<PAGE>

  As Filed with the Securities and Exchange Commission on December 15, 1999

                                                      Registration No. _________
--------------------------------------------------------------------------------

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                       ----------------------------------

                                    FORM S-1
                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933

                       ----------------------------------

                               RIDDELL SPORTS INC.
             (Exact name of registrant as specified in its charter)

                       ----------------------------------

      Delaware                         3949                        22-2890400
----------------------         ---------------------------      ----------------
(State or other juris-         primary standard industrial      (I.R.S. Employer
 diction of incorpora-         classification code number        identification
 tion or organization)                                                number)

       50 East 42nd Street, Suite 1808, New York, NY 10017 (212) 808-5400
    ------------------------------------------------------------------------
    (Address, including zip code, and telephone number, including area code,
                  of registrant's principal executive offices)

                       ----------------------------------

                                DAVID GROELINGER
                             CHIEF FINANCIAL OFFICER
                              RIDDELL SPORTS INC.,
                     50 EAST 42ND STREET, NEW YORK, NY 10017
                                 (212) 808-5400
            (Name, address, including zip code, and telephone number,
                   including area code, of agent for service)

                       ----------------------------------

                                   COPIES TO:

CLIFFORD A. BRANDEIS, ESQ.                    RUBI FINKELSTEIN, ESQ.
ZUKERMAN GORE & BRANDEIS, LLP                 ORRICK HERRINGTON & SUTCLIFFE, LLP
900 THIRD AVENUE                              666 FIFTH AVENUE
NEW YORK, NEW YORK  10022                     NEW YORK, NY 10103
Phone: (212) 223-6700                         Phone: (212) 506-5000
Fax: (212) 223-6433                           Fax: (212) 506-5151

      Approximate date of commencement of proposed sale to the public: As soon
as practicable after effective date of the registration statement.

      If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, check the following box. //

      If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration number of the earlier effective
registration statement for the same offering. //

      If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. //

      If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. //

      If delivery of the prospectus is expected to be made pursuant to Rule 434,
check the following box. //
<PAGE>

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------
                         CALCULATION OF REGISTRATION FEE
---------------------------------------------------------------------------------------
                                             Proposed
                                             Maximum     Proposed
                                             Offering    Maximum          Amount of
Title of Each Class of        Amount to be   Price Per   Aggregate        Registration
Securities to Be Registered   Registered     Unit        Offering Price   Fee
---------------------------------------------------------------------------------------
<S>                           <C>               <C>      <C>              <C>
Common Stock, par value       1,287,500         $3.125   $4,023,437.50    $1,062.25(1)
$.01 per share
---------------------------------------------------------------------------------------
Rights                        1,000,000            N/A             N/A             (2)
---------------------------------------------------------------------------------------
Warrants                      1,000,000            .01         $10,000        $2.64(3)
                                                                              -----
---------------------------------------------------------------------------------------
Total                                                                        $1,064.89
                                                                             =========
---------------------------------------------------------------------------------------
</TABLE>

(1)   Calculated pursuant to Rule 457(c), and includes an additional 37,500
      shares of Common Stock which the Underwriter has the option to purchase to
      cover over-allotments, if any.

(2)   Pursuant to Rule 457(3), no registration fee is payable with respect to
      the rights since the rights are being registered in the same registration
      statement as the securities to be offered pursuant thereto.

(3)   Calculated pursuant to Rule 457(g)(i).
<PAGE>

The information in this prospectus is not complete and may be changed. Riddell
Sports may not sell these securities until the registration statement filed with
the Securities and Exchange Commission is effective. This prospectus is not an
offer to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.

                      SUBJECT TO COMPLETION DECEMBER 15, 1999

Preliminary Prospectus

                               Subscription Rights
                                   to Purchase

                           RIDDELL SPORTS INC. [LOGO]

                      1,000,000 Shares of Common Stock and
           Accompanying Distribution of Common Stock Purchase Warrants

      We are distributing rights to purchase shares of our common stock to
persons who owned our common stock as of the close of business on December 27,
1999, the record date. We will issue up to 1,000,000 shares of common stock in
the offering. You will have the right to subscribe for 0.10795 shares of common
stock for each share of our common stock that you owned on the record date. You
will not have the right to purchase any fractional shares. The subscription
price is $_______ for each whole share.

      If you exercise your rights, you will also receive, for no additional
money, a common stock purchase warrant to purchase, if conditions are met, stock
from Riddell of a new or existing subsidiary that conducts substantially all of
our Internet operations.

      If you do not properly exercise your rights before 5:00 p.m., Eastern
Standard Time, on February [ ], 2000, your rights will expire.

      Our shares are listed for trading on the American Stock Exchange under the
symbol "RDL." On December 10, 1999, the last reported sale price for our common
stock on the American Stock Exchange was $3.125 per share. The rights will be
transferable, but will not be listed or quoted on a formal exchange.

      H.C. Wainwright & Co., Inc. will act as solicitation agent for us in
connection with the rights offering.

      Concurrently with the rights offering, we are offering to sell an
additional 250,000 shares of our common stock to the public under a separate
prospectus plus up to an additional 37,500 shares to cover over-allotments.

      See "Risk Factors" beginning on page 20 to read about factors you should
consider before buying shares of our common stock.

      Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is a
criminal offense.

                                                          Per Share      Total
Subscription Price..................................   $              $

Solicitation Agent Fee..............................   $              $

Proceeds, before expenses, to Riddell...............   $              $

                           H.C. Wainwright & Co., Inc.

                        Prospectus dated [       ], 2000
<PAGE>

      You should rely only on the information contained in this prospectus. We
have not authorized anyone to provide you with information different from that
contained in this prospectus. This prospectus is not an offer to sell or a
solicitation of an offer to buy any securities in any state or other
jurisdiction in which the offer or solicitation is not permitted. You should not
assume that the information in this prospectus is accurate as of any date other
than the date of this prospectus.

In this prospectus, "Riddell," "we," "us" and "our" refer to Riddell Sports Inc.
and our subsidiaries, unless the context specifically indicates otherwise.

<PAGE>

                                TABLE OF CONTENTS
                                                                            Page

THE BOARD RECOMMENDATION.......................................................1

QUESTIONS AND ANSWERS ABOUT THE RIGHTS OFFERING................................1

PROSPECTUS SUMMARY.............................................................7

RISK FACTORS..................................................................20

TRADE NAMES AND TRADEMARKS....................................................31

FORWARD-LOOKING STATEMENTS....................................................32

THE RIGHTS OFFERING...........................................................33

THE CONCURRENT OFFERING.......................................................43

USE OF PROCEEDS...............................................................44

DILUTION .....................................................................45

CAPITALIZATION................................................................46

SELECTED FINANCIAL DATA.......................................................47

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS..................................51

PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY...............................61

BUSINESS .....................................................................62

MANAGEMENT....................................................................85

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
         AND MANAGEMENT.......................................................90

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS...............................101

PLAN OF DISTRIBUTION.........................................................103

DESCRIPTION OF CAPITAL STOCK.................................................104

DESCRIPTION OF DEBT SECURITIES...............................................106

CERTAIN FEDERAL INCOME TAX CONSEQUENCES......................................107

LEGAL MATTERS................................................................110

EXPERTS......................................................................110

WHERE YOU CAN FIND MORE INFORMATION..........................................110

INDEX TO FINANCIAL STATEMENTS................................................F-1



                                        i

<PAGE>

                             NO BOARD RECOMMENDATION

      Our Board of Directors believes that the rights offering is in our best
interests. The rights offering will enable us to raise capital to finance our
Internet operations and for additional working capital.

      Our Board of Directors is not making any recommendation to you as to
whether you should exercise your right to purchase our common stock. You must
make your own decision as to whether to exercise your right. You should not view
the group of certain of Riddell's officers and directors and certain other
individuals who it is currently anticipated will agree to exercise all rights
granted to them and to purchase up to $_______ of the remaining shares offered
under the rights offering, as a recommendation or other indication by Riddell or
our Board of Directors, that the exercise or sale of your rights is in your best
interests. An investment in shares of our common stock must be made according to
your own evaluation of your own best interests.

      American Stock Transfer & Trust Company, our transfer agent, has agreed to
provide services to us and act as the subscription agent in connection with the
rights offering. If you require assistance, please contact our subscription
agent toll free at (800) 937-5449.

                 QUESTIONS AND ANSWERS ABOUT THE RIGHTS OFFERING

      Q:    What is the rights offering?

      A:    The rights offering is a distribution of rights on a pro rata basis
            to all of our common stockholders as of December 27, 1999, the
            record date. "Pro rata" means in proportion to the number of shares
            of our common stock that you and the other stockholders hold on the
            record date. We are distributing rights to purchase an aggregate of
            1,000,000 shares of common stock. The actual number of rights we
            will distribute per share will depend upon the number of shares of
            common stock outstanding on the record date for the rights offering.
            The number of rights per share will be calculated by dividing (i)
            1,000,000, the total number of shares of common stock that may be
            purchased in the rights offering, by (ii) the total number of
            outstanding shares of common stock as of the record date. Based upon
            the number of shares outstanding at December 1, 1999, each share of
            common stock would be entitled to 0.10795 of a full right.

      Q:    How many rights will I receive for each share of common stock that I
            own?

      A:    You will receive 0.10795 of one full right for each share of common
            stock that you own. That means for approximately every 10 shares of
            common stock that you own you will receive one full right.

      Q:    What is a right?

      A:    Each full right is the privilege to purchase one additional share of
            Riddell's common stock for the subscription price.

      Q:    What is the subscription price per share?


                                       2
<PAGE>

      A:    The subscription price per share is $______________.

      Q:    What if the exercise of my rights results in a fractional share of
            common stock?

      A:    If the exercise of your rights would result in the purchase of a
            fractional share, you may exercise your rights only by rounding down
            to and paying for the nearest whole share, or paying for any lesser
            number of whole shares. You may not purchase a fractional share.

      Q:    Why is Riddell offering the rights?

      A:    Riddell is offering the rights to finance its new Internet business
            and for additional working capital.

      Q:    How soon must I act?

      A:    Your rights expire at 5:00 p.m., New York City time, on
            February______, 2000. The subscription agent must receive all
            required documents and payments in good funds before that time and
            date.

      Q:    What documents and form of payment are required to exercise my
            rights?

      A:    If you are a record holder of Riddell common stock on
            December 27, 1999, you are receiving with this prospectus a
            subscription certificate and instructions on how to exercise your
            rights to purchase shares. The subscription certificate must be
            properly filled out and delivered with full payment in good funds to
            American Stock Transfer & Trust Company before the expiration of the
            rights on or before February ______, 2000. The subscription price
            must be paid in good funds, which means by wire transfer, certified
            or cashier's check drawn on a U.S. bank, or personal check that
            clears before expiration of the rights. The instructions also
            describe an alternate procedure called "Notice of Guaranteed
            Delivery". The "Notice of Guaranteed Delivery" allows an extra three
            days for you to deliver the subscription certificate if full payment
            in good funds is received on or before the expiration date, February
            _____, 2000, and if a securities broker or qualified financial
            institution signs the form to guaranty that the subscription
            certificate will be timely delivered. Subscription documents and
            payments should be sent to American Stock Transfer & Trust Company
            at 40 Wall Street, 46th floor, New York, NY 10005.

      Q:    What if a broker, bank or other nominee is the record holder of my
            shares?

      A:    If you wish to exercise your rights to purchase shares, please
            promptly contact the broker, bank or other company holding your
            shares. Because your broker or other nominee holder is the record
            holder of the shares you own, they must complete the subscription
            certificate on your behalf for the shares that you wish to purchase
            or arrange for a subscription certificate issued in your name. The
            broker, bank or other nominee will be requested to contact you for
            instructions on exercising your rights.


                                       3
<PAGE>

      Q:    Will our Board of Directors make a recommendation whether I should
            exercise my rights?

      A:    No.

      Q:    What is the standby group?

      A:    The standby group is a group of individuals who agree to exercise
            all of their rights and who also agree to purchase up to a certain
            dollar amount of shares offered under the rights offering that are
            not purchased by the other stockholders. We currently anticipate
            that a group of our officers, directors and some other individuals
            will agree to exercise all of the rights granted to those members of
            the standby group who are stockholders as of the record date, and,
            in addition, will also agree to purchase up to $__________ worth of
            the shares offered under the rights offering that are not purchased
            by the other stockholders.

      Q:    If I have any questions about this rights offering, who should I
            contact?

      A:    For questions about the rights offering or additional copies of
            offering documents call the subscription agent, American Stock
            Transfer & Trust Company, at (800) 937-5449, (212) 936-5100, or
            (718) 921-8200.

            For other questions and copies of our recent SEC filings contact
            Riddell at (773) 794-1994, extension 307, or refer to other sources,
            described under "Where You Can Find More Information" below.

      Q:    Am I required to exercise my rights?

      A:    No.

      Q:    What will happen if I do not exercise my rights?

      A:    If you do not exercise any rights, the number of shares which you
            own will not change, but, if the rights offering is completed, your
            percentage ownership of Riddell's total outstanding common stock
            will decline. Also, even if you do exercise all of your rights, if
            Riddell completes the concurrent offering, your percentage ownership
            of Riddell's total outstanding common stock will decline.

      Q:    What is the concurrent offering?

      A:    At the same time as we are conducting the rights offering to our
            current stockholders we are also offering to sell 250,000 shares of
            our common stock to the general public.

      Q:    Why are we conducting the concurrent offering?

      A:    For the same reasons that we are conducting the rights offering, to
            finance our new Internet business and for additional working
            capital.


                                       4
<PAGE>

      Q:    May I transfer my rights?

      A:    Yes, rights will be transferable, but it is not anticipated that a
            formal market will be made in the rights. Therefore, they will not
            be listed for trading on any exchange, although it is possible that
            an informal market may develop. We cannot ensure that the rights
            will have any value or can be sold. You may also wish to transfer
            rights to allow your broker or other person to exercise your rights
            for you. The reverse side of the subscription certificate contains
            instructions for these types of transfers.

      Q:    Will my money be returned if the rights offering is cancelled?

      A:    Yes, but without any payment of interest.

      Q:    What fees or charges apply if I purchase shares or attempt to sell
            my rights?

      A:    If you exercise rights through a broker or other holder of your
            shares, you will be responsible for paying any fees that they may
            charge you. If you elect to sell your rights, you are also
            responsible for any fees or sales commissions that may apply to that
            transaction. We will not be charging you any fee or sales commission
            to issue rights to you or to issue shares to you if you exercise
            rights. We will be responsible for paying the solicitation agent its
            fee.

      Q:    May I change or cancel my exercise of rights after I send in the
            required forms?

      A:    No.

      Q:    What is the common stock purchase warrant that Riddell is offering
            along with the rights?

      A:    Attached to each full right is a common stock purchase warrant that
            will entitle you to purchase shares of common stock from Riddell if,
            in the future, Riddell decides to conduct substantially all of its
            Internet operations through a newly formed or existing subsidiary.
            All of the warrants received by holders who exercise rights,
            collectively, are exercisable for __________% of the common stock
            owned by Riddell in this prospective Internet subsidiary at the time
            the common stock purchase warrants are exercisable. You will only
            receive this common stock purchase warrant if, and to the extent,
            you exercise your rights.

      Q:    When are the common stock purchase warrants exercisable?

      A:    Assuming that we decide to conduct our Internet operations in the
            future through a newly formed or presently existing subsidiary, the
            common stock purchase warrants are exercisable if we effect an
            initial public offering of the stock of this Internet subsidiary
            before December 31, 2002, in which event the warrant will be
            exercisable for six months commencing on the closing of the initial
            public offering. If we do not establish such an Internet subsidiary
            by December 31, 2002, or we establish this subsidiary but do not
            take it public by December 31, 2002, your warrants will
            automatically expire and will no


                                       5
<PAGE>

            longer be exercisable.

      Q:    What will be the exercise price of the common stock purchase
            warrant?

      A:    The exercise price for the common stock purchase warrant will be
            $0.01 per share.

      Q:    May I transfer the common stock purchase warrants that I receive if
            I exercise my rights?

      A:    No, with one exception. They can be transferred to your estate if
            you die.


                                       6
<PAGE>

                               PROSPECTUS SUMMARY

      This summary highlights some of the information provided elsewhere in this
prospectus. The summary is not complete and may not provide all information you
should consider before deciding whether or not to exercise the rights. You
should read the entire prospectus carefully. Portions of this prospectus, such
as the Risk Factors section starting on page 20, are not summarized below.

      Riddell also encourages you to review the financial statements and other
information provided in the reports and other documents it files under the
Securities Exchange Act of 1934, as described in the "Where You Can Find More
Information" section in this prospectus at page 110.

                                     Riddell

Our Business

      Riddell is a leading marketer and manufacturer of branded products and
services to the extracurricular activities portion of the educational market. We
believe that the extracurricular activities market encompasses approximately 30
million young men and women in the United States who participate in team sports
and other organized activities outside the classroom. We estimate that this
market generates approximately $5 billion in sales annually, including
approximately $2 billion in athletic equipment and uniforms for team sports and
various products and services for cheerleaders and dancers.

      Under our many brands, the best known of which are Riddell(Registered) and
Varsity Spirit(Registered) (which we own) and Umbro(Registered) (which we
license), we are:

      o     A leading provider of equipment and clothing for team sports;

      o     The only national reconditioner of football protective and other
            athletic equipment;

      o     The largest designer, marketer and supplier of innovative
            cheerleader and dance team uniforms and accessories;

      o     The biggest operator of cheerleading and dance team training camps
            and clinics;

      o     A leading organizer of special events for extracurricular
            activities;

      o     A nationwide provider of soccer apparel, equipment and footwear for
            team play; and

      o     A supplier of sports collectible products through retailers in the
            U.S. and internationally.

      We believe that Riddell branded football equipment is worn by more than
50% of all high school and collegiate football players. We also have a
longstanding agreement with the NFL for the promotion of our Riddell brand. Over
80% of the NFL players choose to wear


                                       7
<PAGE>

our helmets. We believe that our Varsity Spirit brand cheerleading uniforms are
worn by approximately 40% of all high school and 75% of all collegiate
cheerleaders. In 1999, our cheerleading camps were attended by more than 217,000
students, and, in 1999, more than 25,000 people traveled to the Walt Disney
Resort in Orlando, Florida to participate in and view our various cheerleading
and dance competitions.

      In the fourth quarter of 1998, we became the exclusive U.S. licensee for
Umbro branded soccer apparel, footwear and equipment for the team channel of
distribution. Umbro is one of the leading soccer brands worldwide.

Our objectives and strategies

      Our objectives are to increase our current market share and broaden the
recognition of our brands in the extracurricular activities market. We intend to
implement these objectives by continuing to focus on adding new product lines,
developing new special events, competitions and conventions, increasing the size
of our sales force and broadening our already successful integrated marketing
approach. We believe that the implementation of our Internet operations will
enhance our integrated marketing approach.

Our opportunities for growth

      Over the past few years we have positioned ourselves for growth in four
areas:

      o     Football, baseball and softball game uniforms to high school and
            collegiate teams

      o     Football, baseball and softball game uniforms and equipment to
            recreational youth leagues

      o     Apparel, equipment and footwear to the team soccer market

      o     New Internet operations

Our advantages

      We believe that we have three principal advantages that will support our
growth opportunities:

      o     Our direct, proprietary sales force has approximately 320 people who
            are responsible for developing and maintaining relationships among
            the 40,000 junior and senior high schools, colleges and numerous
            recreational organizations throughout the United States. Our sales
            force will be particularly important in connection with sales of
            athletic clothing and equipment to high schools, colleges and
            recreational youth leagues. We believe that we have the only
            national sales force in the U.S. serving the extracurricular market.

      o     Our efficient manufacturing and sourcing capabilities support our
            direct sales effort and enable us to produce and deliver
            competitively priced high quality customized products faster than
            our competitors.


                                       8
<PAGE>

      o     Our relationship marketing, which we began 25 years ago, is a
            year-round, integrated marketing approach that creates a strong bond
            between us and our customers. In the case of cheerleading it
            includes conducting training camps, clinics and conventions,
            producing various nationally-televised and regional championships
            and performance events and selling cheerleading uniforms and
            accessories. Our relationship marketing is designed so that each of
            our products and services reinforce one another, as well as
            strengthen overall brand awareness. We believe that our new Internet
            operations are a logical extension of, and will effectively
            reinforce, our relationship marketing strategy.

Our Internet operations

      Our Internet business, which will be funded, in part, by the proceeds of
this offering, has a community and a commerce orientation. We started our
Internet operations in the fourth quarter of 1999 with our first two web sites:
a community web site with e-commerce elements for cheerleaders, www.varsity.com,
and an e-commerce web site for sports collectibles, www.riddell.com.

      o     Community: We will be developing web sites for identifiable,
            highly-focused communities in the extracurricular activities market.
            We believe that the community members in this market, such as
            cheerleaders, football players and other participants in
            extracurricular activities, often define their lives through their
            participation in these activities. As a result, we believe that
            these community members will become frequent visitors to our web
            sites. Our community web sites will provide these users with
            meaningful, timely, activity-specific content. We believe as we
            create web sites for these discrete, highly-focused communities,
            that our combined group of users will represent a large, sought
            after audience for third-party advertisers and marketers.

      o     Commerce: On our community sites, we anticipate that users will be
            able to purchase our products and purchase the products of other
            marketers who will want to sell to our community members. We will
            offer products that will appeal to the members of our focused
            community sites as well as products that will appeal to members of
            different communities. We also plan to sell advertising, as we
            believe the school leaders and trend setters that use our community
            web sites will be an attractive audience to other marketers. We also
            believe that our web site for sports collectibles will be attractive
            to a broad range of sports fans.

      We believe that the Internet will help us expand our traditional business,
increase our brand recognition and give rise to new revenue streams.

      o     Direct link to our customers: We believe that the content and
            community-building aspects of each community web site will enhance
            our existing relationships and help us build new relationships with
            coaches and participants in various extracurricular activities. The
            Internet will also provide us with another way to rapidly
            disseminate new product information and promote our camps, clinics,
            competitions and performance events.

      o     Market penetration: We believe that the Internet will be
            particularly effective


                                       9
<PAGE>

            with respect to the sale of uniforms and equipment to recreational
            youth leagues, a large and highly-fragmented market.

      o     Expand into new businesses: In addition to new revenue streams from
            alliances with other companies and the sale of advertising, we
            believe that the Internet will ultimately provide us with a
            cost-effective vehicle to begin marketing beyond our traditional
            extracurricular groups (i.e., cheerleaders and team sports) to
            non-athletic extracurricular activities (e.g., musical
            organizations, drama clubs, chess clubs, etc.).

      o     Broaden distribution of sports collectibles: We believe that the web
            site dedicated to our retail products will overcome the geographical
            constraints and inventory limitations of retail stores, which
            preclude our ability to offer collectibles of every team in every
            city. The Internet will also enable us to offer customized products
            that cannot readily be sold through traditional commercial channels.

      We are a Delaware corporation with our principal offices located at 50
East 42nd Street, Suite 1808, New York, NY 10017. Our phone number is (212)
808-5400. Our current web sites are www.varsity.com and www.riddell.com. The
information contained on our web sites is not intended to be a part of this
prospectus.


                                       10
<PAGE>

                             Summary Financial Data

      The selected financial information set forth below is derived from the
more detailed financial data and related notes thereto included elsewhere in
this prospectus. This information shall be read in conjunction with such
financial data.

                                (In Thousands, except per share amounts)
                        --------------------------------------------------------
                            Year Ended December 31,           Nine Months Ended
                                                                September 30,
                        --------------------------------------------------------
                         1996       1997         1998         1998        1999
                         ----       ----         ----         ----        ----
                                                              Unaudited
                                                              ---------
Statements of
Operations
Data:

Net revenues           $72,382    $138,273     $186,600     $159,326    $179,750

Gross profit            33,569      57,598       73,059       64,087      74,781

Interest expense         2,763      11,879       14,656       11,114      11,668

Net Income
(loss)                   2,843        (559)      (7,139)       3,804       8,184

Net Earnings
(loss) per share

         Basic           $0.35      $(0.07)      $(0.78)       $0.42       $0.88

         Diluted          0.33       (0.07)      $(0.78)        0.37        0.78

EBITDA(1)               $7,909     $15,330      $13,230      $19,164     $25,042

1)    EBITDA is the sum of our earnings or loss before extraordinary items (and
      the cumulative effect of changes in accounting principles (as
      applicable)), interest, income taxes, depreciation and amortization
      expense. EBITDA is a widely accepted financial indicator of a company's
      ability to service indebtedness. However, EBITDA should not be considered
      as an alternative to income from operations or to cash flows from
      operating activities (as determined in accordance with generally accepted
      accounting principles) and should not be construed as an indication of a
      our operating performance or as a measure of our liquidity.


                                       11
<PAGE>

                                     December 31,          September 30,
                                     -------- ---          --------- ---
                              1996       1997       1998       1998       1999
                             -------    -------    -------    -------    -------
                                                              Unaudited
                                                              ---------
Balance Sheet Data:

Working capital              $25,957    $37,599    $37,963    $59,634    $65,110

Total assets                  76,361    181,761    186,211    201,942    210,300

Long-term debt, less
current portion               29,984    122,500    126,900    138,200    145,144

Stockholders' equity          27,745     32,125     25,451     36,129     33,635


                                       12
<PAGE>

                             The Rights Offering

Securities offered                             Rights to purchase 1,000,000
                                               shares of our common stock.
                                               Further, to those individuals and
                                               entities who exercise rights, we
                                               will issue warrants which, upon
                                               exercise, will represent in the
                                               aggregate, _____ (____%) percent
                                               of Riddell's ownership in a new
                                               or existing subsidiary that we
                                               may establish in the future to
                                               conduct most of our Internet
                                               operations.

Concurrent offering                            Concurrently with the rights
                                               offering, we are offering 250,000
                                               shares of newly-issued shares of
                                               stock.

Shares of common stock                         9,263,957 outstanding on
outstanding prior to this offering             December 1, 1999.

Shares of common stock outstanding             10,513,957. Unless expressly
after this offering (assuming completion       stated to the contrary, the share
of this rights offering in full and the sale   information in this prospectus
of 250,000 shares in the concurrent            excludes:
offering under a separate prospectus)
                                               o 2,435,025 shares issuable upon
                                               exercise of options granted
                                               pursuant to Riddell's 1991 Stock
                                               Option Plan and 1997 Stock Option
                                               Plan as of December 1, 1999.

                                               o 1,395,011 shares of common
                                               stock issuable upon conversion at
                                               $5.3763 per share (subject to
                                               certain adjustments) of Riddell's
                                               4.1% Convertible Subordinated
                                               Note due 2004.

                                               o The shares issued upon exercise
                                               of the underwriter's
                                               over-allotment option in the
                                               concurrent offering.

Record date                                    December 27, 1999.

Expiration date and time                       The rights expire at 5:00 p.m.,
                                               New York City time, on February
                                               __, 2000, unless properly
                                               exercised before that time and
                                               date.

Rights                                         To each record holder of common
                                               stock on December 27, 1999
                                               Riddell is granting 0.10795 of a
                                               right for each share of common
                                               stock held on such date. To
                                               exercise the right, you must
                                               deliver one full right for each
                                               share of common stock you would
                                               like to purchase.

Subscription price                             The subscription price for each
                                               full right is


                                       13
<PAGE>

                                               $____ per share, payable in cash.
                                               Payment by personal check must
                                               clear payment on or before the
                                               expiration date, which may
                                               require five or more business
                                               days from the date that we
                                               receive your personal check. As a
                                               result, we recommend that
                                               stockholders pay the subscription
                                               price by certified or cashier's
                                               check drawn on a U.S. bank, U.S.
                                               postal money order or wire
                                               transfer of funds.

                                               The subscription price will be
                                               approved by those members of our
                                               Board of Directors that are not
                                               members of the Standby Group.

Transferability of rights                      The rights are transferable, but
                                               we do not anticipate that a
                                               formal market will be made in the
                                               rights or that they will be
                                               listed for trading on any
                                               exchange; although an informal
                                               market may develop. The rights
                                               are issued in the form of
                                               subscription certificates which
                                               accompany this prospectus sent to
                                               the record holders.

Fractional shares                              We will not issue fractional
                                               shares. If your rights would
                                               allow you to purchase a
                                               fractional share, you may
                                               exercise your rights only by
                                               rounding down to and paying for
                                               the nearest whole share, or
                                               paying for any lesser number of
                                               whole shares.

No revocation                                  Once you submit the form of
                                               subscription certificate to
                                               exercise any rights, you are not
                                               allowed to revoke, or change the
                                               exercise or request a refund of
                                               monies paid.

Common Stock Purchase Warrant                  If the right is exercised, the
                                               exercising holder will receive,
                                               for no additional cash, a common
                                               stock purchase warrant that will
                                               entitle the exercising holder to
                                               purchase shares in a new or
                                               existing subsidiary of ours that
                                               we may establish through which we
                                               would conduct substantially all
                                               of our Internet operations. These
                                               warrants will only be exercisable
                                               if we establish an Internet
                                               subsidiary (which presently does
                                               not exist) and we effect an
                                               initial public offering of such
                                               subsidiary on or before December
                                               31, 2002, in which event you will
                                               have six months after the closing
                                               of the initial public offering to
                                               exercise your common stock
                                               purchase warrant. If we do not
                                               establish the Internet subsidiary
                                               before December 31, 2002, or
                                               establish the Internet


                                       14
<PAGE>

                                               subsidiary but do not effect an
                                               initial public offering for such
                                               subsidiary before December 31,
                                               2002, the common stock purchase
                                               warrant will automatically expire
                                               and will no longer be
                                               exercisable. These warrants have
                                               an exercise price of $0.01 per
                                               share and are non-transferrable
                                               except in the event of the death
                                               of the holder.

Reasons for the rights offering                To finance our Internet business
                                               and for additional working
                                               capital.

No board or committee recommendation           Our Board of Directors will not
                                               make any recommendation to
                                               stockholders regarding the
                                               exercise of rights under this
                                               offering. Stockholders who do
                                               exercise rights risk investment
                                               loss on new money invested. We do
                                               not assure you that the
                                               subscription price will be below
                                               the market price for the common
                                               stock, or that anyone purchasing
                                               shares at the subscription price
                                               will be able to sell those shares
                                               in the future at a higher price.
                                               See "Risk Factors -- Risks
                                               relating to the rights offering."

Standby purchase commitment                    It is currently anticipated that
                                               a group to consist of some of
                                               Riddell's officers and directors
                                               and certain other individuals
                                               with whom we are currently in
                                               discussions regarding joining
                                               this group (the "Standby Group")
                                               will agree to exercise all of the
                                               rights granted to those members
                                               of the Standby Group who are
                                               stockholders on the record date.
                                               In addition, the Standby Group
                                               will be contractually bound to
                                               purchase up to $____________ of
                                               the shares offered under the
                                               rights offering that are not
                                               purchased by stockholders who are
                                               not a part of the Standby Group.
                                               The rights granted to the Standby
                                               Group represent ____% of all of
                                               the rights being issued to
                                               stockholders. See "Risk Factors -
                                               Risks Relating to the rights
                                               offering"

Conditions to the rights offering              The obligations of the Standby
                                               Group to complete its purchase of
                                               shares under the proposed standby
                                               agreement are subject to certain
                                               conditions described under
                                               "Rights Offering -- Conditions
                                               relating to the rights offering."
                                               If the standby agreement with the
                                               Standby Group is not consummated
                                               in accordance with its terms for
                                               any reason, or if the other
                                               conditions are not satisfied or


                                       15
<PAGE>

                                               waived, we may terminate the
                                               rights offering and the
                                               concurrent offering in their
                                               entirety. If the rights offering
                                               is terminated, we will refund
                                               without interest to those persons
                                               who subscribed for shares in the
                                               rights offering all payments
                                               received from those subscribers.

Subscription agent                             American Stock Transfer & Trust
                                               Company

Solicitation agent                             H.C. Wainwright & Co., Inc.

Procedure for exercising rights                To exercise rights, you must
                                               complete the subscription
                                               certificate and deliver it to
                                               American Stock Transfer & Trust
                                               Company with full payment under
                                               the subscription privilege.
                                               American Stock Transfer & Trust
                                               Company must receive the proper
                                               forms and payments in good funds
                                               on or before the expiration date.

                                               You may deliver the documents and
                                               payments by mail or commercial
                                               courier. If regular mail is used
                                               for this purpose, we recommend
                                               using insured, registered mail.
                                               You may use an alternative, the
                                               "Notice of Guaranteed Delivery",
                                               if you are unable to deliver the
                                               subscription certificate before
                                               the expiration date, subject to
                                               the requirements of this
                                               procedure described under "The
                                               Rights Offering--Special
                                               procedure under "Notice of
                                               Guaranteed Delivery Form."

Payment adjustments                            If you send a payment that is
                                               insufficient to purchase the
                                               number of shares requested, or if
                                               the number of shares requested is
                                               not specified in the forms, the
                                               payment received will be applied
                                               to exercise the subscription
                                               privilege to the extent of the
                                               payment. If the payment exceeds
                                               the subscription price for the
                                               full exercise of the subscription
                                               privilege, the excess will be
                                               refunded to you as soon as it is
                                               practicable. You will not receive
                                               interest on any payments received
                                               under the rights offering.

Nominee accounts                               If you wish to purchase shares in
                                               this offering and your shares are
                                               held by a securities broker,
                                               bank, trust company or other
                                               nominee, you should promptly
                                               contact your record holder(s) and
                                               request that they exercise rights
                                               on your behalf. You may also
                                               contact the nominee and request
                                               that the nominee send a separate


                                       16
<PAGE>

                                               subscription certificate to you.
                                               If you are a record holder who
                                               wishes an institution such as a
                                               broker or bank to exercise your
                                               rights for you, you should
                                               contact that institution promptly
                                               to arrange the method of
                                               exercise. If you are a nominee
                                               who desires subscription
                                               certificates re-issued in smaller
                                               denominations, you must act
                                               promptly under special procedures
                                               described under "The Rights
                                               Offering--How to transfer
                                               rights."

                                               You are responsible for the
                                               payment of any fees that brokers
                                               or other persons holding your
                                               shares may charge.

                                               You are not responsible for any
                                               fees payable to the Subscription
                                               Agent or the solicitation agent.

Exercise by foreign and certain other          American Stock Transfer & Trust
stockholders                                   Company will hold subscription
                                               certificates for stockholders
                                               having addresses outside the
                                               United States. In order to
                                               exercise rights, holders with
                                               addresses outside the United
                                               States must notify American Stock
                                               Transfer & Trust Company and
                                               timely follow other procedures on
                                               or before the expiration date of
                                               the rights.

U.S. income tax consequences                   For United States federal income
                                               tax purposes, we believe that a
                                               stockholder will not recognize
                                               taxable income as a result of the
                                               distribution of the rights. Upon
                                               exercise of the rights, we
                                               believe that receipt of the
                                               common stock purchase warrants
                                               will be treated as a distribution
                                               of property and taxable as a
                                               dividend to the stockholders to
                                               the extent the fair value of the
                                               common stock purchase warrant on
                                               the date of receipt exceeds the
                                               subscription price allocated to
                                               the warrants. See "The Rights
                                               Offering - Federal Income Tax
                                               Consequences" and "Certain
                                               Federal Income Tax Consequences".
                                               Each stockholder should, and is
                                               urged to, consult their own tax
                                               adviser concerning the tax
                                               consequences of this offering
                                               under the holder's own tax
                                               situation. This prospectus does
                                               not summarize tax consequences
                                               arising under state tax laws,
                                               non-U.S. tax laws, or any tax
                                               laws relating to special tax
                                               circumstances or particular types
                                               of taxpayers.


                                       17
<PAGE>

Stock certificates                             We will deliver stock
                                               certificates representing common
                                               stock purchased by the exercise
                                               of rights as soon as practicable
                                               after the expiration date of the
                                               rights.

Warrant certificates                           We will deliver warrant
                                               certificates representing the
                                               common stock purchase warrants
                                               granted to you upon the exercise
                                               of your rights as soon as
                                               practicable after the expiration
                                               date of the rights.

Amendment, extension and termination           We may amend or extend the rights
                                               offering. We reserve the right to
                                               withdraw the rights offering at
                                               any time prior to the expiration
                                               date for any reason, in which
                                               event all funds received in the
                                               rights offering will be returned
                                               without interest to those persons
                                               who subscribed for shares in the
                                               rights offering.


                                       18
<PAGE>

                           The Concurrent Offering

Shares offered by Riddell                      250,000 shares of common stock

Shares to be outstanding after the offering    10,513,957.
(and assuming the sale of 1,000,000 shares
of our common stock pursuant to the rights
offering under a separate prospectus)

Use of proceeds                                To finance our Internet business
                                               and for additional working
                                               capital

American Stock Exchange symbol                 "RDL"


                                       19
<PAGE>

                                  RISK FACTORS

      You should carefully consider the risks described below and the other
information in this prospectus before deciding to purchase our shares. Many
factors, including the risks described below and other risks that we have not
recognized, could cause our operating results to be different from our
expectations and plans.

      This risk factor section is divided into three sections. The first section
relates to the general business risks associated with Riddell. The second
section relates solely to the risks associated with this offering. The third
section relates to the risks specifically associated with the our Internet
business.

General business risks

      Our significant corporate indebtedness could affect our financial health.
We have significant corporate indebtedness. In June of 1997, we borrowed $115
million to acquire the Varsity Spirit Corporation and refinance certain of our
then outstanding indebtedness. We also have a revolving credit facility of $48
million which we use for working capital purposes, primarily to finance
inventory and receivables and a $7.5 million convertible note. As of September
30, 1999, we had $115 million outstanding in respect of the Senior Notes, $22.64
million outstanding in respect of our revolving credit facility and $7.5 million
outstanding in respect of the convertible note, for approximately $145 million
in total outstanding indebtednesss.

      Some of the risks associated with our corporate indebtedness include:

      o     As the amount of money we have borrowed is large relative to our
            size, our ability to raise additional capital, if needed, in the
            future, may be limited.

      o     A significant portion of our cash flow is needed to pay interest and
            principal on our debt when due. Also, as our revolving credit line
            has a variable rate of interest, an increase in interest rates could
            be harmful to us.

      o     We are more vulnerable to economic downturns and more limited in our
            ability to withstand competitive pressures, particularly from those
            competitors that have not borrowed as much money as we have.

      o     Our ability to pay principal and interest when it becomes due or to
            refinance our debt depends on our future operating performance and
            cash flows, which are subject to factors beyond our control, such as
            prevailing economic conditions, prevailing interest rate levels and
            financial, competitive, business and other factors.

      o     If we do not have enough cash flow to make principal and interest
            payments on our debt obligations when they come due, we may not be
            able to raise cash to meet our payment obligations because of the
            restrictive agreements in our debt obligations.

      o     If we default on our credit obligations, and our default is not
            cured or waived, our default could result in other debt obligations
            automatically becoming due under what are commonly referred to as
            cross-default provisions.


                                       20
<PAGE>

      Restrictive covenants limit our discretion on various business matters.
Our financing agreements contain financial and operating covenants that encumber
our assets and restrict our ability to use our discretion on various business
matters, including our ability to:

      o     borrow additional money;

      o     pay dividends and make specified other payments;

      o     loan money to our subsidiaries or other parties;

      o     make investments, loans and guaranties; and

      o     sell our assets.

      We depend on third-parties to manufacture most of our products. We depend
on foreign and domestic third-parties to manufacture most of our athletic
equipment, practicewear, uniforms, cheerleading accessories and collectible
products. We do not have any long term contracts with our manufacturers, and we
compete with other companies for third-party production capacity. Our
arrangements with our non-U.S. suppliers are subject to the risks generally
associated with doing business abroad, such as:

      o     changes in import duties;

      o     tariffs;

      o     foreign governmental regulations;

      o     political unrest;

      o     foreign currency fluctuations;

      o     disruptions or delays in shipments;

      o     weather and time risks associated with transoceanic shipping;

      o     additional U.S. quotas, duties, taxes or other restrictions that
            could be imposed on importation of products in the future; or

      o     changes in economic conditions in countries in which our
            manufacturing sources are located.

      If any such factors were to render the conduct of business in a particular
country undesirable or impractical, or if our current foreign or domestic
manufacturers were to cease doing business with us for any reason, our business
and operating results could be severely impacted.

      We also purchase raw materials used in our protective products from
third-party suppliers. In particular, we rely on a single supplier to fulfill
our requirements for resin, an integral component in our football and baseball
batters' helmets. If our supplier should fail to continue to fulfill our resin
requirements and a satisfactory alternate supplier could not be found, our
financial results could be materially adversely affected.


                                       21
<PAGE>

      Our business is highly seasonal and follows an annual pattern. Our working
capital needs vary throughout the year typically requiring us to increase our
debt during the first and most of the second quarters of each year. We then
usually generate cash flow to decrease our indebtedness starting late in the
second quarter and into the fourth quarter of each year. This working capital
pattern is influenced by the following factors:

      o     We sell our extracurricular products and reconditioning services
            throughout the year. However, many schools and colleges do not make
            payments for these products and services until the following July to
            October period when the school year begins.

      o     We incur costs in preparing for our cheerleading camps during the
            fourth quarter and into the second quarter, while we receive the
            revenues from camps during the period from June to August.

      o     Semiannual interest payments on our $115 million Senior Notes are
            due each January and July.

      Our quarterly financial results also fluctuate based on the seasonality of
our business. In recent years operations have been most profitable in the second
and third quarters, with the third quarter being the strongest. Losses have been
incurred in the first and fourth quarters. This seasonal profitability pattern
is influenced by the following factors:

      o     We deliver most of our extracurricular products and reconditioning
            services in the first three quarters of each calendar year.

      o     Most of our camp revenue relates to cheerleading camps held during
            the summer. However, we incur costs preparing for the upcoming camp
            season during the fourth through second quarter of each year.

      o     Our sales of sports collectible products are usually at their
            highest during the third and fourth quarters as retailers build
            inventory in anticipation of both the football and holiday shopping
            seasons.

      See "Business - Seasonality and Backlog" and "Management's Discussion and
Analysis of Financial Condition and Results of Operations - Liquidity and
Capital Resources".

      We are subject to product liability and personal injury claims because of
the nature of our products. Given the nature of the products we manufacture,
recondition and sell, particularly our line of football helmets, we have in the
past, and will likely continue in the future, to be subject to product liability
and personal injury claims. Principally these claims have related to head and
neck injuries suffered during the course of a football game. We may also be
subject to personal injury claims arising from our cheerleader and dance team
camps and activities. Due to the uncertainty of litigation, we cannot assure you
that the ultimate cost of these claims will fall within the established reserves
on our financial statements, or that we will have adequate insurance coverage to
cover these claims in the future. Also, our insurance coverage expires in 2005
and we cannot assure you that, subsequent to 2005, our insurer will remain
viable and that future rate increases will not make such insurance uneconomical.
We cannot assure you that one or more meritorious claims against us for product
liability, serious personal, bodily injury will not have a material


                                       22
<PAGE>

adverse effect on our business, financial condition or results of operations.
See "Business - Product Liability Proceedings and Insurance."

      We operate in a competitive market where there are companies larger than
us. In our team sports business, we compete with several large national
companies, such as Bike Athletic Co, Inc., Douglas, Inc., Gear 2000, Inc.,
Schutt, Inc., Rawlings Sporting Goods Company, Inc., Diamond Sports Co., and
Wilson Sporting Goods Company, and in our athletic clothing business, with
national companies such as Champion Products, Inc. and Russell Athletic, Inc.
and with Adidas, Nike and other companies for soccer team apparel, footwear and
equipment. Some of our competitors offer a broad line of sports equipment and
are significantly larger and have substantially greater financial and other
resources at their disposal than we do. We also compete with numerous
independent dealers who market competitors' products and with numerous smaller
manufacturers and suppliers of sporting goods, reconditoners, services and
collectibles. In particular, the protective equipment reconditioning and the
sports collectibles industries are fragmented.

      We compete with one major national company, National Spirit Group Limited,
that markets cheerleader and dance uniforms and accessories and cheerleader and
dance camps. We also compete with other smaller national and regional
competitors that serve the uniform and accessories market or that operate
cheerleader and dance team camps and clinics.

      Competitive pressure could have a material adverse effect on our business,
financial condition and results of operations.

      Our market share information may not be dependable. The market share and
other market data contained in this prospectus are based on independent industry
publications and our good faith estimates. However, we cannot independently
verify market share data with complete certainty due to the unavailability of
raw data and the voluntary nature of the data gathering process. Further
estimates of market data may be incorrect, possibly to a material degree.
Management's estimates with respect to our market are based only on the limited
data in the public domain and our participation in the team sports and school
spirit industries.

      Future sales of our common stock could adversely affect our stock price
and our ability to raise funds in the stock offering. An aggregate of 4,434,119
shares of the our common stock are "restricted securities" as that term is
defined by Rule 144 of the Securities Act of 1933, and may be sold only in
compliance with Rule 144 of the Securities Act. Ordinarily, under Rule 144, a
person who is an affiliate (as that term is defined in Rule 144) of ours and has
beneficially owned restricted securities for a period of one year may, every
three months, sell in brokerage transactions an amount that does not exceed the
greater of (i) one percent of the outstanding class of such securities, or (ii)
the average weekly trading volume in such securities on all national exchanges
and/or reported through the automated quotation system of a registered
securities association during the four weeks prior to the filing of a notice of
sale by a securities holder. A person who is not an affiliate of ours who
beneficially owns restricted securities is also subject to the foregoing volume
limitations but may, after the expiration of two years, sell unlimited amounts
of such securities under certain circumstances. Possible or actual sales of our
outstanding common stock by our stockholders under Rule 144 could have a
depressive effect on the price of the our common stock. There are currently
4,380,119 shares of our common stock eligible for sale pursuant to Rule 144, 97%
of which are owned by our officers and directors. The market price of our common
stock could drop due to sales of a large number of shares of our common stock or
the perception


                                       23
<PAGE>

that these sales might occur. These factors could also make it more difficult to
raise funds through future offerings of common stock or other equity.

      Directors and officers control over 50% of Riddell; their interests may be
different and conflict with yours. After the offering, over 51% of outstanding
shares of common stock could be owned by our officers and directors assuming all
exercise their rights on a pro-rata basis. Management may also increase their
holdings as a result of the offering and participation in the standby group. See
"Security Ownership of Certain Beneficial Owners and Management" As a result,
certain officers and directors will own a sufficient number of shares of the
outstanding voting stock of Riddell to elect the directors of Riddell and
approve corporate actions and transactions on behalf of Riddell and otherwise
control the business and operations of the Riddell. The interest of management
could conflict with yours.

      Increased government regulation could harm our business. At present, no
national governing body regulates cheerleading and dance team activities at the
collegiate level. Although voluntary guidelines relating to safety and
sportsmanship have been issued by the NCAA and some of the athletic conferences,
to date, cheerleading and dance teams generally are free from rules and
restrictions similar to those imposed on other competitive athletics at the
college level. However, if rules limiting off-season training are applied to
cheerleading and/or dance teams (similar to rules imposed by the NCAA on other
sports), it is likely that we would be unable to offer a significant number of
our camps either because participants would be prohibited from participating
during the summer or because suitable sites would not be available. Although we
are not aware of any school officially adopting these activities as a
competitive sport, recognition of cheerleading and/or dance teams as "sports"
would increase the possibility that these activities may become regulated. If we
were restricted from training during the off-season, such regulations would
likely have a material adverse effect on our business, financial condition and
results of operations.

      At the high school level, some state athletic associations have classified
cheerleading as a sport and have in some cases imposed certain restrictions on
off-season practices and out-of-state travel to competitions. However, in all
cases to date, we have been able to work with these state athletic associations
to designate acceptable times for the cheerleaders within these states to attend
camps. We have agreements with several state associations to assist with
sponsoring and execution of official competitions with these states. To date,
state regulations have not had a material effect on our ability to conduct
normal business activities within those states.

