidating Statement of Cash Flows
 December 30,
    2006
  Guarantor


Non-GuarantorIssuer


Subsidiaries


Subsidiaries


Eliminations


ConsolidatedCash flows from operating
    activities:Net income

$
(1,038
)

$
37,875


$
8,591


$
(51,280
)

$
(5,852
)Non-cash adjustments


(378,523
)


344,522



25,267



51,280



42,546Changes in operating assets and
    liabilities, net of effects of acquisitions


(4,490
)


9,889



(18,488
)






(13,089
)Net cash (used in) provided by
    operating activities


(384,051
)


392,286



15,370







23,605Cash flows from investing
    activities:Purchases of property, plant and
    equipment


(5,094
)


(5,745
)


(1,950
)






(12,789
)Purchase of businesses, net of
    cash acquired


(16,195
)


(383,331
)


(7,889
)






(407,415
)Net cash used in investing
    activities


(21,289
)


(389,076
)


(9,839
)






(420,204
)Cash flows from financing
    activities:Capital contributions, net


187,857















187,857Proceeds from debt, net


227,301















227,301Other, net


(12,166
)














(12,166
)Net cash provided by (used in)
    financing activities


402,992















402,992Effect of exchange rate changes on
    cash and cash equivalents






(
)


(126
)






(126
)Increase (decrease) in cash and
    cash equivalents


(2,348
)


3,210



5,405







6,267Cash and cash equivalents,
    beginning of year


3,875



(525
)


282







3,632Cash and cash equivalents, end of
    year

$
1,527


$
2,685


$
5,687


$



$
9,899  69




---



##### Table of Contents



15.
    Quarterly
    Results of Operations (Unaudited)  write-up write-up write-up
  For the Following Quarterly Periods (Unaudited)Second


ThirdFirst


(Restated)


(Restated)


Fourth(Dollars in thousands)2006:Net sales

$
111,172


$
198,275


$
186,485


$
143,041Gross profit


36,865



59,917



65,933



50,149Income (loss) from operations


(1,242
)


15,436



19,526



1,421Net income (loss)


(7,744
)


2,885



4,476



(5,469
)2005:Net sales

$
87,233


$
103,781


$
102,947


$
85,894Gross profit


31,779



40,026



37,454



25,680Income from operations


5,333



12,325



10,893



739Net income (loss)


169



3,475



2,430



(2,992
)   16.
    Subsequent
    Event   70




---



##### Table of Contents



Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure    Item 9A.
    Controls
    and Procedures  Evaluation
    of Disclosure Controls and Procedures
  Rules 13a-15(e)
     71




---



##### Table of Contents



Changes
    in Internal Control Over Financial Reporting
    Managements
    Remediation Plans
    Item 9B.
    Other
    Information    PART III
  Item 10.
    Directors,
    Executive Officers and Corporate Governance    Name

Age

PositionJames L. Easton

72

ChairmanAnthony M. Palma

45

Chief Executive Officer and
    DirectorMark Tripp

48

Chief Financial Officer, Senior
    Vice President and TreasurerDaniel J. Arment

46

Executive Vice President, General
    Manager Mass-Market DivisionDan Jelinek

42

President of Team SportsKwai Kong

44

President of Specialty BusinessRichard D. Tipton

50

Senior Vice President, General
    Counsel and SecretaryJackelyn E. Werblo

53

Senior Vice President of Human
    ResourcesWilliam Beane

45

DirectorShael J. Dolman

35

DirectorMark Genender

43

DirectorPeter Lamm

56

DirectorTerry Lee

59

DirectorTimothy Mayhew

40

DirectorAron Schwartz

36

DirectorLee L. Sienna

55

DirectorPeter V. Ueberroth

70

DirectorRichard E. Wenz

57

Director  72




---



##### Table of Contents



James L. Easton not-for-profit
  Anthony M. Palma
  Mark Tripp
  Daniel J. Arment
  Dan Jelinek
  Kwai Kong
  Richard D. Tipton
 73