      Our success depends on our key personnel. Our executive officers and other
key employees have been primarily responsible for the development and expansion
of our business and the loss of services of one or more of these individuals
could have a material adverse effect on our financial condition.

      A material decline in revenues from the MacGregor trademark could hurt our
business. If there were a material decline in the revenues from the MacGregor
trademark, then the carrying amount of the MacGregor trademark rights could be
deemed to have been impaired. A write-down for such impairment could have a
material adverse effect on our financial position and results of operations.

      Our information systems may be subject to potential year 2000 problems. We
have substantially completed the process of assessing which of our information
systems may


                                       24
<PAGE>

be subject to year 2000 problems and are taking corrective actions to minimize
the potential impact of year 2000 problems. Our corrective actions may not be
sufficient to protect us from year 2000 problems and all of the corrective
actions may not be completed. We also face potential year 2000 issues with third
parties such as our customers, our suppliers and travel systems. If year 2000
problems impact our business, our operating results and financial condition
could be materially harmed.

Risks relating to the rights offering

      We cannot assure you that the subscription price set by the rights
offering will be below the trading price for our stock, or that the trading
price for our stock will not decline during or after the rights offering.

      You are not allowed to revoke or change your exercise of rights after you
send in your subscription forms and payment. If the rights offering is canceled,
we are obligated only to refund payments actually received, without interest.

      You need to act promptly and follow subscription instructions to exercise
your rights. Stockholders who desire to purchase shares in the rights offering
or to transfer or sell their rights must act promptly to ensure that all
required forms and payments are actually received by American Stock Transfer &
Trust Company prior to the expiration date. If you fail to complete and sign the
required subscription forms, send an incorrect payment amount, or otherwise fail
to follow the subscription procedures that apply to your desired transaction,
American Stock Transfer & Trust Company may, depending on the circumstances,
reject your subscription or accept it to the full extent of the payment
received. Neither Riddell, the solicitation agent, nor American Stock Transfer &
Trust Company undertakes to contact you concerning, or attempt to correct, an
incomplete or incorrect subscription form. We have the sole discretion to
determine whether a subscription exercise properly follows the subscription
procedures.

      If you use a personal check to pay for shares, the check must clear prior
to the expiration date, and the clearing process may require 5 or more business
days.

      There may be a delay in your ability to resell the shares that you
purchase. If you exercise rights, you may not be able to resell the new shares
purchased until you (or your broker or other nominee) have received a stock
certificate for the shares purchased. Although we will endeavor to issue the
appropriate certificates as soon as practicable after completion of the rights
offering, there may be some delay between the expiration date and the time we
are able to issue the new stock certificates.

      Our failure to meet certain conditions of the standby commitment may
result in a failure to have a standby commitment. To enable us to receive gross
proceeds of approximately $______________ from the rights offering, a group
consisting of certain of our officers and directors and certain outsiders has
agreed to act as a standby purchaser and purchase up to $____________ of our
common stock offered hereby, less amounts subscribed for by other holders of
rights. However, this commitment is subject to certain conditions to closing.
Our failure to meet any of these conditions, unless waived, may result in the
failure to have a standby commitment.

      You will experience dilution in your ownership of Riddell. In the event
that the rights offering is completed and you do not exercise all of the rights
that have been issued to


                                       25
<PAGE>

you in the rights offering, your percentage ownership of Riddell will decline
because those who do exercise rights will receive additional shares of common
stock of Riddell. Further, even if the rights offering is not completed, or it
is completed and you do exercise all of your rights, if we complete the
concurrent offering in which we are selling additional shares of our common
stock to the general public, your percentage ownership in Riddell will decline.

      Your potential interest in an Internet subsidiary is subject to future
dilution. If you exercise your rights you will receive common stock purchase
warrants which, upon exercise, will represent your pro rata portion of _______%
of our ownership of a new or existing subsidiary through which we will conduct
substantially all of our Internet operations. If we form an Internet subsidiary
and prior to a public offering, we issue shares of common stock or other
securities issuable or convertible into shares of common stock of the subsidiary
to third parties to raise capital, or issue warrants or options to employees,
consultants or directors of the Internet subsidiary, your pro rata interest of
the Internet subsidiary will be diluted. Therefore, any interest that you may
have in our Internet subsidiary by virtue of your common stock purchase warrants
may be substantially diluted.

      We cannot assure you that your common stock purchase warrants will be of
any value. In the event that we do not, in the future, decide to conduct
substantially all of our Internet operations through a newly-formed or existing
subsidiary and effect an initial public offering of that subsidiary by December
31, 2002 your warrants will expire and will be of no value. Even if we do
establish such a subsidiary and effect an initial public offering by December
31, 2002, there can be no assurance that your warrants will have any value, or
that the shares underlying the warrants issuable to you upon your exercise of
the warrants will have any value. Even if we do establish an Internet subsidiary
and take it public by December 31, 2002 we cannot assure you that our Internet
subsidiary will be successful.

Risks relating to the Internet business

      We face difficulties typically encountered by development stage companies
in new and rapidly evolving markets because of our new Internet initiative. We
have just recently begun developing our web sites. An investor purchasing our
common stock must therefore consider the risks and difficulties frequently
encountered by early stage companies in new and rapidly evolving markets, such
as online commerce. These risks include our ability to:

      o     develop our web sites;

      o     acquire rights to content for our web sites;

      o     create a customer base for our web sites;

      o     respond to changes in a rapidly evolving and unpredictable business
            environment;

      o     maintain current and develop new strategic relationships;

      o     manage growth;

      o     continue to develop and upgrade our technology; and

      o     attract, retain and motivate qualified personnel to run our web
            sites.


                                       26
<PAGE>

      We cannot assure you that our sale of products and offering of services on
the Internet will achieve market acceptance with customers.

      We do not yet have all of our planned web sites operational. We are in the
process of building additional web sites. Our initial web sites became
operational in the fourth quarter of 1999 and may encounter programming and
other problems. We have not sold any advertising and, as a result, our revenues
from our Internet business may be low for some time.

      We have never been engaged in electronic commerce. In addition, none of
the management's key executives or other personnel have, until recently, been
engaged in the business of electronic commerce. Accordingly, we cannot assure
you that we will be able to establish and maintain an Internet business that
will be successful. In order to successfully establish and operate an electronic
commerce, or Internet related business, we have to attract and retain a number
of individuals who are capable of effectively helping to formulate the Internet
business plan and thereafter establish, maintain and expand the Internet
operations. There is heavy competition for these individuals and there can be no
assurances that we will be able to attract and retain qualified individuals.

      Content on our web sites may not attract sufficient numbers of customers
and advertisers. Our future success on the Internet will depend upon our ability
to attract users to our web sites to purchase our merchandise and to attract
advertisers to our web sites. We cannot assure you that we will be attractive to
a sufficient number of users or advertisers to generate significant revenues. We
cannot assure you that we will be able to anticipate, develop, monitor and
successfully respond to rapidly changing consumer tastes and preferences to
continually attract large numbers of users to our web sites. If we are unable to
develop Internet content that allows us to attract, retain and expand a loyal
user base, our operating results and financial condition could be materially
adversely affected.


                                       27
<PAGE>

      We will rely, in part, on licensed third-party content on our web sites.
We plan to license some of the content for our web sites to build communities
and attract and retain customers, users and advertisers. If we are unable to
obtain desirable content from current licensors or from new licensors, it will
affect the number of visitors to our web sites, which could materially harm our
Internet business. In addition, if we are unable to obtain content at an
acceptable cost, it could materially harm our ability to compete in our Internet
business and our operating results and financial condition could be materially
adversely affected.

      Our success depends on the continued growth of online commerce. Use of the
Internet by consumers is in its early stages and, as a result, the degree of
acceptance of the Internet as a medium for commerce is uncertain. If online
commerce does not continue to grow or grows more slowly than expected, our
Internet business will be materially harmed. A number of factors could slow the
growth of online commerce, including the following:

      o     the network infrastructure required to support a substantially
            larger volume of transactions may not be developed;

      o     government regulation may increase;

      o     telecommunications capacity problems may result in slower response
            times; and

      o     consumers may have concerns about the security and privacy of online
            commerce transactions.

      We may not be able to compete successfully against current and future
competitors on the Internet. Our success will depend upon our ability to attract
customers by providing efficient means to buy our products and providing
high-quality content and value-added services to build our communities for
advertising revenues and the sale of additional products. The market for our
products and services is intensely competitive. In addition, the online commerce
market for our products and services is new, rapidly evolving and competitive.
There are no substantial barriers to entry in electronic commerce. Many of our
competitors have longer operating histories, larger customer bases, greater
brand recognition and significantly greater financial, marketing and other
resources than we have. If we are unable to successfully compete, our operating
results and financial condition could be materially adversely affected.

      If we fail to keep pace with rapid technological changes on the Internet,
it could materially harm our ability to attract and retain customers. Internet
technology, commercial applications and online uses are all rapidly evolving. If
we do not successfully respond to rapid changes involving the Internet, our
Internet business will be materially harmed. In this regard, we must continue to
develop, enhance and improve the responsiveness and features of our web sites
and develop new features to meet customer needs. We also must respond to
technological advances and emerging industry standards and practices on a
cost-effective and timely basis.

      We are subject to government regulation and legal liabilities that may be
costly and may interfere with our ability to conduct business on the Internet.
Laws and regulations directly applicable to online commerce or Internet
communications are becoming more prevalent. Laws and regulations directly
applicable to Internet communications, commerce and advertising are becoming
more prevalent. The most recent session of the United States Congress resulted
in Internet laws regarding children's privacy, copyrights and


                                       28
<PAGE>

taxation. Such legislation could hamper the growth in use of the Internet
generally and decrease the acceptance of the Internet as a communications,
commercial and advertising medium. Although our transmissions originate in New
York, the governments of other states or foreign countries might attempt to
regulate our transmissions or levy sales or other taxes relating to our
activities. The European Union recently enacted its own privacy regulations that
may result in limits on the collection and use of certain user information. The
laws governing the Internet, however, remain largely unsettled, even in areas
where there has been some legislative action. It may take years to determine
whether and how existing laws such as those governing intellectual property,
privacy, libel and taxation apply to the Internet and Internet advertising. In
addition, the growth and development of the market for Internet commerce may
prompt calls for more stringent consumer protection laws, both in the United
States and abroad, that may impose additional burdens on companies conducting
business over the Internet. Furthermore, the Federal Trade Commission has
recently investigated the disclosure of personal identifying information
obtained from individuals by Internet companies. In the event the Federal Trade
Commission or other governmental authorities adopt or modify laws or regulations
relating to the Internet, our business, results of operations and financial
condition could be adversely affected.

      We may be subject to liability for sales and other taxes. We do not plan
to collect sales or other similar taxes in most states for sales on the
Internet. Our Internet business could be materially harmed if additional sales
and similar taxes are imposed on us, or if penalties are assessed on us for past
nonpayment of these taxes. Recently adopted legislation provides that, prior to
November 2001, a state cannot impose sales taxes on products sold on the
Internet unless these taxes could be charged on non-Internet transactions
involving the products. During this moratorium, it is possible that taxing
mechanisms may be developed that would, following the moratorium, impose
increasing sales and similar tax burdens on us. If these burdens are placed on
us, our Internet business could be materially harmed and there could be a
material adverse effect on our operating results and financial condition.

      We may experience problems from computer systems that are not ready on a
timely basis to process information associated with the year 2000. Many existing
software programs may not accurately process dates arising in the year 2000 and
after because they use only two digits to identify a year and assume that the
two missing digits are always "19." We cannot assure you that all of the
computer systems and related products and software that are important to our
Internet business will be ready by the deadline to address the concerns arising
from the year 2000 problem. If they are not ready, we may experience difficulty
in properly managing our web sites and face the possibility of business
interruptions, financial loss, reputational harm and legal liability. Any of
these could materially harm our Internet business, operating results and
financial condition.

      Our Internet business will depend upon the operations and technology of
various other Internet sites, credit card issuers, as well as other third
parties. Our Internet business, operating results and financial condition may be
materially harmed if these or other third parties are not year 2000 compliant on
a timely basis. We have not developed any contingency plans to address the worst
case scenario that might if occur if year 2000 issues make the Internet or our
web sites unavailable.

      We may be subject to privacy regulations which could limit the
effectiveness of our Internet sales and marketing efforts. Web sites typically
place certain "cookies" on a user's hard drive without the user's knowledge or
express consent. Our web sites and other web sites use cookies for a variety of
reasons, including for the collection of data derived


                                       29
<PAGE>

from the user's Internet activity. Most currently available web browsers allow
users to remove cookies at any time or to prevent cookies from being stored on
their hard drive. In addition, some commentators, privacy advocates and
governmental bodies have suggested limiting or eliminating the use of cookies.
Any reduction or limitation in the use of cookies could limit the effectiveness
of our sales and marketing efforts. In addition, the European Union recently
adopted a directive addressing data privacy that may limit the collection and
use of certain information regarding Internet users. This directive may limit
our ability to target advertising or collect and use information in certain
European countries.

      We display a privacy policy on our web sites. The policy is accessible to
all users of our sites. Notwithstanding this policy, any penetration of our
network security or other misappropriation of our users' personal or credit card
information could subject us to liability. We may be liable for claims based on
unauthorized purchases with credit card information, impersonation or other
similar fraud claims. Claims could also be based on other misuses of personal
information, such as misuses for unauthorized marketing purposes. These claims
could result in litigation. In addition, the Federal Trade Commission and
several states have investigated the use by certain Internet companies of
personal information. We could incur expenses if new regulations regarding the
use of personal information are introduced or if our privacy practices are
investigated.

      In 1998, the U.S. Congress enacted the Children's Online Privacy
Protection Act of 1998. The principal provisions of the law are to become
effective on April 21, 2000. Among other things, subject to certain limited
exceptions, this act:

      o     makes it unlawful for an operator of a web site or online service
            directed to children under age 13, and for any operator that has
            actual knowledge that it is collecting personal information from
            such a child, to collect personal information from the child without
            having obtained verifiable parental consent; and

      o     prohibits conditioning the participation of a child under age 13 in
            a game, the offering of a prize, or another activity on the child
            disclosing more personal information than is reasonably necessary to
            participate in such activity.

      The Federal Trade Commission has not yet promulgated regulations
interpreting this act. We depend upon collecting personal information from our
customers. We believe that the promulgation of regulations under this act will
make it more difficult for us to collect personal information from certain users
of a community web site.

      General security concerns could affect our Internet business. The need to
securely transmit confidential information (such as credit card and other
personal information) over the Internet has been a significant barrier to
e-commerce and communications over the Internet. Any compromise of security
could deter more people from using the Internet or from using it to transmit
confidential information. Furthermore, decreased traffic and e-commerce sales as
a result of general security concerns could cause advertisers to reduce their
amount of online spending. Such security concerns could reduce our market for
e-commerce and indirectly influence our ability to sell online advertising. We
may also incur significant costs to protect Riddell against the threat of
problems caused by such security breaches. Further, if third parties were to
misappropriate our users' personal information or credit card information, users
could possibly bring claims against us.


                                       30
<PAGE>

                           TRADE NAMES AND TRADEMARKS

      This prospectus also includes trade names and trademarks of other
companies. Our use or display of other parties' trade names, trademarks or
products is not intended to and does not imply a relationship with, or
endorsement or sponsorship of Riddell by, the trade name or trademark owners.


                                       31
<PAGE>

                           FORWARD-LOOKING STATEMENTS

      This prospectus contains certain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934, as amended. Our statements of plans,
intentions, objectives and future economic or operating performance contained in
this prospectus are forward-looking statements. Forward-looking statements
include but are not limited to statements containing terms such as "believes,"
"does not believe," "no reason to believe," "expects," "plans," "intends,"
"estimates," "will," "would," "anticipated" or "anticipates."

      Forward-looking statements involve known and unknown risks and
uncertainties which may cause our actual results in future periods to differ
materially from results anticipated in the forward-looking statements. We make
cautionary statements in certain sections of this prospectus, including in the
Risk Factors beginning on page 20. You should read these cautionary statements
as being applicable to all related forward-looking statements wherever they
appear in this prospectus, the materials referred to in this prospectus. No
forward-looking statement is a guarantee or promise of future performance. We
undertake no obligation to update publicly any forward-looking statements for
any reason, even if new information becomes available or other events occur in
the future.


                                       32
<PAGE>

                               THE RIGHTS OFFERING

Basic Subscription Right

      As soon as practicable after the date of this prospectus, Riddell is
distributing, at no charge, to holders of our common stock on the record date,
December 27, 1999, rights to purchase additional shares of its common stock. We
are distributing 0.10795 of a right for each share of common stock held on the
record date. Each full right is exercisable for one share of common stock at a
subscription price of $___________ per share. We have reserved a total of
1,000,000 shares of common stock for the exercise of the rights. Further, if you
exercise your rights, you will also receive, for no additional money, a common
stock purchase warrant that may entitle you to purchase stock in a new or
existing subsidiary of ours that may be created sometime in the future to
conduct substantially all of our Internet operations. All of the warrants that
are issued to those individuals and entities who exercise rights will, in the
aggregate, be exercisable for __________ of our ownership interest in such
subsidiary at the time the warrants first become exercisable. See "Common stock
purchase warrants" in this section below and "Description of Securities --
Warrants".

      We are sending a subscription certificate and related instructions to each
record holder along with this prospectus to evidence the rights. In order to
exercise rights, you must fill out and sign the appropriate subscription
certificate and timely deliver it with full payment for the shares to be
purchased.

      A depository bank, trust company or securities broker or dealer which is a
record holder for more than one beneficial owner of shares may divide or
consolidate subscription certificates to represent shares held on the record
date by their beneficial owners, upon proper showing to American Stock Transfer
& Trust Company.

Fractional shares

      We will not issue any fractional shares. If your rights would allow you to
purchase a fractional share, you may exercise your rights only by rounding down
to and paying for the nearest whole share, or paying for any lesser number of
whole shares. We will accept any inadvertent subscription indicating a purchase
of fractional shares by rounding downward to the nearest number of whole shares
and refunding without interest any payment received for a fractional share as
soon as practicable.

Expiration time and date

      The subscription privilege expires at 5:00 p.m., New York City time, on
February __, 1999. After the expiration date, rights will no longer be
exercisable by anyone.

      In order to exercise rights in a timely manner, you must assure that
American Stock Transfer & Trust Company actually receives, prior to expiration
of the rights, the properly executed and completed subscription certificate (or
form of "Notice of Guaranteed Delivery"), together with full payment in good
funds for all shares you wish to purchase.


                                       33
<PAGE>

Reasons for the rights offering

      We are offering the rights to finance our Internet business and for
additional working capital.

No Board investment recommendation to stockholders

      Our Board of Directors does not make any recommendation to you about
whether you should exercise any rights. If you do not exercise all of your
rights, you will own a smaller percentage of the total outstanding common stock
after completion of the rights offering. If you exercise rights, you risk
investment loss on new money invested. We can not ensure that the subscription
price will be below the market price for the common stock during the rights
offering, or that anyone purchasing shares will be able to sell those shares in
the future at a higher price.

Common stock purchase warrants

      Holders who exercise their rights shall receive, for no additional
consideration, common stock purchase warrants that are exercisable for a portion
of Riddell's ownership interest in a future subsidiary (either newly formed or
presently existing) whose principal business is Riddell's Internet operations.
All of the warrants issued, in the aggregate, will represent the right to
purchase ______ (_____%) percent of Riddell's ownership interest in this
Internet subsidiary at the time the warrants first become exercisable. These
warrants will only become exercisable if (i) we form or use a presently existing
subsidiary to conduct substantially all of our Internet operations, and (ii) we
effect an initial public offering for this subsidiary on or before December 31,
2002. If we effect an initial public offering of our Internet subsidiary by
December 31, 2002, the warrants will be exercisable for six (6) months after the
closing of the initial public offering, after which time they will expire. If we
do not establish an Internet subsidiary by December 31, 2002, or establish such
a subsidiary but do not effect an initial public offering for our Internet
subsidiary on or before December 31, 2002, these common stock purchase warrants
shall expire on December 31, 2002 and shall no longer be exercisable. If we do
effect an initial public offering of our Internet subsidiary on or before
December 31, 2002 we will also register at that time the shares of common stock
issuable to you upon your exercise of the common stock purchase warrants. The
common stock purchase warrants will have an exercise price of $.01 per share,
are not transferable (except in the event of the death of the holder, in which
event they are transferable to the estate of the holder), are subject to
dilution, and will only be issued to those individuals or entities who exercise
rights.

General terms and assumptions

      The record date is December 27, 1999.

      Only holders of record of common stock at the close of business on the
record date, or those to whom rights have been validly transferred, may exercise
rights. You are a record holder for this purpose only if your name is registered
as a stockholder with our transfer agent, American Stock Transfer & Trust
Company, as of the record date.

      o     The text below generally assumes that you are a record holder of
            shares, unless otherwise noted.


                                       34
<PAGE>

      o     If you own shares held in a brokerage, bank or other custodial or
            nominee account, you should promptly send the proper instruction
            form to your broker or other person holding your shares, in order to
            exercise rights. Your broker or other person holding your shares is
            the record holder and will have to act in order for you to exercise
            rights. We have asked the securities brokers and other nominee
            holders of our stock to contact you to obtain your instructions
            concerning rights you are entitled to exercise.

      o     No interest will be paid on your funds delivered to exercise rights,
            regardless of whether the funds are applied to the purchase of
            shares or returned for any reason.

American Stock Transfer & Trust Company

      American Stock Transfer & Trust Company is acting as the subscription
agent for the rights offering under an agreement with Riddell.

      All subscription certificates, payments of the subscription price, nominee
holder certifications and notices of guaranteed delivery, to the extent
applicable to your exercise of rights, must be delivered to:

      American Stock Transfer & Trust Company
      40 Wall Street, 46th floor
      New York, NY 10005

      We will pay the fees and expenses of American Stock Transfer & Trust
Company, except applicable brokerage commissions, taxes and other expenses
relating to the sale of rights for your account by American Stock Transfer &
Trust Company. Riddell has also agreed to indemnify American Stock Transfer &
Trust Company against certain liabilities in connection with the rights
offering.

Solicitation agent

      We have engaged the services of H.C. Wainwright & Co., Inc. to act as
solicitation agent in the rights offering. See "Plan of Distribution."

Standby purchase

      It is currently anticipated that, pursuant to a Standby Purchase
Agreement, certain of our directors and executive officers and certain other
individuals (the "Standby Group"), will agree to exercise all of their
respective rights granted to them by this prospectus, which is ____% of all
rights being offered to stockholders, and to stand by to purchase up to
$___________ worth of the shares that are offered by this prospectus that are
not purchased by the other stockholders who have failed to exercise their
rights.

Conditions relating to the rights offering

      If the proposed Standby Purchase Agreement is not consummated in
accordance with its terms for any reason, including the failure to satisfy
applicable conditions specified in the agreement, we may terminate the rights
offering in its entirety. If the rights offering is terminated for this or any
other reason, we will instruct American Stock Transfer & Trust


                                       35
<PAGE>

Company to refund without interest to those persons who subscribed for shares in
the rights offering all payments received by American Stock Transfer & Trust
Company.

      The material conditions to the Standby Purchase Agreement will likely
include the following, which must be satisfied or waived as of the date and time
the rights expire:

      o     we must not have experienced any material adverse change affecting
            our business, prospects, financial position, stockholders' equity or
            results of operations;

      o     the Securities and Exchange Commission must not have issued a stop
            order relating to the registration statement filed with the
            Securities and Exchange Commission relating to this prospectus;

      o     representations made by the parties in the agreement must be true
            and correct; and

      o     the rights offering must have been completed in the manner described
            in this prospectus.

Method of exercise of rights

      Please do not send subscription certificates or related forms to Riddell.
Please send the properly completed and executed form of subscription
certificates with full payment to American Stock Transfer & Trust Company at:

      American Stock Transfer & Trust Company
      40 Wall Street, 46th floor
      New York, NY 10005

      You should read carefully the subscription certificates and related
instructions and forms which accompany this prospectus. You should call American
Stock Transfer & Trust Company or the solicitation agent promptly with any
questions you may have.

      You may exercise your rights by delivering to American Stock Transfer &
Trust Company, at the address specified in the instructions accompanying this
prospectus, at or prior to expiration of the rights:

      o     the properly completed and executed subscription certificate(s)
            which evidence the rights that you wish to exercise, and

      o     payment in full in good funds of the subscription price for each
            share you wish to purchase under the subscription privilege.

      If you are not a broker, bank or other eligible institution, you must
obtain a signature guarantee on the subscription certificates from a broker,
bank or other institution eligible to guarantee signatures in order to transfer
the subscription certificates in whole or to transfer a portion of your rights.

Required forms of payment for exercise

      If you exercise any rights, you must deliver full payment in the form of:


                                       36
<PAGE>

      o     a check or bank draft drawn upon a U.S. bank, or U.S. postal money
            order, payable to American Stock Transfer & Trust Company
            Subscription Agent, or by wire transfer of funds to the account
            maintained by the American Stock Transfer & Trust Company for this
            rights offering at _______________________, Attention:
            _____________________.

      In order for you to timely exercise your rights, American Stock Transfer &
Trust Company must actually receive the subscription price before expiration of
the rights in the form of:

      o     a personal check which must have timely cleared payment, or

      o     a certified or cashier's check or bank draft drawn upon a U.S. bank
            or a U.S. postal money order, or collected funds in American Stock
            Transfer & Trust Company's account designated above.

      Funds paid by uncertified personal check may take at least five business
days to clear. Accordingly, if you pay the subscription price by means of
uncertified personal check, you should make payment sufficiently in advance of
the expiration time to ensure that your check actually clears and the payment is
received before that time. We are not responsible for any delay in payment by
you and suggest that you consider payment by means of certified or cashier's
check, money order or wire transfer of funds.

Special procedure under "Notice of Guaranteed Delivery" form

      If you wish to exercise rights but cannot ensure that American Stock
Transfer & Trust Company will actually receive the executed subscription
certificate before the expiration of the rights, you may alternatively exercise
rights by causing all of the following to occur within the time prescribed:

      o     American Stock Transfer & Trust Company must receive full payment
            prior to the expiration time for all shares you desire to purchase
            under the subscription privilege.

      o     American Stock Transfer & Trust Company must receive a properly
            executed "Notice of Guaranteed Delivery" substantially in the form
            distributed by us with your subscription certificate at or prior to
            the expiration time.

      o     The "Notice of Guaranteed Delivery" must be executed by both you and
            one of the following: a member firm of a registered national
            securities exchange, an NASD member, a commercial bank or trust
            company having an office or correspondent in the United States, or
            other eligible guarantor institution qualified under a guarantee
            program acceptable to American Stock Transfer & Trust Company. The
            cosigning institution must guarantee in the Notice of Guaranteed
            Delivery that the subscription certificate will be delivered to
            American Stock Transfer & Trust Company within three AMEX trading
            days after the date of the form. You must also provide in that form
            other relevant details concerning the intended exercise of rights.

      o     American Stock Transfer & Trust Company must receive the properly
            completed


                                       37
<PAGE>

            subscription certificate(s) with any required signature guarantee
            within three AMEX trading days following the date of the related
            Notice of Guaranteed Delivery.

      o     If you are a nominee holder of rights, the "Nominee Holder
            Certification" must also accompany the Notice of Guaranteed
            Delivery.

      A Notice of Guaranteed Delivery may be delivered to American Stock
Transfer & Trust Company in the same manner as subscription certificates at the
address set forth above under "The Rights Offering--American Stock Transfer &
Trust Company," or may be delivered by telegram or facsimile transmission
(telecopier no. (718) 234-5001).

      Additional copies of the form of Notice of Guaranteed Delivery are
available upon request from American Stock Transfer & Trust Company.

Incomplete forms; insufficient or excess payment

      If you do not indicate the number of rights being exercised, or do not
forward sufficient payment for the number of rights that you indicate are being
exercised, then we are entitled to accept the subscription forms and payment for
the maximum number of rights that may be exercised based on the actual payment
delivered.

      If your payment exceeds the amount required to pay for the shares you
indicate in your subscription certificate, then we will return any payment not
applied to the purchase of shares under the rights offering procedures without
interest to those who made these payments as soon as practicable by mail.

Exercise of less than all rights

      If you subscribe for fewer than all of the shares represented by your
subscription certificate, you may (1) attempt to sell your remaining rights, or
(2) receive from American Stock Transfer & Trust Company a new subscription
certificate representing the unused rights. See "The Rights Offering-how to
transfer rights" below.

Instructions to nominee holders

      If you are a broker, trustee or depository for securities or other nominee
holder of common stock for beneficial owners of our stock, we are requesting
that you contact the beneficial owners as soon as possible to obtain
instructions and related certifications concerning their rights. Our request to
you is further explained in the suggested form of letter of instructions from
nominee holders to beneficial owners accompanying this prospectus.

      To the extent so instructed, nominee holders should complete appropriate
subscription certificates on behalf of beneficial owners and submit them on a
timely basis to American Stock Transfer & Trust Company with the proper payment.

Risk of loss on delivery of subscription certificate forms and payments

      Each holder of rights bears all risk of the method of delivery to American
Stock Transfer & Trust Company of subscription certificates and payments of the
subscription


                                       38
<PAGE>

price.

      If subscription certificates and payments are sent by mail, you are urged
to send these by registered mail, properly insured, with return receipt
requested, and to allow a sufficient number of days to ensure delivery to
American Stock Transfer & Trust Company and clearance of payment prior to the
expiration time.

      Because uncertified personal checks may take at least five business days
to clear, you are strongly urged to pay, or arrange for payment, by means of
certified or cashier's check, money order or wire transfer of funds.

How procedural and other questions are resolved

      Riddell is entitled to decide all questions concerning the timeliness,
validity, form and eligibility of any exercise of rights. Any such determination
will be final and binding. Riddell, in our sole discretion, may waive any defect
or irregularity, or permit a defect or irregularity to be corrected within such
time as it may determine, or reject the purported exercise or any right because
of any defect or irregularity.

      Subscription certificates will not be considered received or accepted
until all irregularities have been waived or cured within such time as Riddell
determines, in our sole discretion. Neither Riddell nor American Stock Transfer
& Trust Company have any duty to give notification of any defect or irregularity
in connection with the submission of subscription certificates or any other
required document. They will not incur any liability for failure to give such
notification.

      Riddell reserves the right to reject any exercise of rights if the
exercise does not comply with the terms of the rights offering or is not in
proper form or if the exercise of rights would be unlawful or materially
burdensome. See "The Rights Offering-right to block exercise due to regulatory
issues" below.

Questions and assistance concerning the rights

      You should direct any questions or requests for assistance concerning the
method of exercising rights or requests for additional copies of this
prospectus, forms of instructions or the Notice of Guaranteed Delivery to
American Stock Transfer & Trust Company, at 40 Wall Street, 46th floor, New
York, NY 10005, (800) 937-5449, (212) 936-5100 or (718) 921-8200.

No revocation

      Once you have exercised the subscription privilege, you may not revoke or
change your exercise.

How to transfer rights

      It is not anticipated that a formal market will be made in the rights or
that they will be traded on any exchange. Although an informal market may
develop, there is no assurance that any market will develop for the rights.

      You may transfer all of the rights evidenced by a single subscription
certificate by


                                       39
<PAGE>

signing the subscription certificate for transfer in accordance with the
appropriate form printed on the subscription certificate.

      You may transfer a portion of the rights evidenced by a single
subscription certificate by delivering to American Stock Transfer & Trust
Company the subscription certificate properly signed for transfer, with separate
written instructions to register a portion of the rights in the name of your
transferee and to issue a new subscription certificate to the transferee
covering the transferred rights. In that event and by appropriate written
instructions, you may elect to receive a new subscription certificate covering
the rights you did not transfer, or may request that American Stock Transfer &
Trust Company sell your retained rights in the manner described below.

      If you wish to transfer all or a portion of your rights, you should allow
a sufficient amount of time prior to the expiration time for (1) the transfer
instructions to be received and processed by American Stock Transfer & Trust
Company, (2) new subscription certificates to be issued and transmitted and (3)
the rights evidenced by the new subscription certificates to be exercised or
sold by the intended recipients.

      It may require from two to ten business days, or more, to complete
transfers of rights, depending upon how you deliver the subscription certificate
and payment and the number of transactions you request. Neither Riddell nor
American Stock Transfer & Trust Company will be liable to you or any transferee
of rights if subscription certificates or any other required documents are not
received in time for exercise or sale prior to the expiration time.

      If you exercise or sell rights in part, a new subscription certificate for
the remaining rights will be issued to you only if American Stock Transfer &
Trust Company receives a properly endorsed subscription certificate from you no
later than 5:00 p.m., New York City time, on the fifth business day prior to the
expiration date. It will not issue new subscription certificates for partially
exercised or sold warrants submitted after that time and date. If you do submit
a partial exercise or sale after that time and date, you will not be able to
exercise the unexercised or unsold rights.

      Unless you make other arrangements with American Stock Transfer & Trust
Company, a new subscription certificate issued after 5:00 p.m., New York City
time, on the fifth business day before the expiration date will be held for
pick-up by you at American Stock Transfer & Trust Company.

      If you request a reissuance of a subscription certificate, the delivery of
that document will be at your risk.

      You, and not Riddell or American Stock Transfer & Trust Company, will be
responsible for paying any commissions, fees and other expenses (including
brokerage commissions and transfer taxes) you may incur for a purchase, sale or
exercise of rights.

      If you do not exercise your rights prior to the expiration time, those
rights will expire and will no longer be exercisable by you.

Foreign and unknown addresses

      Riddell is not mailing subscription certificates to stockholders whose
addresses are


                                       40
<PAGE>

outside the United States or who have an APO or FPO address. In those cases, the
subscription certificates will be held by American Stock Transfer & Trust
Company for those stockholders. To exercise their rights, these stockholders
must notify American Stock Transfer & Trust Company prior to 11:00 a.m., New
York City time, on _____________, 2000. At that time, if a foreign holder has
not given any other instructions, these rights will be sold, subject to
availability of buyers. If the rights can be sold, a check for the proceeds from
the sale of these rights, less a pro rata portion of any applicable brokerage
commissions, taxes and other expenses, will be sent by mail to the foreign
holders. These sales for foreign holders will be aggregated so that each foreign
holder will receive a weighted average price for the sales, if any.

      If you have sold rights through American Stock Transfer & Trust Company
but it does not know your address or cannot otherwise make delivery of sale
proceeds to you, your sale proceeds will be held in a special account. These
proceeds will be delivered to Riddell if you do not claim them within two years
after the expiration date of the rights offering.

Right to block exercise due to regulatory issues

      We reserve the right to refuse the exercise of rights by any holder of
rights who would, in our opinion, be required to obtain prior clearance or
approval from any state, federal or foreign regulatory authorities for the
exercise of rights or ownership of additional shares if, at the expiration date,
this clearance or approval has not been obtained. We are not undertaking to pay
for any expenses incurred in seeking that clearance or approval.


                                       41
<PAGE>

      We are not offering or selling, or soliciting any purchase of, rights or
underlying shares in any state or other jurisdiction in which this is not
permitted. We reserve the right to delay the commencement of the rights offering
in certain states or other jurisdictions if necessary to comply with local laws.
However, we may elect not to offer rights to residents of any state or other
jurisdiction whose law would require a change in the rights offering in order to
carry out the rights offering in that state or jurisdiction.

No adjustment to outstanding stock options or other stock awards

      Riddell will not, solely as a result of the rights offering, adjust the
number of shares of common stock reserved for issuance under our stock award
plans for employees and other eligible participants, the number of shares
subject to outstanding awards of stock options or awards of restricted stock.
Riddell may, as a result of the rights offering, be required to adjust the
number of shares of common stock reserved in the event of the conversion of the
outstanding Convertible Note into shares of common stock.

Amendment, extension and withdrawal

      If the standby agreement with the Standby Group is not consummated, we may
terminate the rights offering in its entirety and, if we do, we will refund all
funds received for the exercise of rights, as described under "The Rights
Offering - conditions relating to the rights offering."

      Subject to the foregoing, Riddell reserves the right to withdraw the
rights offering at any time prior to the expiration date for any reason, in
which event all funds received in the rights offering will be returned to those
persons who subscribed for shares in the rights offering.

Issuance of stock certificates

      Stock certificates for shares purchased in the rights offering will be
issued to you as soon as practicable after the expiration date. American Stock
Transfer & Trust Company will deliver subscription payments to Riddell only
after consummation of the rights offering and the issuance of stock certificates
to those exercising rights.

      If you exercise rights, you will have no rights as a stockholder until
certificates representing shares you purchased are issued. Unless otherwise
instructed in your subscription certificate form, shares purchased by the
exercise of rights will be registered in the name of the person exercising the
rights.

Issuance of warrant certificates

      Warrant certificates representing the common stock purchase warrants
granted to you upon the exercise of your rights will be issued to you as soon as
practicable after the expiration date.


                                       42
<PAGE>

                           THE CONCURRENT OFFERING

      In addition to the rights offering, we are also selling an additional
250,000 shares of our common stock for $_________ per share. There will be
10,513,957 shares outstanding after the concurrent offering and assuming the
sale of 1,000,000 shares pursuant to the rights offering. The proceeds generated
by the concurrent offering shall be used to finance our Internet business and
for additional working capital.

      Riddell's common stock is traded on the American Stock Exchange under the
symbol "RDL".


                                       43
<PAGE>

                                 USE OF PROCEEDS

      The net proceeds to Riddell from the exercise of rights in the rights
offering and the sale of common stock in the concurrent offering are
approximately $____________ (or $___________ if the underwriters' over-allotment
option is exercised in full), after deducting fees and estimated expenses. We
will use the net cash proceeds from the rights offering and the concurrent
offering to finance our Internet business and for additional working capital
purposes.


                                       44
<PAGE>

                                    DILUTION

      Our net tangible book value, as of September 30, 1999, was $(73,039,000),
or $(7.89) per share of common stock. Net tangible book value per share
represents the amount of total tangible assets less total liabilities divided by
the number of shares of common stock outstanding at September 30, 1999.

      After giving effect to our sale of the 1,250,000 shares of common stock in
this rights offering and the concurrent offering, at an assumed offering price
of $_____ per share, and after deducting estimated expenses related to this
rights offering and the concurrent offering, our pro forma net tangible book
value as of September 30, 1999, would have been $________, or $_____ per share.
This represents an immediate increase in pro forma net tangible book value of
$_____ per share to existing shares, and an immediate dilution of $____ per
share to new shares.

      The following table illustrates this per share dilution:

            Assumed offering price per share                          $

            Net tangible book value per share at
            September 30, 1999                            $ (7.89)

            Increase per share attributable to new shares ______

            Pro     forma net tangible book value
            per share after the offering                              __________

            Dilution per share to new shares                          $
                                                                      ==========

      Assuming the exercise in full of the underwriter's over-allotment option,
the pro forma as adjusted net tangible book value of Riddell at September 30,
1999 would have been approximately $____ per share, representing an immediate
increase in net tangible book value of $___ per share to Riddell's existing
stockholders and an immediate dilution in net tangible book value of $___ per
share to new investors.

      The foregoing discussion and tables assume no exercise of any outstanding
stock options. As of December 1, 1999 there were outstanding options to purchase
2,435,025 shares of common stock at a weighted average exercise price of $4.28
per share. The discussion and table also assumes no conversion of the
Convertible Subordinated Note. Riddell's 4.1% Convertible Subordinated Note is
convertible into 1,395,011 shares of common stock at a conversion rate of
$5.3763 per share, subject to certain adjustments.


                                       45
<PAGE>

                                 CAPITALIZATION

      The table also shows, in the column labeled "As Adjusted", our
capitalization as adjusted for the completion of the rights offering at a
subscription price of $_____ per share and the concurrent offering at a price of
$_____ per share and includes the application of the net cash proceeds from the
offering.

      You should read this table in conjunction with the consolidated financial
statements and the notes to those statements which are included elsewhere in
this prospectus.

                                                        September 30, 1999
                                                        --------- --- ----

                                                        Actual       As Adjusted
                                                        ------       -- --------
                                                             (Unaudited)
                                                             (In thousands)

Long-term debt                                           $145,144    $

Stockholders' equity (Note 8):

      Preferred stock, $0.01 par; authorized 5,000,000         --           --
      shares; none issued

      Common stock, $0.01 par; authorized 40,000,000           93
      shares; issued and outstanding  9,258,957 and
      __________shares, respectively

Capital in excess of par                                   36,849

Accumulated deficit                                        (3,307)      (3,307)
                                                        ---------    ---------
      Total Stockholders' equity                           33,635
                                                        ---------
      Total capitalization                               $178,779    $
                                                        =========


                                       46
<PAGE>

                             SELECTED FINANCIAL DATA

      Our selected consolidated financial information presented below as of and
for the years ended, December 31, 1994, 1995, 1996, 1997 and 1998 has been
derived from our audited consolidated financial statements. The selected
financial information as of and for the nine months ended, September 30, 1998
and September 30, 1999 has been derived from our unaudited condensed
consolidated financial statements, which, in our opinion, reflect all
adjustments, consisting only of adjustments of a normal and recurring nature,
necessary for a fair presentation of our financial position and results of
operations information for such periods. Our historical results are not
necessarily indicative of future operating results or financial position. You
should read this information together with the other information contained under
the captions "Capitalization," "Management's Discussion and the Analysis of
Financial Condition and Results of Operations" and with our audited consolidated
financial statements and unaudited condensed consolidated financial statements
and related notes to those financial statements included elsewhere in this
prospectus.

<TABLE>
<CAPTION>
                           (In thousands, except per share amounts)
                 ----------------------------------------------------------------------------------
Operating Data                           Year Ended December 31,                Nine Months Ended
(1)                                                                                September 30
                 ----------------------------------------------------------------------------------
                   1994         1995        1996        1997       1998(7)      1998        1999
                 ---------    ---------   ---------   ---------   ---------   ---------   ---------
                                                                                    Unaudited
                                                                                    ---------
<S>                <C>          <C>         <C>        <C>         <C>         <C>         <C>
Net revenues       $55,412      $67,043     $72,382    $138,273    $186,600    $159,326    $179,750

Cost of             29,792       35,794      38,813      80,675     113,541      95,239     104,969
revenues         ---------    ---------   ---------   ---------   ---------   ---------   ---------

Gross profit        25,620       31,249      33,569      57,598      73,059      64,087      74,781

Selling,
general and
administrative
expenses (2)        28,614       25,983      27,853      46,278      64,617      49,169      54,024

Other charges        1,188           --          --          --         925          --          --
(6)              ---------    ---------   ---------   ---------   ---------   ---------   ---------

Income (loss)       (4,182)       5,266       5,716      11,320       7,517      14,918      20,757
from
operations

Interest             2,001        2,795       2,763      11,879      14,656      11,114      11,668
expense          ---------    ---------   ---------   ---------   ---------   ---------   ---------
</TABLE>


                                       47
<PAGE>

<TABLE>
<CAPTION>
                           (In thousands, except per share amounts)
                 ----------------------------------------------------------------------------------
Operating Data                           Year Ended December 31,                Nine Months Ended
(1)                                                                                September 30
                 ----------------------------------------------------------------------------------
                   1994         1995        1996        1997       1998(7)      1998        1999
                 ---------    ---------   ---------   ---------   ---------   ---------   ---------
                                                                                    Unaudited
                                                                                    ---------
<S>                <C>          <C>         <C>        <C>         <C>         <C>         <C>
Income (loss)
before taxes,
extraordinary
item and
cumulative
effect of
changes in
accounting
principles          (6,183)      2,471       2,953        (559)     (7,139)      3,804       9,089

Income taxes        (1,250)        100         110          --          --          --         905
(credits)         --------    --------    --------    --------    --------    --------    --------

Income (loss)
before
extraordinary
item(3)            $(4,933)     $2,371      $2,843       $(559)    $(7,139)     $3,804      $8,184
                  ========    ========    ========    ========    ========    ========    ========
Earnings
(loss) per
share before
extraordinary
item:

      Basic         $(0.62)      $0.29       $0.35      $(0.07)     $(0.78)      $0.42       $0.88

      Diluted        (0.62)       0.29        0.33       (0.07)     $(0.78)       0.37        0.78

EBITDA(5)          $(2,229)     $7,433      $7,909     $15,330     $13,230     $19,164     $25,042
</TABLE>


                                       48
<PAGE>

<TABLE>
<CAPTION>
Balance                               December 31,                         September 30,
Sheet Data                            ------------                         -------------
(1)(4)

                 -------------------------------------------------------------------------
                   1994       1995       1996       1997       1998       1998       1999
                 -------    -------    -------    -------    -------    -------    -------
                                                                               Unaudited
                                                                               ---------
<S>              <C>        <C>        <C>        <C>        <C>        <C>        <C>
Working          $11,036    $19,286    $25,957    $37,599    $37,963    $59,634    $65,110
capital

Total assets      72,252     74,125     76,361    181,761    186,211    201,942    210,300

Long-term
debt, less
current
portion           20,168     23,600     29,984    122,500    126,900    138,200    145,144

Stockholders'     24,431     24,902     27,745     32,125     25,451     36,129     33,635
equity
</TABLE>


1)    In June 1997 Riddell acquired Varsity Spirit Corporation.

2)    In 1994 selling, general and administrative expenses included an
      adjustment to record a $4.6 million charge for a product liability
      litigation loss.

3)    An extraordinary item in 1995 consisted of a $1,900,000 ($0.23 per share)
      provision for costs relating to fraudulent transfer litigation.

4)    See Note 11 to Riddell's audited consolidated financial statements
      relating to contingent liabilities.

5)    EBITDA is the sum of our earnings or loss before extraordinary items (and
      the cumulative effect of changes in accounting principles (as
      applicable)), interest, income taxes, depreciation and amortization
      expense. EBITDA is a widely accepted financial indicator of a company's
      ability to service indebtedness. However, EBITDA should not be considered
      as an alternative to income from operations or to cash flows from
      operating activities (as determined in accordance with generally accepted
      accounting principles) and should not be construed as an indication of our
      operating performance or as a measure of our liquidity.

(6)   Other charges of $1,188,000 in 1994 consisted of certain costs relating to
      a change in Riddell's method of distributing team sports products. Other
      charges of $925,000 in 1998 consisted of lease termination and employee
      severance costs related to a restructuring plan adopted in 1998, see
      "Management's Discussion and Analysis of Financial Condition and Results
      of Operations."

(7)   Operations for 1998 were impacted by $1.5 million of losses relating to
      new product initiatives and $3.1 million of costs (including the
      restructuring plan costs referred to in note 6 above) relating to certain
      strategic changes which were undertaken to


                                       49
<PAGE>

      improve future profitability, see "Management's Discussion and Analysis of
      Financial Condition and Results of Operations."


                                       50
<PAGE>

                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

General

      We acquired Varsity Spirit Corporation on June 19, 1997. The Varsity
acquisition significantly increased the size of our business and significantly
changed our financial structure. Varsity's operations include the design and
marketing of cheerleader and dance team uniforms and the operation of
cheerleader and dance team camps, clinics and special events. These operations
have become a part of our extracurricular segment which we have previously
referred to as the institutional segment. Accordingly, references to our
extracurricular segment in this prospectus refers to that portion of our
business that we have historically referred to as our institutional segment.

      The Varsity acquisition significantly increased the size of our business.
On a pro forma basis, revenue for Riddell combined with Varsity was $174.1
million, more than double our 1996 historical stand alone revenues for the year
before the acquisition. Revenues have since grown to $186.6 million for the year
ended December 31, 1998.

      Our historical operating results for 1997 and 1996 do not include
Varsity's operations for the portion of the periods before the Varsity
acquisition. This makes comparisons of operating results less meaningful. In
order to overcome this limitation, part of the discussion and analysis that
follow is based on comparisons to operating results for 1997 and 1996 adjusted
on a pro forma basis to include Varsity's results for the period before the
acquisition and other matters related to the Varsity acquisition. The pro forma
adjustments are described in Note 2 of the Audited Consolidated Financial
Statements included in this prospectus.