---



##### Table of Contents



Jackelyn E. Werblo
  William Billy Beane
  Shael J. Dolman
  Mark Genender
  Peter Lamm
  Terry Lee
  Timothy Mayhew
  Aron Schwartz
 74




---



##### Table of Contents



Lee L. Sienna
  Peter V. Ueberroth Coca-Cola
  Richard E. Wenz
  Code of
    Ethics
    Audit
    Committee
    Item 11.
    Executive
    Compensation  Compensation
    Discussion and Analysis
  Philosophy
   75




---



##### Table of Contents



Overview
    of Compensation and Process
        
    performance against corporate and individual objectives for the
    previous year;
    difficulty of achieving desired results in the coming year;
    value of their unique skills and capabilities to support
    long-term performance of the company;
    performance of their general management
    responsibilities; and
    contribution as a member of the management team.     76




---



##### Table of Contents



Compensation
    Consultant
      Base
    Salary and Bonus
      Equity
    Incentives
      Direct
    Investment
     77




---



##### Table of Contents



Equity
    Incentive Plan
         78




---



##### Table of Contents



Perquisites
    Post-Employment
    Compensation
  401(k) 401(k) 401(k) 401(k)
  401(k)
  Specific
    Compensation of Named Executive Officers
   79




---



##### Table of Contents



Summary
    Compensation Table
  OptionSalary


Bonus


Awards


All Other


TotalName and Principal Position

Year


($)


($)


($)(8)


Compensation


($)Anthony M. Palma,


2006


$
593,750


$
740,115


$
301,715


$
66,240


$
1,701,820Chief Executive Officer(1)William N. Fry,


2006



488,847



400,000



342,656



1,896,210



3,127,713President and Chief Executive
    Officer(1)(2)Mark Tripp


2006



230,229



169,610



65,871



62,985



528,695Chief Financial Officer(3)Paul A. Lehmann,


2006



106,692



75,000







465,395



647,087Executive Vice President and Chief
    Financial Officer(3)(4)Daniel J. Arment,


2006



262,693



198,750



81,954



223,852



767,249Executive Vice President, General
    Manager of Mass Market(5)Kwai Kong,


2006



262,693



198,750



97,514



287,056



846,013President of Specialty Business(6)Dan Jelinek,


2006



272,449



210,000



65,871



38,951



587,271President of Team Sports(7)     (1)
    
    Mr. Palmas employment with us began on March 16,
    2006 in connection with our acquisition of Easton. For 2006, his
    salary and bonus amounts reflect earned amounts after the
    commencement of employment. In conjunction with the acquisition,
    Mr. Fry, who then served as our chief executive officer,
    became President of Action Sports. All other compensation for
    Mr. Palma includes $47,859 paid pursuant to the distribution
    made by our parent in December 2006, $10,000 for car allowance,
    $5,500 for a company profit sharing contribution, $2,234 for
    medical expenses, $518 for long-term disability insurance
    premiums and $129 for holiday gift cards.(2)
    
    Mr. Frys employment with us terminated on
    March 16, 2007. In connection with the consummation of our
    acquisition of Easton, our parent repurchased approximately
    $1,409,678 of its outstanding Class A Common Units and
    Class B Common Units from Mr. Fry. In addition,
    Mr. Fry received $267,468 in connection with the December
    2006 distribution by our parent, a $200,000 retention bonus,
    $11,700 for car allowance, $810 for life insurance premiums,
    $1,054 for medical expenses, and $5,500 for company matching
    401(k) plan contributions. Such amounts are included in all
    other compensation.(3)
    
    Mr. Tripps employment with us began on March 16,
    2006 in connection with the acquisition of Easton. For 2006, his
    salary and bonus amounts reflect earned amounts after the
    commencement of employment. In conjunction with the acquisition,
    Mr. Lehmann resigned his position as Chief Financial
    Officer. All other compensation includes $47,859 paid to
    Mr. Tripp pursuant to the distribution made by our parent
    in December 2006, $5,500 for a company profit sharing
    contribution, $5,000 for car allowance, $3,981 for medical
    expenses, $518 for long-term disability insurance premiums and
    $127 for holiday gift cards.(4)
    