      Set forth below is the percentage of our revenues generated by each of our
three principal segments for each of the twelve month periods ending December
31, 1996, 1997 and 1998 and for each of the nine month periods ended September
30, 1998 and 1999. Information for each of the twelve month periods ending
December 31, 1996 and 1997 is pro forma, giving effect to our acquisition of
Varsity in June, 1997.

                                           Year ended December 31,  Nine month
                                                                   period ended
                                                                   September 30,

                                           1996    1997    1998    1998    1999
                                           ----    ----    ----    ----    ----
Extracurricular Segment:
   Spirit and dance products and services  55.0%   58.2%   60.1%   60.8%   58.8%
   Team Sports products and services       30.2%   30.0%   29.3%   30.1%   34.0%
                                           ----    ----    ----    ----    ----
        Total extracurricular segment      85.2%   88.2%   89.4%   90.9%   92.8%

Retail Segment                             13.3%   10.4%    9.7%    8.2%    6.8%

Licensing Segment                           1.5%    1.4%    0.9%    0.9%    0.4%


                                       51
<PAGE>

Results of Operations

      Nine Months Ended September 30, 1999 Compared to the Nine Months Ended
September 30, 1998

Overview

      Operations for the nine-month period ended September 30, 1999 resulted in
net income of $8.1 million, or $0.78 per share on a diluted basis as compared to
$3.8 million, or $0.37 per share on a diluted basis, for the first nine-months
of 1998.

      Tax expense for the nine-month period was higher in 1999 than 1998 because
of an adjustment arising from certain changes in estimates.

      Income before taxes for the nine-month period increased $5.3 million to
$9.1 million, a 139% improvement in comparison to $3.8 million of income before
taxes for the 1998 year-to-date period. The improvement was principally due to
increased revenues and related improvements in gross margin and operating
expense rates.

Revenues

      Revenues for the nine-month period ended September 30, 1999 increased 13%,
or $20.4 million, to $179.7 million from $159.3 million for the year-to-date
period of 1998.

      The revenue gain came from our extracurricular segment which includes: (i)
cheerleading uniforms, camps and special events, (ii) athletic equipment and
reconditioning lines and a new line of game uniforms and (iii) Umbro-branded
team soccer apparel, equipment and footwear. For the nine-month period,
extracurricular revenues increased 15%, or $22.0 million, to $166.8 million for
1999 from $144.8 million for the year-to-date period of 1998. All
extracurricular product lines showed sales volume increases over the year ago
period and generally higher selling prices also contributed to the revenue
increases. Revenues also benefitted from first year sales of our new line of
Umbro-branded team soccer products and our new line of athletic game uniforms.
These two new product lines generated 37% of the revenue growth for the
nine-month period.

      Revenues from the retail segment were $12.2 million for the first nine
months of 1999, down $0.9 million from the year-ago period. The declines were
anticipated as part of a strategy which called for lower sales and higher
profitability and are principally the result of a decrease in the volume of
youth football equipment sold to retailers because we are shifting our emphasis
on youth football equipment sales to the direct sales force within our
extracurricular segment.

      Revenues from trademark licensing declined to $0.2 million in the third
quarter of 1999 from $0.3 million for the third quarter of 1998. For the
nine-month period royalty revenues declined to $0.8 million for the nine-month
period of 1999 from $1.4 million for the 1998 period. The decline was
anticipated due to the expiration of certain licenses in 1998.

Gross profit

      Gross profit increased to $74.8 million for the nine-month period of 1999
from $64.1


                                       52
<PAGE>

million in 1998. Gross margins improved in both the extracurricular and retail
segments. Gross margin rates increased by 1.4 points to 41.6% for 1999 from
40.2% for the year-to-date period of 1998. Margin rates improved as a result of
modest increases in selling prices, favorable negotiations with vendors and
contractors, improved leverage due to higher absorption of the fixed portion of
operating costs against higher revenue and certain other actions taken at the
end of 1998 which also reduced costs for 1999.

Selling, general and administrative expenses

      Selling, general and administrative expenses decreased as a percentage of
revenues for the third quarter and the year-to-date period.

      Selling, general and administrative expenses decreased as a percentage of
revenues to 30.1% of revenues in the 1999 nine-month period from 30.9% last
year. The improvement is principally the result of cost savings initiatives
implemented at the end of 1998 and improved absorption of the relatively fixed
portions of selling, general and administrative expenses resulting from the
increase in revenues.

Interest expense

      Interest expense increased by $0.6 million to $11.7 million for the
nine-month period ended September 30, 1999 from $11.1 million for the first nine
months of 1998. The increase is attributable to an increase in average
indebtedness which was principally due to higher indebtedness at the beginning
of 1999 than at the beginning of 1998, increased working capital demands related
our new line of Umbro-branded team soccer products and volume growth in other
product lines.

Income taxes

      Income tax expense for the nine-month period ending September 30, 1999
reflects an adjustment relating to the valuation of deferred taxes. No tax
expense, other than this adjustment, has been recorded for the 1999 period as we
have net operating loss carryforwards which offset any such taxes. As a result,
tax expense is not comparable between the nine-month periods of 1999 and 1998.

      We have net operating loss carryforwards that offset most income tax
payments which would otherwise be due for the year.

      Year Ended December 31, 1998 compared to Pro forma Year Ended December 31,
1997

Overview

      Operations for 1998 resulted in a net loss of $7.1 million. While we
achieved satisfactory performance in our core extracurricular business, we
incurred a loss of $1.5 million relating to several new product initiatives and
suffered from weak performance in our retail and licensing segments. We also
incurred costs of $3.1 million relating to certain strategic changes being
undertaken to improve future profitability. These factors are discussed in
greater detail in the following paragraphs and comparisons.


                                       53
<PAGE>

      The loss of $1.5 million from new initiatives within our extracurricular
segment included start up costs for a new line of team soccer apparel, equipment
and footwear to be marketed under the newly acquired license to use the Umbro
trademark in the United States; entry into new areas of the school and private
dance studio dance market including the Company Dance(Registered) program; and
the introduction of athletic game uniforms. These activities were unprofitable
during 1998 due to start up costs and because some activities were started too
late in the year to generate enough revenues to offset the costs. We believe
that the losses incurred for these activities are valuable investments in the
future and views these areas as important to our future growth potential.

      Operations for 1998 were also impacted by lower profits from the trademark
licensing and retail product segments. Licensing declined as our license to
Kmart for MacGregor(Registered) branded apparel and bags was not renewed when it
expired in June 1998, although the license was renewed for other products.
Profitability of the retail segment decreased due to a decline in sales of
sports collectible products.

      We also initiated a series of strategic actions in late 1998 which we
believe will assist in facilitating future profitability. These actions include
the implementation of a restructuring plan involving the consolidation of
several of our reconditioning facilities and the elimination of approximately 40
jobs including two senior positions. Together these actions led to a $925,000
restructuring charge in 1998. The charge includes a provision of $800,000,
included in accrued liabilities at December 31, 1998, for certain lease
termination and employee severance costs, most of which will be expended during
1999. The restructuring actions are expected to yield annual savings of over
$1.0 million after 1999, once facility closures are completed and new
centralized operations are fully implemented.

      Other strategic actions generated additional charges in excess of $2.0
million in 1998. The charges include costs relating to changes in product lines
and marketing materials which are discussed further in the comparisons of gross
margins and selling, general and administrative expenses, below.

      Several cost saving measures were also implemented late in 1998 as part of
our strategic review. Areas which should generate future savings include
negotiated vender cost reductions, consolidation of general insurance policies
and a move of our corporate offices in New York City to smaller, less costly
space. We believe these cost savings actions, combined with the benefits from
the above mentioned restructuring plan, should reduce our costs by $2.0 to $3.0
million annually in 1999 and future years.

Revenues

      Revenues for 1998 increased $12.5 million, or 7%, to $186.6 million in
comparison to pro forma revenues of $174.1 million for 1997.

      All of our revenue gains came from the extracurricular segment where
revenues increased 9% or $13.2 million, from $153.6 million on a pro forma basis
for 1997 to $166.8 million for 1998. Increased volume in cheerleading and dance
uniform and accessory products accounted for the largest part of this revenue
increase, registering a sales increase of $7.1 million, with most of the gain
occurring in the line's core products. In addition, camp and event revenue
increased $3.7 million primarily due to a strong increase in special event
attendance. Athletic product volume increased $2.4 million due largely to
expanded offerings


                                       54
<PAGE>

of athletic practice wear and a new emphasis on the youth football market where
sales had previously been declining in recent years.

      Revenues from the retail segment were relatively stable with 1998 revenues
of $18.1 million compared to 1997 revenues of $18 million. Sales of athletic
products to recreational team dealers and distributors increased, offsetting
declines in the sales of sports collectible products. Sales of sports
collectible products decreased due to lower demand for certain products
introduced in recent years such as miniature hockey and baseball helmets.

      Royalty income from trademark licensing decreased by $0.8 million to $1.6
million in 1998 in comparison to trademark licensing royalties of $2.4 million
in 1997. This decrease is attributable to the expiration in June 1998 of a
license for MacGregor branded apparel and bags with Kmart.

Gross profit

      Gross profit for 1998 increased to $73.1 million from $71.0 million on a
pro forma basis for 1997. Gross margins decreased as a percentage of sales to
39.2% for 1998 from 40.8% on a pro forma basis for 1997. Gross profits were
impacted by a 1998 charge to reflect product line changes and other strategic
decisions which affected the realizable value of inventories. This charge, along
with the decrease in royalty income discussed above, accounted for most of the
decline in margins. Margins were also impacted by a shift in the mix of products
sold as most of the year's revenue gains occurred in product lines that carry
lower margins than the average of our other products.

Selling, general and administrative expenses

      Selling, general and administrative expenses for 1998 increased by $1.6
million to $64.6 million from $63.0 million on a pro forma basis for 1997. In
addition to a normal level of growth related increases, expenses for 1998
included charges taken late in the year relating to strategic changes in product
lines and marketing materials as discussed above and over $2.0 million of
expenses related to the new initiatives mentioned in the overview above.

      Selling, general and administrative expenses decreased as a percentage of
sales to 34.6% for 1998 from 36.2% on a pro forma basis for 1997. However, 1997
expenses included unusual expenses from the Varsity acquisition and the
settlement of certain non-product liability litigation as discussed below in the
comparison of 1997 to 1996.

Interest expense

      Interest expense for 1998 increased 3%, or $0.4 million over 1997 interest
computed on a pro forma basis. The increase is due to a higher level of working
capital indebtedness during the year.

Income taxes

      We did not recognize income tax benefits arising from the 1998 net loss.
The unrecognized tax benefits, together with unrecognized tax benefits arising
from net operating losses in prior years, would be utilized with the generation
of approximately $7.0 million in future pre-tax income and adjustments.


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<PAGE>

      We have certain nondeductible annual expenses which would be added as
adjustments to pretax income to calculate taxes. These expenses include
nondeductible amortization of approximately $2.1 million, most of which arises
from goodwill associated with the Varsity acquisition.

      Pro Forma Year Ended December 31, 1997 Compared to Pro Forma Year Ended
December 31, 1996

Revenues

      Pro forma revenues for the year ending December 31, 1997 increased $13.3
million, or 8%, to $174.1 million from $160.8 million in 1996. We achieved
revenue gains in our extracurricular segment while experiencing offsetting
declines in the Retail and Licensing segments.

      Extracurricular segment revenues increased 12%, or $16.7 million, from
$136.9 million on a pro forma basis for 1996 to $153.6 million on a pro forma
basis for 1997. Most of the gains related to the operations acquired from
Varsity. Uniforms and accessories sales increased by $7.0 million due to volume
growth. Growth in the number of summer camp participants contributed an
additional $6.0 million to camp and event revenues. Extracurricular sales of
athletic products and reconditioning services increased $3.7 million as we
experienced volume gains from our newly introduced line of athletic practice
clothing and from most of our core football protective product lines. These
gains more than offset a decline in sales of youth athletic products.

      Retail segment revenues declined by 15%, or $3.3 million, from $21.4
million for 1996 to $18.1 million for 1997. The decline was principally due to
decreased volume of sports collectible products. We believe the principal
reasons for the decline are related to an industry-wide cautiousness in making
inventory commitments for licensed sports products.

      Royalty income from licensing in 1997 decreased by 4%, or $0.1 million. We
recognized gains in MacGregor royalties from Kmart and royalties from our
Riddell apparel and sock licenses. These gains were offset by royalty declines
due to the expiration of a MacGregor license with Thom McAnn which had generated
$0.3 million in prior years and the temporary cessation of royalty receipts from
our Riddell footwear licensee. As described elsewhere in this prospectus, we
have assigned certain portions of the future royalties from our Riddell footwear
licensee, for up to ten years, to other parties to settle certain litigation.
While the license was transferred to a new licensee in 1998, the assignment
remains in place.

Gross profit

      Pro forma gross profit for 1997 was $71.0 million, an increase over pro
forma gross profit of $68.4 million for 1996. Gross margins, on a pro forma
basis, decreased as a percentage of revenues to 40.8% in 1997 from 42.5% for
1996. There were several factors which influenced the decline in gross margin
rates. Pro forma gross profit was reduced by $0.8 million of charges stemming
from a revaluation of inventory in June 1997 and included in Varsity's
preacquisition results. There was an increase in freight and overtime costs
incurred in the extracurricular segment's cheerleading uniform business in order
to overcome certain production delays which occurred during the year. The
decline in sales of sports collectibles discussed above significantly impacted
gross profit and the margins as these


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<PAGE>

products carried higher than average margins. Sales of our new line of practice
wear reduced gross margins, as expected, since these products carry a lower
margin than our historical product lines. Introduction of our practice wear line
also negatively impacted 1997 margins due to start up costs of related screen
printing operations and introductory pricing. Finally, while the volume of our
reconditioning business increased, margins were down due to higher costs
associated with the initial year of reconditioning work on equipment from new
customers gained during the year and an increase in material and parts usage.

Selling, general and administrative expenses

      On a pro forma basis, selling, general and administrative expenses for
1997 increased by $7.6 million to $63.0 million from pro forma expenses of $55.5
for 1996. Expenses relating to various litigations (exclusive of product
liability matters) that were resolved during 1997 amounted to $2.8 million for
1997 and $1.2 million for 1996. Expenses for 1997 also included a charge of $0.6
million relating to in-the-money Riddell stock options contractually granted to
certain of our employees who previously were employed by Varsity (as further
discussed in Note 9 of the Consolidated Financial Statements) and a charge of
$0.4 million stemming from a revaluation of receivable reserves in June 1997
that was included in Varsity's preacquisition results. Pro forma selling,
general and administrative expenses excluding these items were relatively stable
as a percentage of revenues, increasing from 33.7% of revenues for 1996 to
approximately 34.0% of revenues in 1997.

Interest expense

      Interest expense computed on a pro forma basis for 1997 increased 2%, or
$0.2 million over pro forma 1996 levels. The increase was principally due to
increases in base interest rates relating to our revolving line of credit.
Historical interest expense, excluding any pro forma adjustments for 1997,
included a $3.0 million onetime commitment fee for bridge financing relating to
the Varsity acquisition.

Income taxes

      The pro forma net loss for 1997 did not include any tax benefit. Pro forma
tax expense for 1996 was reduced by the benefit of net operating loss
carryforwards available for recognition during the year. Even though the pro
forma operating results for 1996 resulted in a loss before taxes, tax expense of
approximately $0.6 million would have been included if net operating loss
carryforwards had not been available to offset the expense. The tax would have
been due to adjustments for nondeductible expenses, as discussed above in the
1998 to 1997 comparison of operating results.

Umbro license

      In 1998, we entered into a license agreement with Umbro International,
Inc. which entitles us to market and manufacture Umbro brand soccer team
apparel, footwear, equipment and accessories on an exclusive basis to the team
channel of distribution throughout the United States, Puerto Rico and the U.S.
Virgin Islands. The term of the license is five years with an option to renew
for an additional five-year period if we achieve certain performance levels. The
license is royalty-free in 1999. We are required to begin paying royalties in
the year 2000, at which time we are also required to meet annual minimum sales
figures. If we fail to meet required minimum sales levels subsequent to 1999


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<PAGE>

for two consecutive annual periods, Umbro has the right to terminate the
license.

MacGregor trademark

      We acquired certain rights to the MacGregor trademark as part of an
acquisition in 1988 at an allocated cost of approximately $18.0 million. We are
amortizing the trademark over a period of forty years. The unamortized cost of
this asset included in intangible assets at September 30, 1999 was approximately
$12.9 million (See Note 7 of the Audited Consolidated Financial Statements). If
there were a material decline in the revenues from the MacGregor trademark, then
the carrying amount of the MacGregor trademark rights could be deemed to have
been impaired. A write-down for such impairment could have a material adverse
effect on our financial position and results of operations.

Liquidity and capital resources

      The seasonality of our working capital needs is primarily impacted by
three factors. First, a significant portion of the products we sell into the
extracurricular segment are sold throughout the year on dated-payment terms,
with the related receivables becoming due when the school year begins during the
following July to October period. Second, we incur costs relating to our summer
camp business from the fourth quarter and into the second quarter as we prepare
for the upcoming camp season, while camp revenues are mostly collected in the
June to August period. Lastly, our debt structure impacts our working capital
requirements as the semi-annual interest payments on our $115 million, 10.5%
Senior Notes come due each January and July.

      To finance these seasonal working capital demands, we maintain a credit
facility in the form of a revolving line of credit. The outstanding balance on
the credit facility follows the seasonal cycles described above, increasing
during the early part of the operating cycle in the first and second quarters of
each year and then decreasing from the third quarter and into the fourth quarter
as collections are used to reduce the outstanding balance.

      At September 30, 1999 the outstanding balance under the credit facility
was $22.6 million. This compares with outstanding balances of $4.4 million at
December 31, 1998 and $15.7 million at September 30, 1998. The change in the
outstanding balance between December 31, 1998 and September 30, 1999 reflects
the seasonal working capital pattern presented above, while the increase in
outstanding borrowings between September 30, 1999 and September 30, 1998
reflects the factors discussed above in the paragraph on interest expense in the
comparison of results of operations between these periods.

      In April 1999, we entered into a revised credit facility with Bank of
America National Trust and Savings Association. The revised credit facility
matures at the end of December 2003 and provides for borrowings of up to $48
million depending on certain levels of receivables and inventories. The revised
credit facility replaced our $35 million credit facility with NationsBank, now
named Bank of America, and NBD Bank. NBD Bank subsequently became a participant
in the new facility. We sought the increased size of the credit facility to
provide working capital for new initiatives, especially our new line of
Umbro-branded team soccer products.

      Our current debt service obligations are significant and, accordingly, our
ability to meet our debt service and other obligations will depend on our future
performance and is


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<PAGE>

subject to financial, economic and other factors, some of which are beyond our
control. Furthermore, due to the seasonality of working capital demands
described above, year-over-year growth in our business and working capital could
lead to higher debt levels in future periods. We believe that operating cash
flow together with funds available from our credit facility will be sufficient
to fund our current debt service, seasonal and other current working capital
requirements.

      We are conducting the rights offering and concurrent offering to finance
our Internet business and for additional working capital. We believe we could
finance our Internet business from the existing capital resources described
above. However, the resources provided by the offering will provide us with
greater flexibility in developing our Internet business and not require that we
divert capital that we would otherwise use for our base business. It is likely
that our Internet business will not be profitable and could generate losses
which could exceed the proceeds from the rights offering and the concurrent
offering.

Year 2000 issues

      Riddell, like virtually all companies and organizations, is faced with
addressing the Year 2000 issue which relates to the possibility that computer
systems and computer chips embedded in equipment may not be able to properly
process data after December 31, 1999.

      The most significant Year 2000 issues facing Riddell are associated with
the computer information systems used to plan, operate and track our business.
We have substantially completed the process of assessing which of our
information systems are subject to potential Year 2000 problems and of taking
corrective action to minimize the potential impact of Year 2000 problems. The
status of this program on each of our four major computer information systems
follows:

      Helmet manufacturing and retail operations: Year 2000 issues have been
addressed by replacing hardware and software with new systems certified as Year
2000 compliant by the vendor. The system replacement is part of a modernization
effort that was initiated in early 1997 and was completed in November 1999.

      Extracurricular athletic product distribution and reconditioning
operations: Existing system software was upgraded and modified to address Year
2000 issues. The process was completed in the fourth quarter of 1998, and the
system has been tested and certified by our vendor as Year 2000 compliant.

      Spirit products: Year 2000 issues have been satisfied through corrective
modifications of existing software. The process was completed early in October
1999 and we have tested the software. We are also in the process of replacing
the existing software with a new system, that is certified as Year 2000
compliant by the vendor, as part of an overall upgrade of system capabilities,
but we made the Year 2000 corrections to the existing software as the new system
will not be fully implemented before the end of 1999.

      Camps and events: Year 2000 issues have been satisfied through corrective
modifications of existing software. The process was completed early in the
second quarter of 1999 and has been tested by Riddell.

      We have other minor systems for which Year 2000 corrective action is in
various


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<PAGE>

stages of completion, all scheduled for completion before the end of 1999.

      We face potential Year 2000 problems relating to embedded computer chips
which control equipment used in our business, such as telephone equipment and a
limited amount of machinery. We have completed assessments of equipment
considered most susceptible to Year 2000 issues and repair or replacement has
been arranged for equipment found to have Year 2000 problems.

      We also face potential Year 2000 issues with third parties. These third
parties include customers who purchase our extracurricular and retail products
and suppliers of raw materials and finished goods, among others. Because our
extracurricular products and services are sold to a large number of schools and
other customers, it is impractical to poll them all in order to determine their
Year 2000 readiness. However, because this customer base is large, the potential
of a negative impact on us may be lowered as none of these customers
individually account for a material portion of our revenues. Third parties also
include airlines and air transportation systems. A disruption of domestic or
foreign air travel systems, or fear of such a disruption among our customers,
could have a negative impact on our special events, many of which occur at the
end of the calendar year or shortly thereafter. We have had discussions with
certain other key customers and vendors in order to assess the potential impact
that their Year 2000 problems might have on us. However, the process of
communications with key customers and vendors and planning for the impact of any
problems arising from their systems are ongoing.

      Expense for Year 2000 remedial programs for the years ended December 31,
1997 and 1998 was $200,000 and $250,000, respectively, and a similar level of
expense is anticipated for 1999. We have also incurred capital expenditures for
computer hardware and software related to the system replacements described
above, of approximately $150,000 and $800,000 for the years ended December 31,
1997 and 1998, respectively. These capital expenditures include all of the
system upgrade and modernization aspects of the replacement programs discussed
above. Approximately $700,000 of similar capital expenditures are anticipated
for 1999.

      Our remedial actions are intended to reduce the possibility of a
disruption of our business due to Year 2000 issues. While we believe these
actions will be successful, the issues involved are full of complexities and
uncertainties, so there can be no assurance that a disruption of our business
will not occur. If a material disruption of our business were to occur, it could
have a material adverse impact on our results of operations, liquidity and
financial condition.

      Readers are cautioned that forward-looking statements contained in the
Year 2000 disclosure should be read in conjunction with our Special Cautionary
Notice Regarding Forward-Looking Statements located at the beginning of this
prospectus.


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<PAGE>

      PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY

      Our common stock was quoted on The Nasdaq National Stock Market System
under the symbol RIDL in 1997 and through November 20, 1998. Commencing November
23, 1998 our common stock was listed on the American Stock Exchange under the
symbol RDL. As of December 10, 1999, there were approximately 732 holders of
record of our common stock. The following table sets forth the high and low
sales prices for the common stock as reported by the NASDAQ-NMS for 1997 and
through November 23, 1998, and as reported by the American Stock Exchange for
the rest of 1998 and for 1999:

Year Ended December 31, 1997:             High        Low
                                          ----        ---
First Quarter                             5 1/2       3 7/8
Second Quarter                            5 7/8       3 5/8
Third Quarter                             6           4 5/16
Fourth Quarter                            5 3/8       3 7/8

Year Ended December 31, 1998:
First Quarter                             5 5/8       4
Second Quarter                            6 3/8       4 7/8
Third Quarter                             5           3 3/4
Fourth Quarter                            6 5/8       2 5/8

Year Ended December 31, 1999:
First Quarter                             7 7/8       3 5/8
Second Quarter                            4 3/16      3
Third Quarter                             4           2 7/8
Fourth Quarter*                           3 1/2       2 13/16

      The last sale price of the common stock on December 10, 1999 was $3.125.

*     Represents the period from September 1, 1999 through December 10, 1999.

Dividend Policy

      Since our inception, we have not declared or paid, and do not currently
intend to declare or pay, any dividends on shares of our common stock, and
intend to retain future earnings for reinvestment in our business. Any future
determination to pay cash dividends will be at the discretion of our Board of
Directors and will be dependent upon our results of operations, financial
condition, contractual restrictions and other factors deemed relevant by our
Board of Directors. Our financing arrangements impose restrictions on our
ability to pay cash dividends or make other distributions on our common stock.


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<PAGE>

                                    BUSINESS

General

      Riddell is a leading marketer and manufacturer of branded products and
services to the extracurricular activities portion of the educational market. We
believe that the extracurricular activities market encompasses approximately 30
million young men and women in the United States who participate in team sports
and other organized activities outside the classroom. We estimate that this
market generates approximately $5 billion in sales annually, including
approximately $2 billion of sales in athletic equipment and uniforms for team
sports and various products and services for cheerleaders and dancers.

      Under our many brands, the best known of which are Riddell and Varsity
Spirit (which we own) and Umbro (which we license), we are:

      o     a leading provider of athletic equipment and clothing for team
            sports;

      o     the only national reconditioner of football protective and other
            athletic equipment;

      o     The largest designer, marketer and supplier of innovative
            cheerleader and dance team uniforms and accessories;

      o     The biggest operator of cheerleading and dance team training camps
            and clinics;

      o     A leading organizer of special events for extracurricular
            activities;

      o     A major provider of soccer apparel, equipment and footwear for team
            play; and

      o     A supplier of sports collectible products through retailers in the
            United States and internationally.

      Our success in building our various brands and lines of business is due,
in large part, to our long-standing marketing strategy through which our direct,
proprietary sales force establishes and builds relationships with the
participants, coaches and instructors among the 40,000 junior and senior high
schools, colleges and various youth organizations throughout the United States.
We believe that our sales force is unique within the extracurricular activities
market and provides us with a significant competitive advantage.

      Our relationship marketing strategy is a year-round, integrated approach,
which includes conducting training camps, clinics and conventions and producing
various nationally-televised and regional championships and performance events
in the U.S. and Europe. These activities, which are in themselves profitable,
reinforce each other and the sale of our products, while they enhance
participation and build loyalty to our brands.

      We believe that Riddell branded football equipment is worn by more than
50% of all high school and collegiate football players. We also have a
longstanding agreement with the NFL for the promotion of our Riddell brand. Over
80% of the NFL players choose to wear


                                       62
<PAGE>

our helmets. We also use the Riddell brand to sell sports collectible products
through retailers in the U.S. and internationally. We believe that our Varsity
Spirit brand cheerleading uniforms are worn by approximately 40% of all high
school and 75% of all collegiate cheerleaders. Our cheerleading camps are
attended by more than 200,000 students annually, and in 1999, more than 25,000
people traveled to the Walt Disney Resort in Orlando, Florida to participate in
and view our various cheerleading and dance competitions.

      In the fourth quarter of 1998, we became the exclusive U.S. licensee for
Umbro branded soccer apparel, footwear, equipment and accessories for team
channel distribution. Umbro is one of the leading soccer brands worldwide.

      Over the last few years, we have expanded the array of products and
services for the extracurricular activities market that can be readily sold
using our comprehensive marketing strategy. We have added:

      o     baseballs and baseball equipment in 1996

      o     practice wear (silk-screened t-shirts, shorts and sweat pants and
            shirts) in 1997

      o     instructional conventions and competitions for young participants
            from private dance studios in late 1997

      o     game uniforms for football and baseball in late 1998

      o     team soccer apparel, equipment and footwear in 1999

      Game clothing represents the largest category of sporting goods in the
extracurricular activities market. Based on the results in our first full year
of selling football uniforms, which exceeded our expectations, we believe that
the game uniform market has significant growth potential for us because we
presently have such a small share of this large market. As a result, we plan on
increasing our athletic game uniform production capabilities and expanding our
product offerings to other men's and women's sports, such as basketball and
softball.

      We also plan to build upon our presence in dance through a comprehensive
marketing approach to private dance studios.

Our objectives and strategy

      We believe that these actions will enable us to:

      o     expand the sales of our traditional team sports and school spirit
            products and services

      o     develop relationships with participants in other team sports and
            additional extracurricular activities that we are not currently
            servicing effectively, such as youth baseball

      o     establish new Internet-based revenue streams, through our sale of
            advertising, product sales and third-party alliances


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<PAGE>

      Our business strategy is to further capitalize on our relationship
marketing strategy by:

      o     adding sales people and shrinking sales territories, while having
            more product lines to sell at each school or organization

      o     developing new special events, competitions and conventions to
            reinforce and promote participation in each extracurricular activity

      o     implementing our Internet plans

Opportunities for growth

      We believe that we are poised to experience significant growth in three
product categories over the next twelve months:

      Game uniforms to high schools

      According to the National Federation of High Schools, there are 6.3
million high school athletes who play team sports in the United States. We
believe that the market for game uniforms and practice wear (t-shirts, sweat
shirts, shorts, etc.) exceeds $500 million in the U.S. and that we can capture
an increasing share of this market over each of the next few years.
This market is a natural extension of our core business because:

      o     the decision-makers for the purchase of these products is often the
            same person that our sales force already calls upon to sell football
            equipment and reconditioning services

      o     we have in-house expertise in the manufacturing of cheerleading
            uniforms which is readily transferable to game uniforms

      o     we believe that we can provide faster service than our competitors
            as a result of our efficient manufacturing and outsourcing
            capabilities

      Game uniforms and equipment for recreational youth leagues

      We estimate that the market for game uniforms and equipment for
recreational youth leagues is a $750 million market in the U.S. and that it
consists of approximately 15 million participants in organized youth leagues,
such as Little League, Pop Warner and parks and recreational leagues for
football, baseball, softball and basketball. This market is currently serviced
by a highly fragmented range of suppliers. To address this market, we are using
our in-house sales force and have recently established a dedicated sales force
to service this market in major metropolitan areas. We also plan to continue to
add sales people for this market.

      Apparel, equipment and footwear to the team soccer market

      Soccer has recently become the fastest growing sport in the U.S. among
boys and girls. We believe that there are over 4 million participants from high
school teams and youth leagues nationwide who spend $750 million annually for
apparel, equipment and footwear.


                                       64
<PAGE>

      o     the Umbro brand, which we license, is one of the leading soccer
            brands worldwide

      o     our expertise in manufacturing uniforms for cheerleaders, coupled
            with our ability to out-service our competitors gives us a
            competitive advantage

Our advantages

      We believe that we have four advantages that will support our growth.

      Direct, proprietary sales force

      Our direct, proprietary sales force is comprised of approximately 320
people who are responsible for developing and maintaining relationships among
the 40,000 junior and senior high schools, colleges and numerous recreational
youth organizations throughout the United States. As the only national,
factory-direct marketer of athletic products and services in the extracurricular
activities market, we are able to bypass the middlemen and independent dealer
networks used by our competitors. As a result, we can provide competitive
pricing and enhanced services to our customers.

      Efficient manufacturing and outsourcing capabilities

      Our efficient manufacturing and outsourcing capabilities support our
direct sales force and enable us to produce and deliver competitively priced
high quality customized products faster than our competitors. We accomplish our
efficiencies by manufacturing only those low labor-intensive items and
components that are difficult for outsourcing partners to make, thereby allowing
us to avoid bottlenecks in the production process. By outsourcing the
manufacturing of most of the items that we sell, we are able to focus on design,
marketing, sales and new product development. The result is that we are able to
minimize our capital commitments, operate more efficiently and be better
positioned to respond to changing market conditions.

      Relationship marketing

      Our relationship marketing, which we began 25 years ago, is a year-round,
integrated marketing approach. We enjoy longstanding relationships with the
participants, coaches and instructors of various team sports, school spirit
programs and other extracurricular activities in youth leagues and
organizations. Our sales force develops relationships with coaches and athletic
directors throughout the U.S. by providing value-added services that enhance the
coach's ability to efficiently manage his or her team. Examples of this include
fitting of football helmets and other equipment, quick repair service, and the
design and fitting of custom-uniforms for participants in cheerleading and team
sports. In the case of cheerleading, it also includes conducting training camps,
clinics and conventions, and producing various nationally-televised and regional
championships and performance events in the U.S. and Europe. Our relationship
marketing is designed so that each of our products and services reinforce one
another, as well as strengthen our overall brand awareness. We believe that our
new Internet operations are a logical extension of, and will effectively
reinforce, this marketing strategy.

      Internet operations


                                       65
<PAGE>

      Our Internet operations began in the fourth quarter of 1999. We believe it
is a logical extension and application of our sales and marketing strategy. We
believe that our Internet operations, which have a community and a commerce
orientation, will provide us with a direct link to our customers, enhance our
existing relationships with the participants and coaches in the various
extracurricular activities and expand our business beyond our historical
football and cheerleading product and service offerings, all in a cost-efficient
manner.

Our business segments

      We presently employ our sales and marketing strategy and operate our
business through various wholly-owned subsidiaries in three business segments:

      Extracurricular

      Our extracurricular segment, which we have historically referred to as our
institutional segment, markets, manufactures and distributes products and
services primarily through our 320 person direct sales force to customers such
as schools, recreational groups and other organizations. It is our largest
segment, and was responsible for almost 90% of our revenues in 1998 and
approximately 93% of our revenues for the first nine months of 1999. Over 6.3
million boys and girls participate in team sports in high schools within the
U.S. We estimate that there are an additional 15 million team sports
participants in organized youth leagues and an additional 10 million
participants in school-sponsored bands and choirs and youngsters who take dance
lessons at private studios.

      Retail

      Our retail segment markets products through retailers in the U.S. and
internationally. Most of the products sold by this segment are sports
collectible products, such as authentic and replica football helmets which bear
licensed NFL and collegiate team logos. This segment's operations also include
sales of a limited amount of recreational football, baseball and other athletic
products sold internationally and in the U.S. through consumer product retailers
and distributors.

      Licensing

      Our licensing segment consists of the licensing of our Riddell and
MacGregor trademark rights to other entities for use in marketing products such
as athletic footwear and equipment.

      Extracurricular segment

      We believe that we are a leading marketer and manufacturer of branded
products and services to the extracurricular branch of the U.S. educational
market. Today, our extracurricular products and services segment includes our
team sports and school spirit business units.

      The extracurricular activities market includes most of the organized
activities for children that take place outside of classrooms in the United
States. It includes team sports, school spirit activities, private dance groups,
bands, orchestras, choirs and a wide variety of


                                       66
<PAGE>

other school- sponsored clubs, such as drama, debate and chess.

      These activities take place in approximately 40,000 junior and senior high
schools and in colleges, as well as in youth leagues and organizations like
Little League, Pop Warner and parks and recreation leagues. In addition to the
6.3 million participants in high school team sports in the U.S., we estimate
that there are an additional 15 million participants in team sports at junior
high schools and youth leagues. We also estimate that there are an additional 10
million participates in other extracurricular activities. We estimate that
spending by these various participants on the extracurricular activities that we
are already targeting exceeds $2 billion a year and that the extracurricular
industry is highly-fragmented and represents aggregate spending of $5 billion
annually.

      Relationship marketing

      Our marketing model is based upon our longstanding relationships with
three distinct but equally important groups. First, our direct sales
organization, through personalized service, creates an important connection to
the participants, coaches and instructors of various team sports, school spirit
activities and other extracurricular activities in schools, youth leagues and
organizations and colleges. Second, instructors and staff at our camps, clinics
and performance tours and events motivate participants to get more instruction
and become better competitors. Third, we increase our brand awareness and
enhance our relationships with our customers through our affiliations with
strategic partners such as the Walt Disney Company, ESPN and other media and
marketing entities. These strategic relationships and the televised shows that
we produce reinforce the importance of our events and competitions.

      Our cheerleading operations serve as the template for our
relationship-based marketing strategy. We intend to develop similar events,
conventions and competitions for other extracurricular activities, with soccer
and dance the most likely near-term extensions of our integrated marketing
approach. The marketing of our various activities is designed to provide logical
extensions to basic participation and to encourage participants as they improve
to increasingly utilize more of our products and services.

      Our extracurricular segment is supported and based upon our sales and
marketing strategy, which we believe provides us with a competitive advantage,
and features the following key components.

      o     Our proprietary, direct sales force

      o     Cross marketing of products and promotional activities

            -     Camps

            -     Special events, conventions and competitions

            -     Uniforms and accessories

      o     Key marketing alliances

      Proprietary, direct sales force


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<PAGE>

      Our comprehensive relationship marketing and sales strategy is made
possible by our 320 person direct sales force who are responsible for developing
and maintaining relationships among the 40,000 junior and senior high schools,
and colleges in the United States, visiting between 10,000 and 15,000 schools
every five weeks during the sales season. We believe that there is no other
nationwide direct sales force focusing on the product lines that we sell to the
extracurricular branch of the educational market and that this gives us a
significant competitive advantage. Our sales force develops relationships with
coaches and athletic directors throughout the U.S. by providing value-added
services that enhance the coach's management of his team. Examples of this
include: providing clinics, fitting football helmets and equipment, and quickly
servicing, designing and fitting custom-uniforms for participants in
cheerleading and team sports.

      Over the last several years, we have been increasing the size of our sales
force, and intend to continue to do so over the next few years. Increasing the
size of the sales force goes hand-in-hand with expanding the array of products
and services marketed by the sales force. In this way, we can shrink the size of
sales territories, while sales people become more efficient and increase their
incomes. As a result, we are seeking to make it easier for each salesperson to
better concentrate on and become more intimate with a smaller sales territory,
while at the same time having more products and services to offer to the
customers in that territory. The desired effect is to enable each salesperson to
generate increased sales by spending less time traveling and more time with
customers selling a greater array of products and services. Increased sales
enables the sales force to increase their incomes, because their compensation is
commission-based and smaller territories can also increase their incomes because
the our salespeople pay for all of their travel and other related expenses.

      Promotional activities

      Since 1974, we have conducted (and we continue to refine) profit
generating activities, which are an integral part of our promotional efforts.
Our sales and marketing strategy, as we have developed it for the school spirit
industry, is illustrated in the diagram below. We create relationships through
our camps and events and believe that these relationships naturally translate to
a sales opportunity for our cheerleading uniforms or dance costumes when the
campers return to school. When the sales force interacts with cheerleaders or
dance team participants and their coaches during the design and fitting of
custom uniforms, they also have the opportunity to reinforce participation in
our camps and special events. We intend to extend this strategy to other
extracurricular activities. The marketing of our various activities is designed
to provide logical extensions to basic participation and to encourage
participants, as they improve, to increasingly utilize more of our products and
services. All of our marketing activities are designed so that each of our
various products and services reinforce one another, as well as strengthen
overall brand awareness and loyalty.

      [INSERT BASIC MARKETING TEMPLATE DIAGRAM WHICH DEPICTS THE CROSS-MARKETING
ASPECT OF EACH OF THE THREE ELEMENTS OF OUR INTEGRATED MARKETING STRATEGY]

      How we cross-market is evident from our marketing of special events and
competitions for cheerleaders. For example, in order to attend and participate
in the various special events that we run, such as the nationally-televised
Macy's Thanksgiving Day parade in New York City, a cheerleader must attend and
excel at one of our camps. Our camps are


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<PAGE>

the only place that a cheerleader can get an invitation to appear in one of our
special events. Similarly, we hold local cheerleading competitions that progress
to various regional levels during the course of the fall, which are the only way
for a team to qualify for our championships which are held at the Walt Disney
Resort in Orlando, Florida and nationally-televised on ESPN.

      Camps

      Because our approach to relationship building has inter-related parts, the
marketing process can begin at any point on the above diagram, but in the case
of cheerleading it is our camps which, more than anything else, build brand
loyalty.

      Special events, conventions and competitions enhance relationship
      marketing

      Just as our camps build loyalty to us in cheerleading, special events,
conventions and competitions for other extracurricular activities can build new
allegiances from participants in a wide variety of other extracurricular
activities. We run regional and national cheerleading and dance team
competitions, organize a national dance competition for young individuals and
sponsor youth soccer tournaments. The national competitions and finals for these
activities are typically held at The Walt Disney Resort in Orlando, Florida and
televised on ESPN and/or ESPN2. Participants in the school spirit activities
that we target are also given the opportunity to take part in various
performance events in the U.S. and Europe. These events include parades, such as
the annual Macy's Thanksgiving Day parade in New York City and year-end parades
in London and Paris. We also arrange half-time shows for college football bowl
games. We intend to extend our promotional activities to a greater number of
extracurricular activities with soccer and dance the most likely first
additions.

      Uniforms and accessories

      In addition, the cheerleaders who participant in our special events, such
as parades, often come from a variety of schools, they need a uniform for the
special event so they portray a unified appearance. We design and sell such
uniforms and also sell a travel package, including hotel arrangements, to the
participants in our special events.

      At the same time, because participation in our various promotional
activities enhances our bond with cheerleaders, we believe that their team is
more likely to buy our uniforms and accessories.

      Key Marketing Alliances

      We have a promotional rights agreement with the NFL's licensing division
which requires that our Riddell brand name appear on the front and on the chin
strap of all of our helmets used in NFL play. Our agreement with the NFL further
requires all teams in the NFL to cover any indicia of brand identification of
any other manufacturers that might otherwise appear on helmets, face masks or
chin straps not manufactured by us, but used during league play. In return, we
agree to supply specified quantities of Riddell helmets, shoulder pads and
related equipment, either at no cost or at reduced cost to each NFL team which
has a requisite percentage of its roster using the Riddell helmet. Presently,
over 80% of NFL players choose to wear our Riddell brand football helmets.


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<PAGE>

      We also have longstanding marketing alliances with other strategic
partners such as the Walt Disney Company, ESPN and other media and marketing
entities through which we create visibility on nationally-televised shows. These
shows further reinforce the importance of the activity and competitor. All of
these relationships enhance one another and serve to reinforce and cross-market
our products and services.

      We believe that our new Internet operations, which are described further
below, are a logical extension and application of this approach and are designed
to enhance our contact with customers and build brand loyalty.

      [INSERT DIAGRAM OF MARKETING TEMPLATE WITH INTERNET ADD-ON WHICH DEPICTS
HOW OUR NEW INTERNET OPERATIONS FIT INTO AND AUGMENT THE CROSS MARKETING ASPECTS
OF OUR INTEGRATED MARKETING STRATEGY]

      Our extracurricular segment, which we have historically referred to as our
institutional segment, is comprised of two divisions that relate to the sales of
products for both team sports and the school spirit industry.

      Team Sports

      We are the world's leading manufacturer of football helmets, which we sell
under our Riddell brand. Our Riddell brand football helmets are worn by football
players throughout the world, including players on all NFL teams, certain other
professional leagues and on most teams in the NCAA. High school teams, however,
have historically been the largest market for our football helmets. We offer
several types of varsity and youth helmets which are different in their
configurations, padding and other features. Our helmets are known for their
quality and performance and meet the industry standards set by the National
Operational Committee for Safety in Athletic Equipment ("NOCSAE"). NOCSAE, an
independent entity, is organized by various participants from the sporting goods
industry which establishes industry-wide standards for protective athletic
equipment.

      We also sell a professional and collegiate line of shoulder pads under the
Power(Registered) name and several other lines of shoulder pads under the
Riddell name. The shoulder pads are used by NFL, college, high school and youth
players.

      We have been steadily increasing the categories of athletic products we
sell to the extracurricular market. In 1998, we introduced a line of custom team
uniforms for high school and youth participants. In 1996, we introduced a line
of baseball and softball products designed for high school and college players
and expanded this line to the youth market in 1998.

      Game Uniforms

      We are seeking to capitalize on the same expertise and efficiency, and
apply the same design and manufacturing techniques that we have employed in
producing custom-made cheerleading and dance apparel in connection with
producing game uniforms for various team sports. We believe that the game
uniform market for team sports is a larger market than our other team sports
products and services lines of business. We believe that by using the suppliers
of our Varsity cheerleader uniforms we will be able to produce and deliver


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<PAGE>

competitively priced, high quality game uniforms faster than our competitors.

      In 1998, we began offering our Umbro team soccer uniforms, along with a
line of equipment and apparel, through a network of independent sales
representatives. These independent sales representatives market and sell Umbro
team soccer apparel, footwear and equipment to the team channel of distribution
in the United States.

      In 1998, we also began manufacturing athletic team uniforms for other
sports. We believe that the manufacturing capabilities of our cheerleader
uniform operations, coupled with the breadth and depth of our direct sales
organization to schools and youth organizations across the country, provide us
with an opportunity to successfully expand our historical line of athletic
equipment into game uniforms.

      Reconditioning

      We are the leading national reconditioner of football helmets, shoulder
pads and related equipment with what we believe to be an over 50% share of the
reconditioning market. Reconditioning typically involves the cleaning,
sanitizing, buffing or painting, and recertifying of helmets as conforming to
NOCSAE standards. Reconditioning may also include replacing face guards,
interior pads and chin straps. We also recondition shoulder pads, as well as
equipment for other sports, including baseball and lacrosse helmets, catchers'
masks and baseball gloves. Our reconditioning services are sold by our sales
force to the same athletic coaches responsible for equipment purchases. Our
reconditioning customers are primarily high schools, colleges and youth
recreational groups.

      School Spirit

      Cheerleader Dance Team and Game Uniforms and Accessories

      We design, market and manufacture cheerleader and dance team uniforms and
accessories, including sweaters, sweatshirts, jumpers, vests, skirts, warm-up
suits, t-shirts, shorts, pompons, socks, jackets, pins and gloves. We market all
of our cheerleading uniforms and accessories under the Varsity Spirit trademark.
Over 100,000 catalogs are mailed annually to schools and school spirit advisors
and coaches containing color photographs and descriptions of our Varsity Spirit
line of uniforms and accessories. We supplement our direct sales force and
catalog sales efforts with a telemarketing sales force of 13 full and part-time
employees.

      Cheerleader and Dance Team Camps

      We operate cheerleader and dance team camps in the United States. Camp
enrollment has increased every year since the camp division commenced operation
in 1975 with 20 cheerleading camps and 4,000 participants. During the 1999 camp
season, approximately 218,000 participants (consisting of students and their
coaches) attended Varsity's Universal Cheerleader Association and United Spirit
Association camps, including over 8,000 participants representing colleges and
junior colleges. During 1999, cheerleading and/or dance team squads from
approximately 75% of the universities comprising the Atlantic Coast, Big East,
Big Ten, Big Twelve, Pacific 10 and Southeastern collegiate athletic conferences
attended our camps.


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<PAGE>

      Camp sessions for high school and junior high school students are held
primarily in June, July and August while camp sessions for college cheerleaders
and dance team participants are held primarily in August. We also offer mascot
training clinics at certain cheerleader and dance team camps.

      A significant majority of our cheerleader and dance team camps are
conducted on college or junior college campuses. We contract with the colleges
and universities for the provision of housing, food and conference facilities.
The camps generally are conducted over a four-day period and are attended by
resident and commuting students. We generally market the camp, establish and
collect participation fees, register students, provide instruction and perform
all related administrative services.

      Our instructors are mostly college cheerleaders who may have previously
attended our camp, and we believe that our training of many of the top college
cheerleading squads augments our recruiting of high school and junior high
school camp participants. Prior to the commencement of our camps, instructors
participate in an intensive six-day training session where they are taught new
cheerleading and dance material. We also place a high degree of emphasis on
teaching our instructors the most up-to-date teaching, training and safety
techniques. We hire instructors by utilizing applications given to talented camp
participants, supervisor evaluations and numerous nationwide tryouts. As a
result of this process, we believe that we hire the most qualified and talented
instructors available.

      We were a founding member of and remain an active participant in the
American Association of Cheerleading Coaches and Advisors ("AACCA"), an industry
trade group whose mission is to improve the quality of cheerleading and to
maintain established safety standards. In 1990, AACCA published comprehensive
certification and safety guidelines for cheerleading coaches. We follow the
AACCA safety guidelines in the training of our instructional staff and in the
conduct of our cheerleader and dance team camps and competitions.

      Special Events

      We promote our Varsity Spirit brand products and services, as well as the
school spirit industry, through active and visible association with the
following annual championships and television specials:

      o     National High School Cheerleading Championship(Registered)

      o     National Dance Team Championship(Registered)

      o     College Cheerleading and Dance Team National
            Championship(Registered)

      o     National All Star Cheerleading Championship(Registered)

      o     Company Dance Championship(Registered)

      These championships and special events have been regularly televised on
the ESPN television network and have been sponsored by various companies and
products, including Nike, Unilever, Sprint, The Walt Disney World Resort,
Johnson & Johnson and Claire's Accessories.


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<PAGE>

      In addition to promoting cheerleading and dance team activities, these
championships, television specials and events are a source of revenues for us.
In 1999, over 25,000 persons, including cheerleaders and their families,
participated in our special events.

      Other Extracurricular Operations

      We are seeking to expand our uniform design, manufacturing and special
event expertise from cheerleading into the private dance studio market through a
venture called Company Dance. Company Dance operates weekend dance conventions
in seventeen U.S. cities and an annual championship from the Walt Disney Resort
in Orlando that is televised on ESPN. We also design, manufacture and market
costumes for dance recitals.

      We also operate a tour company, which does business as Intropa,
specializing in organizing trips for cheerleaders, bands, choirs and orchestras,
dance and theater groups and other school affiliated or performing groups, which
tour in the continental United States, Hawaii, Canada, Europe and Israel.

      Production

      Team Sports Products

      We design, manufacture and package all of our full sized football and
baseball batting helmets at our plant in Chicago, Illinois. Our Elk Grove,
Illinois warehouse facility also has a screen printing operation which can
customize practicewear and uniforms with almost any logo, team name or other
design or numbering that a customer requests.

      Power shoulder pads are manufactured for us by a single source in Canada,
and we have a facility in Pennsylvania that can customize these shoulder pads.
All of our other shoulder pads are imported as finished products from sources in
the Far East.

      We purchase our baseball products, other than baseball batting helmets,
from suppliers in the Far East and source our practicewear from four domestic
suppliers. Athletic uniforms are purchased on a made-to-order basis from
domestic suppliers.

      All of our manufactured protective products are subjected to at least four
separate quality control procedures. Quality control inspections for helmets are
conducted when the product is molded, when liners are inserted, when face guards
are attached and when the product is finished, and samples of all models
produced are tested in accordance with NOCSAE standards. We continually monitor
our products for quality.

      All varsity protective football helmet shells are covered by a five-year
warranty and youth football helmet shells are covered by a three-year warranty.
Helmet liners, protective padding and shoulder pads are covered by a one-year
warranty.

      Principal raw materials purchased by us for use in our protective products
include various custom and standard grades of resins, plastic and foam as well
as metal fasteners, paints and cardboard. Similar materials are used in most
purchased components and finished products along with steel wire used in
purchased face guard components and textile products used in purchased
practicewear and athletic uniforms. We rely on a single supplier with respect to
fulfilling all of our requirements for resin, which is an integral component in
the


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<PAGE>

manufacture of helmets.

      We employ an engineering staff principally with respect to the design,
development and improvement of our helmets and shoulder pads and to the testing
of raw materials which are used in our products or in the development of new
products. We have eight employees devoted principally to design, development and
quality and have several patents and patents pending that are applicable to our
protective products.

      Reconditioning

      Our reconditioning services include the sanitizing, buffing or painting,
replacing certain parts and recertifying of athletic equipment as conforming to
NOCSAE standards. These services are performed at our reconditioning facilities
which are located throughout the United States.

      Cheerleading and Dance Team Uniforms and Accessories

      Cheerleading and dance team uniforms designed, manufactured and marketed
by us are made to order. During 1999, we contracted for our production
requirements with nine independent garment manufacturers. The manufacturers
provide knitting, cutting, sewing, finishing and shipping for all orders, and we
provide the patterns, fabrics, yarn and manufacturing specifications and quality
control supervision. We also provide some cutting, knitting and lettering at two
specialized production facilities. The use of independent manufacturing
facilities to fulfill our production needs affords us with the flexibility to
adjust our production output to meet our highly seasonal selling cycle. The use
of independent manufacturers also reduces our fixed costs, which we believe is
beneficial in a highly seasonal business.

      Cheerleading accessories such as shoes, pompons and campwear are purchased
from various suppliers including Nike(Registered), Capezio(Registered) and
Converse(Registered), among others. We have expanded the variety and number of
accessories we market, which has contributed to the increase in our merchandise
sales revenue in recent years.

      Retail Segment

      Our retail segment markets our Riddell branded products primarily through
retailers. In the fourth quarter of 1999, we launched our collectible web site,
www.riddell.com. Most of our branded retail products are sports collectible
products which consist primarily of authentic and replica helmets of
professional and college sports teams. These helmets are offered in various
miniature and full-size models bearing the colors and logos of NFL and other
professional or collegiate teams. Our full-size authentic football helmets are
the same helmets used by players on these teams. Other sports collectible
products bearing licensed team logos include lamps and desk organizers fashioned
from miniature helmets and a line of smaller, less expensive miniature helmets
tailored for the mass market. In early 1999, we also announced the introduction
of a desk organizer bearing logos and designs licensed from NASCAR and various
professional drivers.

      Our retail segment also includes sales of certain recreational football
and baseball products sold through retailers and distributors in the United
States and athletic products sold internationally.


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<PAGE>

      In connection with the sale of our collectible helmets, NFL Properties
Inc. has granted us a license to use the names, symbols, emblems, designs and
colors of the member clubs of the NFL and the "League Marks" (i.e., "National
Football League," "NFL," "NFC," "AFC," "Super Bowl," "Pro Bowl," the "NFL
Shield" design and other insignia adopted by the NFL) on authentic and replica
football helmets sold for display purposes.

      Marketing sales and promotion

      Our retail segment products are sold primarily to retail and specialty
sporting goods stores and distributors through approximately 57 independent
commissioned sales representatives. We strategically target different channels
of trade based on the type and price of each retail product.

      In support of our sports collectible products, we have initiated various
advertising and public relations efforts. Advertisements are placed in
publications targeted toward the sports collectible industry as well as other
licensed products retailers. We also provide incentives to retail outlets to
advertise and display Riddell products during promotional periods and
participate in a major national sporting goods show where we promote our
products.

      The retail segment also benefits from the promotional exposure of the NFL
Agreement described above under the extracurricular segment.

      Production

      We engineer, manufacture and package our full size collectible helmets at
our plant in Chicago, Illinois in a process similar to that used for our
competitive helmets. We purchase our miniature helmets and other collectible
products principally from two sources in China.

      We have retained a design company to assist us in developing new retail
collectible products on terms that we believe are customary in the industry and
from time to time we work with other design companies.

      Athletic products sold as part of the retail segment are manufactured or
purchased, together with similar products sold through our extracurricular
segment.

      Licensing Segment

      We license our Riddell and MacGregor trademarks to third parties for use
on various products, including athletic clothing and footwear.

      We are continually exploring additional opportunities for licensing the
MacGregor and Riddell trademarks and retain the services of an independent
licensing agent to assist our efforts in this regard worldwide.

      The licensing segment also benefits from the promotional exposure of our
agreement with the NFL because it gives our brand national television exposure
on a weekly basis during the football season.

      Riddell licensing


                                       75
<PAGE>

      We license the Riddell trademark to third parties for certain types of
athletic clothing, socks and athletic footwear.

      Pursuant to an agreement settling an action commenced against us in March
1995 by the trustee for MacGregor Sporting Goods, Inc., which filed for
bankruptcy protection in 1989, we license the "Riddell" name to an affiliate of
Enterprise Rent-a-Car, which purchased this license from the party with whom we
initially settled. This license relates to the use of the Riddell brand on
footwear. We will not receive any royalties from this license until the earlier
of the second half of 2007 or such time as the license produces $3.0 million
(plus interest) of royalties.

      MacGregor licensing

      We have granted Kmart Corporation a non-exclusive license to use the
MacGregor trademark on athletic socks until June 30, 2001. We have also granted
Footstar, Inc. an exclusive license to use the MacGregor trademark on athletic
footwear sold at Kmart stores under a license with an initial term expiring on
June 30, 2001. The license granted to Footstar is renewable at Footstar's option
for an additional two-year period if certain conditions are satisfied.

Our Internet business

      We believe that we are uniquely positioned to take advantage of commercial
opportunities offered by electronic community-building and commerce. We believe
that our Internet strategy of building community sites and simultaneously
establishing complementary commerce sites affords us a unique opportunity to
extend our relationship sales and marketing strategy to expand our core business
as well as develop new lines of business.

      We plan to devote a substantial portion of our initial efforts towards
developing community sites. We launched our Internet business in the fourth
quarter of 1999 with our first two web sites: a community web site with
e-commerce elements for cheerleaders, www.varsity.com, and our e-commerce web
site for our sports collectibles, www.riddell.com.

      We intend to develop additional community sites, for various activities,
expanding to the 20 million young men and women who participate in team sports
in schools, colleges and various recreational leagues and organizations
throughout the U.S. It is likely that future Internet sites will include the 10
million other young men and women who participate in other extracurricular
activities, such as dance, band, etc.

      Unlike the Internet operations of other companies, which are looking for a
portion of a large, often ill-defined market, such as teenage girls, our
approach to the Internet is to focus on well-defined distinct special interest
groups (such as participants in team sports, including football, soccer,
baseball and softball, and cheerleading and dance teams). We also plan to
develop sites for communities that participate in other extracurricular
activities. The age group of our target market includes the demographic sector
commonly called Generation Y, the 56 million boys and girls between the ages of
10 and 24.

      Our Internet advantages

      Strong community identification


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      We believe that our target customers are so dedicated to the
extracurricular activities in which they participate that the activity often
becomes a defining aspect of their lives. For example, cheerleaders, football
players and other high school and youth athletes are typically very enthusiastic
about their activities. We believe that we can aggregate a large audience
through our Internet operations by gradually adding additional web sites for
each distinct group.

      Our community sites will feature original, frequently-updated,
highly-relevant content that speaks directly to each targeted group's need for
information which help individuals improve the quality of their participation
and increase their enjoyment of their activity. Through their involvement with
our Internet sites, community members will not only be able to get information,
but will also have the opportunity to be interactively involved to benefit
themselves and their teams. They will be encouraged to submit articles and
pictures, ask questions of the experts, make postings on various message boards,
enter contests, play games, etc.

      For example, for cheerleaders, there would be information on new routines,
safety tips, upcoming competitions, etc., as well as discussions of other
logical outside interests of cheerleaders, such as beauty, fashion, style, etc.
The site will also serve as a secure Intranet among the cheerleading squad
itself, allowing the squad to post the schedule of games and practices, letting
the coach communicate with the cheerleading squad, and permit squad members to
exchange ideas, schedule practice times, and otherwise chat or communicate.

      Cost-effective web site promotion

      We will use our direct sales force to promote our web sites. When the
sales force is calling on coaches and squads, they will be educating them about
the benefits of our web sites. In addition the sales force will be able to help
them to get their own pages up on our site at no cost to the team, group or
school.

      We believe that we have a marketing advantage as compared to other
Internet companies in promoting our web sites, because we already have our own
320 salespeople calling on 10,000 to 15,000 high schools every four or five
weeks during our sales season.

      In addition, we also run cheerleading camps for over 200,000 cheerleaders
in the summer, recondition approximately 600,000 helmets, and sell approximately
200,000 new helmets and approximately 2,200,000 million pieces of cheerleading
and team sport clothing, equipment and accessories each year. In connection with
all of these activities, we plan to gather e-mail addresses, distribute fliers
at schools and cheerleading camps and attach hang tags on all of our uniforms,
equipment and accessories, promoting the appropriate community web site. We
believe these efforts will increase the awareness of our brands and web sites.

      We believe that the coaches and instructors who have come to rely on us
for various goods and services will find that their jobs can be made easier by
our Internet offerings and therefore are likely to become even more supportive
of us and our products.

      Internet Benefits

      New Revenue Streams


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<PAGE>

      We believe that the Internet will give rise to new streams of revenue and
help us expand and enhance the relationships in our traditional business.

      Direct link to our customers

      The content and community-building aspects of our web sites will enhance
existing relationships with coaches and participants in extracurricular
activities.

      Market penetration

      We believe that the Internet will be particularly effective in selling
uniforms and equipment to the recreational youth leagues, a large market. In
particular, we believe that the greatest potential for expanding our traditional
sales through electronic commerce is the recreational youth sports market. This
is a highly fragmented market which we believe includes approximately 20 million
boys and girls between the ages of 5-18 who participate in a variety of sports
and purchase approximately $1 billion of athletic equipment and clothing for use
in these activities each year. The coaches and parents who typically organize
and are in charge of these various recreational youth leagues (i.e., not
directly a part of a public or private school system) are typically pressed for
time. The ability of these individuals to readily access, order and purchase
uniforms, equipment and accessories easily over the Internet in a single
transaction will be highly attractive to these individuals. As a consequence, we
believe that electronic commerce can rapidly increase the our sales to this
market.

      Broaden distribution of sports collectibles and customized products

      We believe that our web sites dedicated to our retail products will
overcome the geographical limitation of stores, which preclude our ability to
offer collectibles of every team in every city. Over the Internet, our extensive
line of NFL, MLB and collegiate full and miniature size helmets and other
collectibles (such as our lamps and desk organizers) will be far more readily
available to consumers. For instance, on the Internet, even a Cincinnati Bengals
fan living in Phoenix, Arizona can readily obtain any of the Cincinnati Bengals
collectible items, many if not all of which are not likely to be carried in the
local Phoenix stores. The Internet will also enable us to offer customized
products (i.e., your high school team's helmet for Father's Day with a memento
printed on the helmet) that cannot readily be sold through traditional
commercial channels. Further, orders for customized versions of our full size
and miniature, authentic and replica collectibles can easily be ordered and
delivered through our Internet site.

      We operate our electronic commerce business through several of our
existing subsidiaries, although we may at some future date establish a separate
subsidiary to run our Internet business.

Seasonality and backlog

      Our operations are highly seasonal. In recent years operations have been
most profitable in the second and third quarters, with the third quarter
typically the strongest and losses have been incurred in the first and fourth
quarters. This seasonal pattern is influenced by the following factors:


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      Orders for the extracurricular segment's athletic products and
reconditioning services are solicited over a sales cycle that begins in the fall
of each year and continues until just before the start of a new school year at
the end of the following summer. Delivery of products and performance of
reconditioning services reach a low point in the fall of each year after school
begins and during the football playing season. These activities contribute most
to profitability in the first through third quarters of each calender year.

      Cheerleading and dance uniforms and accessories are typically ordered
commencing late March through August and are shipped prior to or contemporaneous
with the start of the school year.

      Most of the extracurricular segment's camp revenues relate to our
cheerleading camps. We incur costs relating to our camp business from the fourth
quarter through the second quarter as we prepares for the upcoming camp season,
while most revenue relating to camps is earned during the June to August period.

      Our retail segment's sports collectible products are sold to retailers
throughout the year. However, sales are usually at their highest during the
third and fourth quarters as retailers build inventory in anticipation of both
the football and the holiday shopping seasons.

      We believe that the sale of Umbro branded items will also be seasonal,
substantially following the pattern of our existing extracurricular athletic
products as soccer, like football, is primarily a fall sport. Soccer, however
experiences a spring season as well, which may somewhat temper the seasonality
of the sale of Umbro branded products.

      Our sales order backlog was $9.4 million at October 31, 1999, a 69%
increase over October 31, 1998 backlog of $5.6 million. Backlog increased in all
areas of our business. The increase includes $2.1 million of orders for our line
of Umbro soccer products, introduced in 1999.

Competition

      Athletic Products

      Our principal competitor in the football helmet market is Schutt,
manufacturer of the AIR helmet. We compete principally with Bike Athletic Co.,
Inc., Douglas, Inc., Gear 2000, Inc. and Rawlings Sporting Goods Company, Inc.
in the football shoulder pad business, with Diamond Sports Co., Rawlings
Sporting Goods Company, Inc., Wilson Sporting Goods Company and other companies
in baseball and softball products, with Champion Products, Inc., Russell
Athletic, Inc., and other companies for practicewear and athletic game uniforms
and with Adidas, Nike, and other companies for soccer team apparel, footwear and
equipment. We also compete with numerous independent dealers throughout the
United States who market the competitor's products. Some of our competitors are
substantially larger and have greater resources than us.

      We believe that we compete in the football market on the basis of quality,
price, reliability, service, comfort and ease of maintenance. With respect to
football and other athletic products, our believe that our direct sales force
provides us with a competitive advantage in terms of our ability to provide
superior customer service and a significant price advantage due to the
elimination of independent dealers which are used by our competitors.


                                       79
<PAGE>

      Reconditioning

      Reconditioners compete on the basis of quality, price, reputation,
convenience and customer loyalty. We believe that we are the largest nationwide
participant among the approximately 30 competitors in the highly fragmented
athletic reconditioning industry.

      Spirit products and services

      We are one of two major companies that design and market cheerleader,
dance team and booster club uniforms and accessories on a national basis.
Besides us and our major national competitor, National Spirit Group, there are
many other smaller regional competitors serving the uniform and accessories
market in the United States. We believe that the principal factors governing the
selection of cheerleader and dance team uniforms and accessories are the
quality, variety, design, delivery, service and, to a lesser extent, price.

      We are also one of two companies that annually operate a significant
number of cheerleader and dance team camps in the United States (the other being
National Spirit Group). There are also many other smaller companies and schools
that operate camps and clinics on a regional basis. We believe that the
principal factors governing the selection of a cheerleader or dance team camp or
clinic are the reputation of the camp operator for providing quality instruction
and supervision, location, schedule and the tuition charged for camp
participation.

      Retail collectible products

      Our collectible products compete with a large number and wide array of
manufacturers and sellers of sports and other collectible and memorabilia
products, some of which have greater resources than us. Among our competitors in
this large marketplace are sellers of products such as autographed photographs
and uniforms and other memorabilia and manufacturers of clothing, such as caps
and jackets.

      Licensing

      Competition in the licensing of sports equipment, apparel and footwear is
substantial, and the Riddell and MacGregor brands compete with numerous
companies also having significant brand recognition, many of which have greater
financial, distribution, marketing and other resources. Brand recognition and
reputation for quality are important competitive factors in the licensing of
sports apparel and footwear. Competing brands include Adidas(Registered),
Champion(Registered), Converse(Registered), Nike(Registered),
Rawlings(Registered), Reebok(Registered), Russell(Registered) and
Wilson(Registered).

Patents and trade secrets

      Certain of our football helmet liner systems and other items are protected
by patents and trade secrets, including a patent on our inflatable liner
expiring in 2010. Other patents on the liners will expire in 2008. We also have
patents expiring in 2006, 2007 and 2008 on various components of our shoulder
pads which improve absorption of shock.

Trademarks and service marks

      We own various common law and registered trademarks in the U.S. and
various


                                       80
<PAGE>

foreign countries including the following: Riddell, MacGregor, ProEdge, Power,
Air Pac, Warrior, Biolite, Maxpro, Universal Cheerleaders Association, Varsity
Spirit, United Spirit Association, National High School Cheerleading
Championship, the Universal Dance Association, Universal Dance Camps, Varsity
Spirit Fashions and The National Dance Team Championship, among others.

      Our use of the MacGregor trademark is limited by an agreement with Global
Licensing Corporation, which owns the similar trademark McGregor. Under this
agreement, the parties have agreed on certain restrictions in the use of their
respective trademarks. We have licensed the MacGregor trademark in connection
with certain team sports items sold to extracurricular customers. We do not have
the MacGregor trademark rights to golf products.

Governmental regulation

      Our products and accessories are subject to the Federal Consumer Product
Safety Act, which empowers the Consumer Product Safety Commission to protect
consumers from hazardous sporting goods and other articles. The Consumer Product
Safety Commission has the authority to exclude from the market certain articles
which are found to be hazardous and can require a manufacturer to repurchase
such goods. Similar local laws exist in some states and cities in the United
States, Canada and Europe. We maintain a quality control program for our
protective equipment operations and other products that is designed to comply
with applicable laws. To date, none of our products have been deemed to be
hazardous by any governmental agency.

      There is no national governing body regulating cheerleading and dance team
activities at the collegiate level. Although voluntary guidelines relating to
safety and sportsmanship have been issued by the NCAA and some of the athletic
conferences, to date cheerleading and dance teams are generally free from rules
and restrictions similar to those imposed on other competitive athletics at the
college level. However, if rules limiting off-season training are applied to
cheerleading and/or dance teams (similar to rules imposed by the NCAA on certain
sports), it is likely that we would be unable to offer a significant number of
our camps either because participants would be prohibited from participating
during the summer or because enough suitable sites would not be available.
Although we are not aware of any school officially adopting these activities as
a competitive sport, recognition of cheerleading and/or dance teams as "sports"
would increase the possibility that cheerleader or dance activities may become
regulated. We currently do not believe that any regulation of collegiate
cheerleading or dance teams as a "sport" is forthcoming in the foreseeable
future, and in the event any rules are proposed to be adopted by athletic
associations, we expect to participate in the formulation of such rules to the
extent permissible.

      At the high school level, some state athletic associations have classified
cheerleading as a sport and in some cases have imposed certain restrictions on
off-season practices and out-of-state travel to competitions. However, in all
cases to date, we have been able to work with these state athletic associations
to designate acceptable times for the cheerleaders within these states to attend
camps. We have also signed agreements with several state associations to assist
with sponsoring and executing official competitions within these states. To
date, state regulations have not had a material effect on our ability to conduct
our normal business activities.

      Operations at all of our facilities are subject to regulation by the
Occupational Safety


                                       81
<PAGE>

and Health Agency and various other regulatory agencies.

      Our operations are also subject to environmental regulations and controls.
While some of the raw materials used by us may be potentially hazardous, it has
not received any material environmental citations or violations and has not been
required to spend significant amounts to comply with applicable law.

Employees

      At October 31, 1999, we had approximately 1,230 employees. Approximately
1,035 of these employees were employed on a full time basis and 195 were part
time or temporary employees. Approximately 34 employees employed in
manufacturing at the Chicago factory are represented by the Chicago and Central
States Joint Board, Amalgamated Clothing and Textile Workers Union, under a
collective bargaining agreement which expires in March 2002. Approximately 28 of
our employees working in reconditioning at our New York facility are represented
by the Local #500A United Food and Commercial Workers Union (AFL-CIO) under a
collective bargaining agreement that expires in January 2000, but is presently
being renegotiated.

      During the summer of 1999, we employed approximately 1,900 summer camp
instructors, trainers and administrators on a seasonal basis.

      We believe that our relations with our employees are satisfactory.

Insurance and product liability proceedings

      Insurance

      We also carry general liability insurance with coverage limits which we
believe is adequate for our business.

      We also maintain product liability insurance. The policy is an
occurrence-based policy providing coverage against claims currently pending
against us and future claims relating to injuries occurring between December
1994 and January 2005 even if such claims are filed after the end of the policy
period. The insurance program provides certain basic and excess coverages with
combined aggregate coverage of over $40,000,000 subject to the limitations
described below.

      The first level of insurance coverage under the policy provides coverage
of up to $2,250,000 per claim (with an annual limit of $4,500,000) in excess of
an uninsured retention (deductible) of $750,000 per occurrence. This basic
coverage has an aggregate limit which is currently $4,900,000, but the policy
requires us to increase this maximum limit to $7,700,000 by paying a fixed
annual payment or by prepaying the required premium at any time, which counts at
120% of the amount paid toward the limit.

      The insurance program also provides for additional coverage, which may be
subject to


                                       82
<PAGE>

certain state statutes limiting the applicability of such coverage in certain
instances, of up to $20,000,000 per occurrence, in excess of the first
$3,000,000 of each claim which is covered by the uninsured retention and basic
coverage, to the extent available. Claims covered by this excess coverage are
subject to one of two separate $20,000,000 aggregate policy limits, depending on
the date of the related injury. The first $20,000,000 aggregate limit applies to
claims for injuries occurring prior to January 31, 1998 while claims occurring
after January 1998, are covered under the second separate $20,000,000 aggregate
limit.

      There is no certainty that coverage will remain available to us after
January 2005 or that the insured amounts will be sufficient to cover all future
claims.

      Our product liability insurance carrier is a division of American
International Group, Inc., which has been rated A++XV by A.M. Best Property and
Casualty Insurance Rating Company.

      In March 1999, a jury rendered a verdict against us in a Texas product
liability lawsuit for approximately $11.4 million plus interest from February
1996. We have filed an appeal of the verdict. If the verdict was paid in full it
would be covered by the insurance described above, except for an amount equal to
the $750,000 uninsured retention. This amount, however, is already included in
our balance sheet reserves. Any such payment by the insurance company would
reduce the aggregate limits of insurance coverage available for other claims, as
discussed above.

      Product Liability Proceedings

      We have historically been a defendant in product liability personal injury
suits allegedly related to the use of football helmets manufactured or
reconditioned by us. As of November 30, 1999, five product liability cases were
pending against us.

      We have established reserves for pending product liability claims and
determine our reserves based on the level of insurance that is available and
estimates of losses and defense and settlement costs which we anticipate would
result from such claims based on information available at the time the financial
statements are issued. Due to the uncertainty involved with estimates, actual
results have at times varied substantially from earlier estimates and could do
so in the future. Accordingly, there can be no assurance that the ultimate costs
of these claims or potential future claims will fall within the established
reserves. See Note 11 to the Audited Consolidated Financial Statements.

Properties

      We own our principal football helmet manufacturing facility located in
Chicago, Illinois and we lease various facilities throughout the U.S.

      We believe our properties, machinery and equipment are adequate for our
current requirements.

      Set forth below is information regarding our principal properties:


                                       83
<PAGE>

--------------------------------------------------------------------------------
                                                   Square
Location                     Principal Use        Footage  Lease Expiration Date
--------                     -------------        -------  ---------------------
--------------------------------------------------------------------------------
New York, New          Corporate headquarters         650  September 2000
York
--------------------------------------------------------------------------------
Chicago, Illinois      Headquarters of             95,000  Owned
                       Riddell, Inc. and helmet
                       manufacturing
--------------------------------------------------------------------------------
Elk Grove Village,     Warehouse and              105,000  March 2000
Illinois               distribution center
--------------------------------------------------------------------------------
Elyria, Ohio           Headquarters for All        72,000  September 2014
                       American Sports
                       Corporation
                       reconditioning
                       operations and
                       customer service
--------------------------------------------------------------------------------
Stroudsburg,           Reconditioning and          44,000  October 2001
Pennsylvania           shoulder pad
                       customizing
--------------------------------------------------------------------------------
Memphis, Tennessee     Headquarters for            64,000  November 2000
                       Varsity's Operations
                       and Manufacturing
--------------------------------------------------------------------------------
Olive Branch,          Warehouse                   80,000  October 2000
Mississippi
--------------------------------------------------------------------------------

      We also lease several smaller facilities throughout the country.


                                       84
<PAGE>

                                   MANAGEMENT

      Our directors and executive officers are set forth below as of December
10, 1999.

                                                Positions
Name                             Age            with Riddell
----                             ---            ------------

Robert E. Nederlander (1)        67             Chairman of the Board

David M. Mauer (1)               51             Director, President and Chief
                                                Executive Officer

Jeffrey G. Webb (1) (2)          49             Vice Chairman of the Board of
                                                Riddell, President and Chief
                                                Operating Officer of the Varsity
                                                Group Division

David Groelinger                 49             Executive Vice President and
                                                Chief Financial Officer

Leonard Toboroff (1)             67             Director and Vice President

Don R. Kornstein                 48             Director

John McConnaughy, Jr. (1)        71             Director

Glenn E. "Bo" Schembechler       70             Director

Arthur N. Seessel, III (2)       61             Director

--------------------
(1)   Messrs. Nederlander, Mauer, Webb, Toboroff and McConnaughy and certain
      entities controlled by them, are parties to a shareholders' agreement that
      requires the parties thereto to vote the shares of Riddell's common stock
      owned by them directly and beneficially in the same manner as does Mr.
      Nederlander and for the election of Mr. Webb and his designee as members
      of our Board of Directors during the term of Mr. Webb's employment
      agreement. See "Employment Agreements and Change of Control Arrangements."
      In addition, the shareholders' agreement generally provides that the
      voting restrictions are terminated when a party transfers his shares. The
      Shareholders' Agreement expires on the earlier of May 28, 2001 or upon Mr.
      Nederlander's death.

(2)   In accordance with the agreements entered into in connection with
      Riddell's acquisition of Varsity in 1997, our Board of Directors increased
      the number of its members from seven to eight and agreed to nominate Mr.
      Webb and his designee to become members of the Board for the three-year
      period commencing at June 1997 and terminating on the third anniversary of
      such date or upon earlier termination of Mr. Webb's employment. Mr.


                                       85
<PAGE>

      Webb, who was elected a member of our Board at our 1998 annual meeting of
      stockholders and is our Vice Chairman, has named Arthur N. Seessel, III to
      serve on our Board as his designee.

      Set forth below is biographical information regarding each director and
executive officer of Riddell based on information supplied by them.

      Robert E. Nederlander. Mr. Nederlander has been Chairman of the Board of
Riddell since April 1988 and was Riddell's Chief Executive Officer from April
1988 through April 1, 1993. Mr. Nederlander has been President and/or a Director
since November 1981 of the Nederlander Organization, Inc., owner and operator of
one of the world's largest chains of live theaters. Since December 1998 Mr.
Nederlander has been a co-managing member of the Nederlander Company LLC, an
operator of live theaters outside of New York City. He served as the Managing
General Partner of the New York Yankees from August 1990 until December 1991,
and has been a limited partner since 1973. Mr. Nederlander has been President
since October 1985 of the Nederlander Television and Film Productions, Inc. and
Chairman of the Board since January 1988 of Mego Financial Corporation. Mr.
Nederlander was a director of Mego Mortgage Corporation from December 1996 until
June 1998. Mr. Nederlander became Chairman of the Board of Allis-Chalmers Corp.
in May 1989; from 1993 through October 1996 he was Vice Chairman, and thereafter
he remained solely a director. In 1995, Mr. Nederlander became a director of HFS
Incorporated, which recently merged into Cendant Corporation. In October 1996
Mr. Nederlander became a director of News Communications, Inc., a publisher of
community-oriented free circulation newspapers.

      David M. Mauer. Mr. Mauer became Riddell's Chief Executive Officer on
April 1, 1993, succeeding Mr. Nederlander. Mr. Mauer was President of Mattel
U.S.A. from late 1990 through the beginning of 1993 and was President of Tonka
U.S.A. Toy Group from 1988 until 1990. In 1995, Mr. Mauer was elected a member
of the Board of Directors of The Topps Company, Inc. Mr. Mauer is also a
director of the National Center for Missing and Exploited Children.

      Jeffrey G. Webb. Mr. Webb has been the Vice Chairman of the Board of
Riddell and the President and Chief Operating Officer of the Varsity Group
Division since Varsity was acquired by Riddell in June 1997. Prior to the
Varsity acquisition, Mr. Webb was Chairman of the Board, President and Chief
Executive Officer of Varsity Spirit Corporation since our formation in 1974.

      David Groelinger. In March of 1996, Mr. David Groelinger was appointed
Riddell's Chief Financial Officer, and in June 1996 our Executive Vice
President. From 1994 to 1995 he was a member of the Board of Directors,
Executive Vice President and Chief Financial Officer of Regency Holdings
(Cayman) Inc., which owned and operated a major international cruise line. Prior
to 1994 Mr. Groelinger served in various senior financial capacities during his
twelve years at Chiquita Brands International, Inc. In 1990, he was promoted to
Vice President reporting to the Chiquita's President and Chief Operating
Officer. Regency Holdings (Cayman) Inc. filed a petition to reorganize under
Chapter 11 of the United States Bankruptcy Code in November 1995.

      Leonard Toboroff. Mr. Toboroff has been Vice President of Riddell since
April 1988. Since May 1989, Mr. Toboroff has been a Vice President and Vice
Chairman of the Board of Allis-Chalmers Corp. Mr. Toboroff has been a practicing
attorney since 1961 and from


                                       86
<PAGE>

January 1, 1988 to December 31, 1990, was counsel to Summit Solomon & Feldesman
in New York City, which was counsel to Riddell from April 1988 through February
1993. He has been a Director since August 1987 and was Chairman and Chief
Executive Officer from December 1987 to May 1988 of Ameriscribe Corp. Mr.
Toboroff was Chairman and Chief Executive Officer from May through July 1982,
and then was Vice Chairman from July 1982 through September 1988 of American
Bakeries Company. Mr. Toboroff has been a director of Banner Aerospace, Inc., a
supplier of aircraft parts, since September 1992. He has been a director of
Engex, Inc. and director of Saratoga Springs Beverage Co. since 1993, and a
director of Hi Rise Recycling since March 1999.

      Don R. Kornstein. Mr. Kornstein has been a member of the Board of
Directors, Chief Executive Officer and President of Jackpot Enterprises, Inc.
since September 1994. Prior to this Mr. Kornstein was a Senior Managing Director
at Bear, Stearns & Co. Inc. for 17 years through September 1994. Mr. Kornstein
has been a director of Riddell since April 1995.

      John McConnaughy, Jr. Mr. McConnaughy has been Chairman and Chief
Executive Officer of JEMC Corp. since 1988. From 1969 to 1986, Mr. McConnaughy
served as Chairman and Chief Executive Officer of Peabody International Corp.
("Peabody"). From 1981 to 1992, he served as Chairman and Chief Executive
Officer of GEO International Corp. when it was spun off from Peabody in 1981.
Mr. McConnaughy is a Director of DeVlieg Bullard Inc., Mego Financial
Corporation, Transact International, Inc., Levcor International, Inc., Wave
Systems, Inc. and Adrien Arpel, Inc. He has been a director of Riddell since
September 1989.

      Glenn E. "Bo" Schembechler. Mr. Schembechler was President of the Detroit
Tigers from January 1990 through August 1992 and a member of the Tigers Board of
Directors from 1989 through 1990. He is also a Director of Midland Company. From
1968 through 1989, Mr. Schembechler was head football coach of the University of
Michigan and served as its Athletic Director in 1988 and 1989. He has been a
director of Riddell since September 1991.

      Arthur N. Seessel, III. Mr. Seessel was the Chief Executive Officer of
Seessel Holdings Inc., a supermarket chain located in Memphis, Tennessee, until
the company was sold in 1996. Mr. Seessel currently serves as a consultant to
Albertson's Inc. and is a member of the Board of Directors of Red River
Bankshares and Auto Radio Inc. He has been a director of Riddell since February
1999.


                                       87
<PAGE>

Structure and Compensation of Board of Directors

      Directors' fees and board meeting attendance

      Directors who are not officers of Riddell received a fee in 1999 of
$20,000 per annum. In 1999, directors who were members of the Audit and
Compensation Committees of the Board (Messrs. McConnaughy, Kornstein,
Schembechler and Seessel) were also each paid an aggregate additional amount of
$5,000 per annum for their Committee memberships.

      During 1999, Messrs. Nederlander, Toboroff, McConnaughy, Kornstein and
Schembechler were each granted an option to purchase up to 7,500 shares of
Riddell's common stock at an exercise price of $3.125 per share and Mr. Seessel
was granted an option to purchase up to 15,000 shares of Riddell's common stock
at an exercise price of $6.50 per share. These grants were pursuant to
provisions of the 1991 and 1997 Stock Option Plans which provide for fixed
automatic grants of options to eligible directors as described below under
"General Description of 1997 Stock Option Plan." In 1999, Messrs. Nederlander,
McConnaughy, Toboroff and Schembechler each received a payment of $16,875 in
exchange for the surrender of stock options granted to them in 1994 for 15,000
shares each, at an exercise price of $2.625. The payment was computed based on
the "in the money" value of the options at the time of the payments.

      See "Summary Compensation Table" and "Options Granted in 1999" for a
discussion of compensation paid to Mr. Mauer, a director and Riddell's Chief
Executive Officer and Mr. Webb, Riddell's Vice Chairman and the President and
Chief Operating Officer of our Varsity Group Division.

      Riddell has agreed to indemnify each director and officer against certain
claims and expenses for which the director might be held liable in connection
with service on the Board. In addition, Riddell maintains an insurance policy
insuring our directors and officers against such liabilities.

      During calendar year ended December 31, 1999, there were four meetings of
the Board of Directors. One meeting was attended by all of the members of the
Board of Directors, one meeting was attended by all of the members other than
Mr. Schembechler, one meeting was attended by all of the members other than Mr.
Webb and one meeting was attended by all of the members other than Mr.
McConnaughy.

      Committee Structure and Meetings

      The Board of Directors maintains an Executive Committee consisting of Mr.
Nederlander, the Committee's Chairman, Mr. Mauer, Mr. Toboroff and Mr. Webb.
Under Riddell's bylaws the Executive Committee has the power of the full Board.
The Executive Committee did not hold any meetings in 1999.

      The Board of Directors also maintains a Compensation Committee comprised
in 1999 of Messrs. McConnaughy, Schembechler, Seessel and Kornstein. Mr.
Kornstein was Chairman of the Committee in 1999. None of these individuals has
ever been an officer of Riddell. The Compensation Committee reviews and
establishes the cash and non cash compensation of key employees and recommends
grants of options under Riddell's 1991 Stock Option Plan and 1997 Stock Option
Plan. It considers recommendations of


                                       88
<PAGE>

management and, when it deems appropriate, the advice of outside experts in
connection with these determinations. The Compensation Committee had one
meeting, which was attended by all of the members of the Compensation Committee.

      The Board of Directors has established an Audit Committee which in 1999
consisted of Messrs. McConnaughy, Schembechler, Seessel and Kornstein. Mr.
Kornstein was Chairman of the Committee in 1999. No member of the Audit
Committee has ever been an officer of Riddell. The Audit Committee reviews
Riddell's internal controls and the objectivity of our financial reporting and
the scope and results of the auditing engagement. It meets with appropriate
Riddell financial personnel and independent public accountants in connection
with these reviews. The auditors have access to such Committee at any time. The
Audit Committee had one meeting in 1999 which was attended by all of the members
of the Audit Committee.

      The members of each committee are appointed by the Board of Directors for
a term beginning after the first regular meeting of the Board following the
Annual Meeting and until their respective successors are elected and qualified.
Each committee elects its own Chairman.


                                       89
<PAGE>

         SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

      The following table sets forth certain information as of November 12, 1999
pertaining to ownership of the Riddell's common stock by persons known to
Riddell to own 5% or more of Riddell's common stock and common stock owned
beneficially by each director and named executive officer of Riddell and by
directors and named executive officers of Riddell as a group.

      The information contained herein has been obtained from Riddell's records,
or from information furnished directly by the individual or entity to Riddell
made by such persons with the U.S. Securities and Exchange Commission.

<TABLE>
<CAPTION>
                                                         Percent
                                                           of
                                       Shares Owned      Common               As Adjusted (Assuming Completion of Rights
                                       Beneficially       Stock                    Offering and Concurrent Offering)
                                       ------------       -----                    ---------------------------------

                                                                               Minimum (1)                   Maximum (2)
                                                                               -----------                   -----------

                                                                        Shares         Percentage       Shares       Percentage
                                                                        ------         ----------       ------       ----------

<S>                                    <C>                <C>          <C>                <C>
Robert E. Nederlander                  5,289,747(3)       51.9%        5,760,917          50.4%
810 Seventh Avenue
New York, NY 10019

David M. Mauer                           480,645(4)        5.0%          486,921           4.5%
c/o Riddell Sports Inc
50 East 42nd Street, Suite
1808
New York, NY 10017

Jeffrey G. Webb                        1,214,370(5)       12.6%        1,303,374          12.0%
c/o Varsity Spirit
Corporation
2525 Horizon Lake Drive
Memphis, TN 38133

David Groelinger                          71,000(6)           *           71,918           *
c/o Riddell Sports Inc.
50 East 42nd Street, Suite
1808
New York, NY 10017

Leonard Toboroff                       1,303,585(7)       14.0%        1,440,253          13.6%
c/o Riddell Sports Inc.
50 East 42nd Street, Suite
1808
New York, NY 10017
</TABLE>


                                       90
<PAGE>

<TABLE>
<S>                                    <C>                <C>          <C>                <C>
Don R. Kornstein                          50,000(8)           *           50,000           *
c/o Riddell Sports Inc.
50 East 42nd Street, Suite
1808
New York, NY 10017

John McConnaughy, Jr.                  1,038,937(9)       11.2%        1,147,037          10.9*
c/o JEMC Corp.
1011 High Ridge Road
Stamford, CT  06905

Glenn E. "Bo"                             37,500(8)           *           37,500           *
Schembechler
c/o Riddell Sports Inc.
50 East 42nd Street, Suite
1808
New York, NY 10017

Arthur N. Seessel, II                       None           None             None           None
c/o Seessel's Supermarkets
1745 Union Avenue
Memphis, TN 38104

All officers and directors as          5,448,247          52.7%        5,920,335          51.1%
a group (9 individuals)

Angelo, Gordon & Co., L.P.             1,395,000(10)      13.1%        1,395,000          11.7%
245 Park Avenue,
26th Fl.
New York, NY 10167
</TABLE>

      --------------------

      * Less than 1%

      (1)   Adjusted to reflect the assumed exercise of each individual's pro
            rata rights granted pursuant to the rights offering and assuming no
            shares of common stock are purchased by the standby group pursuant
            to rights issued to other stockholders.

      (2)   Adjusted to reflect the assumed exercise of each individual's pro
            rata rights granted pursuant to the rights offering and assuming the
            standby group purchases all of the shares of common stock pursuant
            to the standby purchase commitment.

      (3)   Of the 5,289,747 shares beneficially owned by Mr. Nederlander: (i)
            1,252,210 shares are owned by Mr. Nederlander directly or through
            entities controlled by him having dispositive power over these
            shares (37,500 of these 1,252,210 shares underlie options granted
            under Riddell's 1991 Stock Option Plan that are exercisable
            currently or within 60 days of November 12, 1999; 646,037 of such
            1,252,210 shares are subject to a voting trust expiring May 29, 2001
            pursuant to which Robert Nederlander is voting trustee and has sole
            voting power (except to the limited extent described in Note 6
            below) and (ii) an


                                       91
<PAGE>

            additional 4,037,537 shares are beneficially owned by Mr.
            Nederlander as voting trustee under the voting trust and pursuant to
            a shareholders' agreement to which Mr. Nederlander and certain other
            officers and directors of Riddell and their affiliates are parties.
            Under Rule 13-d of the Securities Exchange Act of 1934, Mr.
            Nederlander is deemed to beneficially own the shares of stock
            subject to the voting trust and the stockholders' agreement. The
            stockholders' agreement terminates upon the earliest May 28, 2001 or
            the death of Mr. Nederlander, or the date of the transfer of shares
            subject to the stockholders' agreement (other than to certain
            parties) as to the shares transferred.

      (4)   The shares of common stock beneficially owned by Mr. Mauer are
            subject to the stockholders' agreement and 422,500 of these shares
            are issuable in connection with options granted under Riddell's 1991
            Stock Option Plan and the warrant that are exercisable currently or
            within 60 days of November 12, 1999.

      (5)   The shares of common stock beneficially owned by Mr. Webb are
            subject to the stockholders' agreement and 389,843 of these shares
            underlie options granted under Riddell's 1997 Stock Option Plan that
            are exercisable currently or within 60 days of November 12, 1999.

      (6)   Includes 62,500 shares underlying that portion of an option granted
            under Riddell's 1991 Stock Option Plan that is exercisable within 60
            days of November 12, 1999.

      (7)   The shares of common stock beneficially owned by Mr. Toboroff are
            subject to the stockholders' agreement and 37,500 shares underlie
            options granted under Riddell's 1991 Stock Option Plan that are
            exercisable currently or within 60 days of November 12, 1999

      (8)   Represents shares underlying options granted under Riddell's 1991
            Stock Option Plan that are exercisable currently or within 60 days
            of November 12, 1999.

      (9)   Of the shares of common stock beneficially owned by Mr. McConnaughy:
            (i) 484,530 are subject to the voting trust; (ii) 554,407 are
            subject to the stockholders' agreement and (iii) 37,500 shares
            underlie options granted under Riddell's 1991 Stock Option Plan that
            are exercisable currently or within 60 days of November 12, 1999.
            Mr. McConnaughy has pledged his interest in 989,155 shares of
            Riddell's common stock to financial institutions to secure loans.
            The voting trust provides that if Mr. McConnaughy defaults on the
            loan pursuant to which the pledge was made, the voting restrictions
            are removed from the pledged shares.

      (10)  Based on a Schedule 13G filed February 13, 1997, Angelo, Gordon &
            Co., L.P. may be deemed to be the beneficial owner of 1,395,000
            shares as a result of voting and dispositive powers it holds with
            respect to $1,000,000 principal amount of Riddell's 4.10%
            Convertible Subordinated Note due November 1, 2004 (the "Notes")
            convertible at $5.3763 per share into 186,000 shares of


                                       92
<PAGE>

            Riddell's common stock held for its own account and $6,500,000
            principal amount of Notes convertible into 1,209,000 shares of
            common stock which it holds for the account of private investment
            funds for which it acts a general partner and/or investment advisor
            or investment manager.

Section 16(a) Disclosure

      Riddell believes, based solely on our review of the copies of the Forms 3,
4 and 5 required to be filed with Riddell pursuant to Section 16(a) of the
Exchange Act by our officers, directors and beneficial owners of more than 10%
of Riddell's common stock, that during the eleven (11) month period ended
December 1, 1999, all filing requirements applicable to such persons were
complied with.

Executive Compensation Summary Compensation Table

      The table below sets forth the cash compensation paid to or accrued for
Riddell's Chief Executive Officer and our five other most highly paid executive
officers in 1998 for services rendered in all capacities to Riddell and our
subsidiaries during the fiscal years ended December 31, 1998, 1997 and 1996.

<TABLE>
<CAPTION>
                                             Annual Compensation                    Long Term Compensation Awards
                                  ---------------------------------------------------------------------------------
                                                                                   Securities
Name and                                                       Other Annual        Underlying      All Other
Principal Position       Year      Salary           Bonus      Compensation (1)     Options(2)     Compensation (3)
------------------       ----      ------           -----      ----------------     ----------     ----------------
<S>                      <C>      <C>             <C>                  <C>           <C>                <C>
Robert E.
Nederlander              1998     $196,160               -             -               7,500                 -
Chairman of the          1997      189,511         $50,000             -               7,500                 -
Board                    1996      180,656               -             -               7,500                 -

David M. Mauer
Chief Executive          1998     $575,000               -             -              40,000            $1,000
Officer                  1997      550,000         $60,000             -              50,000             4,750
                         1996      500,000               -                            50,000             4,620

Jeffrey G. Webb
President and            1998     $375,000        $207,090             -              35,000                 -
Chief Operating          1997      200,914(4)      133,380(5)          -             397,760(4)              -
Officer of The
Varsity Group
Division since the
Varsity
Acquisition date
of June 19, 1997
</TABLE>


                                       93
<PAGE>

<TABLE>
<CAPTION>
                                             Annual Compensation                    Long Term Compensation Awards
                                  ---------------------------------------------------------------------------------
                                                                                   Securities
Name and                                                       Other Annual        Underlying      All Other
Principal Position       Year      Salary           Bonus      Compensation (1)    Options(2)      Compensation (3)
------------------       ----      ------           -----      ----------------     ----------     ----------------
<S>                      <C>      <C>              <C>            <C>                 <C>             <C>
David Groelinger
Chief Financial          1998     $220,385               -               -            15,000            $1,000
Officer and              1997      195,977         $50,000               -            20,000             4,302
Executive Vice           1996      143,308          25,000               -            65,000                 -
President since
March 7, 1996

Thomas L. Clark
Senior Vice              1998     $132,693         $88,000        $164,467(6)         20,000                 -
President,
Consumer
Products, of
Riddell Group
Division since
February 8, 1999

Dan Cougill
President and            1998     $252,275               -               -            45,000          $457,667
Chief Operating          1997      259,231               -               -            20,000             4,750
Officer of Riddell       1996      230,000               -               -            15,000             4,750
Group Division
until November
27, 1998
</TABLE>

---------------------------

(1)   Other perquisites and other personal benefits paid for the named executive
      officers are omitted from the table as permitted by the rules of the U.S.
      Securities and Exchange Commission because they aggregated less than the
      lesser of $50,000 and 10% of the total annual salary and bonus set forth
      in the columns entitled, "Salary" and "Bonus" for each named executive
      officer.