    Mr. Lehmanns employment with us was terminated on
    April 30, 2006. Shortly thereafter, Mr. Lehmann
    executed a separation agreement with us. Pursuant to that
    agreement, Mr. Lehmann was paid severance in the amount of
    $294,635. In addition, Mr. Lehmann received $155,618 in
    relocation benefits, $8,400 for car allowance, $5,500 for
    company matching 401(k) plan contributions and $1,242 for life
    insurance premiums. Such amounts are included in all other
    compensation.(5)
    
    In connection with the consummation of our acquisition of
    Easton, our parent repurchased approximately $143,392 worth of
    its outstanding Class B Common Units from Mr. Arment.
    In addition, Mr. Arment received $50,150 in connection with
    the December 2006 distribution by our parent, $24,000 for
    housing allowance, $5,500 for company matching 401(k) plan
    contributions and $810 for life insurance premiums. Such amounts
    are included in all other compensation. 80




---



##### Table of Contents



(6)
    
    In connection with the consummation of our acquisition of
    Easton, our parent repurchased approximately $175,143 of its
    outstanding Class B Common Units from Mr. Kong. In
    addition, Mr. Kong received $105,873 in connection with the
    December 2006 distribution by our parent, $5,500 for company
    matching 401(k) plan contributions and $540 in life insurance
    premiums. Such amounts are included in all other compensation.(7)
    
    Mr. Jelineks employment with us began on
    March 16, 2006 in connection with our acquisition of
    Easton. For 2006, his salary and bonus amounts reflect earned
    amounts after the commencement of employment. All other
    compensation includes $28,715 paid to Mr. Jelinek pursuant
    to the distribution made by our parent in December 2006, $5,500
    for a company profit sharing contribution, $4,091 for medical
    expenses, $518 for long-term disability insurance premiums and
    $127 for holiday gift cards.(8)
    
    For all named executive officers, option awards include the
    Class B Common Units of our parent granted to such officer
    under our equity incentive plan during 2006. The amount set
    forth in the table reflects the amounts reported for financial
    statement reporting purposes for fiscal year 2006 in accordance
    with SFAS 123R. The assumptions made in establishing such
    amounts are more fully described in Note 12 to the audited
    consolidated financial statements included in Item 8 of
    this annual report.  Grants of
    Plan Based Awards
  Estimated FuturePayouts underNon-Equity


All Other OptionIncentive Plan


Awards: Number of


Exercise or Base


Grant Date Value ofAwards


Securities


Price of Option


Stock and Option(Target)


Underlying Options


Awards


AwardsName

Grant Date


($)(1)


(#)(2)


($/Sh)(3)


($)(4)Anthony M. Palma






740,1155/1/2006







5,542,168.449


$
2.1419


$
5,026,747William N. Fry






400,0003/16/2006







3,762,970.944


$
2.1419


$
3,413,015Mark Tripp






169,6105/1/2006







1,209,979.914


$
2.1419


$
1,097,452Paul A. Lehmann






75,000Daniel J. Arment






198,7505/12/2006







105,125.811


$
2.1419


$
95,3493/16/2006







794,874.189


$
2.1419



713,002Kwai Kong






198,7505/12/2006







100,000.000


$
2.1419


$
90,7003/16/2006







970,882.046


$
2.1419



870,881Dan Jelinek






210,0005/1/2006







1,209,979.914


$
2.1419


$
1,097,452     (1)
    
    The amounts set forth in this table represent estimated payouts
    under annual non-equity incentive plans for 2006.(2)
    
    All option awards consist of Class B Common Units issued
    pursuant to our parents equity method incentive plan.(3)
    
    The amounts set forth in the table represent the fair market
    value of a Class A Common Unit of our parent on the date
    the applicable Class B Common Units were granted to such
    holder.(4)
    
    The amounts set forth in the table reflect the grant date fair
    value, pursuant to SFAS 123(R). The assumptions made in
    establishing such amount are more fully described in
    Note 12 to the audited consolidated financial statements
    included in this annual report. 81




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##### Table of Contents



Outstanding
    Equity Awards at Fiscal Year-End
  Option AwardsNumber ofSecuritiesUnderlyingUnexercised


OptionOptions (#)


Exercise


OptionUnexercisable


Price ($)


ExpirationName

(1)


(2)


DateAnthony M. Palma


5,542,168.45


$
2.1419



5/1/2010William N. Fry


3,762,970.94


$
2.1419



3/16/2010Mark Tripp


1,209,979.91


$
2.1419



5/1/2010Paul A. Lehmann










Daniel J. Arment


794,874.189


$
2.1419



3/16/2010105,125.811


$
2.1419



5/12/2010Kwai Kong


970,882.046


$
2.1419



3/16/2010100,000.000


$
2.1419



5/12/2010Dan Jelinek


1,209,979.91


$
2.1419



5/1/2010     (1)
    
    All option awards consist of Class B Common Units issued
    pursuant to our parents equity incentive plan.(2)
    
    The amounts set forth in the table represent the fair market
    value of a Class A Common Unit of our parent on the date
    the applicable Class B Common Units were granted to such holder.  Option
    Exercises
  Option Awards(1)Number of


ValueShares Acquired on


Realized onName

Exercise (#)


Exercise ($)Anthony M. Palma






William N. Fry


1,099,294.091


$
716,960Mark Tripp






Paul A. Lehmann






Daniel J. Arment


219,858.818


$
143,392Kwai Kong


268,541.842


$
175,143Dan Jelinek






     (1)
    The option awards referred to above are Class B Common
    Units of our parent that were repurchased by our parent in
    connection with the consummation of our acquisition of Easton.  Employment
    Arrangements and Payments Upon Termination or Change of
    Control
    Anthony M. Palma
   82




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##### Table of Contents



and/or
      Triggering Event

Pay-Out AmountCompany terminates for cause


Company terminates other than for
    cause

$
2,240,112Mr. Palma terminates for Good
    Reason

$
2,240,112Mr. Palma terminates other than
    for Good Reason


Termination following a Change of
    Control

$
2,240,112    83




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##### Table of Contents



Mark Tripp
        and/or
      Triggering Event

Pay-Out AmountCompany terminates for cause


Company terminates other than for
    cause

$
582,110Mr. Tripp terminates for Good
    Reason

$
582,110Mr. Tripp terminates other than
    for Good Reason


Termination following a Change of
    Control

$
582,110    84




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##### Table of Contents



Dan Jelinek
        and/or
      Triggering Event

Pay-Out AmountCompany terminates for cause


Company terminates other than for
    cause

$
735,000Mr. Jelinek terminates for Good
    Reason

$
735,000Mr. Jelinek terminates other than
    for Good Reason


Termination following a Change of
    Control

$
735,000    85




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##### Table of Contents



William N. Fry
  Paul A. Lehmann.
  Specific
    Compensation of Directors
  out-of-pocket
  Director
    Compensation
  All OtherOption Awards


Compensation


TotalName(1)

($)(2)


($)(3)


($)James L. Easton










William Beane

$
117,689






$
117,689Shael J. Dolman










Mark Genender










Peter Lamm










Terry Lee

$
117,689


$
200,000


$
317,689Timothy Mayhew










Aron Schwartz










Lee L. Sienna










Peter V. Ueberroth

$
117,609






$
117,609Richard E. Wenz

$
235,378






$
235,378     (1)
    
    As noted above, Mr. Palma also serves as a director of our
    company and is a member of the board of managers of our parent.
    All of Mr. Palmas compensation, including for
    services as a director, is reflected in the summary compensation
    table above and therefore has been omitted from this table.(2)
    
    For all applicable directors, option awards include the
    Class B Common Units of our parent granted to such director
    under our equity incentive plan during 2006. The amount set
    forth in the table above reflects the grant 86