(2)   These options were issued under Riddell's 1991 Stock Option Plan or 1997
      Stock Option Plan. Options granted to Mr. Cougill were forfeited upon his
      separation from Riddell.

(3)   Represents Riddell's contribution to a 401(k) plan on behalf of the
      employee and in the case of Mr. Cougill, also includes $456,667 of
      separation payments paid or accrued in 1998.

(4)   Pursuant to an employment agreement between Riddell and Mr. Webb effective
      in June 1997 which provides for an annual base salary of $375,000 and
      certain stock options to be granted in 1997. See "Employment Agreements
      and Change of Control Arrangements."

(5)   Includes unrestricted stock awards of Riddell's common stock valued at
      $153,400 for 1998 and $98,800 for 1997 based on quoted market values on
      the date the awards were granted. The 1998 award of 41,600 was valued at
      approximately $3.69 per


                                       94
<PAGE>

      share and the 1997 award of 20,800 shares was valued at $4.75 per share.

(6)   Includes one-time relocation related expenses of $164,467 for Mr. Clark.


                                       95
<PAGE>

Stock Options Granted in 1998

      The following table sets forth information concerning individual grants of
stock options made during 1998 to each executive officer listed below pursuant
to Riddell's 1991 and 1997 Stock Option Plans.

<TABLE>
<CAPTION>
                                                 % of Total                                             Potential Realizable
                              Number of           Options                                                 Value at Assumed
                              Securities         Granted to                                               Annual Rates of
                              Underlying         Employees          Exercise                                Stock Price
                               Options           In Fiscal         Price Per        Expiration            Appreciation for
Name                           Granted              Year             Share             Date               Option Term (1)
----                           -------              ----             -----             ----                           ---

                                                                                                         5%             10%
                                                                                                         --             ---

<S>                             <C>                 <C>              <C>            <C>               <C>             <C>
Robert                           7,500               2%              $5.38          6/24/2008         $25,352         $64,248
Nederlander (2)

David M. Mauer                  40,000               9%              $5.38          6/24/2008         135,212         342,655
(3)

Jeffrey Webb (3)                35,000               8%              $5.38          6/24/2008         118,311         299,823

David                           15,000               3%              $5.38          6/24/2008          50,705         128,495
Groelinger (3)

Thomas L.                       20,000               4%              $4.88           2/9/2008          61,317         155,390
Clark (4)

Dan Cougill (5)                 45,000              10%              $5.38          6/24/2008              (5)             (5)
</TABLE>

(1)   Based upon the per share market price on the date of grant and an annual
      appreciation of such market price at the rate stated in the table through
      the expiration date of such options. Gains, if any, are dependent upon the
      actual performance of the common stock, as well as the continued
      employment of the executive officers through the vesting period. The
      potential realizable values indicated have not taken into account amounts
      required to be paid as income tax under the Internal Revenue Code and any
      applicable state laws.

(2)   This option was granted pursuant to provisions of the 1991 Stock Options
      Plan which provides for annual fixed automatic grants of options to
      certain eligible directors. The option is fully exercisable commencing
      June 24, 1999 through June 24, 2008. In the event Mr. Nederlander's Board
      membership terminates, generally, other than for cause, the option becomes
      fully exercisable for 90 days. The option terminates if Mr. Nederlander's
      Board membership terminates for cause.

(3)   This option vests as to 25% of the underlying shares on each of the first,
      second, third and


                                       96
<PAGE>

      fourth anniversaries of the date of grant. The option is canceled upon a
      termination of employment for cause. In the event the employee's
      employment is terminated by Riddell, generally, other than for cause, this
      stock option becomes fully exercisable for one year. The option fully
      vests immediately upon a change in control.

(4)   This option vests as to 25% of the underlying shares on each of the first,
      second, third and fourth anniversaries of the date of grant. The option is
      canceled upon a termination of employment for cause. In the event the
      employee's employment is terminated by Riddell, generally, other than for
      cause, the stock option remains exercisable for 90 days to the extent of
      any underlying shares which were vested on the termination date.

(5)   Options granted to Mr. Cougill were forfeited upon his separation from
      Riddell.


                                       97
<PAGE>

Stock Options Held at End of 1998

      The following table indicates the total number of exercisable and
unexercisable stock options held by each executive officer listed below on
December 31, 1998. No options to purchase Riddell's common stock were exercised
by any of these individuals during 1998. On December 31, 1998, the last sale
price of the common stock on the American Stock Exchange was $5.625 per share.

<TABLE>
<CAPTION>
                              Number of Securities Underlying                Value of Unexercised
                                  Unexercised Options at                   in-the-Money Options at
                                     December 31, 1998                        December 31, 1998
                                     -----------------                        -----------------

Name                         Exercisable         Unexercisable         Exercisable          Unexercisable
----                         -----------         -------------         -----------          -------------
<S>                              <C>                   <C>                <C>                      <C>
Robert Nederlander                45,000                 7,500            $107,325                 $1,875

David M. Mauer                   387,500               102,500             741,188                 45,063

Jeffrey G. Webb                  364,427                68,333             638,079                 15,583

David Groelinger                  37,500                 7,500              33,425                 39,025

Thomas L. Clark                       --                20,000                  --                 15,000
</TABLE>

Employment Agreements and Change of Control Arrangements

      In June 1992, Riddell entered into an employment agreement with each of
Messrs. Nederlander and Toboroff. Each agreement continues until terminated by
Riddell, with termination effective three years after Riddell delivers notice of
termination or, if earlier, until the death or disability of the employee. The
agreements are immediately terminable by Riddell for cause (as defined therein).
Bonuses are at the discretion of the board. Each agreement provides a base
salary of $162,500 which may be increased in the discretion of the board,
provided that in any event each year the salaries are increased at least by the
percentage increase in the Consumer Price Index. Each agreement provides that in
the event Riddell terminates the employee's employment, generally, other than
for cause, the employee will receive his full salary through the end of the term
of his agreement and annual bonuses for the remainder of the term equal to the
average of the annual bonuses awarded to the employee prior to termination. Each
agreement acknowledges that the employee will devote time and provide services
to entities other than Riddell.

      In April 1993, Riddell entered into an employment agreement with Mr.
Mauer. The agreement, as amended in 1994, provides an annual base salary in such
amount in excess of $400,000 as the Board of Directors may determine from time
to time. The agreement provides for the years subsequent to 1993, that the Board
of Directors and Mr. Mauer establish target bonuses based upon measures to be
agreed upon before the beginning of each calendar year, and that Mr. Mauer's
bonus will be a percentage, not to exceed 100%, of his base salary based upon
the percent of the targets achieved. The agreement continues until terminated by
Riddell, with termination effective three years after Riddell delivers notice of
termination or, if earlier, until Mr. Mauer's


                                       98
<PAGE>

death or disability. The agreement is immediately terminable for cause (as
defined therein). Mr. Mauer was granted an option for ten years to acquire
300,000 shares of Riddell's common stock pursuant to the Agreement at an average
price of $3.63 per share. In the event Mr. Mauer's employment is terminated,
generally, other than for cause, Mr. Mauer will receive his salary for a period
of three years plus a pro rata portion of the bonus earned through the date of
termination, and his options become fully exercisable for one year.

      In addition, in connection with the acquisition of Varsity Spirit
Corporation, Riddell entered into an employment agreement with Mr. Webb
effective June 1997. Under the provisions of such agreement Mr. Webb serves as
Vice Chairman of the Board of Directors of Riddell as well as President and
Chief Operating Officer of the Varsity Group Division. Mr. Webb is entitled to a
base salary of no less than $375,000 per year and is eligible to participate in
those bonus arrangements which are made available to other senior officers of
Riddell at a target level of 40% of his base salary. Pursuant to his employment
agreement, Mr. Webb received options to purchase 50,000 shares of common stock
of Riddell with a per share exercise price of $5.44 and "special options" to
purchase an additional 347,760 shares at a per share exercise price of $3.80.
Upon termination of Mr. Webb's employment (i) by Riddell without cause (as
defined therein), (ii) by Mr. Webb with good reason (as defined therein,
including a material adverse alteration in his status or responsibilities and
relocation more than 50 miles from Memphis, Tennessee), or (iii) following a
change in control (as defined therein), Mr. Webb will receive continued payments
of base salary for the longer of the remainder of the term and one year (two
years in case of termination following a change in control), as well as certain
benefits. Mr. Webb is subject to a non-competition covenant generally for a
period of two years following the termination of his employment for any reason.
Pursuant to his employment agreement, Mr. Webb agreed to become a party to the
Shareholders' Agreement to which Messrs. Mauer, Nederlander, Toboroff and
McConnaughy are parties.

      Riddell entered into an employment agreement with Mr. Groelinger effective
March 1996 in connection with his joining Riddell as Chief Financial Officer.
The agreement provides for an annual base salary of $180,000 and a guaranteed
minimum bonus for 1996 of $25,000. Thereafter, bonuses will be a percentage of
his salary, with a target of 40%. Pursuant to the Agreement, Mr. Groelinger was
granted a ten-year option to purchase 65,000 shares of Riddell's common stock at
an exercise price of $4.63 per share. The agreement is immediately terminable
for cause (as defined therein) and expires, unless renewed, in March 2001. The
agreement provides, generally, that if Mr. Groelinger's employment is terminated
other than for cause he will be paid no less than one year's salary (two years'
salary in the event termination arises in connection with a change of control
(as defined therein)) plus a pro rata portion of his bonus through the date of
termination and his stock options become immediately exercisable for one year to
the extent then vested.

      The stock options granted to Messrs. Mauer, Webb and Groelinger in
connection with their employment become immediately exercisable in the event a
change of control of Riddell occurs.


                                       99
<PAGE>

Compensation committee interlocks and insider participation

      Mr. McConnaughy is a member of Riddell's Board of Directors and our
Compensation and Audit Committees and a member of a group of stockholders who
may be deemed to beneficially own and exercise control over approximately 52% of
Riddell's outstanding common stock as of November 12, 1999. See "Security
Ownership of Certain Beneficial Owners and Management."

Our 1991 Stock Option Plan and 1997 Stock Option Plan

      Introduction

      Riddell maintains two stock option plans: the 1991 Riddell Sports Inc.
Stock Option Plan (the "1991 Plan") and the 1997 Riddell Sports Inc. Stock
Option Plan (the "1997 Plan") pursuant to which there are 305,650 shares of
common stock available for grant of options as of November 12, 1999. Riddell has
granted an aggregate of 2,609,850 shares of our common stock under options and
stock grants made in accordance with the 1991 Plan and 1997 Plan as of November
12, 1999 (net of past grants canceled or expired).

      1991 Stock Option Plan

      Riddell's Board of Directors adopted the 1991 Stock Option Plan, which was
approved by Riddell's stockholders, to attract and retain qualified management.
Options to acquire an aggregate of 1,415,500 shares of common stock were
originally reserved for issuance under the 1991 Plan

      Under the 1991 Plan, options may be granted from time to time to key
employees, including officers, directors, advisors and independent consultants
to Riddell or to any of our subsidiaries. The board is generally empowered to
interpret the 1991 Plan, to determine the terms of the option agreements, to
determine the employees to whom options are to be granted, and to determine the
number of shares subject to each option and the exercise price thereof. Upon
exercise of an option, the optionee may pay the purchase price with previously
acquired securities of Riddell, or at the discretion of the Board, Riddell may
loan some or all of the purchase price to the optionee.

      Each Riddell director other than any director who is also a Chief
Executive Officer, President, Executive Vice President or Senior Vice President
of Riddell or any of our subsidiaries will receive an option to acquire 7,500
shares of common stock each year. In addition, each such individual (other than
current directors) will receive an option to acquire 15,000 shares of common
stock upon becoming a member of the board and, after the first anniversary of
his joining the board, the annual grant of an option to acquire 7,500 shares
concurrently with the grants to the other directors. All such directors' options
will become exercisable in full on the first anniversary of the date of grant
will have an exercise price equal to the fair market value of the common stock
on the date of grant, which will be the closing price of the common stock on the
date of each annual meeting of stockholders. For tax reasons, the 1991 Plan
limits the number of shares of common stock with respect to which options may be
granted to any individual in any year to no more than 150,000.

      'The board may modify, suspend or terminate the 1991 Plan, provided
however, that certain material modifications affecting the 1991 Plan must be
approved by the stockholders, and any change in the 1991 Plan that may adversely
affect an optionee's rights under an option previously granted under the 1991
Plan requires the consent of the optionee.


                                      100
<PAGE>

      1997 Stock Option Plan

      Under the 1997 Plan a maximum of 1,500,000 shares of common stock has been
reserved for issuance, subject to equitable adjustment upon the occurrence of
any stock dividend, stock split, recapitalization, combination or exchange of
shares.

      Unless otherwise determined by the board, the 1997 Plan shall be
administered by a committee appointed by the board, which shall consist of two
or more members of the board who are "outside directors" within the meaning of
section 162(m) of the Internal Revenue Code. The full board shall also have the
authority, in its discretion, to grant stock options or other stock-based awards
under the 1997 Plan and to administer the 1997 Plan. For all purposes under the
1997 Plan, any entity which performs the duties described, shall be referred to
as the "Committee." The Committee shall have full authority, subject to the
provisions of the 1997 Plan, among other things, to determine the persons to
whom options or other stock-based awards will be granted, to determine the
exercise price of the stock options and to prescribe, amend and rescind rules
and regulations relating to the 1997 Plan. Grants of stock options or other
stock-based awards may be made under the 1997 Plan to selected employees,
directors (including directors who are not employees) and consultants of Riddell
and our present or future affiliates, in the discretion of the Committee.

      The 1997 Plan also provides for automatic grants of stock options (with an
exercise price equal to the fair market value of a share of common stock on the
date of grant) to each member of the board who is not a Chief Executive Officer,
President, Senior Vice President or Executive Vice President of Riddell or our
subsidiaries ("Eligible Directors"). Except as otherwise determined by the
Committee, options to purchase 15,000 shares of common stock will be
automatically granted to Eligible Directors upon commencement of their service
on the board, except with respect to Eligible Directors serving on the date of
the 1997 annual stockholders meeting. Thereafter Eligible Directors are granted
an option to purchase 7,500 shares of common stock on the date of each
subsequent annual meeting of stockholders (unless such Eligible Director has
received an initial option grant less than one year prior to the date of such
meeting). Options automatically granted to Eligible Directors become exercisable
as to all shares on the first anniversary of the date of grant or on the
retirement of the Eligible Director from the Board, whichever is first. Options
automatically granted to Eligible Directors expire on the earliest of (i) the
tenth anniversary of the date of grant, (ii) the second anniversary of the
termination of the Eligible Directors' service on the Board for reasons other
than cause, or (iii) thirty days after the termination of the Eligible
Directors' service on the Board of Directors for cause (as defined in the 1997
Plan).

      Except to the extent the committee provides otherwise, stock options
granted under the 1997 Plan shall not be transferable otherwise than by will or
by the laws of descent and distribution. The 1997 Plan may, at any time and from
time to time, be altered, amended, suspended, or terminated by the board, in
whole or in part; provided that, unless otherwise determined by the board, an
amendment that requires stockholder approval in order for the 1997 Plan to
continue to comply with Section 162(m) of the Internal Revenue Code or any other
law, regulation or stock exchange requirement shall not be effective unless
approved by the requisite vote of stockholders. In addition, no amendment may be
made which adversely affects any of the rights of a optionee under any award
theretofore granted, without such grantee's written consent.

                 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      In 1994 Riddell granted a common stock purchase warrant to a limited
partnership owned in part by Messrs. Nederlander, Toboroff and McConnaughy to
purchase 150,000 shares of our


                                      101
<PAGE>

common stock in consideration for the extension of a note in the amount of
$2,000,000 issued by the partnership in favor of Riddell. In August 1995 certain
of the original partners withdrew from the partnership, and Messrs. Cougill,
Mauer, McConnaughy, Nederlander and Toboroff or entities controlled by them
acquired their interests in the warrant.

      In 1998, based on a resolution of the Compensation Committee with Mr.
McConnaughy abstaining, Riddell allowed the holders of the warrant to effect a
cashless exercise of the warrant, in effect accepting shares issuable upon
exercise as payment for the exercise based on per share value one-eighth of a
point higher than the quoted market value. As a result, 42,362 shares of common
stock were issued in exchange for the 150,000 share warrant based on an exercise
price of $2.96 per share and an exchange price of $4.125 per share. The exchange
price of $4.125 per share was set on a date when the quoted market price of a
share of common stock was $4.00.


                                      102
<PAGE>

                              PLAN OF DISTRIBUTION

      We are offering the shares of common stock in the rights offering directly
to holders of our common stock.

      As soon as practicable after the date of this prospectus, we will
distribute the rights and copies of this prospectus to individuals who owned
shares of common stock on December ___, 1999.

      We currently anticipate that a group of our officers, directors and some
other individuals will agree to exercise all of the rights granted to those
members of the standby group who are stockholders as of the record date, and, in
addition, will also agree to purchase up to $__________ worth of the shares
offered under the rights offering that are not purchased by the other
stockholders.

      We will pay the fees and expenses of American Stock Transfer & Trust
Company, as subscription agent in the rights offering. We have also have agreed
to indemnify the subscription agent from any liability which it may incur in
connection with the rights offering, including liabilities under the Securities
Act of 1933.

      We will pay H.C. Wainwright & Co., Inc., as solicitation agent, an agency
fee equal to 3% of the gross proceeds received upon the exercise of rights in
the rights offering.

      In addition to the rights offering, we are also conducting an underwritten
offering of 250,000 shares of our common stock, the concurrent offering. In the
concurrent offering, H.C. Wainwright & Co. shall act as underwriter. In its
capacity as underwriter, H.C. Wainwright & Co., Inc. shall receive a 7% discount
on all shares underwritten in the concurrent offering. We have also granted the
underwriter an option, exercisable during the 45-day period commencing on the
date of this prospectus, to purchase at the public offering price per share,
less the underwriting discount, up to an aggregate of 37,500 shares of common
stock. In addition, we have agreed to issue to H.C. Wainwright & Co. as
underwriter of the concurrent offering, five-year warrants to purchase up to
_____% of the number of shares of common stock sold in the concurrent offering.

      We have also agreed to reimburse H.C. Wainwright & Co. for its actual
out-of-pocket expenses incurred in connection with the rights offering and the
concurrent offering, including the fees and expenses of its counsel.

      In addition, we have agreed to indemnify H.C. Wainwright & Co. against
some liabilities, including civil liabilities under the Securities Act, or to
contribute to payments H.C. Wainwright & Co. may be required to make in this
respect.


                                      103
<PAGE>

                          DESCRIPTION OF CAPITAL STOCK

General

      We are authorized to issue 45,000,000 shares of common stock, $0.01 par
value, and 5,000,000 shares of undesignated preferred stock, $0.01 par value.
The following description of our capital stock does not purport to be complete
and is subject to and qualified by our certificate of incorporation and by-laws,
which are included as exhibits to the Registration Statement of which this
prospectus forms a part of, and by the provisions of applicable Delaware law.

Common stock

      As of December 10, 1999 there were 9,263,957 shares of common stock
outstanding which were held of record by approximately 732 stockholders.

      The holders of common stock are entitled to one vote per share on all
matters to be voted upon by the stockholders. The holders of common stock are
entitled to receive ratably dividends, if any, as may be declared from time to
time by the Board of Directors out of funds legally available for such purpose.
In the event of a liquidation, dissolution or winding up of Riddell, the holders
of common stock are entitled to share ratably in all assets remaining after
payment of liabilities subject to prior distribution rights of preferred stock,
if any, then outstanding. The common stock has no preemptive or conversion
rights or other subscription rights. There are no redemption or sinking fund
provisions applicable to the common stock. All outstanding shares of common
stock are fully paid and non-assessable, and the shares of common stock to be
issued upon the closing of this offering will be fully paid and non-assessable.

Preferred stock

      As the proper language was inadvertently omitted from our certificate of
incorporation in connection with a previous amendment, we are currently amending
our certificate of incorporation to provide the Board of Directors with the
authority, without action by the stockholders, to designate and issue preferred
stock in one or more series and to designate the rights, preferences and
privileges of each series, any or all of which may be greater than the rights of
the common stock. We cannot state the actual effect of the issuance of any
shares of preferred stock upon the rights of holders of common stock until the
Board determines the specific rights of the holders of such preferred stock.
However, effects on the holders of common stock might include, among other
things, restricting dividends on a common stock, deleting the voting power of
the common stock, and paring the liquidation rights of the common stock and
delaying or preventing a change of control of Riddell without further action by
the stockholders. As of December ____, 1999, there are 5,000,000 shares of
preferred stock authorized, although none were issued and outstanding. We have
no present plans to issue any shares of preferred stock.


                                      104
<PAGE>

Common stock purchase warrants

      Holders who exercise their rights shall receive, for no additional
consideration, common stock purchase warrants that are exercisable for a portion
of Riddell's ownership interest in a future subsidiary (either newly formed or
presently existing) whose principal business is Riddell's Internet operations.
All of the warrants issued, in the aggregate, will represent the right to
purchase ______ (____%) percent of Riddell's ownership interest in this Internet
subsidiary at the time the warrants first become exercisable. These warrants
will only become exercisable if (i) we form or use a presently existing
subsidiary to conduct substantially all of our Internet operations, and (ii) we
effect an initial public offering for this subsidiary on or before December 31,
2002. If we close on an initial public offering of our Internet subsidiary by
December 31, 2002, the warrants will be exercisable for six (6) months after the
closing of the initial public offering, after which time they will expire. If we
do not form an Internet subsidiary by December 31, 2002, or form such a
subsidiary but do not effect an initial public offering for our Internet
subsidiary on or before December 31, 2002, these common stock purchase warrants
shall expire on December 31, 2002 and shall no longer be exercisable. If we do
effect an initial public offering of our Internet subsidiary on or before
December 31, 2002 we will also register at that time the shares of common stock
issuable to you upon your exercise of the common stock purchase warrants. The
common stock purchase warrants will have an exercise price of $.01 per share,
are not transferable (except in the event of the death of the holder, in which
event they are transferable to the estate of the holder), are subject to
dilution, and will only be issued to those individuals or entities who exercise
rights.

Delaware anti-takeover law and certain charter and bylaw provisions

      Certain provisions of Delaware law and our certificate of incorporation
and by-laws could make it more difficult to acquire us by means of a tender
offer, a proxy contest or otherwise and the removal of incumbent officers and
directors. These provisions, summarized below, are expected to discourage
certain types of coercive takeover practices and inadequate takeover bids and to
encourage persons seeking to acquire control of us to first negotiate with us.
We believe that the benefits of increased protection of our potential ability to
negotiate with the proponent of an unfriendly or unsolicited proposal to acquire
or restructure us outweigh the disadvantages of discouraging takeover or
acquisition proposals because, among other things, negotiation of these
proposals could result in an improvement of their terms.

      We are subject to Section 203 of the Delaware General Corporation Law, an
anti-takeover law. In general, Section 203 prohibits a publicly held Delaware
corporation from engaging in a "business combination" with an "interested
stockholder" for a period of three years following the date the person became an
interested stockholder, unless (with certain exceptions) the "business
combination" or the transaction in which the person became an interested
stockholder is approved in a prescribed manner. Generally, a "business
combination" includes a merger, asset or stock sale, or other transaction
resulting in a financial benefit to the interested stockholder. Generally, an
"interested stockholder" is a person who, together with affiliates and
associates, owns (or within three years prior to the determination of interested
stockholder status, did own) 15% or more of a corporation's voting stock. The
existence of this provision would be expected to have an anti-takeover effect
with respect to transactions not approved in advance by the Board of Directors,
including discouraging attempts that might result in a premium over the market
price for the shares of common stock held by stockholders.

      Our certificate of incorporation and by-laws require that special meetings
of our


                                      105
<PAGE>

stockholders may be called only by the Board of Directors or certain of our
officers.

                         DESCRIPTION OF DEBT SECURITIES

      In April 1999, we entered into a revised credit facility with Bank of
America National Trust and Savings Association. The revised credit facility
replaced our $35 million credit facility with NationsBank (now named Bank of
America) and NBD Bank which subsequently became a participant in the revised
facility. The revised credit facility consists of a line of credit in a
principal amount not to exceed $48 million, expiring at the end of December
2003. Draws under the line of credit are limited to a percentage of certain
receivables and inventory. The outstanding balance of the line accrues interest
at a rate of LIBOR plus a margin of 2.25% on draws so designated by us, payable
at the end of the applicable interest period, but not less frequently than
quarterly, and on other draws at the higher of the bank's prime rate plus a
margin of 0.75% or the Federal Funds rate plus 1.25%, payable monthly. The
credit facility also calls for an unused line fee equal to an annual rate of
0.375% applied to the amount by which the lesser of $40 million and the then
maximum revolving amount exceeds the average daily balance of outstanding
borrowings under the line. After December 31, 1999, the margin of the interest
rate over the related rates is subject to quarterly adjustment dependent on
certain financial ratios. The interest rate margin can vary between 1.75% and
2.75% over LIBOR, 0.25% to 1.25% over the prime rate and 0.75% and 1.75% over
the Federal Funds rate. The credit facility agreement contains certain covenants
which, among other things, require us to meet certain financial ratio and net
worth tests, restrict the level of additional indebtedness we may incur, limit
payments of dividends, restrict the sale of assets and limit investments we may
make. The credit facility also requires repayment of the principal amount upon
the occurrence of a change in the control, as defined, of Riddell. We have
pledged essentially all of our tangible assets as collateral for the credit
facility.

      The 10.5% Senior Notes due 2007 contain certain covenants that, among
other things, restrict the level of other indebtedness we may incur, the amounts
of investments we may make in other businesses, the sale of assets and use of
proceeds therefrom, and the payment of dividends. The Senior Notes also restrict
payment of junior indebtedness prior to the maturity of the junior indebtedness.
The interest on the Senior Notes is payable semiannually on January 15 and July
15. The holders of the Senior Notes have the right to require the Senior Notes
to be redeemed at 101% of the principal amount in the event of a change of
control (as defined in the Senior Notes). The Senior Notes contain certain
prepayment restrictions and have no mandatory redemption provisions. The Senior
Notes are guaranteed by all of our subsidiaries. Each of these subsidiaries are
wholly-owned subsidiaries of Riddell and have fully and unconditionally
guaranteed the Senior Notes on a joint and several basis. Riddell itself is a
holding company with no assets or operations other than those relating to our
investments in our subsidiaries.

      The 4.1% convertible subordinated note is subordinated in right to prior
payment in full of Senior Indebtedness, which is generally defined in the
governing agreements to include debt under the senior notes and revolving line
of credit described above and any refinancing, renewal or replacement thereof as
well as certain other debt. Repayments of 25% and 33 1/3% of the then
outstanding principal balance is due on November 1, 2002 and 2003, respectively,
with the remaining balance due November 1, 2004. Interest is payable
semiannually each May 1 and November 1. The note limits our ability to grant
certain stock options and requires repayment of 101% of the principal amount in
the event of a change in control (as defined). In connection with obtaining
consents needed for various aspects of the Varsity acquisition, we amended the
note to provide for a reduction from $6.00 to $5.3763 per share in the
conversion price.


                                      106
<PAGE>

                    CERTAIN FEDERAL INCOME TAX CONSEQUENCES

General

      This section discusses certain federal income tax consequences of the
rights offering to (1) beneficial owners of our common stock upon distribution
of the rights, (2) holders of rights upon the exercise and disposition of the
rights, and (3) holders of common stock purchase warrants. The discussion is
based on the Internal Revenue Code of 1986, as amended, the Treasury regulations
thereunder, judicial authority, and current administrative rulings and practice,
all of which are subject to change prospectively or retroactively. The
discussion is limited to U.S. taxpayers who hold our common stock, and will hold
the rights and common stock purchase warrants and any shares acquired upon the
exercise of such rights or warrants, as capital assets (generally, property held
for investment). This discussion deals only with stockholders who receive the
rights in the initial offering and does not include any tax consequences under
state, local and foreign law. Financial institutions, broker-dealers, nominee
holders of our common stock or rights or common stock purchase warrants, life
insurance companies, tax-exempt organizations and possibly other types of
taxpayers may be subject to special provisions of the tax law or subject to
other tax considerations not discussed below.

      HOLDERS SHOULD CONSULT THEIR OWN TAX ADVISORS CONCERNING THEIR OWN
RESPECTIVE TAX SITUATIONS OR SPECIAL TAX CONSIDERATIONS THAT MAY APPLY TO THEM,
INCLUDING WITHOUT LIMITATION FOREIGN, STATE AND LOCAL LAWS THAT MAY APPLY.

Tax Consequences of Rights

      Distribution of rights

      Owners of our common stock will not recognize taxable income as a result
of the distribution of the rights.

      Basis and holding period of the rights

      The tax basis of the rights received by an owner of our common stock will
be zero, unless the stockholder elects to allocate a portion of the tax basis of
the common stock to the rights received in proportion to their respective fair
market values. The election to allocate a portion of the tax basis to the rights
must be made on the holders federal income tax return for the taxable year in
which the rights are received.

      The holding period of a stockholder with respect to the rights received as
a distribution on such stockholders common stock will include the stockholders
holding period for the common stock with respect to which the rights were
distributed.

      Transfer of the rights

      A holder of rights who sells the rights prior to exercise will recognize
capital gain or loss equal to the difference between the sale proceeds and the
tax basis (if any) in the rights sold.

      Lapse of the rights


                                      107
<PAGE>

      If rights expire prior to their sale or other disposition, the holders of
those rights will not recognize any gain or loss, assuming the holder did not
elect to allocate tax basis to the rights upon the initial distribution;
therefore no adjustment will be made to the tax basis of our common stock, if
any, owned by such holders.

      Exercise of the rights and basis and holding period of the common stock

      Holders of rights will not recognize any gain or loss upon the exercise of
rights except as discussed below with respect to the common stock purchase
warrants. The tax basis of our common stock acquired through exercise of the
rights will be equal to the sum of the subscription price allocated to our
common stock received upon exercise and the holders tax basis (if any) in the
rights. We believe that a holder should first allocate a portion of the
subscription price to the common stock purchase warrants received based upon the
proportion of the fair market value of such warrants on the date of receipt to
the sum of the fair market value of the common stock purchase warrants and the
common stock. A holder should allocate the remainder of the subscription price
to our common stock acquired through exercise of the rights. An independent
appraiser retained by us has determined the fair market value of the common
stock purchase warrants to be $_______ per warrant as of _______________.
Holders of rights should consult with their own tax advisors regarding the tax
consequences of exercising the rights and the tax basis of our common stock
received upon exercise.

      The holding period for our common stock acquired through exercise of the
rights will begin on the date the rights are exercised.

      Sale of common stock

      A stockholder will recognize gain or loss upon the sale of our common
stock acquired by exercise of rights in an amount equal to the difference
between the amount realized and the stockholders tax basis in the shares. The
gain or loss so recognized will be long-term or short-term capital gain or loss,
depending on whether the shares have been held for more than one year.

Tax Consequences of Common Stock Purchase Warrants

      Distribution of common stock purchase warrants

      Upon exercise of the rights, we believe that receipt of the common stock
purchase warrants will be treated as a distribution of property and taxable as a
dividend to the stockholders upon receipt to the extent the fair market value of
the common stock purchase warrants on the date of receipt exceeds the
subscription price allocated to said warrants. An independent appraiser retained
by us has determined the fair market value of the common stock purchase warrant
to be $_______ per warrant as of __________.

      The tax basis of the common stock purchase warrants will be equal to the
allocated portion of the subscription price plus the amount of dividend
resulting thereon; accordingly, Riddell believes that the total tax basis of the
common stock purchase warrants will be equal to the fair market value of the
common stock purchase warrants as of the date of receipt.

      We believe that the proper measurement date to value the common stock
purchase warrant is the date the warrant is issued (i.e., the date the rights
are exercised). However, the Internal Revenue Service may assert that the proper
date of measurement occurs on the date of exercise of


                                      108
<PAGE>

the common stock purchase warrant, in which case the exercise of the common
stock purchase warrants would be treated as a distribution of property and
taxable as a dividend to the stockholders to the extent that the fair market
value of the shares received upon exercise of the warrants exceeds the amount
paid for such shares, subject to the current and accumulated earnings and
profits of Riddell. We will aggressively contest any such assertion by the
Internal Revenue Service. Holders of common stock purchase warrants should
consult with their own tax advisors regarding the tax consequences of exercising
the warrants.

      Holding period of common stock purchase warrants

      The holding period of the common stock purchase warrants will begin on the
date following the day of distribution.

      Lapse of common stock purchase warrants

      In the event the common stock purchase warrants expire, the holder will
recognize a loss to the extent of the tax basis allocated to the common stock
purchase warrant. Such a loss would be a capital loss.

      Exercise of the common stock purchase warrant

      To the extent the common stock purchase warrant is exercised, there should
not be a taxable event. The tax basis in the shares received would be the basis
of the warrant and the exercise price paid for the shares of stock.


                                      109
<PAGE>

                                  LEGAL MATTERS

      The validity of the common stock, the rights and warrants in this offering
will be passed upon for Riddell by Zukerman Gore & Brandeis, LLP, New York, New
York. Orrick, Herrington & Sutcliffe LLP will pass upon various legal matters
for the underwriter.

                                     EXPERTS

      The consolidated financial statements and schedules as of December 31,
1998 and 1997 and for each of the three years in the period ended December 31,
1996 included in this prospectus and elsewhere in this registration statement
have been audited by Grant Thornton LLP independent public accountants, as
indicated in their reports with respect thereto, and are included herein in
reliance upon the authority of said firm as experts in accounting and auditing.

                       WHERE YOU CAN FIND MORE INFORMATION

      We file annual, quarterly and special reports and other information with
the Securities and Exchange Commission. You may read and copy any document we
file at the SEC's public reference rooms in Washington, D.C., New York, New York
and Chicago, Illinois. You may call the SEC at 1-800-SEC-0330 for further
information on the public reference rooms. Our recent SEC filings also are
available to you at the SEC's web site at http://www.sec.gov.

      This prospectus, which constitutes a part of a registration statement on
Form S-1 filed by us with the Securities and Exchange Commission under the
Securities Act of 1933, omits certain of the information set forth in the
registration statement. Accordingly, for further information, you should refer
to the registration statement and its exhibits on file with the Securities and
Exchange Commission. Furthermore, statements contained in this prospectus
concerning any document filed as an exhibit are not necessarily complete and, in
each instance, we refer you to the copy of such document filed as an exhibit to
the registration statement.


                                       110
<PAGE>

                         INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
                                                                                                              PAGE
                                                                                                              ----
<S>                                                                                                           <C>
Unaudited Condensed Financial Statements:
  Condensed Consolidated Balance Sheets at September 30, 1999,
     December 31, 1998 and September 30, 1998..............................................................    F-2
  Condensed Consolidated Statements of Operations for the nine months
     ended September 30, 1999 and 1998.....................................................................    F-3
  Condensed Consolidated Statements of Stockholders' Equity for the nine months
     ended September 30, 1999 and 1998.....................................................................    F-4
  Condensed Consolidated Statements of Cash Flows for the nine months
     ended September 30, 1999 and 1998.....................................................................    F-5
  Notes to Condensed Consolidated Financial Statements.....................................................    F-6

Audited Consolidated Financial Statements:
  Report of Independent Certified Public Accountants.......................................................    F-9
  Consolidated Balance Sheets at December 31, 1998 and 1997................................................   F-10
  Consolidated Statements of Operations for the years ended
     December 31, 1998, 1997 and 1996......................................................................   F-11
  Consolidated Statements of Shareholders' Equity for the years
     ended December 31, 1998, 1997 and 1996................................................................   F-12
  Consolidated Statements of Cash Flows for the years ended
     December 31, 1998, 1997 and 1996......................................................................   F-13
  Notes to Consolidated Financial Statements...............................................................   F-14
</TABLE>

                                      F-1

<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                                  (UNAUDITED)
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                        SEPTEMBER 30,    DECEMBER 31,    SEPTEMBER 30,
                                                                           1999             1998            1998
                                                                        -------------    ------------    -------------
<S>                                                                     <C>              <C>             <C>
                               ASSETS
Current assets:
  Cash...............................................................     $     368        $  1,752        $   2,824
  Accounts receivable, trade, less allowance for doubtful accounts
     ($1,619, $1,302 and $933 respectively) (Note 3).................        56,064          28,016           48,761
  Inventories (Note 4)...............................................        30,356          28,763           24,608
  Prepaid expenses...................................................         4,435           6,493            4,393
  Other receivables..................................................         1,612           1,644            1,790
  Deferred taxes.....................................................           271           1,253            1,358
                                                                          ---------        --------        ---------
     Total current assets............................................        93,106          67,921           83,734
Property, plant and equipment, less accumulated depreciation ($9,086,
  $7,213 and $6,532 respectively)....................................         8,095           7,871            7,548
Intangibles and deferred charges, less accumulated amortization
  ($16,903, $13,858 and $16,331 respectively)........................       106,674         108,735          109,035
Other assets.........................................................         2,425           1,684            1,625
                                                                          ---------        --------
                                                                          $ 210,300        $186,211        $ 201,942
                                                                          ---------        --------        ---------
                                                                          ---------        --------        ---------
                LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable...................................................     $  14,224        $ 12,744        $  12,432
  Accrued liabilities................................................        10,876          11,253            9,016
  Customer deposits..................................................         2,896           5,961            2,652
                                                                          ---------        --------        ---------
     Total current liabilities.......................................        27,996          29,958           24,100
Long-term debt, less current portion:................................       145,144         126,900          138,200
Deferred taxes.......................................................           271             348              453
Other Liabilities....................................................         3,254           3,554            3,060
Contingent liabilities (Note 6)......................................            --              --               --
Stockholders' equity
  Common stock.......................................................            93              93               91
  Additional paid in capital.........................................        36,849          36,849           36,586
Accumulated deficit..................................................        (3,307)        (11,491)            (548)
                                                                          ---------        --------        ---------
                                                                             33,635          25,451           36,129
                                                                          ---------        --------        ---------
                                                                          $ 210,300        $186,211        $ 201,942
                                                                          ---------        --------        ---------
                                                                          ---------        --------        ---------
</TABLE>

           See notes to condensed consolidated financial statements.

                                      F-2
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                  (UNAUDITED)
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                                                                            NINE MONTHS ENDED
                                                                                              SEPTEMBER 30,
                                                                                          ----------------------
                                                                                            1999          1998
                                                                                          --------      --------
<S>                                                                                       <C>           <C>
Net revenues:
  Net sales, products and reconditioning...............................................   $132,767      $115,310
  Camps and events.....................................................................     46,219        42,615
  Royalty income.......................................................................        764         1,401
                                                                                          --------      --------
                                                                                           179,750       159,326
                                                                                          --------      --------
Cost of revenues:
  Products and reconditioning..........................................................     72,993        65,217
  Camps and events.....................................................................     31,976        30,022
                                                                                          --------      --------
Cost of sales..........................................................................    104,969        95,239
                                                                                          --------      --------
Gross profit...........................................................................     74,781        64,087
Selling, general and administrative expenses...........................................     54,024        49,169
                                                                                          --------      --------
Income from operations.................................................................     20,757        14,918
Interest expense.......................................................................     11,668        11,114
                                                                                          --------      --------
Income before taxes....................................................................      9,089         3,804
Income taxes...........................................................................        905            --
                                                                                          --------      --------
Net income.............................................................................   $  8,184      $  3,804
                                                                                          --------      --------
                                                                                          --------      --------
Net earnings per share:
  Basic................................................................................   $   0.88      $   0.42
  Diluted..............................................................................   $   0.78      $   0.37

Weighted average number of common and common equivalent shares outstanding:
  Basic................................................................................      9,259         9,122
  Diluted..............................................................................     10,862        11,066
</TABLE>

           See notes to condensed consolidated financial statements.

                                      F-3
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                                  (UNAUDITED)
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                            RETAINED
                                                           COMMON STOCK      ADDITIONAL     EARNINGS         TOTAL
                                                         ----------------     PAID IN      (ACCUMULATED    STOCKHOLDERS'
                                                         SHARES    AMOUNT     CAPITAL       DEFICIT)         EQUITY
                                                         ------    ------    ----------    ------------    -------------
<S>                                                      <C>       <C>       <C>           <C>             <C>
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998:

  Balance, January 1, 1998............................   9,079      $ 91      $ 36,386       $ (4,352)        $32,125
     Issuance of common stock upon
       exercise of stock options......................      28        --            72             --              72
     Stock issued to employees........................      27        --           128             --             128
     Net income for the period........................      --        --            --          3,804           3,804
                                                         ------     ----      --------       --------         -------
  Balance, September 30, 1998.........................   9,134      $ 91      $ 36,586       $   (548)        $36,129
                                                         ------     ----      --------       --------         -------
                                                         ------     ----      --------       --------         -------

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999:

  Balance, January 1, 1999............................   9,259      $ 93      $ 36,849       $(11,491)        $25,451
     Net income for the period........................      --        --            --          8,184           8,184
                                                         ------     ----      --------       --------         -------
  Balance, September 30, 1999.........................   9,259      $ 93      $ 36,849       $ (3,307)        $33,635
                                                         ------     ----      --------       --------         -------
                                                         ------     ----      --------       --------         -------
</TABLE>

           See notes to condensed consolidated financial statements.

                                      F-4
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (UNAUDITED)
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                               NINE MONTHS ENDED
                                                                                                 SEPTEMBER 30,
                                                                                              --------------------
                                                                                                1999        1998
                                                                                              --------    --------
<S>                                                                                           <C>         <C>
Cash flows from operating activities:
  Net income...............................................................................   $  8,184    $  3,804
  Adjustments to reconcile net income to net cash used in operating activities:
     Depreciation and amortization:
       Amortization of debt issue costs....................................................        633         602
       Other depreciation and amortization.................................................      4,285       4,246
     Provision for losses on accounts receivable...........................................        718         442
     Deferred taxes........................................................................        905          --
     Changes in assets and liabilities:
       (Increase) decrease in:
          Accounts receivable, trade.......................................................    (28,766)    (22,778)
          Inventories......................................................................     (1,593)       (542)
          Prepaid expenses.................................................................      2,058       2,407
          Other receivables................................................................         32        (228)
          Other assets.....................................................................       (741)     (1,027)
       Increase (decrease) in:
          Accounts payable.................................................................      1,480       4,055
          Accrued liabilities..............................................................       (377)     (1,573)
          Customer deposits................................................................     (3,065)     (1,877)
          Other liabilities................................................................       (300)         --
                                                                                              --------    --------
            Net cash provided by (used in) operating activities............................    (16,547)    (12,469)
                                                                                              --------    --------
Cash flows from investing activities:
  Capital expenditures.....................................................................     (2,097)     (1,490)
  Other....................................................................................       (419)         --
                                                                                              --------    --------
            Net cash used in investing activities..........................................     (2,516)     (1,490)
                                                                                              --------    --------
Cash flows from financing activities:
  Net borrowings under line-of-credit agreement............................................     18,244      15,700
  Debt issue costs.........................................................................       (565)         --
  Proceeds from issuance of common stock...................................................         --          72
                                                                                              --------    --------
            Net cash provided by financing activities......................................     17,679      15,772
                                                                                              --------    --------
Net increase (decrease) in cash............................................................     (1,384)      1,813
Cash, beginning............................................................................      1,752       1,011
                                                                                              --------    --------
Cash, end..................................................................................   $    368    $  2,824
                                                                                              --------    --------
                                                                                              --------    --------
</TABLE>

           See notes to condensed consolidated financial statements.

                                      F-5
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION

     The condensed consolidated financial statements include the accounts of the
Company and its wholly-owned subsidiaries. All significant intercompany accounts
and transactions have been eliminated. These statements are unaudited, and in
the opinion of management include all adjustments (consisting only of normal
recurring adjustments) necessary for the fair presentation of the Company's
consolidated financial position and the consolidated results of its operations
and cash flows at September 30, 1999 and 1998 and for the periods then ended.
Certain information and footnote disclosures made in the Company's annual
audited consolidated financial statements have been condensed or omitted from
these interim statements. Accordingly, these condensed consolidated financial
statements should be read in conjunction with the audited consolidated financial
statements appearing elsewhere in this prospectus. Operating results for the
nine months ended September 30, 1999 are not indicative of the results to be
expected during the remainder of 1999.

     Income tax expense for the nine-month period ending September 30, 1999
reflect an adjustment relating to the valuation of deferred taxes. No tax
expense, other than this adjustment, has been recorded for the 1999 period as
the Company has net operating loss carryforwards which offset any such taxes.

2. EARNINGS PER SHARE

     Basic earnings per share amounts have been computed by dividing earnings by
the weighted average number of outstanding common shares. Diluted earnings per
share is computed by adjusting earnings for the effect of the assumed conversion
of dilutive securities and dividing the result by the weighted average number of
common shares and common equivalent shares relating to dilutive securities. A
reconciliation between the numerators and denominators for these calculations
follows:

<TABLE>
<CAPTION>
                                                                                     NINE MONTHS ENDED
                                                                                       SEPTEMBER 30,
                                                                                    -------------------
                                                                                     1999        1998
                                                                                    -------     -------
                                                                                      (IN THOUSANDS)
<S>                                                                                 <C>         <C>
Earnings--numerator:
  Net income.....................................................................   $ 8,184     $ 3,804
  Effect of assumed conversion of convertible debt,
     interest savings net of tax.................................................       314         314
                                                                                    -------     -------
     Numerator for diluted per share computation.................................   $ 8,498     $ 4,118
                                                                                    -------     -------
                                                                                    -------     -------
Shares--denominator:
  Weighted average number of outstanding common shares...........................     9,259       9,122
  Weighted average common equivalent shares:
     Options, assumed exercise of dilutive options net of treasury shares which
       could have been purchased from the proceeds of the
       assumed exercise based on average market prices...........................       208         549
     Convertible debt, assumed conversion........................................     1,395       1,395
                                                                                    -------     -------
       Denominator for diluted per share computation.............................   $10,862     $11,066
                                                                                    -------     -------
                                                                                    -------     -------
</TABLE>

3. RECEIVABLES

     The Company's policy is to record revenues when goods have been shipped.
Accounts receivable include unbilled shipments of approximately $3,053,000,
$1,678,000 and $1,683,000 at September 30, 1999, December 31, 1998 and
September 30, 1998, respectively. Unbilled shipments represent receivables for
shipments that have not been invoiced. These amounts relate principally to
partial shipments to customers who are not invoiced until their order is shipped
in its entirety or customers with orders containing other terms that require a
deferral in the issuance of an invoice. Management believes that substantially
all of the unbilled receivables at September 30, 1999 will be invoiced before
the end of the calendar year.

                                      F-6
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

4. INVENTORIES

     Inventories consist of the following (In thousands):

<TABLE>
<CAPTION>
                                                             SEPTEMBER 30,    DECEMBER 31,     SEPTEMBER 30,
                                                                1999             1998             1998
                                                             -------------    -------------    -------------
<S>                                                          <C>              <C>              <C>
  Finished goods..........................................      $18,696          $16,584          $13,078
  Work-in-process.........................................        1,878            2,769            2,361
  Raw materials...........................................        9,782            9,410            9,169
                                                                -------          -------          -------
                                                                $30,356          $28,763          $24,608
                                                                -------          -------          -------
                                                                -------          -------          -------
</TABLE>

5. LONG TERM DEBT

     In April 1999, the Company entered into a revised credit facility with Bank
of America National Trust and Savings Association. The revised credit facility
replaced the Company's $35 million credit facility with NationsBank (now named
Bank of America ) and NBD Bank which subsequently became a participant in the
revised facility. The revised credit facility consists of a line of credit in a
principal amount not to exceed $48 million, expiring at the end of December
2003. Draws under the line of credit are limited to a percentage of certain
receivables and inventory. The outstanding balance of the line accrues interest
at a rate of LIBOR plus a margin of 2.25% on draws so designated by the Company,
payable at the end of the applicable interest period, but not less frequently
than quarterly, and on other draws at the higher of the bank's prime rate plus a
margin of 0.75% or the Federal Funds rate plus 1.25%, payable monthly. The
credit facility also calls for an unused line fee equal to an annual rate of
0.375% applied to the amount by which the lesser of $40 million and the then
maximum revolving amount exceeds the average daily balance of outstanding
borrowings under the line. After December 31, 1999 the margin of the interest
rate over the related rates is subject to quarterly adjustment dependent on
certain financial ratios. The interest rate margin can vary between 1.75% and
2.75% over LIBOR, 0.25% to 1.25% over the prime rate and 0.75% and 1.75% over
the Federal Funds rate. The credit facility agreement contains certain covenants
which, among other things, require the Company to meet certain financial ratio
and net worth tests, restrict the level of additional indebtedness the Company
may incur, limit payments of dividends, restrict the sale of assets and limit
investments the Company may make. The credit facility also requires repayment of
the principal amount upon the occurrence of a change in the control, as defined,
of the Company. The Company has pledged essentially all of its tangible assets
as collateral for the credit facility.

6. LITIGATION MATTERS AND CONTINGENCIES

     At September30, 1999, the Company was a defendant in 4 product liability
suits relating to personal injuries allegedly related to the use of helmets
manufactured or reconditioned by subsidiaries of the Company. The Company
estimates that the uninsured portion of future costs and expenses related to
these claims and incurred but not reported claims will amount to at least
$3,800,000, and accordingly, a reserve in this amount is included in the
Condensed Consolidated Balance Sheet at September 30, 1999 as part of accrued
liabilities and other liabilities. These reserves are based on estimates of
losses and defense costs not covered by insurance that are anticipated to result
from such claims, from within a range of potential outcomes, based on available
information, including an analysis of historical data such as the rate of
occurrence and the settlement amounts of past cases. However, due to the
uncertainty involved with estimates, the ultimate outcome of these claims, or
potential future claims, cannot presently be determined and actual results on
certain claims have at times varied substantially from earlier estimates and
could do so in the future. Accordingly, there can be no assurance that the
ultimate costs of such claims will fall within the established reserves.

                                      F-7
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

7. SUPPLEMENTAL CASH FLOW INFORMATION

     Cash paid for interest was $14,043,000 and $14,330,000 for the nine-month
periods ended September 30, 1999 and 1998, respectively. Income tax payments or
refunds were not significant for the nine-month periods ended September 30, 1999
and 1998.

     During the nine-month period ended September 30, 1998 the Company issued
shares of its Common Stock, valued at $128,000 based on quoted market values at
the time of grant, to certain employees as consideration for compensation
included in accrued liabilities at December 31, 1997.

8. SEGMENT INFORMATION:

     Net revenues and income or loss from operations for the Company's three
reportable segments are as follows:

<TABLE>
<CAPTION>
                                                                                     NINE MONTHS ENDED
                                                                                       SEPTEMBER 30,
                                                                                    -------------------
                                                                                     1999        1998
                                                                                    -------     -------
                                                                                      (IN THOUSANDS)
<S>                                                                                 <C>         <C>
Net revenues:
  Institutional products and services............................................  $166,786    $144,790
  Retail products................................................................    12,200      13,135
  Trademark licensing............................................................       764       1,401
                                                                                    -------     -------
     Consolidated total..........................................................  $179,750    $159,326
                                                                                    -------     -------
                                                                                    -------     -------
Income (loss) from operations:
  Institutional products and services............................................   $22,946     $16,261
  Retail products................................................................       676         551
  Trademark licensing............................................................       191         787
  Corporate and unallocated expenses.............................................    (3,056)     (2,681)
                                                                                    -------     -------
     Consolidated total..........................................................   $20,757     $14,918
                                                                                    -------     -------
                                                                                    -------     -------
</TABLE>

                                      F-8
<PAGE>
               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

Board of Directors
Riddell Sports Inc.

     We have audited the accompanying consolidated balance sheets of Riddell
Sports Inc. (a Delaware corporation) and Subsidiaries as of December 31, 1998
and 1997, and the related consolidated statements of operations, shareholders'
equity and cash flows for each of the three years in the period ended December
31, 1998. These financial statements are the responsibility of the management of
Riddell Sports Inc. Our responsibility is to express an opinion on these
financial statements based on our audits.

     We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

     In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Riddell Sports
Inc. and Subsidiaries as of December 31, 1998 and 1997, and the consolidated
results of their operations and their consolidated cash flows for each of the
three years in the period ended December 31, 1998 in conformity with generally
accepted accounting principles.

                                          GRANT THORNTON LLP

Chicago, Illinois
February 19, 1999, except for Note 17
  as to which the date is March 16, 1999

                                      F-9
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                                 DECEMBER 31,
                                                                                             --------------------
                                                                                               1998        1997
                                                                                             --------    --------
<S>                                                                                          <C>         <C>
                                     ASSETS (Note 8)
Current assets:
  Cash....................................................................................   $  1,752    $  1,011
  Accounts receivable, trade, less allowance for doubtful accounts ($1,302 and $824
     respectively) (Note 4)...............................................................     28,016      26,425
  Inventories (Note 5)....................................................................     28,763      24,066
  Prepaid expenses........................................................................      6,493       6,800
  Other receivables.......................................................................      1,644       1,562
  Deferred taxes (Note 12 )...............................................................      1,253       1,358
                                                                                             --------    --------
          Total current assets............................................................     67,921      61,222
Property and equipment, less accumulated depreciation (Note 6)............................      7,871       7,823
Intangible assets and deferred charges, less accumulated
  amortization (Note 7)...................................................................    108,735     112,118
Other assets..............................................................................      1,684         598
                                                                                             --------    --------
                                                                                             $186,211    $181,761
                                                                                             --------    --------
                                                                                             --------    --------
                           LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
  Accounts payable........................................................................   $ 12,744    $  8,377
  Accrued liabilities (Note 11)...........................................................     11,253      10,717
  Customer deposits.......................................................................      5,961       4,529
                                                                                             --------    --------
          Total current liabilities.......................................................     29,958      23,623
Long-term debt, less current portion (Note 8).............................................    126,900     122,500
Deferred taxes (Note 12)..................................................................        348         453
Other liabilities (Note 11)...............................................................      3,554       3,060
Commitments and contingent liabilities (Notes 10 and 11)
Shareholders' equity (Note 9):
  Preferred stock, $.01 par; authorized 5,000,000 shares; none issued.....................         --          --
  Common stock, $.01 par; authorized 40,000,000 shares; issued and outstanding 9,258,957
     and 9,079,154 shares, respectively...................................................         93          91
  Capital in excess of par................................................................     36,849      36,386
  Accumulated deficit.....................................................................    (11,491)     (4,352)
                                                                                             --------    --------
                                                                                               25,451      32,125
                                                                                             --------    --------
                                                                                             $186,211    $181,761
                                                                                             --------    --------
                                                                                             --------    --------
</TABLE>

                See notes to consolidated financial statements.

                                      F-10
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                                                                     YEARS ENDED DECEMBER 31,
                                                                                  -------------------------------
                                                                                    1998        1997       1996
                                                                                  --------    --------    -------
<S>                                                                               <C>         <C>         <C>
Net revenues:
  Net sales, products and reconditioning.......................................   $136,283    $103,583    $69,888
  Camps and events.............................................................     48,704      32,302         --
  Royalty income...............................................................      1,613       2,388      2,494
                                                                                  --------    --------    -------
                                                                                   186,600     138,273     72,382
                                                                                  --------    --------    -------

Costs of revenues:
  Products and reconditioning..................................................     79,611      58,718     38,813
  Camps and events.............................................................     33,930      21,957         --
                                                                                  --------    --------    -------
                                                                                   113,541      80,675     38,813
                                                                                  --------    --------    -------
Gross profit...................................................................     73,059      57,598     33,569
Selling, general and administrative expenses...................................     64,617      46,278     27,853
Other charges..................................................................        925          --         --
                                                                                  --------    --------    -------
Income from operations.........................................................      7,517      11,320      5,716
Interest expense (Note 8)......................................................     14,656      11,879      2,763
                                                                                  --------    --------    -------
Income (loss) before taxes and extraordinary item..............................     (7,139)       (559)     2,953
Income taxes...................................................................         --          --        110
                                                                                  --------    --------    -------
Net income (loss)..............................................................   $ (7,139)   $   (559)   $ 2,843
                                                                                  --------    --------    -------
                                                                                  --------    --------    -------

Earnings (loss) per share:
  Basic........................................................................   $  (0.78)   $  (0.07)   $  0.35
  Diluted......................................................................   $  (0.78)   $  (0.07)   $  0.33

Weighted average number of common and common equivalent shares outstanding
  Basic........................................................................      9,134       8,585      8,068
  Diluted......................................................................      9,134       8,585      8,730
</TABLE>

                See notes to consolidated financial statements.

                                      F-11
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                           RETAINED
                                                          COMMON STOCK      ADDITIONAL     EARNINGS          TOTAL
                                                        ----------------     PAID-IN      (ACCUMULATED    SHAREHOLDERS'
                                                        SHARES    AMOUNT     CAPITAL       DEFICIT)         EQUITY
                                                        ------    ------    ----------    ------------    --------------
<S>                                                     <C>       <C>       <C>           <C>             <C>
Balance, January 1, 1996.............................   8,068      $ 81      $ 31,457       $ (6,636)        $ 24,902
  Net income for the year............................      --        --            --          2,843            2,843
                                                        ------     ----      --------       --------         --------
Balance, December 31, 1996...........................   8,068        81        31,457         (3,793)          27,745
  Compensation in connection with option grants......      --        --           559             --              559
  Issuance of common stock upon exercise of stock
     options.........................................      25        --            60             --               60
  Sale of common stock, net of costs.................     986        10         4,310             --            4,320
  Net (loss) for the year............................      --        --            --           (559)            (559)
                                                        ------     ----      --------       --------         --------
Balance, December 31, 1997...........................   9,079        91        36,386         (4,352)          32,125
  Issuance of common stock upon exercise of stock
     options and warrants............................      99         1           136             --              137
  Stock issued to employees..........................      81         1           327                             328
  Net (loss) for the period..........................      --        --            --         (7,139)          (7,139)
                                                        ------     ----      --------       --------         --------
Balance, December 31, 1998...........................   9,259      $ 93      $ 36,849       $(11,491)        $ 25,451
                                                        ------     ----      --------       --------         --------
                                                        ------     ----      --------       --------         --------
</TABLE>

                See notes to consolidated financial statements.

                                      F-12
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                       YEARS ENDED DECEMBER 31,
                                                                                    ------------------------------
                                                                                     1998        1997       1996
                                                                                    -------    --------    -------
<S>                                                                                 <C>        <C>         <C>
Cash flows from operating activities:
  Net income (loss)..............................................................   $(7,139)   $   (559)   $ 2,843
  Adjustments to reconcile net income to net cash provided by (used in) operating
     activities:
     Depreciation and amortization:
       Amortization of debt issue costs..........................................       803         502         15
       Other depreciation and amortization.......................................     5,713       4,010      2,193
     Stock options issued........................................................        --         559         --
     Compensation expense for stock issued to employees..........................       199          --         --
     Provision for losses on accounts receivable.................................       929         365        436
     Change in assets and liabilities (net of effects from acquisitions):
       (Increase) decrease in:
          Accounts receivable, trade.............................................    (2,520)      6,426     (1,482)
          Inventories............................................................    (4,697)      1,400     (1,980)
          Prepaid expenses.......................................................       307       2,304        (10)
          Other receivables......................................................       (82)        975        199
          Other assets...........................................................       212          45         39
       Increase (decrease) in:
          Accounts payable.......................................................     4,367      (4,010)    (1,437)
          Accrued liabilities....................................................       664        (502)    (2,842)
          Customer deposits......................................................     1,432      (6,167)    (2,558)
          Other liabilities......................................................       494        (987)        --
                                                                                    -------    --------    -------
            Net cash provided by (used in) operating activities..................       682       4,361     (4,584)
                                                                                    -------    --------    -------
Cash flows from investment activities:
  Capital expenditures...........................................................    (2,494)     (1,814)    (1,139)
  Acquisitions...................................................................        --     (91,245)        --
  Umbro license acquisition fee..................................................      (500)         --         --
  Other investments..............................................................    (1,298)         --         --
  Contingent "earn-out" payments on prior acquisitions...........................      (187)       (166)      (174)
                                                                                    -------    --------    -------
            Net cash used in investing activities................................    (4,479)    (93,225)    (1,313)
                                                                                    -------    --------    -------
Cash flows from financing activities:
  Net borrowings under line-of-credit agreement..................................     4,400     (17,890)       (87)
  Proceeds from issuance of long-term debt.......................................        --     115,000      7,500
  Debt issue costs...............................................................        --      (6,220)      (761)
  Principal payments on long-term debt:
     Shareholders................................................................        --        (439)      (871)
     Banks and other.............................................................        --      (5,313)      (142)
  Proceeds from issuance of common stock.........................................       138       4,380         --
                                                                                    -------    --------    -------
            Net cash provided by financing activities............................     4,538      89,518      5,639
                                                                                    -------    --------    -------
Net increase (decrease) in cash..................................................       741         654       (258)
Cash, beginning..................................................................     1,011         357        615
                                                                                    -------    --------    -------
Cash, ending.....................................................................   $ 1,752    $  1,011    $   357
                                                                                    -------    --------    -------
                                                                                    -------    --------    -------
</TABLE>

                See notes to consolidated financial statements.

                                      F-13
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Principles of consolidation:  The consolidated financial statements include
the accounts of Riddell Sports Inc. and its wholly-owned subsidiaries (the
"Company"). All significant intercompany accounts and transactions have been
eliminated.

     Business:  The Company provides institutional sporting goods and school
spirit products and services to educational and recreational organizations
through its national, direct sales force. The Company is the leading
manufacturer and reconditioner of football protective equipment and the leading
supplier of products and services to the school spirit industry. The Company
also markets miniature and full-size helmets for collectors and licenses the
Riddell and MacGregor trademarks for use on athletic footwear and apparel. The
Company operates primarily throughout the United States.

     Inventories:  Inventories are stated at the lower of cost (determined on a
first-in, first-out basis) or market and include material, labor and factory
overhead.

     Property and equipment:  Property and equipment are stated at cost.
Depreciation is being computed using the straight-line method over the estimated
useful lives (principally 30 years for buildings and improvements and 3 to 7
years for machinery and equipment) of the related assets.

     Intangible assets and deferred charges:  Debt issue costs are amortized to
interest expense over the term of the related debt. Other intangibles and
deferred charges are being amortized by the straight-line method over their
respective estimated lives.

     Long-lived assets including goodwill and other intangible assets are
reviewed for impairment whenever events or changes in circumstances indicate
that the carrying amount of an asset may not be recoverable. For purposes of
evaluating the recoverability of long-lived assets, the related assets' carrying
value is compared to the undiscounted estimated future cash flows from the
related operations.

     Income taxes:  Deferred tax liabilities and assets are recognized for the
expected future tax consequences of events that have been included in the
financial statements or tax returns. Deferred tax liabilities and assets are
determined based on the difference between the financial statement and tax bases
of assets and liabilities (excluding non-deductible goodwill) using enacted tax
rates in effect for the years in which the differences are expected to become
recoverable or payable.

     Revenues:  Sales of products and reconditioning are generally recorded upon
shipment to customers. Camp and event revenues are recognized over the term of
the respective activity. Royalty income is generally recorded by the Company
when earned based upon contracts with licensees. These contracts provide for
royalties based upon the licensee's sales or purchases of covered products,
subject to periodic minimum amounts of royalties.

     Estimates:  In preparing financial statements in conformity with generally
accepted accounting principles, management is required to make estimates and
assumptions that affect the reported amounts of assets and liabilities and the
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses for the periods
reported. Actual results could differ from those estimates. Estimates relating
to contingent liabilities are further discussed in Note 11.

     Concentration of credit risk:  The Company earns the majority of its
revenues from sales to schools and other institutions. The Company maintains
reserves for potential losses on receivables from these institutions, as well as
receivables from other customers, and such losses have not exceeded managements
expectations.

     Earnings (loss) per share:  Basic earnings (loss) per share is computed by
dividing earnings (loss) by the weighted average number of outstanding common
shares. Diluted earnings per share is computed by adjusting earnings for effect
of the assumed conversion of dilutive securities and dividing the result by the
weighted average number of common shares and common equivalent shares relating
to dilutive securities. Only

                                      F-14
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES--(CONTINUED)

outstanding shares are considered in computing diluted loss per share. A
reconciliation between the numerators and denominators for these calculations
follows:

<TABLE>
<CAPTION>
                                                                                        YEARS ENDED DECEMBER 31,
                                                                                       ---------------------------
                                                                                        1998       1997      1996
                                                                                       -------    ------    ------
                                                                                             (IN THOUSANDS)
<S>                                                                                    <C>        <C>       <C>
Earnings (loss)--numerator:
  Net income (loss).................................................................   $(7,139)   $ (559)   $2,843
  Effect of assumed conversion, when dilutive, of convertible debt--interest savings
     net of tax.....................................................................        --        --        61
                                                                                       -------    ------    ------
       Numerator for diluted per share computation..................................   $(7,139)   $ (559)   $2,904
                                                                                       -------    ------    ------
                                                                                       -------    ------    ------
Shares--denominator:
  Weighted average number of outstanding common shares..............................     9,134     8,585     8,068
  Weighted average common equivalent shares:
     Options and warrants, assumed exercise of dilutive options and warrants, net of
      treasury shares which could have been purchased from the proceeds of the
      assumed exercise based on average market prices...............................        --        --       480
     Convertible debt, assumed conversion when dilutive.............................        --        --       182
                                                                                       -------    ------    ------
       Denominator for diluted per share computation................................     9,134     8,585     8,730
                                                                                       -------    ------    ------
                                                                                       -------    ------    ------
</TABLE>

     The convertible debt, which has been outstanding since November 1996, is
described in Note 8 below. Options and warrants are described in Note 9 below.
Options and warrants to purchase 89,500 shares of common stock with a weighted
average exercise price of $10.29 which were outstanding at December 31, 1996
were excluded from the computation of diluted earnings per share for 1996 as
their inclusion would not have been dilutive because their exercise prices were
greater than the average market price of common shares for the year.

     Segment information:  Effective December 31, 1998, the Company adopted
Statement of Financial Accounting Standards (SFAS) No. 131, "Disclosure About
Segments of an Enterprise and Related Information." SFAS No. 131 supersedes SFAS
No. 14, "Financial Reporting for Segments of a Business Enterprise", replacing
the "industry segment" approach with the "management" approach. The management
approach designates the internal organization that is used by management for
making operating decisions and assessing performance as the source of the
Company's reportable segments. SFAS No. 131 also requires disclosures about
products and services, geographic areas, and major customers. 1996 and 1997
segment disclosure have been restated to conform to SFAS No. 131.

     Capitalized software:  Statement of Position (SOP) 98-1, "Accounting for
the Costs of Computer Software Developed or Obtained for Internal Use", is
effective for fiscal years beginning after December 15, 1998. SOP 98-1 provides
guidance on accounting for the costs of computer software developed or obtained
for internal use. The Company plans to adopt SOP 98-1 beginning January 1, 1999.

2. ACQUISITION

     On June 19, 1997 the Company acquired Varsity Spirit Corporation
("Varsity"). Varsity is a leading supplier of cheerleader and dance team
uniforms and accessories to the youth, junior high, high school and college
markets. Varsity is also a leading operator of cheerleader and dance team camps,
clinics and special events. The net purchase price of approximately
$91.2 million, including costs of the acquisition, was paid in cash, and the
acquisition has been accounted for under the purchase method. The purchase price
was allocated based on estimated fair values at the date of acquisition. This
resulted in an excess of the purchase price over the net assets acquired of
$74.8 million, which has been recorded as goodwill and is being amortized on a
straight-

                                      F-15
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

2. ACQUISITION--(CONTINUED)

line basis over 40 years. A summary of the allocation of the purchase price to
assets acquired based on their estimated fair values follows:

<TABLE>
<CAPTION>
                                                                                                      (IN THOUSANDS)
                                                                                                      --------------
<S>                                                                                                   <C>
Purchase price including costs and
  liabilities paid at closing......................................................................      $ 95,548
Less, cash acquired................................................................................        (4,303)
                                                                                                         --------
Net cash cost......................................................................................        91,245
Current liabilities assumed........................................................................        23,068

Less, acquired assets:
  Current assets, excluding cash...................................................................       (35,055)
  Property and Equipment...........................................................................        (3,926)
  Other assets.....................................................................................          (577)
                                                                                                         --------
Excess cost over net assets acquired (goodwill)....................................................      $ 74,755
                                                                                                         --------
                                                                                                         --------
</TABLE>

     The operating results of Varsity have been included in the consolidated
statements of operations from the date of acquisition. The following pro forma
information presents the combined operations of the Company and Varsity as if
the acquisition, and relating financing transactions discussed in Note 8, had
occurred at the beginning of each of the periods presented:

<TABLE>
<CAPTION>
                                                                                           YEAR ENDED DECEMBER
                                                                                                   31,
                                                                                          ----------------------
                                                                                            1997          1996
                                                                                          --------      --------
                                                                                          (IN THOUSANDS, EXCEPT
                                                                                            PER SHARE AMOUNTS)
<S>                                                                                       <C>           <C>
Net revenues...........................................................................   $174,084      $160,831
Cost of revenues.......................................................................    103,076        92,426
                                                                                          --------      --------
Gross profit...........................................................................     71,008        68,405
Selling, general and administrative expenses...........................................     63,048        55,469
                                                                                          --------      --------
Income from operations.................................................................      7,960        12,936
Interest expense.......................................................................     14,230        13,988
                                                                                          --------      --------
Income (loss) before taxes.............................................................     (6,270)       (1,052)
Income taxes...........................................................................         --            --
                                                                                          --------      --------
Net income (loss)......................................................................   $ (6,270)     $ (1,052)
                                                                                          --------      --------
                                                                                          --------      --------
Earnings (loss) per share:
  Basic................................................................................   $  (0.69)     $  (0.12)
  Diluted..............................................................................   $  (0.69)     $  (0.12)
Depreciation and amortization..........................................................   $  5,588      $  5,142
</TABLE>

     These pro forma results have been presented for comparative purposes only
and include the following pro forma adjustments (amounts shown in thousands and
relate to the years ended December 31, 1997 and 1996, respectively): (1)
additional amortization expense as a result of goodwill arising from the
acquisition ($789 and $1,616); (2) salary increases relating to contracts
entered into in conjunction with the transactions ($75 and $150); (3)
elimination of costs incurred by Varsity in maintaining its status as a separate
public corporation ($165 and $443); (4) adjustments of certain expenses incurred
by the Company or Varsity based on programs existing within the other company
($38 and $95); (5) elimination of one time charges arising from the transaction
for redeeming Varsity stock options ($4,783 for 1997 only), a change in control
payment ($250 for 1997 only) and bridge loan commitment fees ($3,000 for 1997
only); (6) additional interest on acquisition debt and related debt changes
($5,401 and $11,391); and (7) the tax effect of the above ($1,728 credit
elimination and $3,524 expense

                                      F-16
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

2. ACQUISITION--(CONTINUED)

elimination). The pro forma results are not necessarily indicative of results
that would have occurred had the combination been effected at the dates
indicated nor of future operating results of the combined operations.

3. UMBRO LICENSE

     In November 1998, the Company entered into an license agreement (the "Umbro
License") with Umbro International, Inc. ("UMBRO") pursuant to which the Company
acquired the right for five years to manufacture, market and sell UMBRO brand
soccer team apparel, footwear, equipment, and accessories on an exclusive basis
to the team channel of distribution throughout the United States, Puerto Rico
and the U.S. Virgin Islands. The Umbro License is royalty-free for 1999. The
Company is required to begin paying royalties in the year 2000, at which time it
is also required to meet annual minimum sales figures. In the event that the
Company fails to meet required minimum sales levels subsequent to 1999 for two
consecutive annual periods, UMBRO has the right to terminate the Umbro License.
The Umbro License, which expires in November of 2003, may be extended for an
additional five years at the Company's option on or before August 15, 2003,
provided that the Company achieves certain performance levels. Simultaneously,
the Company acquired certain inventory, promotional material and a 15% interest
in U.S.I.S.L., Inc., an organization that promotes soccer in the United States,
with an option to increase its ownership to 20%. The Company incurred costs and
expenses approximating $3.4 million allocated as follows:

<TABLE>
<CAPTION>
                                                                                  (IN THOUSANDS)
                                                                                  --------------
<S>                                                                               <C>
Investment in U.S.I.S.L., Inc..................................................       $  300
License Rights.................................................................          500
Inventories....................................................................        2,500
Other..........................................................................          100
                                                                                      ------
                                                                                      $3,400
                                                                                      ------
                                                                                      ------
</TABLE>

4. RECEIVABLES

     Accounts receivable include unbilled shipments of approximately $1,678 and
$1,157 at December 31, 1998 and 1997, respectively, principally relating to
Varsity's business. It is the Company's policy to record revenues when the
related goods have been shipped. Unbilled shipments represent receivables for
shipments that have not yet been invoiced. These amounts relate principally to
partial shipments to customers who are not invoiced until their order is shipped
in its entirety or customers with orders containing other terms that require a
deferral in the issuance of an invoice. Management believes that substantially
all of these unbilled receivables will be invoiced within the current sales
season.

5. INVENTORIES

     Inventories consist of the following:

<TABLE>
<CAPTION>
                                                                              DECEMBER 31,
                                                                           ------------------
                                                                            1998       1997
                                                                           -------    -------
                                                                             (IN THOUSANDS)
<S>                                                                        <C>        <C>
Finished goods..........................................................   $16,584    $12,691
Work-in-process.........................................................     2,769      3,571
Raw materials...........................................................     9,410      7,804
                                                                           -------    -------
                                                                           $28,763    $24,066
                                                                           -------    -------
                                                                           -------    -------
</TABLE>

                                      F-17
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

6. PROPERTY AND EQUIPMENT

     Property and equipment consist of the following:

<TABLE>
<CAPTION>
                                                                              DECEMBER 31,
                                                                           ------------------
                                                                            1998       1997
                                                                           -------    -------
                                                                             (IN THOUSANDS)
<S>                                                                        <C>        <C>
Land....................................................................   $   207    $   207
Building and improvements...............................................     1,527      1,428
Machinery and equipment.................................................    13,350     10,955
                                                                           -------    -------
                                                                            15,084     12,590
Less accumulated depreciation...........................................     7,213      4,767
                                                                           -------    -------
                                                                           $ 7,871    $ 7,823
                                                                           -------    -------
                                                                           -------    -------
</TABLE>

     Depreciation expense relating to all property and equipment amounted to
$2,446,000, $1,423,000, and $598,000 the years ended December 31, 1998, 1997 and
1996, respectively.

7. INTANGIBLE ASSETS AND DEFERRED CHARGES

     Intangible assets and deferred charges consist of the following:

<TABLE>
<CAPTION>
                                                                                 ESTIMATED        DECEMBER 31,
                                                                                  LIVES       --------------------
                                                                                 IN YEARS       1998        1997
                                                                                 ---------    --------    --------
                                                                                                 (IN THOUSANDS)
<S>                                                                              <C>          <C>         <C>
MacGregor trademark rights....................................................         40     $ 18,040    $ 18,040
MacGregor license agreements..................................................          8           --       2,030
Trademarks....................................................................         40        3,250       3,250
Goodwill......................................................................         40       91,479      91,292
Debt issue costs..............................................................          8        6,981       6,981
Other.........................................................................    7 to 10        2,843       3,773
                                                                                              --------    --------
                                                                                               122,593     125,366
Less accumulated amortization.................................................                  13,858      13,248
                                                                                              --------    --------
                                                                                              $108,735    $112,118
                                                                                              --------    --------
                                                                                              --------    --------
</TABLE>

8. LONG-TERM DEBT

     Long-term debt consists of the following:

<TABLE>
<CAPTION>
                                                                                                 DECEMBER 31,
                                                                                             --------------------
                                                                                               1998        1997
                                                                                             --------    --------
                                                                                                (IN THOUSANDS)
<S>                                                                                          <C>         <C>
Outstanding balance under a credit facility expiring in 2002, terms further described
  below...................................................................................   $  4,400    $     --
Senior notes, 10.5%, due 2007, terms further described below..............................    115,000     115,000
Convertible subordinated note payable, interest at 4.1%, due 2002 through 2004, terms
  further described below.................................................................      7,500       7,500
                                                                                             --------    --------
                                                                                              126,900     122,500
Less current portion......................................................................         --          --
                                                                                             --------    --------
                                                                                             $126,900    $122,500
                                                                                             --------    --------
                                                                                             --------    --------
</TABLE>

                                      F-18
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

8. LONG-TERM DEBT--(CONTINUED)

     The aggregate maturities of long-term debt are as follows:

<TABLE>
<CAPTION>
YEARS ENDING DECEMBER 31,                                                                           (IN THOUSANDS)
-------------------------                                                                           --------------
<S>                         <C>                                                                     <C>
           2002             .....................................................................      $  6,275
           2003             .....................................................................         1,875
           2004             .....................................................................         3,750
           2007             .....................................................................       115,000
                                                                                                       --------
                                                                                                       $126,900
                                                                                                       --------
                                                                                                       --------
</TABLE>

     The credit facility consists of a line of credit with the Company's bankers
in a principal amount not to exceed $35 million, expiring in 2002. Draws under
the line of credit are limited under the terms of the related loan agreement to
a percentage of certain receivables and inventory. The outstanding balance of
the line accrues interest, payable monthly, at a rate of LIBOR plus a margin of
2.5% on draws so designated by the Company, and on other draws at the higher of
the bank's prime rate plus a margin of 1% or the Federal Funds rate plus 1.5%.
At December 31, 1998 LIBOR rates averaged approximately 4.9% and the prime rate
was 7.75%. The credit facility also calls for a commitment fee equal to an
annual rate of 0.5% applied to the unused portion of the line. The margin of the
interest rate over the related rates, as well as the commitment fee rate, is
subject to quarterly adjustment dependent on certain financial ratios. The
interest rate margin can vary between 1.5% and 2.5% over LIBOR, 0% to 1% over
the prime rate, 0.5% and 1.5% over the Federal Funds rate and 0.4% to 0.5% on
the commitment fee. The credit facility agreement contains certain covenants
which, among other things, require the Company to meet certain ratio and net
worth tests, restrict the level of additional indebtedness the Company may
incur, limit payments of dividends, restrict the sale of assets and restricts
investments the Company may make. The credit facility also requires repayment of
the principal amount upon the occurrence of certain changes in the control of
the Company. The Company has pledged essentially all of its tangible assets as
collateral for the credit facility.

     The 10.5% senior notes due 2007 (the "Senior Notes") contain certain
covenants that, among other things, restrict the level of other indebtedness the
Company may incur, the amounts of investments it may make in other businesses,
the sale of assets and use of proceeds therefrom, and the payment of dividends.
The Senior Notes also restrict payment of junior indebtedness prior to the
maturity of the junior indebtedness. The interest on the Senior Notes is payable
semiannually on January 15 and July 15. The holders of the Senior Notes have the
right to require the Senior Notes to be redeemed at 101% of the principal amount
in the event of a Change of Control (as defined). The Senior Notes contain
certain prepayment restrictions and have no mandatory redemption provisions. The
Senior Notes are guaranteed by all of the Company's subsidiaries. Each of these
subsidiaries are wholly-owned subsidiaries of the Company and have fully and
unconditionally guaranteed the Senior Notes on a joint and several basis. The
Company itself is a holding company with no assets or operations other than
those relating to its investments in its subsidiaries. The separate financial
statements of the guaranteeing subsidiaries are not presented in this report
because, considering the facts stated above, the separate financial statements
and other disclosures concerning the guaranteeing subsidiaries are not deemed
material to investors by management.

     The 4.1% convertible subordinated note is subordinated in right to prior
payment in full of Senior Indebtedness, which is generally defined in the
governing agreements to include debt under the senior notes and revolving line
of credit described above and any refinancing, renewal or replacement thereof as
well as certain other debt. Repayments of 25% and 33 1/3% of the then
outstanding principal balance is due on November 1, 2002 and 2003, respectively,
with the remaining balance due November 1, 2004. Interest is payable
semiannually each May 1 and November 1. The note limits the Company's ability to
grant certain stock options and requires repayment of 101% of the principal
amount in the event of a change in control (as defined). In connection with
obtaining consents needed for various aspects of the Varsity acquisition, the
Company amended the note to provide for a reduction from $6.00 to $5.3763 per
share in the conversion price.

                                      F-19
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

8. LONG-TERM DEBT--(CONTINUED)

     The Senior Notes were issued and the revolving credit facility was entered
into in connection with the 1997 acquisition of Varsity Spirit Corporation (see
Note 2). In connection with these financing transactions, all other long-term
debt of the Company, except the convertible notes, was repaid. The Company
incurred debt issue costs of approximately $5.4 million in connection with the
Senior Notes and approximately $0.8 million of costs in connection with the new
credit facility. These costs are included with intangibles and deferred charges
(see Note 7) and are being amortized to interest expense over the life of the
related debt. The Company also incurred costs of $3.0 million in connection with
a bridge loan commitment needed to support the acquisition. The bridge loan was
not drawn-down and the commitment fee was charged to interest expense in June
1997.

9. SHAREHOLDERS' EQUITY AND STOCK OPTION PLANS

     In conjunction with the Varsity Acquisition in June 1997, the Company sold
986,169 shares of its Common Stock to certain key employees of Varsity at $4.50
per share for an aggregate, net of related costs, of approximately $4.3 million
pursuant to Stock Purchase Agreements, dated May 15, 1997.

     Stock option plans:  The 1991 Stock Option Plan, as amended, and the 1997
Stock Option Plan provide for the granting of options to key employees,
directors, advisors and independent consultants to the Company for the purchase
of up to an aggregate of 2,915,500 shares of the Company's common stock. Under
the 1991 Stock Option Plan, options for an aggregate of 1,415,500 shares may be
granted at an option price of no less than 85% of the market price of the
Company's common stock on the date of grant and may be exercisable between one
and ten years from the date of grant. Under the 1997 Stock Option Plan, options
or other stock-based awards may be granted for an aggregate of 1,500,000 shares.
The 1997 Stock Option Plan generally does not restrict the option price or
exercise terms of grants.

     During 1998, the Company issued 81,000 shares of its Common Stock to
certain employees for incentive compensation as a stock award under the terms of
the 1997 Stock Option Plan. These shares were recorded at a value of $328,000
based on quoted market values at the date of grant. The grants include 27,000
shares, valued at $128,000, granted in consideration for compensation included
in accrued liabilities at December 31, 1997.

     During 1997, in connection with the terms of certain agreements entered
into in connection with the Varsity acquisition, the Company issued options for
the purchase of approximately 950,000 shares of its Common Stock to Varsity
employees. Included in this amount are 450,000 options to certain key employees
of Varsity which vested immediately with an option price of $3.80. A charge of
approximately $559,000 was recorded in June, 1997, and credited to additional
paid in capital to reflect the intrinsic value of these options based on their
in-the-money position on the measurement date for this grant. The remaining
500,000 options were issued to a broad group of Varsity employees with exercise
prices at market. Both of these sets of option grants are included in the
information summarized below.

     Options granted through December 31, 1998 generally have been designated as
non-qualified stock options and, except as described above, have had option
prices equal to market values on the date of grant, have had

                                      F-20
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

9. SHAREHOLDERS' EQUITY AND STOCK OPTION PLANS--(CONTINUED)

terms of five or ten years, and have had vesting periods of one or four years.
Information relating to stock option transactions over the past three years is
summarized as follows:

<TABLE>
<CAPTION>
                                                                      OPTIONS OUTSTANDING        OPTIONS EXERCISABLE
                                                                    -----------------------    -----------------------
                                                                                   WEIGHTED                   WEIGHTED
                                                                                   AVERAGE                    AVERAGE
                                                                                    PRICE                      PRICE
                                                                      NUMBER         PER         NUMBER         PER
                                                                    OUTSTANDING     SHARE      EXERCISABLE     SHARE
                                                                    -----------    --------    -----------    --------
<S>                                                                 <C>            <C>         <C>            <C>
Balance, January 1, 1996.........................................    1,032,050      $ 4.02        485,775      $ 5.21
  Granted........................................................      239,500      $ 4.57
  Forfeited......................................................       (5,500)     $ 2.89
  Expired........................................................      (80,000)     $ 8.00
                                                                     ---------
Balance, December 31, 1996.......................................    1,186,050      $ 3.87        712,913      $ 3.79
  Granted........................................................    1,085,925      $ 4.75
  Exercised......................................................      (25,000)     $ 2.39
  Forfeited......................................................       (7,000)     $ 4.46
  Expired........................................................      (82,000)     $10.75
                                                                     ---------
Balance, December 31, 1997.......................................    2,157,975      $ 4.05      1,284,425      $ 3.37
  Granted........................................................      461,600      $ 5.08
  Exercised......................................................      (58,825)     $ 2.48
  Forfeited......................................................     (291,925)     $ 3.59
  Expired........................................................      (16,300)     $ 4.05
                                                                     ---------
Balance, December 31, 1998.......................................    2,252,525      $ 4.36      1,362,106      $ 3.81
                                                                     ---------
                                                                     ---------
</TABLE>

     Options granted in 1998 include grants for 56,600 shares, granted in
November 1998, to certain employees (none of which were directors of the
Company) in exchange for cancellation of options for 69,850 shares which had
previously been granted to these employees. The canceled options, which are
included in the forfeited category above, would have expired in December 1998
and had a weighted average option price of $2.65 per share. The new grants had a
term of ten years and a weighted average option price of $3.76 per share.

     Further information about stock options outstanding at December 31, 1998 is
summarized as follows:

<TABLE>
<CAPTION>
                              OPTIONS OUTSTANDING                  OPTIONS EXERCISABLE
                    ----------------------------------------     ------------------------
                                     WEIGHTED       WEIGHTED                     WEIGHTED
                                     AVERAGE        AVERAGE                      AVERAGE
                                    REMAINING        PRICE                        PRICE
   RANGE OF           NUMBER        CONTRACTUAL       PER          NUMBER          PER
EXERCISE PRICES     OUTSTANDING        LIFE          SHARE       EXERCISABLE      SHARE
---------------     -----------     -----------     --------     -----------     --------
<S>                 <C>             <C>             <C>          <C>             <C>
$1.80 - $2.49           136,500     2.4 years        $ 1.99         135,000       $ 1.99
$2.50 - $3.99           764,100     7.2 years        $ 3.56         721,250       $ 3.54
$4.00 - $5.44         1,351,925     8.9 years        $ 5.05         505,856       $ 4.67
</TABLE>

     At December 31, 1998 there were 498,150 shares available for future option
grants.

     In accordance with the provisions of Statement of Financial Accounting
Standards No. 123, "Accounting for Stock-Based Compensation" (SFAS 123), the
Company has elected to continue to account for stock-based compensation under
the intrinsic value based method of accounting prescribed by Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees" (APB
25). Under APB 25, generally, no cost is recorded for stock options issued to
employees unless the option price is below market at the time options are
granted. The following pro forma net income and earnings per share are presented
for informational purposes and

                                      F-21
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

9. SHAREHOLDERS' EQUITY AND STOCK OPTION PLANS--(CONTINUED)

have been computed using the fair value method of accounting for stock-based
compensation as set forth in SFAS 123:

<TABLE>
<CAPTION>
                                                                                        YEARS ENDED DECEMBER 31,
                                                                                      ----------------------------
                                                                                       1998       1997       1996
                                                                                      -------    -------    ------
                                                                                             (IN THOUSANDS)
<S>                                                                                   <C>        <C>        <C>
Pro forma net income (loss)........................................................   $(7,953)   $(1,973)   $2,669
Pro forma earnings (loss) per share
     Basic.........................................................................   $ (0.87)   $ (0.23)   $ 0.33
     Diluted.......................................................................   $ (0.87)   $ (0.23)   $ 0.31
</TABLE>

     These pro forma amounts may not be representative of future disclosures
because they do not take into effect pro forma compensation expense related to
grants made before 1995. The pro forma results include expense related to the
fair value of stock options estimated at the date of grant using the
Black-Scholes option pricing model and the following weighted average
assumptions for the years ended December 31, 1998, 1997 and 1996, respectively:
risk-free interest rates of 5.3%, 6.4% and 6.6%; expected volatility of 56%, 50%
and 38%; expected option life of 7.0 years, 7.0 years and 6.9 years, and no
dividend payments. The weighted average estimated fair value of options granted
during 1998, 1997 and 1996 was $3.16, $3.28 and $2.40 per share, respectively.

     Warrants:  At December 31, 1998 warrants were outstanding for the purchase
of an aggregate of 172,152 shares of the Company's common stock. These warrants
are held by one of the Company's banks and are exercisable through October 1999
at an exercise price of $3.72 per share.

     During 1998 certain officers and directors of the Company exercised
outstanding warrants for shares of the Company's Common Stock which would have
expired in January 1999. The Company agreed to a cashless exercise of the
warrants, in effect accepting shares issuable upon exercise as payment for the
exercise. As a result, 42,362 shares of Common Stock were issued in exchange for
warrants for 150,000 shares based on an exercise price of $2.96 per share and an
exchange price of $4.125 per share. The exchange price of $4.125 per share was
set on a date when the quoted market price of a share of Common Stock was $4.00.

10. COMMITMENTS

     Leases:  The Company leases various facilities and equipment under
operating leases. Rent expense amounted to approximately $2,792,000, $1,958,000
and $1,451,000 for the years ended December 31, 1998, 1997 and 1996,
respectively.

     Future minimum rental payments for all non-cancelable lease agreements for
periods after December 31, 1998 are as follows:

<TABLE>
<CAPTION>
YEARS ENDING DECEMBER 31,                                                                           (IN THOUSANDS)
-------------------------                                                                           --------------
<S>                         <C>                                                                     <C>
1999                        .....................................................................      $  2,828
2000                        .....................................................................         2,023
2001                        .....................................................................           789
2002                        .....................................................................           557
2003                        .....................................................................           431
Later years                 .....................................................................         3,370
                                                                                                       --------
          Total minimum payments required........................................................      $  9,998
                                                                                                       --------
                                                                                                       --------
</TABLE>

     Employee benefits:  The Company has three noncontributory defined benefit
pension plans that cover, or have covered, certain employee groups. These plans
consist of two "Union Plans" covering certain unionized employees and a
"Non-Union Plan" that covered other employees of certain subsidiaries. The
Non-Union Plan

                                      F-22
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

10. COMMITMENTS--(CONTINUED)

was amended in 1994 to provide that no benefits would accrue under the plan on
or after December 31, 1994. Expense for these plans for the year ended
December 31, 1998 was approximately $200,000 including a provision for expense
of an anticipated termination of the Non-Union Plan. Total pension expense for
these plans was under $50,000 in each of the years ended December 31, 1997 and
1996.

     The Company maintains defined contribution (401-k) plans covering
substantially all of its employees, other than those covered by the Union Plans.
Company contributions to these plans are based on a percentage of employee
contributions and are funded and charged to expense as incurred. Expenses
related to the plans amounted to $95,000, $342,000 and $307,000 for the years
ended December 31, 1998, 1997 and 1996, respectively.

11. ACCRUED LIABILITIES AND CONTINGENCIES

     Recorded liabilities:  In regards to the product liability contingencies
discussed below, the Company has recorded certain liabilities. While these
amounts are discussed in the remaining sections of this note, a summary of these
amounts together with other items comprising the balance sheet line items
"accrued liabilities" and "other liabilities" follows:

<TABLE>
<CAPTION>
                                                                                           ACCRUED        OTHER
                                                                                           LIABILITIES  LIABILITIES
                                                                                           (CURRENT)    (NON-CURRENT)
                                                                                           ---------    -------------
                                                                                                 (IN THOUSANDS)
<S>                                                                                        <C>          <C>
December 31, 1998:
  Product liability matters, reserves for pending and other contingencies...............    $   700        $ 3,300
  Accrued interest......................................................................      5,690             --
  Other accrued liabilities.............................................................      4,863            254
                                                                                            -------        -------
     Total of balance sheet category....................................................    $11,253        $ 3,554
                                                                                            -------        -------
                                                                                            -------        -------

December 31, 1997:
  Product liability matters, reserves for pending and other contingencies...............    $   700        $ 3,000
  Accrued interest......................................................................      6,536             --
  Other accrued liabilities.............................................................      3,481             60
                                                                                            -------        -------
     Total of balance sheet category....................................................    $10,717        $ 3,060
                                                                                            -------        -------
                                                                                            -------        -------
</TABLE>

     Product liability litigation matters and contingencies:  At December 31,
1998, the Company was a defendant in 5 product liability suits relating to
personal injuries allegedly related to the use of helmets manufactured or
reconditioned by subsidiaries of the Company. The ultimate outcome of these
claims, or potential future claims, cannot presently be determined. The Company
estimates that the uninsured portion of future costs and expenses related to
these claims, and incurred but not reported claims, will amount to at least
$4,000,000 and, accordingly, a reserve in this amount is included in the
Consolidated Balance Sheet at December 31, 1998 as part of accrued liabilities
and other liabilities. These reserves are based on estimates of losses and
defense costs anticipated to result from such claims, from within a range of
potential outcomes, based on available information, including an analysis of
historical data such as the rate of occurrence and the settlement amounts of
past cases. However, due to the uncertainty involved with estimates actual
results have at times varied substantially from earlier estimates and could do
so in the future. Accordingly there can be no assurance that the ultimate costs
of such claims will fall within the established reserves.

     The Company maintains product liability insurance under a policy expiring
in January 2005. The policy is an occurrence-based policy providing coverage
against claims currently pending against the Company and future claims relating
to all injuries occurring prior to January 2005 even if such claims are filed
after the end of the

                                      F-23
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

11. ACCRUED LIABILITIES AND CONTINGENCIES--(CONTINUED)

policy period. The insurance program provides certain basic and excess coverage
on product liability claims with a combined aggregate coverage of over
$40,000,000 subject to the limitations described below.

     The first level of insurance coverage under the policy ("Basic Coverage")
provides coverage of up to $2,250,000 per claim in excess of an uninsured
retention (deductible) of $750,000 per occurrence. The Basic Coverage is subject
to an aggregate program limit and certain annual aggregate sub limits. The Basic
Coverage, which does not affect the availability of the excess coverage
described below, has an aggregate limit which is currently $4.9 million, but the
policy allows the Company to increase this maximum limit to $7.7 million at any
time by prepaying the required premium, which counts at 120% of the amount paid
toward the limit. The Basic Coverage, to the extent available, covers the
insured portion of the first $3,000,000 of a claim. The insurance program also
provides for additional coverage ("Excess Coverage") of up to $20,000,000 per
occurrence, in excess of the first $3,000,000 of each claim. Claims covered by
the Excess Coverage are subject to one of two separate $20,000,000 aggregate
policy limits, depending on the date of the related injury. The first
$20,000,000 aggregate limit applies to claims for injuries occurring prior to
January 31, 1998, and claims occurring after January 1998 are covered by the
second separate $20,000,000 aggregate limit.