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##### Table of Contents



date fair value, pursuant to SFAS 123(R). The assumptions
    made in establishing such amount are more fully described in
    Note 12 to the audited consolidated financial statements
    included in Item 8 of this annual report. Mr. Beane
    received 129,328.334 Class B Common Units on March 16,
    2006; Mr. Lee received 129,328.334 Class B Common
    Units on March 16, 2006; Mr. Ueberroth received
    129,328.334 Class B Common Units on July 10, 2006; and
    Mr. Wenz received 258,656.668 Class B Common Units on
    July 10, 2006.(3)
    
    For all directors, all other compensation includes the amount
    paid directly to such director pursuant to the distribution made
    by our parent in December 2006. In addition, we note that Jas D.
    Easton, Inc., an affiliate of James L. Easton, received an
    aggregate $9,585,413, Fenway Easton-Bell Sports Holding, LLC and
    certain related investors, one or more of which are affiliates
    of Messrs. Genender, Lamm, Mayhew, and Schwartz, received
    an aggregate $89,551,348, and the Ontario Teachers Pension Plan
    Board, an affiliate of Messrs. Dolman and Sienna, received
    an aggregate $39,108,485, in each case, in connection with such
    distribution by our parent. In addition, Mr. Lee received
    $100,000 pursuant to a consulting agreement with us and a
    $100,000 bonus.  Compensation
    Committee Report
   87




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##### Table of Contents



Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters    Percentage





PercentageOwnership





OwnershipInterest in


Class B


Interest inClass A Common


Class A


Common


Class BUnits(1)


Units


Units(2)


UnitsFenway Easton-Bell Sports
    Holdings, LLC(3)


111,020,957.500



53.5
%






Teachers Private Capital(4)


47,621,270.834



23.0
%






York Street Capital Partners,
    LLC(5)


12,271,099.273



5.9
%






Jas. D. Easton, Inc.(6)


11,671,880.106



5.6
%






Anthony M. Palma


58,359.401




*


5,542,168.449



17.9
%William N. Fry(7)


326,153.806




*


3,762,970.944



12.2
%Mark Tripp


58,359.401




*


1,209,979.914



3.9
%Paul A. Lehmann(8)














Richard D. Tipton










500,000



1.6
%Jackelyn E. Werblo










300,000



*Dan Jelinek


35,015.640




*


1,209,979.914



3.9
%Kwai Kong


129,102.399




*


1,070,882.046



3.5
%Daniel J. Arment


61,153.768




*


900,000



2.9
%James L. Easton(6)


11,671,880.106



5.6
%






Peter V. Ueberroth(9)










129,328.334



*Lee L. Sienna(4)














Shael J. Dolman(4)














Terry Lee(10)


114,035.208







129,328.334



*William Beane(11)










129,328.334



*Peter Lamm(12)


111,020,957.500



53.5
%






Mark Genender(13)














Timothy Mayhew(14)










1,046,209.017



3.4
%Aron Schwartz(14)














Richard Wenz(15)










258,656.668



*All managers, directors and
    executive officers as a group(16)


3,940,821.479



1.2
%


30,758,406.857



99.6
%     *
    
    means less than 1%.(1)
    
    For a discussion of the Class A Common Units of our parent,
    see Item 11  Executive Compensation and
    Item 13  Certain Relationships, Related
    Transactions and Director Independence.(2)
    
    For a discussion of the Class B Common Units of our parent,
    see Item 11  Executive Compensation and
    Item 13  Certain Relationships, Related
    Transactions and Director Independence.(3)
    
    Represents (i) 109,044,085.908 Class A Common Units
    held by Fenway Easton-Bell Sports Holdings, LLC over which it
    has sole voting and investment power, (ii) 1,500,831.393
    Class A Common Units held by FPIP, 88