     Other contingencies and litigation matters:  In addition to the matters
discussed in the preceding paragraphs, the Company has certain other claims or
potential claims against it that may arise in the normal course of business,
including without limitation, claims relating to personal injury as well as
employment related matters. Management believes that the probable resolution of
such matters will not materially affect the financial position or results of
operations of the Company.

12. INCOME TAXES

     Income taxes on income (loss), before extraordinary items, for the years
ended December 31, 1998, 1997 and 1996 is summarized below:

<TABLE>
<CAPTION>
                                                                                           YEARS ENDED DECEMBER
                                                                                                   31,
                                                                                          ----------------------
                                                                                          1998     1997     1996
                                                                                          ----     ----     ----
                                                                                              (IN THOUSANDS)
<S>                                                                                       <C>      <C>      <C>
Current tax expense:
  Federal.............................................................................    $ --     $ --     $ 50
  State...............................................................................      --       --       60
                                                                                          ----     ----     ----
                                                                                            --       --      110
                                                                                          ----     ----     ----
Deferred tax expense:
  Federal.............................................................................      --       --       --
  State...............................................................................      --       --       --
                                                                                          ----     ----     ----
                                                                                            --       --       --
                                                                                          ----     ----     ----
                                                                                          $ --     $ --     $110
                                                                                          ----     ----     ----
                                                                                          ----     ----     ----
</TABLE>

     For the years ended December 31, 1997 and 1996, tax expense was reduced by
offsetting tax benefits of approximately $500,000 and $1,200,000, respectively,
of net operating loss carryforwards which were not recognized in prior years.

                                      F-24
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

12. INCOME TAXES--(CONTINUED)

     Significant components of deferred income tax assets and liabilities at
December 31, 1998, 1997 and 1996 are as follows:

<TABLE>
<CAPTION>
                                                                                    YEARS ENDED DECEMBER 31,
                                                                                 -------------------------------
                                                                                  1998        1997        1996
                                                                                 -------     -------     -------
                                                                                         (IN THOUSANDS)
<S>                                                                              <C>         <C>         <C>
Deferred income tax assets:
  Accrued expenses and reserves..............................................    $ 2,843     $ 2,267     $ 3,509
  Inventory..................................................................        711         733         492
  Intangible assets..........................................................         --          --          26
  Net operating loss, and credit, carryforwards..............................      6,551       4,832       3,689
  Other......................................................................        308         276          36
                                                                                 -------     -------     -------
                                                                                  10,413       8,108       7,752
  Valuation allowances.......................................................     (3,215)     (1,031)     (1,386)
                                                                                 -------     -------     -------
  Total deferred income tax assets...........................................      7,198       7,077       6,366
                                                                                 -------     -------     -------
Deferred income tax liabilities:
  Intangible assets and deductible goodwill..................................      5,648       5,498       6,014
  Property and equipment.....................................................        442         481          86
  Prepaid expenses...........................................................        203         193         266
                                                                                 -------     -------     -------
  Total deferred income tax liabilities......................................      6,293       6,172       6,366
                                                                                 -------     -------     -------
Total net deferred income tax asset..........................................    $   905     $   905     $     0
                                                                                 -------     -------     -------
                                                                                 -------     -------     -------
</TABLE>

     The net current and non-current components of the deferred income taxes
were recognized in the balance sheet at December 31, 1998, 1997 and 1996 as
follows:

<TABLE>
<CAPTION>
                                                                                      YEARS ENDED DECEMBER 31,
                                                                                    ----------------------------
                                                                                     1998       1997       1996
                                                                                    ------     ------     ------
                                                                                           (IN THOUSANDS)
<S>                                                                                 <C>        <C>        <C>
Net current assets, included with prepaid expenses..............................    $1,253     $1,358     $1,820
Net non-current deferred tax liabilities........................................       348        453      1,820
                                                                                    ------     ------     ------
                                                                                    $  905     $  905     $    0
                                                                                    ------     ------     ------
                                                                                    ------     ------     ------
</TABLE>

     A reconciliation of effective tax rates to federal statutory tax rates is
as follows:

<TABLE>
<CAPTION>
                                                                                                   YEARS ENDED
                                                                                                  DECEMBER 31,
                                                                                             -----------------------
                                                                                             1998     1997     1996
                                                                                             -----    -----    -----
<S>                                                                                          <C>      <C>      <C>
Statutory Federal tax rate................................................................   (34.0%)  (34.0%)   34.0%
Differences resulting from:
  Effective state tax rate, net of federal tax benefit....................................      --       --      3.1
  Amortization not deductible for tax purposes............................................    10.2     87.1      5.8
  Travel & entertainment expenses not deductible for tax purposes.........................     3.9     33.9      1.2
  Losses with no current benefit..........................................................    20.2
  Benefit of prior periods net operating losses not previously recognized.................            (86.4)   (40.2)
  Other differences.......................................................................    (0.3)    (0.6)    (0.2)
                                                                                             -----    -----    -----
                                                                                               0.0%     0.0%     3.7%
                                                                                             -----    -----    -----
                                                                                             -----    -----    -----
</TABLE>

     At December 31, 1998 the Company had estimated net operating loss
carryforwards for federal income tax purposes of approximately $17,700,000
expiring between 2008 to 2013. While this loss carryforward is available

                                      F-25
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

12. INCOME TAXES--(CONTINUED)

to reduce the payment of taxes that might otherwise be payable in future years,
the benefit of most of the net operating losses have been recognized in the
computation of income tax expense reflected in the Company's consolidated
financial statements in prior years. Benefits relating to approximately $7.0
million of net operating loss carryforwards have not yet been recognized in the
computation of income tax expense for financial reporting purposes and have been
reserved for as part of the deferred income tax asset valuation allowance. These
unrecognized carryforwards would be recognized through a reduction of income tax
expense in future periods upon the generation of an offsetting amount of taxable
earnings.

13. RELATED PARTY TRANSACTIONS

     In 1997, in connection with certain financing transactions occurring in
connection with the Varsity acquisition, notes payable to shareholders of
$439,000 plus accrued interest were repaid in advance of maturity. Interest of
$17,000 and $111,000 on the note was included in interest expense for the years
ended December 31, 1997, and 1996, respectively. In 1996 the Company paid
consulting fees of $75,000 to one director and paid another director $20,000 for
services in connection with a series of promotional football clinics sponsored
by the Company.

14. SUPPLEMENTAL CASH FLOW INFORMATION

     Cash payments for interest were $14,700,000, $5,260,000 and $2,662,000 for
the years ended December 31, 1998, 1997 and 1996, respectively. Interest
payments for 1997 included $3,000,000 relating to bridge financing commitment
fees--see Note 8. Income tax payments, or refunds, were not significant for
1998, 1997 or 1996.

     In 1998, the Company issued shares of its Common Stock, valued at $128,000
based on quoted market values at the time of grant, to certain employees as
consideration for compensation included in accrued liabilities at December 31,
1997.

     In June 1997, in connection with the Varsity acquisition, the Company
assumed liabilities of $23,068,000.

15. FAIR VALUES OF FINANCIAL INSTRUMENTS

     The Company's financial instruments include cash, accounts receivable,
accounts payable and long-term debt. The carrying values of cash, accounts
receivable and accounts payable approximate their fair values. The Company's
long-term debt include the Senior Notes which at December 31, 1998 had a
carrying value of $115,000,000 and a fair value, based on quoted market values,
of $109,250,000. The Company's remaining long-term debt is not traded and has no
quoted market value, however management believes any difference between its
carrying value and fair value would not be material in relation to these
Consolidated Financial Statements.

16. SEGMENT AND PRODUCT LINE INFORMATION

     The Company has three reportable segments: institutional products and
services, retail products and trademark licensing:

     Institutional products and services:  This segment markets products and
services primarily through the Company's direct sales force for institutional
customers such as schools, leagues, recreational groups and other organizations
for competitive and recreational sport and spirit activities. Operations include
the manufacture and sale of athletic products (including football helmets),
spirit products (including cheerleading and dance uniforms and accessories), and
athletic equipment reconditioning. The segment also operates cheerleader and
dance team camps, clinics and special events.

     Retail products:  This segment markets products through retailers in the
U.S. and internationally. Most of the products sold by this segment are sports
collectible products, such as authentic and replica football helmets,

                                      F-26
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

16. SEGMENT AND PRODUCT LINE INFORMATION--(CONTINUED)

which bear licensed sports team logos. The segment's operations also include
sales of certain recreational football and other athletic products sold through
consumer product retailers and distributors.

     Trademark licensing:  This segment consists of the licensing of the
Company's Riddell and MacGregor trademark rights to other entities for use in
marketing products such as athletic footwear and apparel.

     The Company's reportable segments are strategic business units that differ
and are managed separately because of the nature of their markets and channels
of distribution. The Institutional products and services segment includes the
company's institutional athletic products business unit and its spirit
(cheerleading and dance) business unit. Information about these two business
units has been combined and reported as the institutional products and services
segment as the units have similar economic and other business traits.

     The accounting policies of the segments are the same as those described in
the summary of significant accounting policies except for the inclusion of
operating results for Varsity Spirit Corporation, and related pro forma
adjustments, for the period prior to its acquisition in June 1997 (see Note 2).
The company evaluates performance of the institutional products and services
segment based on these pro forma results. Total assets are as reported and do
not include pro forma amounts or adjustments.

<TABLE>
<CAPTION>
                                                                                  YEARS ENDED DECEMBER 31,
                                                                             ----------------------------------
                                                                               1998         1997         1996
                                                                             --------     --------     --------
                                                                                       (IN THOUSANDS)
<S>                                                                          <C>          <C>          <C>
Net revenues:
  Institutional products and services....................................    $166,845     $153,641     $136,974
  Retail products........................................................      18,142       18,055       21,363
  Trademark licensing....................................................       1,613        2,388        2,494
                                                                             --------     --------     --------
                                                                              186,600      174,084      160,831
  Less, preacquisition results of Varsity Spirit Corporation included
     above...............................................................          --       35,811       88,449
                                                                             --------     --------     --------
  Consolidated total.....................................................    $186,600     $138,273     $ 72,382
                                                                             --------     --------     --------
                                                                             --------     --------     --------

Income from Operations:
  Institutional products and services....................................    $ 11,416     $ 10,841     $ 11,423
  Retail products........................................................          56        1,742        3,727
  Trademark licensing....................................................         841        1,476        1,536
  Corporate and unallocated expenses.....................................      (4,796)      (6,099)      (3,750)
                                                                             --------     --------     --------
                                                                                7,517        7,960       12,936
  Less, preacquisition results of Varsity Spirit Corporation included
     above...............................................................          --       (3,360)       7,220
                                                                             --------     --------     --------
  Consolidated total.....................................................    $  7,517     $ 11,320     $  5,716
                                                                             --------     --------     --------
                                                                             --------     --------     --------

Depreciation and amortization, exclusive of debt issue costs:
  Institutional products and services....................................    $  4,497     $  4,253     $  3,854
  Retail products........................................................         557          595          541
  Trademark licensing....................................................         614          696          702
  Corporate and unallocated..............................................          45           44           45
                                                                             --------     --------     --------
                                                                                5,713        5,588        5,142
  Less, preacquisition results of Varsity Spirit Corporation included
     above...............................................................          --        1,578        2,949
                                                                             --------     --------     --------
  Consolidated total.....................................................    $  5,713     $  4,010     $  2,193
                                                                             --------     --------     --------
                                                                             --------     --------     --------
</TABLE>

                                      F-27
<PAGE>
                      RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

16. SEGMENT AND PRODUCT LINE INFORMATION--(CONTINUED)

<TABLE>
<CAPTION>
                                                                                  YEARS ENDED DECEMBER 31,
                                                                             ----------------------------------
                                                                               1998         1997         1996
                                                                             --------     --------     --------
                                                                                       (IN THOUSANDS)
Capital expenditures:
<S>                                                                          <C>          <C>          <C>
  Institutional products and services....................................    $  2,265     $  2,562     $  2,698
  Retail products........................................................         229          139          269
                                                                             --------     --------     --------
                                                                                2,494        2,701        2,967
  Less, preacquisition results of Varsity Spirit Corporation included
     above...............................................................          --          887        1,828
                                                                             --------     --------     --------
  Consolidated total.....................................................    $  2,494     $  1,814     $  1,139
                                                                             --------     --------     --------
                                                                             --------     --------     --------

Total assets:
  Institutional products and services....................................    $150,163     $143,414     $ 43,302
  Retail products........................................................      10,253       11,497       11,468
  Trademark licensing....................................................      16,898       17,835       17,807
  Corporate and unallocated..............................................       8,897        9,015        3,784
                                                                             --------     --------     --------
  Consolidated total.....................................................    $186,211     $181,761     $ 76,361
                                                                             --------     --------     --------
                                                                             --------     --------     --------

Revenues by product line for all reportable segments in the aggregate were as follows:
  Cheerleader and dance products.........................................    $ 63,491     $ 56,453     $ 49,472
  Camps and events.......................................................      48,704       44,966       38,977
  Athletic products......................................................      34,276       30,177       27,884
  Athletic product reconditioning........................................      23,415       22,892       21,700
  Sports collectibles....................................................      15,101       17,208       20,304
  Trademark licensing....................................................       1,613        2,388        2,494
                                                                             --------     --------     --------
                                                                              186,600      174,084      160,831
  Less, preacquisition results of Varsity Spirit Corporation included
     above...............................................................          --       35,811       88,449
                                                                             --------     --------     --------
  Consolidated revenues..................................................    $186,600     $138,273     $ 72,382
                                                                             --------     --------     --------
                                                                             --------     --------     --------
</TABLE>

17. SUBSEQUENT EVENT

     On March 16, 1999, a jury rendered a verdict against the Company in a Texas
product liability lawsuit for approximately $11.4 million plus interest from
February 1996. The Company intends to appeal the verdict. If the verdict was
paid in full it would be covered by the insurance described above, except for an
amount equal to the $750,000 uninsured retention. This amount, however, is
already included in the Company's balance sheet reserves. Any such payment by
the insurance company would reduce the amount of the aggregate limits of the
Company's product liability insurance coverage described in Note 11, above.

                                      F-28
<PAGE>


================================================================================

                          Riddell Sports Inc. [Logo]

                          H.C. Wainwright & Co., Inc.

================================================================================



<PAGE>

                                                                [Alternate Page]

The information in this prospectus is not complete and may be changed. Riddell
Sports may not sell these securities until the registration statement filed with
the Securities and Exchange Commission is effective. This prospectus is not an
offer to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.

SUBJECT TO COMPLETION DECEMBER 15, 1999

Preliminary Prospectus

                         250,000 Shares of Common Stock

                           RIDDELL SPORTS INC. [LOGO]

      We are a leading marketer and distributor of branded products and services
to the extracurricular portion of the educational market. We are selling 250,000
shares of our common stock.

      Our shares are listed for trading on the American Stock Exchange under the
symbol "RDL." On December 10, 1999, the last reported sale price for our common
stock on the American Stock Exchange was $3.125 per share.

      Simultaneously with this underwritten offering, we are conducting a rights
offering to our stockholders to sell an additional 1,000,000 shares of our
common stock under a separate prospectus.

      See "Risk Factors" beginning on page [   ] to read about factors you
should consider before buying shares of our common stock.

      Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is a
criminal offense.

                                                      Per Share      Total
Public offering price........................       $              $

Underwriting discounts and commissions.......       $              $

Proceeds, before expenses, to Riddell........       $              $

      Delivery and payment for the shares will be on [ ], 2000.

      The underwriter may, under some circumstances, for 45 days after the date
of this prospectus, purchase up to an additional 37,500 shares of our common
stock from us at the public offering price, less underwriting discounts and
commissions.

                        H.C. Wainwright & Co., Inc.

                    Prospectus dated [          ], 2000


                                      A-1
<PAGE>

                                                                [Alternate Page]

      You should rely only on the information contained in this prospectus. We
have not authorized anyone to provide you with information different from that
contained in this prospectus. This prospectus is not an offer to sell or a
solicitation of an offer to buy any securities in any state or other
jurisdiction in which the offer or solicitation is not permitted. You should not
assume that the information in this prospectus is accurate as of any date other
than the date of this prospectus.

      In this prospectus, "Riddell," "we," "us" and "our" refer to Riddell
Sports Inc. and our subsidiaries, unless the context specifically indicates
otherwise.


                                      A-2
<PAGE>

                                                                [Alternate Page]

                                TABLE OF CONTENTS

                                                                           Page

PROSPECTUS SUMMARY.........................................................

RISK FACTORS...............................................................

TRADE NAMES AND TRADEMARKS.................................................

FORWARD-LOOKING STATEMENTS.................................................

THE CONCURRENT OFFERING....................................................

THE RIGHTS OFFERING........................................................

USE OF PROCEEDS............................................................

DILUTION...................................................................

CAPITALIZATION.............................................................

SELECTED FINANCIAL DATA....................................................

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
      CONDITION AND RESULTS OF OPERATIONS..................................

PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY............................

BUSINESS ..................................................................

MANAGEMENT.................................................................

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
      AND MANAGEMENT.......................................................

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.............................

UNDERWRITING...............................................................

DESCRIPTION OF CAPITAL STOCK...............................................

DESCRIPTION OF DEBT SECURITIES.............................................

LEGAL MATTERS..............................................................

EXPERTS....................................................................

WHERE YOU CAN FIND MORE INFORMATION........................................

INDEX TO FINANCIAL STATEMENTS.............................................. F-1



                                      A-3
<PAGE>

                                                                [Alternate Page]

                               RIGHTS OFFERING


Securities Offered                             Rights to purchase 1,000,000
                                               shares of our common stock at
                                               $___ per share pro rata to all of
                                               our common stockholders as of
                                               December 27, 1999.  Further, to
                                               those individuals and entities
                                               who exercise rights, we will
                                               issue warrants which, upon
                                               exercise, will represent in the
                                               aggregate, _____ (____%) percent
                                               of Riddell's ownership in a new
                                               or existing subsidiary that we
                                               may establish in the future to
                                               conduct most of our Internet
                                               operations.

                                      A-4
<PAGE>

                                                                [Alternate Page]

                                 RIGHTS OFFERING

      In addition to the concurrent offering, we are also granting rights to
purchase 1,000,000 additional shares of our common stock at $________ per share
pro rata to all of our common stockholders as of December 27, 1999, the record
date. Each stockholder has been granted 0.10795 rights for every share of common
stock they hold on the record date. Further, if the stockholders exercise their
rights, they will also receive, for no additional money, the right, if certain
conditions are met, to purchase stock from Riddell of a new or existing
subsidiary that will conduct substantially all of our Internet operations.


                                      A-5
<PAGE>

                                                                [Alternate Page]

                                  UNDERWRITING

      Subject to the terms and conditions contained in the underwriting
agreement, we have agreed to sell to H.C. Wainwright & Co., Inc. and H.C.
Wainwright & Co., Inc. has agreed to purchase on a firm commitment basis 250,000
shares of our common stock offered in this offering.

      A copy of the underwriting agreement has been filed as an exhibit to this
registration statement.

      The underwriter has advised us that it proposes to offer the shares to the
public at the initial public offering price on the cover page of this prospectus
and that it may allow some dealers who are members of the NASD, concessions not
in excess of $   per share and the dealers who receive concessions may reallow a
sum not in excess of $   per share to other dealers who are members of the NASD
and to some foreign dealers. Upon completion of this offering, the offering
price, the concession to selected dealers, and the reallowance to other dealers
may be changed by the underwriter. The underwriter has informed us that it does
not expect discretionary sales by the underwriter to exceed five percent of the
shares offered by this prospectus.

      The underwriter shall also receive a discount of 7% per share for all
shares underwritten in this offering. We have also granted the underwriter an
option, exercisable during the 45-day period commencing an the date of this
prospectus, to purchase at the public offering price per share, less the
underwriting discount, up to an aggregate of 37,500 shares of common stock. The
underwriter may exercise this right of purchase only for the purpose of covering
over-allotments, if any, made in connection with the sale of shares.

      We have also agreed to sell to the underwriter, for nominal consideration,
the underwriters warrants to purchase up to ___% of the number of shares of
common stock sold in the concurrent offering. The underwriter's warrants are
exercisable for a period of four years commencing one year after the date of
this prospectus at an exercise price per share equal to $____ (_____% of the
public offering price).

      We have granted demand registration rights at our expense for a period of
five years from the effective date of this offering upon the written demand of
holder(s) representing a majority of the warrants and piggyback registration
rights for a period of seven years from the effective date of this offering with
respect to registration under the Securities Act of the securities directly or
indirectly issuable upon exercise of the underwriter's warrants. In addition,
for a period of five years from the effective date of this offering, we have
agreed, on one occasion and upon the written request of any holder(s), to
promptly register the underlying securities for purposes of a public offering,
solely at the expense of the requesting holder(s).

      The underwriter's warrants contain anti-dilution provisions providing for
adjustments of the exercise price and number of shares issuable on exercise of
the underwriter's warrants, upon the occurrence of some events, including stock
dividends, stock splits, and recapitalizations. The holders of the underwriter's
warrants have no voting, dividend, or other rights as a stockholder with respect
to shares of common stock underlying the underwriter's warrants, unless the
underwriter's warrants shall have been exercised.


                                      A-6
<PAGE>

                                                                [Alternate Page]

      In connection with this underwritten offering, we are also conducting a
rights offering in which we are offering right evidenced by subscription
certificates to purchase shares of our common stock to our existing
shareholders. H.C. Wainwright & Co. is also acting as solicitation agent in the
rights offering and shall receive an agency fee equal to 3% of the gross
proceeds we receive upon the exercise of certain rights in that offering.

      We have also agreed to reimburse H.C. Wainwright & Co. for its actual
out-of-pocket expenses incurred in connection with the rights offering and the
concurrent offering, including the fees and expenses of its counsel.

      Rules of the Securities and Exchange Commission may limit the ability of
the underwriter to bid for or purchase shares before the distribution of the
shares is completed. However, the underwriter may engage in the following
activities in accordance with the rules:

      Stabilizing transactions. The underwriter may make bids or purchases for
the purpose of pegging, fixing or maintaining the price of the shares, so long
as stabilizing bids do not exceed a specified maximum.

      Over-allotments and coverage transactions. The underwriter may create a
short position in the shares by selling more shares than are set forth on the
cover page of this prospectus. If a short position is created in connection with
the offering, the underwriter may engage in covering transactions by purchasing
shares in the open market. The underwriter may also elect to reduce any short
position by exercising all or part of the over-allotment option.

      Stabilization and covering transactions may cause the price of the shares
to be higher than it would be in the absence of such transactions.

      Neither we nor the underwriter makes any representation or prediction as
to the effect that the transactions described above may have on the price of the
shares. These transactions may occur on the American Stock Exchange, in the
over-the-counter market or on any trading market. If such transactions are
commenced, they may be discontinued without notice at any time.

      We have agreed to indemnify H.C. Wainwright & Co. against some
liabilities, including civil liabilities under the Securities Act, or to
contribute to payments H.C. Wainwright & Co. may be required to make in this
respect.


                                      A-7
<PAGE>

                                     PART II

                     INFORMATION NOT REQUIRED IN PROSPECTUS

Item 14. Other Expenses of Issuance and Distribution.

The following table sets forth expenses in connection with the issuance and
distribution of the securities being registered. All amounts shown are
estimated, except the SEC registration fee.

SEC registrationfee..................................................$1064.89

NASD filing fee......................................................$903

Subscription Agent fees and expenses.................................$35,000

Information Agent fees and expenses..................................NA

Registration Agent fees and expenses.................................NA

Legal fees and expenses (including blue sky fees and expenses).......$180,000

Accounting fees......................................................$20,000

Printing and mailing expenses........................................$100,000

Miscellaneous........................................................$113,032.11

Total................................................................$450,000

Item 15. Indemnification of Directors and Officers.

      Pursuant to Section 102(b)(7) of the Delaware General Corporation Law (the
"DGCL"), the Certificate of Incorporation of the Registrant contains provisions
which eliminate the personal liability of our directors for monetary damages
resulting from breaches of their fiduciary duty other than liability for
breaches of the duty of loyalty, acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law, violations under
Section 174 of the DGCL or any transaction from which the director derived an
improper personal benefit.

      Section 145 of the DGCL permits, and under certain circumstances requires,
the Registrant to indemnify our directors, officers, employees, and agents
subject to certain conditions and limitations. The Registrant's Bylaws contain
provisions to indemnify our directors and officers to the fullest extent
permitted by Section 145 of the DGCL, including circumstances in which
indemnification is otherwise discretionary. In addition, the Registrant
maintains officers' and directors' liability insurance which insures against
liabilities that our officers and directors may incur in such capacities.

Item 16. Exhibits and financial statement schedules.

      A list of the exhibits included as part of this Registration Statement is
set forth in the Exhibit Index that immediately precedes such exhibits and is
incorporated herein by this reference.


                                      II-1
<PAGE>

(a) EXHIBIT

NUMBER      DESCRIPTION

1.1         Form of Underwriting Agreement, by and between Riddell and H.C.
            Wainwright & Co., Inc. (1)

2.1         Asset Purchase Agreement, dated as of April 11, 1988, among
            Riddellink Holding Corporation, EN&T Associates, Inc., Netlink Inc.,
            Riddell, Inc. (predecessor corporation), Equilink Licensing Corp.,
            and MacGregor Sporting Goods, Inc., as amended on April 18, 1988
            (the formal trademark assignments and license agreements
            implementing this agreement are omitted) (2) and Amendment thereto,
            dated March 1992. (3)

2.2         Agreement and Plan of Merger, dated as of May 5, 1997, by and among
            Riddell Sports Inc., Cheer Acquisition Corp. and Varsity Spirit
            Corporation. (31)

2.3         Asset Purchase Agreement dated as of December 1, 1994 by and between
            Intropa International U.S.A., Inc., Elisabeth Polsterer and
            Varsity/Tours, Inc. (27)

2.4         Asset Purchase Agreement dated as of May 15, 1996 by and between
            United Special Events, Inc., Michael Olmstead and Varsity USA, Inc.
            (26)

3.1         Amended and Restated Articles of Incorporation of Riddell Sports
            Inc. (20)

3.2         First Amended and Restated Bylaws of Riddell Sports Inc. (18)

3.3         Certificate of Incorporation of All American Sports Corporation
            (formerly known as Ameracq Corp). (33)

3.4         Bylaws of All American Sports Corporation (formerly known as Ameracq
            Corp). (33)

3.5         Certificate of Incorporation of Cheer Acquisition Corp. (33)

3.6         Bylaws of Cheer Acquisition Corp. (33)

3.7         Certificate of Incorporation of Equilink Licensing Corporation. (33)

3.8         Bylaws of Equilink Licensing Corporation. (33)

3.9         Certificate of Incorporation of Proacq Corp. (33)

3.10        Bylaws of Proacq Corp. (33)

3.11        Certificate of Incorporation of RHC Licensing Corporation. (33)

3.12        Bylaws of RHC Licensing Corporation. (33)

3.13        Amended and Restated Articles of Incorporation of Riddell, Inc.
            (formerly known as EN&T Associates Inc.). (33)


                                      II-2
<PAGE>

3.14        Bylaws of Riddell, Inc. (formerly known as EN&T Associates Inc.).
            (33)

3.15        Amended and Restated Articles of Incorporation of Ridmark
            Corporation. (33)

3.16        Bylaws of Ridmark Corporation. (33)

3.17        Charter of International Logos, Inc. (33)

3.18        Bylaws of International Logos, Inc. (33)

3.19        Charter of Varsity/Intropa Tours, Inc. (33)

3.20        Bylaws of Varsity/Intropa Tours, Inc. (33)

3.21        Amended and Restated Charter of Varsity Spirit Fashions & Supplies,
            Inc. (33)

3.22        Bylaws of Varsity Spirit Fashions & Supplies, Inc. (33)

3.23        Amended and Restated Charter of Varsity USA, Inc. (33)

3.24        Bylaws of Varsity USA, Inc. (33)

4.1         Indenture, dated as of June 19, 1997, between Riddell, certain
            subsidiaries of Riddell Sports Inc., as guarantors, and Marine
            Midland Bank, as Trustee. (23)

4.2         Form of Underwriter's Warrant Agreement by and between Riddell and
            H.C. Wainwright & Co., Inc. (1-A)

4.3         Form of Common Stock Purchase Warrant. (1-A)

4.4         Form of Warrant Agreement between Riddell and American Stock
            Transfer & Trust Company. (1-A)

5.1         Opinion of Zukerman Gore & Brandeis, LLP (1-A)

9.1         Voting Trust Agreement dated May 1991. (2)

10.1        Settlement Agreement, dated April 9, 1981, among McGregor-Doniger
            Inc., Brunswick Corporation and The Equilink Corporation. (2)

10.2        1997 Stock Option Plan (22)

10.3        Agreement, made January 23, 1989, between Equilink Licensing Corp.
            and Kmart Corporation, with supplemental agreements dated November
            16, 1989, August 30, 1990 (2), June 30, 1994 (12) and June 30, 1998.
            (1)

10.4        Lease, dated November 12, 1993, between the International
            Brotherhood of Painters and Allied Trade Union and Industry Pension
            Fund and Riddell, Inc., (16); and amendment dated March 20, 1995
            (16); and Amendment dated September 19, 1996. (21)

10.5        Lease Agreement, dated November 2, 1984 by and between ADI Real
            Estate Joint Venture No. 2 (predecessor to The School Employees
            Retirement Board of Ohio) and Alamo Athletics Inc. (predecessor to
            All American Sports Corporation), and Amendments thereto, dated
            January 30, 1990. (3)


                                      II-3
<PAGE>

10.6        Lease Agreement, dated as of September 1, 1988 by and between Exeter
            Management Corporation and All American. (3)

10.7        Lease Agreement, dated April 1991, by and between Stroudsburg Park
            Associates and All American Corp. (3); as amended March 31, 1995.
            (18)

10.8        Lease, dated as of September 1, 1968, by and between Munro M. Grant
            and the All American Company and Extension and Amendment of Lease,
            dated July 11, 1989. (3)

10.9        Lease dated December 12, 1991, between O'Shanter Resources Inc. and
            All American Sports, Inc. (3)

10.10       Lease, dated May 5, 1986, by and between Paul Goldstein, Nathan
            Hoffenberg, All American and Medalist Industries, (3); amendment
            dated January 30, 1997. (21)

10.11       Lease, dated October 28, 1987, as amended and extended by letter
            dated October 31, 1991, by and between GABT Developments Ltd. and
            Marcan Ltd. (a division of All American ), (3); amendment dated
            February 6, 1997. (21)

10.13       1991 Stock Option Plan (2) as amended by amendments described in
            Riddell Sports Inc.'s proxy materials for its annual stockholders
            meetings held on August 20, 1992, September 30, 1993, June 27, 1996
            and June 24, 1997.

10.14       Perpetual License and Trademark Maintenance Agreements among MacMark
            Corporation, Equilink Licensing Corporation and BSN Corp. each dated
            February 19, 1992 (3) and amendment dated November 1, 1992 (7).

10.15       Master Agreement by and among MacGregor Sports Products, Inc., BSN
            Corp. and MacMark Corporation dated February 19, 1992 (3); amendment
            No. 1 dated November 1, 1992. (16)

10.16       Employment Agreement, dated June 22, 1992, between Riddell Sports
            Inc. and Robert Nederlander (5); amended July 27, 1994. (12)

10.17       Employment Agreement, dated June 22, 1992, between Riddell Sports
            Inc. and Leonard Toboroff (5); amended July 27, 1994. (12)

10.18       Lease, dated September 10, 1992, and Amendment, dated October 1,
            1992, and Amendment, dated October 22, 1992, between All American
            Sports Corporation and Ronald K. Howell d/b/a Lakewood Land and
            Cattle Company. (6)

10.19       Lease Addendum letter, dated February 13, 1992, between All American
            Sports Corporation and Paul Goldstein and Nathan Hoffenberg. (6)

10.20       License Agreement, dated October 1, 1992, between All American
            Sports Corporation and NOCSAE. (7)

10.21       Employment Agreement, dated March 19, 1993, commencing March 25,
            1993 between David Mauer and Riddell Sports Inc. (7), as amended
            January 17, 1994; November 1, 1994 (14); November 28, 1994 (16)


                                      II-4
<PAGE>

10.22       Settlement agreement, dated February 15, 1994, among Riddell, Inc.,
            Riddell Sports Inc., RHC Licensing Corporation, Ridmark Corporation,
            Pursuit Athletic Footwear, Inc., Riddell Athletic Footwear, Inc.,
            Ernie Wood, Harry Wood, Silver Eagle Holdings, Ltd., Save Power,
            Limited, Extravest Holdings Limited, Frederic Brooks, Donald Engel,
            Alan Tessler, Alan Hirschfield, Jeffrey Steiner, Robert Nederlander,
            Leonard Toboroff, Jeffrey Epstein, John McConnaughy, Connecticut
            Economics Corporation, Stephen Tannen, Woodco Sports, Inc., Arthur
            Tse, Silver Top Limited, Billion Nominees, Limited, Weston Holdings
            Limited. (9)

10.23       Employment Agreement, dated as of February 1, 1994, between Riddell
            Inc. and Dan Cougill (11), as amended February 1, 1995 (17).

10.24       Employment Agreement, dated as of March 7, 1996, between Riddell
            Sports Inc. and David Groelinger (19), as amended March 7, 1998
            (34).

10.25       Note Purchase Agreement, dated October 30, 1996, between Riddell
            Sports Inc. and Silver Oak Capital, L.L.C., as amended by letter
            agreement dated May 2, 1997. (20)

10.26       Registration Rights Agreement, dated November 8, 1996, between
            Riddell Sports Inc. and Silver Oak Capital L.L.C. (20)

10.27       Shareholders Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc., Cheer Acquisition Corp. and certain shareholders of
            Varsity Spirit Corporation. (32)

10.28       Stock Purchase Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc., Cheer Acquisition Corp. and Jeffrey G. Webb (32)

10.29       Stock Purchase Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc. and Gregory C. Webb (32)

10.30       Stock Purchase Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc. and W. Kline Boyd (32)

10.31       Stock Purchase Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc. and J. Kristyn Shepherd (32)

10.32       Employment Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc. and Jeffrey G. Webb (32)

10.33       Employment Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc. and Gregory C. Webb (32)

10.34       Employment Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc. and W. Kline Boyd (32)

10.35       Employment Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc. and J. Kristyn Shepherd (32)

10.36       Registration Rights Agreement, dated as of June 19, 1997, between
            Riddell Sports Inc., and NationsBanc Capital Markets, Inc. and First
            Chicago Capital Markets, Inc., as Purchasers. (23)


                                      II-5
<PAGE>

10.37       Sales Representative Agreement between Varsity Spirit Fashions &
            Supplies, Inc. and Stuart Educational Products, Inc., along with
            Security Agreement between Varsity Spirit Fashions & Supplies, Inc.
            and Gary Stuart and Patti Stuart, both individually and collectively
            doing business as Stuart Educational Products. (24)

10.38       Programming Agreement between Universal Cheerleaders Association and
            ESPN, Inc. (24).

10.39       Employment Agreement, dated December 1, 1994, between Varsity Spirit
            Corporation and Deana Roberts. (27)

10.40       Settlement Agreement, dated June 20, 1997, by and among Riddell
            Sports Inc., RHC Licensing Corporation, Riddell, Inc., Equilink
            Licensing Corporation, Ridmark Corporation, MacMark Corporation, NBD
            Bank, f/k/a NBD Bank, N.A., MLC Partners Limited Partnership, Robert
            E. Nederlander, Leonard Toboroff, John McConnaughy, Jr., Lisa J.
            Marroni, Frederic H. Brooks, Connecticut Economics Corporation,
            Robert Weisman, Bruce H. Levitt, as Bankruptcy Trustee of M.
            Holdings Corporation, Paul Swanson, as Bankruptcy Trustee of MGS
            Acquisition, Inc. and MacGregor Sports, Inc., Official Unsecured
            Creditors' Committee of MacGregor Sporting Goods, Inc., M. Holdings
            Corporation, f/k/a MacGregor Sporting Goods Inc., Innovative
            Promotions, Inc., Ernest Wood, Jr., Harry Wood, Pursuit Athletic
            Footwear, Inc., and Riddell Athletic Footwear, Inc. (33)

10.41       License Agreement dated March 4, 1998 between Footstar Corp. and
            Equilink Licensing Corporation (34)

10.42       Umbro License Agreement, dated as of November 23, 1998, between
            Umbro International, Inc. and Varsity Spirit Fashions & Supplies,
            Inc. (1-B)

10.43       Asset and USISL Stock Purchase Agreement, dated as of November 1998,
            between Umbro International, Inc. and Varsity Spirit Fashions &
            Supplies, Inc. (1-A)

10.44       Signal/Riddell Expense Sharing Arrangement dated November 23, 1998,
            between Signal Apparel Company, Inc. and Riddell Sports Inc. (1-B)

10.45       Industrial Lease and Agreement dated October 1, 1998, between
            Laphiew Gin Company and Varsity Spirit Corporation. (1-B)

10.46       Amended and Restated Loan, Guaranty And Security Agreement dated as
            of April 20, 1999 among the financial institutions named therein, as
            the Lenders, Bank of America National Trust and Savings Association,
            as the Agent, Riddell Sports Inc., as the Parent Guarantor, Riddell,
            Inc., All American Sports Corporation, Varsity Spirit Corporation,
            and Varsity Spirit Fashions & Supplies, Inc. collectively, as the
            Borrower and all other subsidiaries of the Parent Guarantor,
            collectively, as the Subsidiary Guarantors. (36)

10.47       Form of Subscription Agent Agreement, by and between Riddell and
            American Stock Transfer & Trust Company. (1-A)


                                      II-6
<PAGE>

10.48       Form of Solicitation Agent's Agreement by and between Riddell and
            H.C. Wainwright & Co., Inc. (1)

21          List of subsidiaries. (33)

23          Consent of Grant Thornton LLP regarding Riddell Sports Inc. (1-A)

23.1        Consent of Zukerman Gore & Brandeis, LLP (included in Exhibit 5.1)

99.1        Form of Instructions for Use of Riddell Rights Certificates. (1-A)

99.2        Form of Notice of Guaranteed Delivery for Subscription Rights. (1-A)

99.3        Form of Letter to Stockholders Who Are Record Holders. (1-A)

99.4        Form of Letter to Stockholders Who Are Beneficial Holders. (1-A)

99.5        Form of Letter to Clients of Stockholders Who Are Beneficial
            Holders. (1-A)

99.6        Form of Nominee Holder Certification Form. (1-A)

99.7        Substitute Form W-9 for Use with the Rights Offering. (1-A)

99.8        Form of Beneficial Owner Election Form. (1-A)

----------

      (1)   Filed herewith.

      (1-A) To be filed by amendment.

      (1-B) Incorporated by reference to Riddell Sports Inc.'s Form 10K report
            (Commission File No. 001-14629) for the year ended December 31,
            1998.

      (2)   Incorporated by reference to Riddell Sports Inc.'s Registration
            Statement on Form S-1 (Commission File No. 33-40488) effective June
            27, 1991 (including all pre-effective amendments to the Registration
            Statement).

      (3)   Incorporated by reference to Riddell Sports Inc.'s Form 10-K report
            (Commission File No. 0-19298) for the year ended December 31, 1991.

      (4)   Incorporated by reference to Riddell Sports Inc.'s Registration
            Statement on Form S-1 (Commission File No. 33-40488) effective June
            17, 1992 (including all pre-effective amendments to the Registration
            Statement).

      (5)   Incorporated by reference to Riddell Sports Inc.'s Form 10-Q report
            (Commission File No. 0-19298) for the quarter ended June 30, 1992.

      (6)   Incorporated by reference to Riddell Sports Inc.'s Form 10-Q report
            (Commission File No. 0-19298) for the quarter ended September 30,
            1992.

      (7)   Incorporated by reference to Riddell Sorts Inc.'s Form 10-K report
            (Commission File No. 0-19298) filed on March 30, 1993.


                                      II-7
<PAGE>

      (8)   Incorporated by reference to Riddell Sports Inc.'s Post Effective
            Amendment No. 2 to Form S-1 Registration Statement (Commission File
            No. 33-47884) filed on January 28, 1994.

      (9)   Incorporated by reference to Riddell Sports Inc.'s Form 10-K for the
            year ended December 31, 1993.

      (10)  Incorporated by reference to Riddell Sports Inc.'s Form 10-K/A
            constituting Amendment No. 1 to Form 10-K for the year ended
            December 31, 1993, filed June 21, 1994.

      (11)  Incorporated by reference to Riddell Sports Inc.'s Form 10-Q for the
            quarter ended March 31, 1994.

      (12)  Incorporated by reference to Riddell Sports Inc.'s Form 10-Q for the
            quarter ended June 30, 1994.

      (13)  Incorporated by reference to Riddell Sports Inc.'s Form 8-K filed
            July 3, 1994.

      (14)  Incorporated by reference to Riddell Sports Inc.'s Form 10-Q for the
            quarter ended September 30, 1994.

      (15)  Incorporated by reference to Riddell Sports Inc.'s Form 8-K filed
            January 11, 1994.

      (16)  Incorporated by reference to Riddell Sports Inc.'s Form 10-K for the
            year ended December 31, 1994.

      (17)  Incorporated by reference to Riddell Sports Inc.'s Form 8-K dated
            June 23, 1995.

      (18)  Incorporated by reference to Riddell Sports Inc.'s Form 10-K for the
            year ended December 31, 1995, dated November 11, 1996.

      (19)  Incorporated by reference to Riddell Sports Inc.'s Form 10-Q dated
            May 14, 1996.

      (20)  Incorporated by reference to Riddell Sports Inc.'s Form 10-Q dated
            November 11, 1996.

      (21)  Incorporated by reference to Riddell Sports Inc.'s Form 10-K for the
            year ended December 31, 1996.

      (22)  Incorporated by reference to Riddell Sports Inc.'s Proxy Statement
            filed June 6, 1997.

      (23)  Incorporated by reference to Riddell Sports Inc..'s Form 8-K dated
            June 19, 1997.

      (24)  Incorporated by reference to the Varsity Spirit Corporation's
            Registration Statement on Form S-1 (Registration Statement No.
            33-44431) filed on December 10, 1991.

      (25)  Incorporated by reference to the Varsity Spirit Corporation's
            Amendment No. 1 to Registration Statement on Form S-1 (Registration
            Statement No. 33-44431) filed on January 21, 1992.


                                      II-8
<PAGE>

      (26)  Incorporated by reference to the Varsity Spirit Corporation's Annual
            Report on Form 10-K for the year ended March 31, 1993 (File No.
            0-19790).

      (27)  Incorporated by reference to the Varsity Spirit Corporation's
            Transition Report on Form 10-K for the transition period April 1,
            1994 to December 31, 1994 (File No. 0-19790)

      (28)  Incorporated by reference to the Varsity Spirit Corporation's
            Quarterly Report on Form 10-Q for the quarter ended June 30, 1996
            (File No. 0-19790).

      (29)  Incorporated by reference to the Varsity Spirit Corporation's
            Quarterly Report on Form 10-Q for the quarter ended September 30,
            1996 (File No. 0-19790).

      (30)  Incorporated by reference to the Varsity Spirit Corporation's annual
            Report on Form 10-K for the year ended December 31, 1996 (File No.
            0-19790).

      (31)  Incorporated by reference to Riddell Sports Inc.'s Report on Form
            8-K filed May 8, 1996.

      (32)  Incorporated by reference to Varsity Spirit Corporation Schedule 13D
            filed June 25, 1997.

      (33)  Incorporated by reference to Riddell Sports Inc.'s Registration
            Statement on Form S-4 (Registration No. 333-31525) filed July 18,
            1997.

      (34)  Incorporated by reference to Riddell Sports Inc.'s Form 10-K Report
            for the year ended 1997 (file No. 0-19298).

      (35)  Incorporated by reference to Riddell Sports Inc.'s Form 10-Q dated
            May 15, 1998.

      (36)  Incorporated by reference to Riddell Sports Inc's Form 10-Q dated
            March 31, 1999.

      (b)   Financial Statement Schedules

            Report of Independent Certified Public Accountants on Schedules

            Schedule II - Valuation and Qualifying Accounts

            All other financial statement schedules are omitted as the required
            information is presented in the financial statements or the notes
            thereto or is not necessary.

Item 17. Undertakings.

 The undersigned registrant hereby undertakes:

      (1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:

      (i)   To include any prospectus required by section 10(a)(3) of the
            Securities Act of 1933.


                                      II-9
<PAGE>

      (ii)  To reflect in the prospectus any facts or events arising after the
            effective date of the registration statement (or the most recent
            post-effective amendment thereof) which, individually or in the
            aggregate, represent a fundamental change in the information set
            forth in the registration statement. Notwithstanding the foregoing,
            any increase or decrease in volume of securities offered (if the
            total dollar value of securities offered would not exceed that which
            was registered) and any deviation from the low or high and of the
            estimated maximum offering range may be reflected in the form of
            prospectus filed with the Commission pursuant to Rule 424(b) if, in
            the aggregate, the changes in volume and price represent no more
            than a 20 percent change in the maximum aggregate offering price set
            forth in the "Calculation of Registration Fee" table in the
            effective registration statement.

      (iii) To include any material information with respect to the plan of
            distribution not previously disclosed in the registration statement
            or any material change to such information in the registration
            statement;

      (2) That, for the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.

      (3) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.

      (4) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.

      (5) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the registrant's annual report pursuant to section
13(a) or 15(d) of the Securities Exchange Act of 1934 that is incorporated by
reference in the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.

      (6) The undersigned registrant hereby undertakes to supplement the
prospectus, after the expiration of the subscription period, to set forth the
results of the subscription offer, the transactions by the standby group during
the subscription period, the amount of unsubscribed securities to be purchased
by the standby group, and the terms of any subsequent reoffering thereof. If any
public offering by the standby group is to be made on terms differing from those
set forth on the cover page of the prospectus, a post-effective amendment will
be filed to set forth the terms of such offering.


                                     II-10
<PAGE>

      Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions described under Item 15 above, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of our counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.

Signatures

      Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-1 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of New York, State of New York, on December 14, 1999.

      Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.

                                     RIDDELL SPORTS INC.

                                     By: /s/ David Mauer
                                        ------------------------
                                        David Mauer

                                     Chief Executive Officer

      KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints DAVID M. MAUER and DAVID GROELINGER and each of
them, as his true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution for him and in his name, place and stead, in any
and all capacities to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and
agent full power and authority to do and perform each and every act and thing
requisite or necessary to be done in and about the premises, as fully as to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent or any of them, or his
substitutes, may lawfully do or cause to be done by virtue thereof.

      Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates


                                     II-11
<PAGE>

indicated.


/s/ David M. Mauer           Chief Executive Officer           December 14, 1999
--- ----- -- -----           and Director David M. Mauer
(Principal Executive Officer)


/s/ Robert Nederlander       Chairman of the Board             December 14, 1999
--- ------ -----------
Robert Nederlander

/s/ Jeffrey G. Webb          Vice Chairman of the Board        December 14, 1999
--- ------- -- ----          and President and Chief
Jeffrey G. Webb              Operating Officer of
                             Varsity Spirit Corporation

/s/ Leonard Toboroff         Vice President and Director       December 14, 1999
--- ------- --------
Leonard Toboroff

/s/ David Groelinger         Executive Vice President and      December 14, 1999
--- ----- ----------         Chief Financial Officer
David Groelinger             (Principal Financial Officer)

/s/ Lawrence Simon           Senior Vice President             December 14, 1999
--- -------- -----           (Principal Accounting Officer)
Lawrence Simon

/s/ Don Kornstein            Director                          December 14, 1999
--- --- ---------
Don Kornstein

/s/ John McConnaughy, Jr.    Director                          December 14, 1999
--- ---- ------------ ---
John McConnaughy, Jr.