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##### Table of Contents



LLC over which it has sole voting and investment power and
    (iii) 476,040.199 Class A Common Units held by FPIP
    Trust, LLC over which it has sole voting and investment power.
    Each of Fenway Easton-Bell Sports Holdings, LLC, FPIP, LLC, and
    FPIP Trust, LLC are affiliates of Fenway Partners, LLC. The
    principal executive offices of Fenway Partners, LLC and its
    affiliates are located at 152 W. 57th Street,
    59th Floor, New York, New York 10019.(4)
    
    Teachers Private Capital is the private equity arm of
    Ontario Teachers Pension Plan Board. The principal
    executive offices of Ontario Teachers Pension Plan Board,
    Lee L. Sienna and Shael J. Dolman are located at 5650 Yonge
    Street, Toronto, Ontario M2M 4H5 Canada.(5)
    
    Represents (i) 7,602,347.230 Class A Common Units held
    by York Street Mezzanine Partners, L.P. over which it has sole
    voting and investment power and (ii) 4,668,752.043
    Class A Common Units held by York Street Mezzanine
    Partners II, L.P. over which it has sole voting and
    investment power. The principal executive offices of York Street
    Partners are located at One Pluckemin Way, Bedminster, New
    Jersey 07921.(6)
    
    James L. Easton is the Chairman of Easton-Bell Sports,
    Incs board of directors. Mr. Easton is also the
    President and Chairman of Jas. D. Easton, Inc. and may be deemed
    to beneficially own the units of our parent that are
    beneficially owned by Jas. D. Easton, Inc. Mr. Easton
    disclaims beneficial ownership of such units except to the
    extent of his pecuniary interests therein. The principal
    executive offices of Jas. D. Easton, Inc. and James L. Easton
    are located at 7855 Haskell Avenue, Suite 350, Van Nuys,
    California 91406.(7)
    
    William N. Fry resigned his position as an executive officer of
    the Company in March 2007. The principal address of Mr. Fry
    is located at 6225 N. State Hwy 161, Suite 300, Dallas,
    Texas 75038.(8)
    
    Paul A. Lehmann resigned his position as an executive officer of
    the Company in April 2006. The principal address of
    Mr. Lehmann is located at 1100 Shady Lane, Southlake, Texas
    76092.(9)
    
    The principal office of Peter V. Ueberroth is located at The
    Contrarian Group, 1071 Camelback St., Suite 111, Newport
    Beach, California 92660.(10)
    
    Represents (i) 114,035.208 Class A Common Units held
    by Hayden Capital Investments, LLC over which it has sole voting
    and investment power and (ii) 129,328.334 Class B
    Common Units held by Mr. Lee. Mr. Lee is the managing
    member of Hayden Capital Investments, LLC. Mr. Lee may be
    deemed to beneficially own the units of our parent that are
    beneficially owned by Hayden Capital Investments, LLC.
    Mr. Lee disclaims beneficial ownership of such units except
    to the extent of his pecuniary interests therein. The principal
    office of Terry Lee is located at
    11022 S. 51st Street #104, Phoenix, Arizona
    85044.(11)
    
    The principal office of William Beane is located at 7000
    Coliseum Way, Oakland, California 94621.(12)
    
    Mr. Lamm is the Chairman and Chief Executive Officer of
    Fenway Partners, LLC, and a managing member of each Fenway
    Partners II, LLC, the general partner of Fenway Easton-Bell
    Sports Holdings, LLC, FPIP, LLC and FPIP Trust, LLC.
    Mr. Lamm may be deemed to beneficially own the units of
    Easton-Bell Sports, LLC that are beneficially owned by Fenway
    Easton-Bell Sports Holdings, LLC, FPIP, LLC and FPIP Trust, LLC.
    Mr. Lamm disclaims beneficial ownership of such units
    except to the extent of his pecuniary interests therein. The
    principal office of Mr. Lamm is located at
    152 W. 57th Street, 59th Floor, New York,
    New York 10019.(13)
    
    The principal office of Mark Genender is located at 11111 Santa
    Monica Blvd., Suite 1470, Los Angeles, California 90025(14)
    
    The principal offices of Timothy Mayhew and Aron Schwartz are
    located at 152 W. 57th Street, 59th Floor,
    New York, New York 10019.(15)
    
    The principal office of Richard Wenz is located at 26429 Brick
    Lane, Bonita Springs, Florida 34134.(16)
    
    Excludes units to which such managers, directors and executive
    officers may be deemed to beneficially own, but which beneficial
    ownership is disclaimed by such person.  Item 13.
    Certain
    Relationships, Related Transactions and Director
    Independence  Operating
    Agreement
   89




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##### Table of Contents



Subscription
    Agreements
    EBS
    Credit Agreement
        Management
    Agreements
   90




---



##### Table of Contents



out-of-pocket out-of-pocket
    Arrangements
    with Management
      Arrangements
    with Jas. D. Easton, Inc.
    Easton Easton
 91




---



##### Table of Contents



Other
    Related Party Transactions
  Co-Chairman.
    Item 14.
    Principal
    Accountant Fees and Services  Fees
    2006


2005Audit Fees

$
1,162,806


$
609,491Tax Fees


28,650



142,400Total

$
1,191,456


$
751,891   Audit Fees Form 10-Q non-U.S. jurisdictions
  Tax Fees
 92




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##### Table of Contents



Policy of
    Audit Committee Pre-Approval of Audit and Permissible Non-Audit
    Services of Independent Auditor
    PART IV
  Item 15.
    Exhibits
    and Financial Statement Schedules  Form 10-K:
  Form 10-K.
    page II-1.
  Schedule

DescriptionSchedule II

Valuation and Qualifying Accounts       Exhibit



The Filings Referenced forNumber

Description of Exhibit

Incorporation by Reference are:2
.1

Stock Purchase Agreement dated as
    of February 1, 2006

Exhibit 2.1 to the
    Companys Current Report on
    Form 8-K
    filed February 7, 2006.3
.1(a)

Amended and Restated Certificate
    of Incorporation of Easton-Bell Sports, Inc.

Exhibit 3.1(a) to the
    Companys Annual Report on
    Form 10-K
    filed March 30, 2006.3
.1(b)

Amended and Restated Bylaws of
    Easton-Bell Sports, Inc.

Exhibit 3.1(b) to the
    Companys Annual Report on
    Form 10-K
    filed March 30, 2006.4
.1

Indenture dated as of
    September 30, 2004

Exhibit 4.1 to the
    Companys Registration Statement on
    Form S-4
    filed April 7, 2005.4
.2

Form of 8.375% Senior
    Subordinated Note due 2012

Exhibit 4.2 to the
    Companys Registration Statement on
    Form S-4
    filed April 7, 2005.4
.3

Supplemental Indenture dated as of
    March 16, 2006

Exhibit 4.3 to the
    Companys Annual Report on
    Form 10-K
    filed March 30, 2006.4
.4

Supplemental Indenture dated as of
    April 11, 2005

Exhibit 4.4 to the
    Companys Annual Report on
    Form 10-K
    filed March 30, 2006.10
.1

Credit and Guaranty Agreement
    dated as of March 16, 2006

Exhibit 10.1 to the
    Companys Annual Report on
    Form 10-K
    filed March 30, 2006.10
.2

Pledge and Security Agreement,
    dated as of March 16, 2006

Exhibit 10.2 to the
    Companys Annual Report on
    Form 10-K
    filed March 30, 2006.10
.3

Canadian Pledge and Security
    Agreement dated as of March 16, 2006

Exhibit 10.3 to the
    Companys Annual Report on
    Form 10-K
    filed March 30, 2006.10
.4*

2006 Equity Incentive Plan

Exhibit 10.4 to the
    Companys Annual Report on
    Form 10-K
    filed March 30, 2006. 93




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##### Table of Contents



Exhibit



The Filings Referenced forNumber

Description of Exhibit

Incorporation by Reference are:10
.5*

Employment Agreement with Anthony
    M. Palma

Exhibit 10.2 to the
    Companys Current Report on
    Form 8-K/A
    filed June 23, 2006.10
.6*

Employment Agreement with Mark
    Tripp

Exhibit 10.3 to the
    Companys Current Report on
    Form 8-K/A
    filed June 23, 2006.10
.7*

Employment Agreement with Dan
    Jelinek

Exhibit 10.4 to the
    Companys Current Report on
    Form 8-K/A
    filed June 23, 2006.10
.8*

Employment Agreement with Richard
    Tipton

Filed herewith10
.9*

Consulting Agreement with Terry Lee

Exhibit 10.8 to the
    Companys Registration Statement on
    Form S-4
    filed April 7, 2005.10
.10*

Employment Agreement with William
    Fry

Exhibit 10.1 to the
    Companys Current Report on
    Form 8-K
    filed April 13, 2006.21
.1

Subsidiaries

Exhibit 21.1 to the
    Companys Annual Report on
    Form 10-K
    filed March 30, 2006.31
.1

Certification of the Chief
    Executive Officer pursuant to the Section 302 of the
    Sarbanes-Oxley Act of 2002

Filed herewith31
.2

Certification of the Chief
    Financial Officer pursuant to the Section 302 of the
    Sarbanes-Oxley Act of 2002

Filed herewith32
.1

Certification of the Chief
    Executive officer and Chief Financial Officer pursuant to the
    18 U.S.C. Section 1350 as adopted pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002

Filed herewith  94




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##### Table of Contents



SIGNATURES
      By:
    /s/  Anthony
    M. Palma    Chief Executive Officer
      Signature

Title

Date/s/  Anthony
    M. PalmaAnthony
    M. Palma

Chief Executive Officer and
    Director (Principal Executive Officer)

April 6, 2007/s/  Mark
    TrippMark
    Tripp

Chief Financial Officer
    (Principal Financial Officer)

April 6, 2007/s/  James
    L. EastonJames
    L. Easton

Director

April 6, 2007/s/  William
    BeaneWilliam
    Beane

Director

April 6, 2007/s/  Shael
    J. DolmanShael
    J. Dolman

Director

April 6, 2007/s/  Mark
    GenenderMark
    Genender

Director

April 6, 2007/s/  Peter
    LammPeter
    Lamm

Director

April 6, 2007/s/  Terry
    LeeTerry
    Lee

Director

April 6, 2007/s/  Timothy
    MayhewTimothy
    Mayhew

Director

April 6, 2007/s/  Aron
    SchwartzAron
    Schwartz

Director

April 6, 2007 95




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##### Table of Contents



Signature

Title

Date/s/  Lee
    L. SiennaLee
    L. Sienna

Director

April 6, 2007/s/  Peter
    V. UeberrothPeter
    V. Ueberroth

Director

April 6, 2007/s/  Richard
    WenzRichard
    Wenz

Director

April 6, 2007  96




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##### Table of Contents



ANNUAL
    REPORT ON
    FORM 10-K
    ITEM 15 (a)(2)
  FINANCIAL
    STATEMENT SCHEDULE
    YEAR ENDED DECEMBER 30, 2006
  II-1
  VALUATION AND QUALIFYING ACCOUNTS
  AdditionsBalance at





Charged to





Balance atBeginning


Acquired


Costs and





End ofDescription

of Period


Businesses


Adjustments


Deductions


Period(Dollars in thousands)Year ended December 30,
    2006
    Product Liability

$
8,118


$



$
3,970


$
(2,666
)

$
9,422Year ended December 31, 2005
    
    Product Liability


6,734







3,816



(2,432
)


8,118Year ended December 31, 2004
    
    Product Liability


3,198



2,830



877



(171
)


6,734Year ended December 30, 2006
    
    Doubtful Accounts

$
2,634


$
2,454


$
2,560


$
(2,013
)

$
5,635Year ended December 31, 2005
    
    Doubtful Accounts


3,599







(194
)


(771
)


2,634Year ended December 31, 2004
    
    Doubtful Accounts


1,229



2,687



255



(572
)


3,599  97