/s/ Glenn E. Schembechler    Director                          December 14, 1999
--- ----- -- ------------
Glenn E. Schembechler

/s/ Arthur N. Seessel, III   Director                          December 14, 1999
--- ------ -- -------- ---
Arthur N. Seessel, III


                                     II-12

<PAGE>

               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
                                  ON SCHEDULE

Board of Directors
Riddell Sports Inc.

     In connection with our audit of the consolidated financial statements of
Riddell Sports Inc. and Subsidiaries referred to in our report dated February
21, 1998, which is included in the prospectus constituting Part I of this
Registration Statement, we have also audited Schedule II for each of the three
years in the period ended December 31, 1998. In our opinion, this schedule
presents fairly, in all material respects, the information required to be set
forth therein.

                                          GRANT THORNTON LLP

Chicago, Illinois
February 19, 1999

                                      S-1
<PAGE>
                                                                     SCHEDULE II

                      RIDDELL SPORTS INC. AND SUBSIDIARIES
                       VALUATION AND QUALIFYING ACCOUNTS

<TABLE>
<CAPTION>
                     COL. A                           COL. B              COL. C                COL. D         COL. E
-------------------------------------------------   ----------    -----------------------     ----------     ----------
                                                                         ADDITIONS
                                                                  -----------------------
                                                                                  (2)
                                                                    (1)         CHARGED
                                                    BALANCE AT    CHARGED TO    TO OTHER                     BALANCE AT
                                                    BEGINNING     COSTS AND     ACCOUNTS--                    END OF
                   DESCRIPTION                      OF PERIOD     EXPENSES      DESCRIBE      DEDUCTIONS      PERIOD
                   -----------                      ----------    ----------    ---------     ----------     ----------

<S>                                                 <C>           <C>           <C>           <C>            <C>
Year ended December 31, 1996
  Allowance for doubtful accounts................      $620          $436            --          $543(a)       $  513
Year ended December 31, 1997
  Allowance for doubtful accounts................      $513          $365         $ 325(b)       $379(a)       $  824
Year ended December 31, 1998
  Allowance for doubtful accounts................      $824          $929            --          $451(a)       $1,302
</TABLE>

------------------

Notes: (a) Accounts written off net of recoveries

       (b) Addition charged to other accounts for 1997 is the initial balance
           from the Varsity acquisition.

                                      S-2
[{"type": "S-1", "sequence": "1", "description": "REGISTRATION STATEMENT", "secsgml_size_bytes": 508336}]
{"company-data": {"conformed-name": "RIDDELL SPORTS INC", "cik": "0000874786", "assigned-sic": "3949", "irs-number": "222890400", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-1", "act": "33", "file-number": "333-92781", "film-number": "99774857"}, "business-address": {"street1": "50 EAST 42ND STREET", "street2": "SUITE 1808", "city": "NEW YORK", "state": "NY", "zip": "10017", "phone": "(212) 808-5400"}, "mail-address": {"street1": "50 EAST 42ND STREET", "street2": "SUITE 1808", "city": "NEW YORK", "state": "NY", "zip": "10017"}}
As Filed with the Securities and Exchange Commission on December 15, 1999

                                                      Registration No. _________
--------------------------------------------------------------------------------

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                       ----------------------------------

                                    FORM S-1
                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933

                       ----------------------------------

                               RIDDELL SPORTS INC.
             (Exact name of registrant as specified in its charter)

                       ----------------------------------

      Delaware                         3949                        22-2890400
----------------------         ---------------------------      ----------------
(State or other juris-         primary standard industrial      (I.R.S. Employer
 diction of incorpora-         classification code number        identification
 tion or organization)                                                number)

       50 East 42nd Street, Suite 1808, New York, NY 10017 (212) 808-5400
    ------------------------------------------------------------------------
    (Address, including zip code, and telephone number, including area code,
                  of registrant's principal executive offices)

                       ----------------------------------

                                DAVID GROELINGER
                             CHIEF FINANCIAL OFFICER
                              RIDDELL SPORTS INC.,
                     50 EAST 42ND STREET, NEW YORK, NY 10017
                                 (212) 808-5400
            (Name, address, including zip code, and telephone number,
                   including area code, of agent for service)

                       ----------------------------------

                                   COPIES TO:

CLIFFORD A. BRANDEIS, ESQ.                    RUBI FINKELSTEIN, ESQ.
ZUKERMAN GORE & BRANDEIS, LLP                 ORRICK HERRINGTON & SUTCLIFFE, LLP
900 THIRD AVENUE                              666 FIFTH AVENUE
NEW YORK, NEW YORK  10022                     NEW YORK, NY 10103
Phone: (212) 223-6700                         Phone: (212) 506-5000
Fax: (212) 223-6433                           Fax: (212) 506-5151

      Approximate date of commencement of proposed sale to the public: As soon
as practicable after effective date of the registration statement.

      If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, check the following box. //

      If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration number of the earlier effective
registration statement for the same offering. //

      If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. //

      If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. //

      If delivery of the prospectus is expected to be made pursuant to Rule 434,
check the following box. //
---------------------------------------------------------------------------------------
                         CALCULATION OF REGISTRATION FEE
---------------------------------------------------------------------------------------
                                             Proposed
                                             Maximum     Proposed
                                             Offering    Maximum          Amount of
Title of Each Class of        Amount to be   Price Per   Aggregate        Registration
Securities to Be Registered   Registered     Unit        Offering Price   Fee
---------------------------------------------------------------------------------------
Common Stock, par value       1,287,500         $3.125   $4,023,437.50    $1,062.25(1)
$.01 per share
---------------------------------------------------------------------------------------
Rights                        1,000,000            N/A             N/A             (2)
---------------------------------------------------------------------------------------
Warrants                      1,000,000            .01         $10,000        $2.64(3)
                                                                              -----
---------------------------------------------------------------------------------------
Total                                                                        $1,064.89
                                                                             =========
---------------------------------------------------------------------------------------
(1)   Calculated pursuant to Rule 457(c), and includes an additional 37,500
      shares of Common Stock which the Underwriter has the option to purchase to
      cover over-allotments, if any.

(2)   Pursuant to Rule 457(3), no registration fee is payable with respect to
      the rights since the rights are being registered in the same registration
      statement as the securities to be offered pursuant thereto.

(3)   Calculated pursuant to Rule 457(g)(i).
The information in this prospectus is not complete and may be changed. Riddell
Sports may not sell these securities until the registration statement filed with
the Securities and Exchange Commission is effective. This prospectus is not an
offer to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.

                      SUBJECT TO COMPLETION DECEMBER 15, 1999

Preliminary Prospectus

                               Subscription Rights
                                   to Purchase

                           RIDDELL SPORTS INC. [LOGO]

                      1,000,000 Shares of Common Stock and
           Accompanying Distribution of Common Stock Purchase Warrants

      We are distributing rights to purchase shares of our common stock to
persons who owned our common stock as of the close of business on December 27,
1999, the record date. We will issue up to 1,000,000 shares of common stock in
the offering. You will have the right to subscribe for 0.10795 shares of common
stock for each share of our common stock that you owned on the record date. You
will not have the right to purchase any fractional shares. The subscription
price is $_______ for each whole share.

      If you exercise your rights, you will also receive, for no additional
money, a common stock purchase warrant to purchase, if conditions are met, stock
from Riddell of a new or existing subsidiary that conducts substantially all of
our Internet operations.

      If you do not properly exercise your rights before 5:00 p.m., Eastern
Standard Time, on February [ ], 2000, your rights will expire.

      Our shares are listed for trading on the American Stock Exchange under the
symbol "RDL." On December 10, 1999, the last reported sale price for our common
stock on the American Stock Exchange was $3.125 per share. The rights will be
transferable, but will not be listed or quoted on a formal exchange.

      H.C. Wainwright & Co., Inc. will act as solicitation agent for us in
connection with the rights offering.

      Concurrently with the rights offering, we are offering to sell an
additional 250,000 shares of our common stock to the public under a separate
prospectus plus up to an additional 37,500 shares to cover over-allotments.

      See "Risk Factors" beginning on page 20 to read about factors you should
consider before buying shares of our common stock.

      Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is a
criminal offense.

                                                          Per Share      Total
Subscription Price..................................   $              $

Solicitation Agent Fee..............................   $              $

Proceeds, before expenses, to Riddell...............   $              $

                           H.C. Wainwright & Co., Inc.

                        Prospectus dated [       ], 2000
You should rely only on the information contained in this prospectus. We
have not authorized anyone to provide you with information different from that
contained in this prospectus. This prospectus is not an offer to sell or a
solicitation of an offer to buy any securities in any state or other
jurisdiction in which the offer or solicitation is not permitted. You should not
assume that the information in this prospectus is accurate as of any date other
than the date of this prospectus.

In this prospectus, "Riddell," "we," "us" and "our" refer to Riddell Sports Inc.
and our subsidiaries, unless the context specifically indicates otherwise.
TABLE OF CONTENTS
                                                                            Page

THE BOARD RECOMMENDATION.......................................................1

QUESTIONS AND ANSWERS ABOUT THE RIGHTS OFFERING................................1

PROSPECTUS SUMMARY.............................................................7

RISK FACTORS..................................................................20

TRADE NAMES AND TRADEMARKS....................................................31

FORWARD-LOOKING STATEMENTS....................................................32

THE RIGHTS OFFERING...........................................................33

THE CONCURRENT OFFERING.......................................................43

USE OF PROCEEDS...............................................................44

DILUTION .....................................................................45

CAPITALIZATION................................................................46

SELECTED FINANCIAL DATA.......................................................47

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS..................................51

PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY...............................61

BUSINESS .....................................................................62

MANAGEMENT....................................................................85

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
         AND MANAGEMENT.......................................................90

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS...............................101

PLAN OF DISTRIBUTION.........................................................103

DESCRIPTION OF CAPITAL STOCK.................................................104

DESCRIPTION OF DEBT SECURITIES...............................................106

CERTAIN FEDERAL INCOME TAX CONSEQUENCES......................................107

LEGAL MATTERS................................................................110

EXPERTS......................................................................110

WHERE YOU CAN FIND MORE INFORMATION..........................................110

INDEX TO FINANCIAL STATEMENTS................................................F-1

                                        i
NO BOARD RECOMMENDATION

      Our Board of Directors believes that the rights offering is in our best
interests. The rights offering will enable us to raise capital to finance our
Internet operations and for additional working capital.

      Our Board of Directors is not making any recommendation to you as to
whether you should exercise your right to purchase our common stock. You must
make your own decision as to whether to exercise your right. You should not view
the group of certain of Riddell's officers and directors and certain other
individuals who it is currently anticipated will agree to exercise all rights
granted to them and to purchase up to $_______ of the remaining shares offered
under the rights offering, as a recommendation or other indication by Riddell or
our Board of Directors, that the exercise or sale of your rights is in your best
interests. An investment in shares of our common stock must be made according to
your own evaluation of your own best interests.

      American Stock Transfer & Trust Company, our transfer agent, has agreed to
provide services to us and act as the subscription agent in connection with the
rights offering. If you require assistance, please contact our subscription
agent toll free at (800) 937-5449.

                 QUESTIONS AND ANSWERS ABOUT THE RIGHTS OFFERING

      Q:    What is the rights offering?

      A:    The rights offering is a distribution of rights on a pro rata basis
            to all of our common stockholders as of December 27, 1999, the
            record date. "Pro rata" means in proportion to the number of shares
            of our common stock that you and the other stockholders hold on the
            record date. We are distributing rights to purchase an aggregate of
            1,000,000 shares of common stock. The actual number of rights we
            will distribute per share will depend upon the number of shares of
            common stock outstanding on the record date for the rights offering.
            The number of rights per share will be calculated by dividing (i)
            1,000,000, the total number of shares of common stock that may be
            purchased in the rights offering, by (ii) the total number of
            outstanding shares of common stock as of the record date. Based upon
            the number of shares outstanding at December 1, 1999, each share of
            common stock would be entitled to 0.10795 of a full right.

      Q:    How many rights will I receive for each share of common stock that I
            own?

      A:    You will receive 0.10795 of one full right for each share of common
            stock that you own. That means for approximately every 10 shares of
            common stock that you own you will receive one full right.

      Q:    What is a right?

      A:    Each full right is the privilege to purchase one additional share of
            Riddell's common stock for the subscription price.

      Q:    What is the subscription price per share?

                                       2
A:    The subscription price per share is $______________.

      Q:    What if the exercise of my rights results in a fractional share of
            common stock?

      A:    If the exercise of your rights would result in the purchase of a
            fractional share, you may exercise your rights only by rounding down
            to and paying for the nearest whole share, or paying for any lesser
            number of whole shares. You may not purchase a fractional share.

      Q:    Why is Riddell offering the rights?

      A:    Riddell is offering the rights to finance its new Internet business
            and for additional working capital.

      Q:    How soon must I act?

      A:    Your rights expire at 5:00 p.m., New York City time, on
            February______, 2000. The subscription agent must receive all
            required documents and payments in good funds before that time and
            date.

      Q:    What documents and form of payment are required to exercise my
            rights?

      A:    If you are a record holder of Riddell common stock on
            December 27, 1999, you are receiving with this prospectus a
            subscription certificate and instructions on how to exercise your
            rights to purchase shares. The subscription certificate must be
            properly filled out and delivered with full payment in good funds to
            American Stock Transfer & Trust Company before the expiration of the
            rights on or before February ______, 2000. The subscription price
            must be paid in good funds, which means by wire transfer, certified
            or cashier's check drawn on a U.S. bank, or personal check that
            clears before expiration of the rights. The instructions also
            describe an alternate procedure called "Notice of Guaranteed
            Delivery". The "Notice of Guaranteed Delivery" allows an extra three
            days for you to deliver the subscription certificate if full payment
            in good funds is received on or before the expiration date, February
            _____, 2000, and if a securities broker or qualified financial
            institution signs the form to guaranty that the subscription
            certificate will be timely delivered. Subscription documents and
            payments should be sent to American Stock Transfer & Trust Company
            at 40 Wall Street, 46th floor, New York, NY 10005.

      Q:    What if a broker, bank or other nominee is the record holder of my
            shares?

      A:    If you wish to exercise your rights to purchase shares, please
            promptly contact the broker, bank or other company holding your
            shares. Because your broker or other nominee holder is the record
            holder of the shares you own, they must complete the subscription
            certificate on your behalf for the shares that you wish to purchase
            or arrange for a subscription certificate issued in your name. The
            broker, bank or other nominee will be requested to contact you for
            instructions on exercising your rights.

                                       3
Q:    Will our Board of Directors make a recommendation whether I should
            exercise my rights?

      A:    No.

      Q:    What is the standby group?

      A:    The standby group is a group of individuals who agree to exercise
            all of their rights and who also agree to purchase up to a certain
            dollar amount of shares offered under the rights offering that are
            not purchased by the other stockholders. We currently anticipate
            that a group of our officers, directors and some other individuals
            will agree to exercise all of the rights granted to those members of
            the standby group who are stockholders as of the record date, and,
            in addition, will also agree to purchase up to $__________ worth of
            the shares offered under the rights offering that are not purchased
            by the other stockholders.

      Q:    If I have any questions about this rights offering, who should I
            contact?

      A:    For questions about the rights offering or additional copies of
            offering documents call the subscription agent, American Stock
            Transfer & Trust Company, at (800) 937-5449, (212) 936-5100, or
            (718) 921-8200.

            For other questions and copies of our recent SEC filings contact
            Riddell at (773) 794-1994, extension 307, or refer to other sources,
            described under "Where You Can Find More Information" below.

      Q:    Am I required to exercise my rights?

      A:    No.

      Q:    What will happen if I do not exercise my rights?

      A:    If you do not exercise any rights, the number of shares which you
            own will not change, but, if the rights offering is completed, your
            percentage ownership of Riddell's total outstanding common stock
            will decline. Also, even if you do exercise all of your rights, if
            Riddell completes the concurrent offering, your percentage ownership
            of Riddell's total outstanding common stock will decline.

      Q:    What is the concurrent offering?

      A:    At the same time as we are conducting the rights offering to our
            current stockholders we are also offering to sell 250,000 shares of
            our common stock to the general public.

      Q:    Why are we conducting the concurrent offering?

      A:    For the same reasons that we are conducting the rights offering, to
            finance our new Internet business and for additional working
            capital.

                                       4
Q:    May I transfer my rights?

      A:    Yes, rights will be transferable, but it is not anticipated that a
            formal market will be made in the rights. Therefore, they will not
            be listed for trading on any exchange, although it is possible that
            an informal market may develop. We cannot ensure that the rights
            will have any value or can be sold. You may also wish to transfer
            rights to allow your broker or other person to exercise your rights
            for you. The reverse side of the subscription certificate contains
            instructions for these types of transfers.

      Q:    Will my money be returned if the rights offering is cancelled?

      A:    Yes, but without any payment of interest.

      Q:    What fees or charges apply if I purchase shares or attempt to sell
            my rights?

      A:    If you exercise rights through a broker or other holder of your
            shares, you will be responsible for paying any fees that they may
            charge you. If you elect to sell your rights, you are also
            responsible for any fees or sales commissions that may apply to that
            transaction. We will not be charging you any fee or sales commission
            to issue rights to you or to issue shares to you if you exercise
            rights. We will be responsible for paying the solicitation agent its
            fee.

      Q:    May I change or cancel my exercise of rights after I send in the
            required forms?

      A:    No.

      Q:    What is the common stock purchase warrant that Riddell is offering
            along with the rights?

      A:    Attached to each full right is a common stock purchase warrant that
            will entitle you to purchase shares of common stock from Riddell if,
            in the future, Riddell decides to conduct substantially all of its
            Internet operations through a newly formed or existing subsidiary.
            All of the warrants received by holders who exercise rights,
            collectively, are exercisable for __________% of the common stock
            owned by Riddell in this prospective Internet subsidiary at the time
            the common stock purchase warrants are exercisable. You will only
            receive this common stock purchase warrant if, and to the extent,
            you exercise your rights.

      Q:    When are the common stock purchase warrants exercisable?

      A:    Assuming that we decide to conduct our Internet operations in the
            future through a newly formed or presently existing subsidiary, the
            common stock purchase warrants are exercisable if we effect an
            initial public offering of the stock of this Internet subsidiary
            before December 31, 2002, in which event the warrant will be
            exercisable for six months commencing on the closing of the initial
            public offering. If we do not establish such an Internet subsidiary
            by December 31, 2002, or we establish this subsidiary but do not
            take it public by December 31, 2002, your warrants will
            automatically expire and will no

                                       5
longer be exercisable.

      Q:    What will be the exercise price of the common stock purchase
            warrant?

      A:    The exercise price for the common stock purchase warrant will be
            $0.01 per share.

      Q:    May I transfer the common stock purchase warrants that I receive if
            I exercise my rights?

      A:    No, with one exception. They can be transferred to your estate if
            you die.

                                       6
PROSPECTUS SUMMARY

      This summary highlights some of the information provided elsewhere in this
prospectus. The summary is not complete and may not provide all information you
should consider before deciding whether or not to exercise the rights. You
should read the entire prospectus carefully. Portions of this prospectus, such
as the Risk Factors section starting on page 20, are not summarized below.

      Riddell also encourages you to review the financial statements and other
information provided in the reports and other documents it files under the
Securities Exchange Act of 1934, as described in the "Where You Can Find More
Information" section in this prospectus at page 110.

                                     Riddell

Our Business

      Riddell is a leading marketer and manufacturer of branded products and
services to the extracurricular activities portion of the educational market. We
believe that the extracurricular activities market encompasses approximately 30
million young men and women in the United States who participate in team sports
and other organized activities outside the classroom. We estimate that this
market generates approximately $5 billion in sales annually, including
approximately $2 billion in athletic equipment and uniforms for team sports and
various products and services for cheerleaders and dancers.

      Under our many brands, the best known of which are Riddell(Registered) and
Varsity Spirit(Registered) (which we own) and Umbro(Registered) (which we
license), we are:

      o     A leading provider of equipment and clothing for team sports;

      o     The only national reconditioner of football protective and other
            athletic equipment;

      o     The largest designer, marketer and supplier of innovative
            cheerleader and dance team uniforms and accessories;

      o     The biggest operator of cheerleading and dance team training camps
            and clinics;

      o     A leading organizer of special events for extracurricular
            activities;

      o     A nationwide provider of soccer apparel, equipment and footwear for
            team play; and

      o     A supplier of sports collectible products through retailers in the
            U.S. and internationally.

      We believe that Riddell branded football equipment is worn by more than
50% of all high school and collegiate football players. We also have a
longstanding agreement with the NFL for the promotion of our Riddell brand. Over
80% of the NFL players choose to wear

                                       7
our helmets. We believe that our Varsity Spirit brand cheerleading uniforms are
worn by approximately 40% of all high school and 75% of all collegiate
cheerleaders. In 1999, our cheerleading camps were attended by more than 217,000
students, and, in 1999, more than 25,000 people traveled to the Walt Disney
Resort in Orlando, Florida to participate in and view our various cheerleading
and dance competitions.

      In the fourth quarter of 1998, we became the exclusive U.S. licensee for
Umbro branded soccer apparel, footwear and equipment for the team channel of
distribution. Umbro is one of the leading soccer brands worldwide.

Our objectives and strategies

      Our objectives are to increase our current market share and broaden the
recognition of our brands in the extracurricular activities market. We intend to
implement these objectives by continuing to focus on adding new product lines,
developing new special events, competitions and conventions, increasing the size
of our sales force and broadening our already successful integrated marketing
approach. We believe that the implementation of our Internet operations will
enhance our integrated marketing approach.

Our opportunities for growth

      Over the past few years we have positioned ourselves for growth in four
areas:

      o     Football, baseball and softball game uniforms to high school and
            collegiate teams

      o     Football, baseball and softball game uniforms and equipment to
            recreational youth leagues

      o     Apparel, equipment and footwear to the team soccer market

      o     New Internet operations

Our advantages

      We believe that we have three principal advantages that will support our
growth opportunities:

      o     Our direct, proprietary sales force has approximately 320 people who
            are responsible for developing and maintaining relationships among
            the 40,000 junior and senior high schools, colleges and numerous
            recreational organizations throughout the United States. Our sales
            force will be particularly important in connection with sales of
            athletic clothing and equipment to high schools, colleges and
            recreational youth leagues. We believe that we have the only
            national sales force in the U.S. serving the extracurricular market.

      o     Our efficient manufacturing and sourcing capabilities support our
            direct sales effort and enable us to produce and deliver
            competitively priced high quality customized products faster than
            our competitors.

                                       8
o     Our relationship marketing, which we began 25 years ago, is a
            year-round, integrated marketing approach that creates a strong bond
            between us and our customers. In the case of cheerleading it
            includes conducting training camps, clinics and conventions,
            producing various nationally-televised and regional championships
            and performance events and selling cheerleading uniforms and
            accessories. Our relationship marketing is designed so that each of
            our products and services reinforce one another, as well as
            strengthen overall brand awareness. We believe that our new Internet
            operations are a logical extension of, and will effectively
            reinforce, our relationship marketing strategy.

Our Internet operations

      Our Internet business, which will be funded, in part, by the proceeds of
this offering, has a community and a commerce orientation. We started our
Internet operations in the fourth quarter of 1999 with our first two web sites:
a community web site with e-commerce elements for cheerleaders, www.varsity.com,
and an e-commerce web site for sports collectibles, www.riddell.com.

      o     Community: We will be developing web sites for identifiable,
            highly-focused communities in the extracurricular activities market.
            We believe that the community members in this market, such as
            cheerleaders, football players and other participants in
            extracurricular activities, often define their lives through their
            participation in these activities. As a result, we believe that
            these community members will become frequent visitors to our web
            sites. Our community web sites will provide these users with
            meaningful, timely, activity-specific content. We believe as we
            create web sites for these discrete, highly-focused communities,
            that our combined group of users will represent a large, sought
            after audience for third-party advertisers and marketers.

      o     Commerce: On our community sites, we anticipate that users will be
            able to purchase our products and purchase the products of other
            marketers who will want to sell to our community members. We will
            offer products that will appeal to the members of our focused
            community sites as well as products that will appeal to members of
            different communities. We also plan to sell advertising, as we
            believe the school leaders and trend setters that use our community
            web sites will be an attractive audience to other marketers. We also
            believe that our web site for sports collectibles will be attractive
            to a broad range of sports fans.

      We believe that the Internet will help us expand our traditional business,
increase our brand recognition and give rise to new revenue streams.

      o     Direct link to our customers: We believe that the content and
            community-building aspects of each community web site will enhance
            our existing relationships and help us build new relationships with
            coaches and participants in various extracurricular activities. The
            Internet will also provide us with another way to rapidly
            disseminate new product information and promote our camps, clinics,
            competitions and performance events.

      o     Market penetration: We believe that the Internet will be
            particularly effective

                                       9
with respect to the sale of uniforms and equipment to recreational
            youth leagues, a large and highly-fragmented market.

      o     Expand into new businesses: In addition to new revenue streams from
            alliances with other companies and the sale of advertising, we
            believe that the Internet will ultimately provide us with a
            cost-effective vehicle to begin marketing beyond our traditional
            extracurricular groups (i.e., cheerleaders and team sports) to
            non-athletic extracurricular activities (e.g., musical
            organizations, drama clubs, chess clubs, etc.).

      o     Broaden distribution of sports collectibles: We believe that the web
            site dedicated to our retail products will overcome the geographical
            constraints and inventory limitations of retail stores, which
            preclude our ability to offer collectibles of every team in every
            city. The Internet will also enable us to offer customized products
            that cannot readily be sold through traditional commercial channels.

      We are a Delaware corporation with our principal offices located at 50
East 42nd Street, Suite 1808, New York, NY 10017. Our phone number is (212)
808-5400. Our current web sites are www.varsity.com and www.riddell.com. The
information contained on our web sites is not intended to be a part of this
prospectus.

                                       10
Summary Financial Data

      The selected financial information set forth below is derived from the
more detailed financial data and related notes thereto included elsewhere in
this prospectus. This information shall be read in conjunction with such
financial data.

                                (In Thousands, except per share amounts)
                        --------------------------------------------------------
                            Year Ended December 31,           Nine Months Ended
                                                                September 30,
                        --------------------------------------------------------
                         1996       1997         1998         1998        1999
                         ----       ----         ----         ----        ----
                                                              Unaudited
                                                              ---------
Statements of
Operations
Data:

Net revenues           $72,382    $138,273     $186,600     $159,326    $179,750

Gross profit            33,569      57,598       73,059       64,087      74,781

Interest expense         2,763      11,879       14,656       11,114      11,668

Net Income
(loss)                   2,843        (559)      (7,139)       3,804       8,184

Net Earnings
(loss) per share

         Basic           $0.35      $(0.07)      $(0.78)       $0.42       $0.88

         Diluted          0.33       (0.07)      $(0.78)        0.37        0.78

EBITDA(1)               $7,909     $15,330      $13,230      $19,164     $25,042

1)    EBITDA is the sum of our earnings or loss before extraordinary items (and
      the cumulative effect of changes in accounting principles (as
      applicable)), interest, income taxes, depreciation and amortization
      expense. EBITDA is a widely accepted financial indicator of a company's
      ability to service indebtedness. However, EBITDA should not be considered
      as an alternative to income from operations or to cash flows from
      operating activities (as determined in accordance with generally accepted
      accounting principles) and should not be construed as an indication of a
      our operating performance or as a measure of our liquidity.

                                       11
December 31,          September 30,
                                     -------- ---          --------- ---
                              1996       1997       1998       1998       1999
                             -------    -------    -------    -------    -------
                                                              Unaudited
                                                              ---------
Balance Sheet Data:

Working capital              $25,957    $37,599    $37,963    $59,634    $65,110

Total assets                  76,361    181,761    186,211    201,942    210,300

Long-term debt, less
current portion               29,984    122,500    126,900    138,200    145,144

Stockholders' equity          27,745     32,125     25,451     36,129     33,635

                                       12
The Rights Offering

Securities offered                             Rights to purchase 1,000,000
                                               shares of our common stock.
                                               Further, to those individuals and
                                               entities who exercise rights, we
                                               will issue warrants which, upon
                                               exercise, will represent in the
                                               aggregate, _____ (____%) percent
                                               of Riddell's ownership in a new
                                               or existing subsidiary that we
                                               may establish in the future to
                                               conduct most of our Internet
                                               operations.

Concurrent offering                            Concurrently with the rights
                                               offering, we are offering 250,000
                                               shares of newly-issued shares of
                                               stock.

Shares of common stock                         9,263,957 outstanding on
outstanding prior to this offering             December 1, 1999.

Shares of common stock outstanding             10,513,957. Unless expressly
after this offering (assuming completion       stated to the contrary, the share
of this rights offering in full and the sale   information in this prospectus
of 250,000 shares in the concurrent            excludes:
offering under a separate prospectus)
                                               o 2,435,025 shares issuable upon
                                               exercise of options granted
                                               pursuant to Riddell's 1991 Stock
                                               Option Plan and 1997 Stock Option
                                               Plan as of December 1, 1999.

                                               o 1,395,011 shares of common
                                               stock issuable upon conversion at
                                               $5.3763 per share (subject to
                                               certain adjustments) of Riddell's
                                               4.1% Convertible Subordinated
                                               Note due 2004.

                                               o The shares issued upon exercise
                                               of the underwriter's
                                               over-allotment option in the
                                               concurrent offering.

Record date                                    December 27, 1999.

Expiration date and time                       The rights expire at 5:00 p.m.,
                                               New York City time, on February
                                               __, 2000, unless properly
                                               exercised before that time and
                                               date.

Rights                                         To each record holder of common
                                               stock on December 27, 1999
                                               Riddell is granting 0.10795 of a
                                               right for each share of common
                                               stock held on such date. To
                                               exercise the right, you must
                                               deliver one full right for each
                                               share of common stock you would
                                               like to purchase.

Subscription price                             The subscription price for each
                                               full right is

                                       13
$____ per share, payable in cash.
                                               Payment by personal check must
                                               clear payment on or before the
                                               expiration date, which may
                                               require five or more business
                                               days from the date that we
                                               receive your personal check. As a
                                               result, we recommend that
                                               stockholders pay the subscription
                                               price by certified or cashier's
                                               check drawn on a U.S. bank, U.S.
                                               postal money order or wire
                                               transfer of funds.

                                               The subscription price will be
                                               approved by those members of our
                                               Board of Directors that are not
                                               members of the Standby Group.

Transferability of rights                      The rights are transferable, but
                                               we do not anticipate that a
                                               formal market will be made in the
                                               rights or that they will be
                                               listed for trading on any
                                               exchange; although an informal
                                               market may develop. The rights
                                               are issued in the form of
                                               subscription certificates which
                                               accompany this prospectus sent to
                                               the record holders.

Fractional shares                              We will not issue fractional
                                               shares. If your rights would
                                               allow you to purchase a
                                               fractional share, you may
                                               exercise your rights only by
                                               rounding down to and paying for
                                               the nearest whole share, or
                                               paying for any lesser number of
                                               whole shares.

No revocation                                  Once you submit the form of
                                               subscription certificate to
                                               exercise any rights, you are not
                                               allowed to revoke, or change the
                                               exercise or request a refund of
                                               monies paid.

Common Stock Purchase Warrant                  If the right is exercised, the
                                               exercising holder will receive,
                                               for no additional cash, a common
                                               stock purchase warrant that will
                                               entitle the exercising holder to
                                               purchase shares in a new or
                                               existing subsidiary of ours that
                                               we may establish through which we
                                               would conduct substantially all
                                               of our Internet operations. These
                                               warrants will only be exercisable
                                               if we establish an Internet
                                               subsidiary (which presently does
                                               not exist) and we effect an
                                               initial public offering of such
                                               subsidiary on or before December
                                               31, 2002, in which event you will
                                               have six months after the closing
                                               of the initial public offering to
                                               exercise your common stock
                                               purchase warrant. If we do not
                                               establish the Internet subsidiary
                                               before December 31, 2002, or
                                               establish the Internet

                                       14
subsidiary but do not effect an
                                               initial public offering for such
                                               subsidiary before December 31,
                                               2002, the common stock purchase
                                               warrant will automatically expire
                                               and will no longer be
                                               exercisable. These warrants have
                                               an exercise price of $0.01 per
                                               share and are non-transferrable
                                               except in the event of the death
                                               of the holder.

Reasons for the rights offering                To finance our Internet business
                                               and for additional working
                                               capital.

No board or committee recommendation           Our Board of Directors will not
                                               make any recommendation to
                                               stockholders regarding the
                                               exercise of rights under this
                                               offering. Stockholders who do
                                               exercise rights risk investment
                                               loss on new money invested. We do
                                               not assure you that the
                                               subscription price will be below
                                               the market price for the common
                                               stock, or that anyone purchasing
                                               shares at the subscription price
                                               will be able to sell those shares
                                               in the future at a higher price.
                                               See "Risk Factors -- Risks
                                               relating to the rights offering."

Standby purchase commitment                    It is currently anticipated that
                                               a group to consist of some of
                                               Riddell's officers and directors
                                               and certain other individuals
                                               with whom we are currently in
                                               discussions regarding joining
                                               this group (the "Standby Group")
                                               will agree to exercise all of the
                                               rights granted to those members
                                               of the Standby Group who are
                                               stockholders on the record date.
                                               In addition, the Standby Group
                                               will be contractually bound to
                                               purchase up to $____________ of
                                               the shares offered under the
                                               rights offering that are not
                                               purchased by stockholders who are
                                               not a part of the Standby Group.
                                               The rights granted to the Standby
                                               Group represent ____% of all of
                                               the rights being issued to
                                               stockholders. See "Risk Factors -
                                               Risks Relating to the rights
                                               offering"

Conditions to the rights offering              The obligations of the Standby
                                               Group to complete its purchase of
                                               shares under the proposed standby
                                               agreement are subject to certain
                                               conditions described under
                                               "Rights Offering -- Conditions
                                               relating to the rights offering."
                                               If the standby agreement with the
                                               Standby Group is not consummated
                                               in accordance with its terms for
                                               any reason, or if the other
                                               conditions are not satisfied or

                                       15
waived, we may terminate the
                                               rights offering and the
                                               concurrent offering in their
                                               entirety. If the rights offering
                                               is terminated, we will refund
                                               without interest to those persons
                                               who subscribed for shares in the
                                               rights offering all payments
                                               received from those subscribers.

Subscription agent                             American Stock Transfer & Trust
                                               Company

Solicitation agent                             H.C. Wainwright & Co., Inc.

Procedure for exercising rights                To exercise rights, you must
                                               complete the subscription
                                               certificate and deliver it to
                                               American Stock Transfer & Trust
                                               Company with full payment under
                                               the subscription privilege.
                                               American Stock Transfer & Trust
                                               Company must receive the proper
                                               forms and payments in good funds
                                               on or before the expiration date.

                                               You may deliver the documents and
                                               payments by mail or commercial
                                               courier. If regular mail is used
                                               for this purpose, we recommend
                                               using insured, registered mail.
                                               You may use an alternative, the
                                               "Notice of Guaranteed Delivery",
                                               if you are unable to deliver the
                                               subscription certificate before
                                               the expiration date, subject to
                                               the requirements of this
                                               procedure described under "The
                                               Rights Offering--Special
                                               procedure under "Notice of
                                               Guaranteed Delivery Form."

Payment adjustments                            If you send a payment that is
                                               insufficient to purchase the
                                               number of shares requested, or if
                                               the number of shares requested is
                                               not specified in the forms, the
                                               payment received will be applied
                                               to exercise the subscription
                                               privilege to the extent of the
                                               payment. If the payment exceeds
                                               the subscription price for the
                                               full exercise of the subscription
                                               privilege, the excess will be
                                               refunded to you as soon as it is
                                               practicable. You will not receive
                                               interest on any payments received
                                               under the rights offering.

Nominee accounts                               If you wish to purchase shares in
                                               this offering and your shares are
                                               held by a securities broker,
                                               bank, trust company or other
                                               nominee, you should promptly
                                               contact your record holder(s) and
                                               request that they exercise rights
                                               on your behalf. You may also
                                               contact the nominee and request
                                               that the nominee send a separate

                                       16
subscription certificate to you.
                                               If you are a record holder who
                                               wishes an institution such as a
                                               broker or bank to exercise your
                                               rights for you, you should
                                               contact that institution promptly
                                               to arrange the method of
                                               exercise. If you are a nominee
                                               who desires subscription
                                               certificates re-issued in smaller
                                               denominations, you must act
                                               promptly under special procedures
                                               described under "The Rights
                                               Offering--How to transfer
                                               rights."

                                               You are responsible for the
                                               payment of any fees that brokers
                                               or other persons holding your
                                               shares may charge.

                                               You are not responsible for any
                                               fees payable to the Subscription
                                               Agent or the solicitation agent.

Exercise by foreign and certain other          American Stock Transfer & Trust
stockholders                                   Company will hold subscription
                                               certificates for stockholders
                                               having addresses outside the
                                               United States. In order to
                                               exercise rights, holders with
                                               addresses outside the United
                                               States must notify American Stock
                                               Transfer & Trust Company and
                                               timely follow other procedures on
                                               or before the expiration date of
                                               the rights.

U.S. income tax consequences                   For United States federal income
                                               tax purposes, we believe that a
                                               stockholder will not recognize
                                               taxable income as a result of the
                                               distribution of the rights. Upon
                                               exercise of the rights, we
                                               believe that receipt of the
                                               common stock purchase warrants
                                               will be treated as a distribution
                                               of property and taxable as a
                                               dividend to the stockholders to
                                               the extent the fair value of the
                                               common stock purchase warrant on
                                               the date of receipt exceeds the
                                               subscription price allocated to
                                               the warrants. See "The Rights
                                               Offering - Federal Income Tax
                                               Consequences" and "Certain
                                               Federal Income Tax Consequences".
                                               Each stockholder should, and is
                                               urged to, consult their own tax
                                               adviser concerning the tax
                                               consequences of this offering
                                               under the holder's own tax
                                               situation. This prospectus does
                                               not summarize tax consequences
                                               arising under state tax laws,
                                               non-U.S. tax laws, or any tax
                                               laws relating to special tax
                                               circumstances or particular types
                                               of taxpayers.

                                       17
Stock certificates                             We will deliver stock
                                               certificates representing common
                                               stock purchased by the exercise
                                               of rights as soon as practicable
                                               after the expiration date of the
                                               rights.

Warrant certificates                           We will deliver warrant
                                               certificates representing the
                                               common stock purchase warrants
                                               granted to you upon the exercise
                                               of your rights as soon as
                                               practicable after the expiration
                                               date of the rights.

Amendment, extension and termination           We may amend or extend the rights
                                               offering. We reserve the right to
                                               withdraw the rights offering at
                                               any time prior to the expiration
                                               date for any reason, in which
                                               event all funds received in the
                                               rights offering will be returned
                                               without interest to those persons
                                               who subscribed for shares in the
                                               rights offering.

                                       18
The Concurrent Offering

Shares offered by Riddell                      250,000 shares of common stock

Shares to be outstanding after the offering    10,513,957.
(and assuming the sale of 1,000,000 shares
of our common stock pursuant to the rights
offering under a separate prospectus)

Use of proceeds                                To finance our Internet business
                                               and for additional working
                                               capital

American Stock Exchange symbol                 "RDL"

                                       19
RISK FACTORS

      You should carefully consider the risks described below and the other
information in this prospectus before deciding to purchase our shares. Many
factors, including the risks described below and other risks that we have not
recognized, could cause our operating results to be different from our
expectations and plans.

      This risk factor section is divided into three sections. The first section
relates to the general business risks associated with Riddell. The second
section relates solely to the risks associated with this offering. The third
section relates to the risks specifically associated with the our Internet
business.

General business risks

      Our significant corporate indebtedness could affect our financial health.
We have significant corporate indebtedness. In June of 1997, we borrowed $115
million to acquire the Varsity Spirit Corporation and refinance certain of our
then outstanding indebtedness. We also have a revolving credit facility of $48
million which we use for working capital purposes, primarily to finance
inventory and receivables and a $7.5 million convertible note. As of September
30, 1999, we had $115 million outstanding in respect of the Senior Notes, $22.64
million outstanding in respect of our revolving credit facility and $7.5 million
outstanding in respect of the convertible note, for approximately $145 million
in total outstanding indebtednesss.

      Some of the risks associated with our corporate indebtedness include:

      o     As the amount of money we have borrowed is large relative to our
            size, our ability to raise additional capital, if needed, in the
            future, may be limited.

      o     A significant portion of our cash flow is needed to pay interest and
            principal on our debt when due. Also, as our revolving credit line
            has a variable rate of interest, an increase in interest rates could
            be harmful to us.

      o     We are more vulnerable to economic downturns and more limited in our
            ability to withstand competitive pressures, particularly from those
            competitors that have not borrowed as much money as we have.

      o     Our ability to pay principal and interest when it becomes due or to
            refinance our debt depends on our future operating performance and
            cash flows, which are subject to factors beyond our control, such as
            prevailing economic conditions, prevailing interest rate levels and
            financial, competitive, business and other factors.

      o     If we do not have enough cash flow to make principal and interest
            payments on our debt obligations when they come due, we may not be
            able to raise cash to meet our payment obligations because of the
            restrictive agreements in our debt obligations.

      o     If we default on our credit obligations, and our default is not
            cured or waived, our default could result in other debt obligations
            automatically becoming due under what are commonly referred to as
            cross-default provisions.

                                       20
Restrictive covenants limit our discretion on various business matters.
Our financing agreements contain financial and operating covenants that encumber
our assets and restrict our ability to use our discretion on various business
matters, including our ability to:

      o     borrow additional money;

      o     pay dividends and make specified other payments;

      o     loan money to our subsidiaries or other parties;

      o     make investments, loans and guaranties; and

      o     sell our assets.

      We depend on third-parties to manufacture most of our products. We depend
on foreign and domestic third-parties to manufacture most of our athletic
equipment, practicewear, uniforms, cheerleading accessories and collectible
products. We do not have any long term contracts with our manufacturers, and we
compete with other companies for third-party production capacity. Our
arrangements with our non-U.S. suppliers are subject to the risks generally
associated with doing business abroad, such as:

      o     changes in import duties;

      o     tariffs;

      o     foreign governmental regulations;

      o     political unrest;

      o     foreign currency fluctuations;

      o     disruptions or delays in shipments;

      o     weather and time risks associated with transoceanic shipping;

      o     additional U.S. quotas, duties, taxes or other restrictions that
            could be imposed on importation of products in the future; or

      o     changes in economic conditions in countries in which our
            manufacturing sources are located.

      If any such factors were to render the conduct of business in a particular
country undesirable or impractical, or if our current foreign or domestic
manufacturers were to cease doing business with us for any reason, our business
and operating results could be severely impacted.

      We also purchase raw materials used in our protective products from
third-party suppliers. In particular, we rely on a single supplier to fulfill
our requirements for resin, an integral component in our football and baseball
batters' helmets. If our supplier should fail to continue to fulfill our resin
requirements and a satisfactory alternate supplier could not be found, our
financial results could be materially adversely affected.

                                       21
Our business is highly seasonal and follows an annual pattern. Our working
capital needs vary throughout the year typically requiring us to increase our
debt during the first and most of the second quarters of each year. We then
usually generate cash flow to decrease our indebtedness starting late in the
second quarter and into the fourth quarter of each year. This working capital
pattern is influenced by the following factors:

      o     We sell our extracurricular products and reconditioning services
            throughout the year. However, many schools and colleges do not make
            payments for these products and services until the following July to
            October period when the school year begins.

      o     We incur costs in preparing for our cheerleading camps during the
            fourth quarter and into the second quarter, while we receive the
            revenues from camps during the period from June to August.

      o     Semiannual interest payments on our $115 million Senior Notes are
            due each January and July.

      Our quarterly financial results also fluctuate based on the seasonality of
our business. In recent years operations have been most profitable in the second
and third quarters, with the third quarter being the strongest. Losses have been
incurred in the first and fourth quarters. This seasonal profitability pattern
is influenced by the following factors:

      o     We deliver most of our extracurricular products and reconditioning
            services in the first three quarters of each calendar year.

      o     Most of our camp revenue relates to cheerleading camps held during
            the summer. However, we incur costs preparing for the upcoming camp
            season during the fourth through second quarter of each year.

      o     Our sales of sports collectible products are usually at their
            highest during the third and fourth quarters as retailers build
            inventory in anticipation of both the football and holiday shopping
            seasons.

      See "Business - Seasonality and Backlog" and "Management's Discussion and
Analysis of Financial Condition and Results of Operations - Liquidity and
Capital Resources".

      We are subject to product liability and personal injury claims because of
the nature of our products. Given the nature of the products we manufacture,
recondition and sell, particularly our line of football helmets, we have in the
past, and will likely continue in the future, to be subject to product liability
and personal injury claims. Principally these claims have related to head and
neck injuries suffered during the course of a football game. We may also be
subject to personal injury claims arising from our cheerleader and dance team
camps and activities. Due to the uncertainty of litigation, we cannot assure you
that the ultimate cost of these claims will fall within the established reserves
on our financial statements, or that we will have adequate insurance coverage to
cover these claims in the future. Also, our insurance coverage expires in 2005
and we cannot assure you that, subsequent to 2005, our insurer will remain
viable and that future rate increases will not make such insurance uneconomical.
We cannot assure you that one or more meritorious claims against us for product
liability, serious personal, bodily injury will not have a material

                                       22
adverse effect on our business, financial condition or results of operations.
See "Business - Product Liability Proceedings and Insurance."

      We operate in a competitive market where there are companies larger than
us. In our team sports business, we compete with several large national
companies, such as Bike Athletic Co, Inc., Douglas, Inc., Gear 2000, Inc.,
Schutt, Inc., Rawlings Sporting Goods Company, Inc., Diamond Sports Co., and
Wilson Sporting Goods Company, and in our athletic clothing business, with
national companies such as Champion Products, Inc. and Russell Athletic, Inc.
and with Adidas, Nike and other companies for soccer team apparel, footwear and
equipment. Some of our competitors offer a broad line of sports equipment and
are significantly larger and have substantially greater financial and other
resources at their disposal than we do. We also compete with numerous
independent dealers who market competitors' products and with numerous smaller
manufacturers and suppliers of sporting goods, reconditoners, services and
collectibles. In particular, the protective equipment reconditioning and the
sports collectibles industries are fragmented.

      We compete with one major national company, National Spirit Group Limited,
that markets cheerleader and dance uniforms and accessories and cheerleader and
dance camps. We also compete with other smaller national and regional
competitors that serve the uniform and accessories market or that operate
cheerleader and dance team camps and clinics.

      Competitive pressure could have a material adverse effect on our business,
financial condition and results of operations.

      Our market share information may not be dependable. The market share and
other market data contained in this prospectus are based on independent industry
publications and our good faith estimates. However, we cannot independently
verify market share data with complete certainty due to the unavailability of
raw data and the voluntary nature of the data gathering process. Further
estimates of market data may be incorrect, possibly to a material degree.
Management's estimates with respect to our market are based only on the limited
data in the public domain and our participation in the team sports and school
spirit industries.

      Future sales of our common stock could adversely affect our stock price
and our ability to raise funds in the stock offering. An aggregate of 4,434,119
shares of the our common stock are "restricted securities" as that term is
defined by Rule 144 of the Securities Act of 1933, and may be sold only in
compliance with Rule 144 of the Securities Act. Ordinarily, under Rule 144, a
person who is an affiliate (as that term is defined in Rule 144) of ours and has
beneficially owned restricted securities for a period of one year may, every
three months, sell in brokerage transactions an amount that does not exceed the
greater of (i) one percent of the outstanding class of such securities, or (ii)
the average weekly trading volume in such securities on all national exchanges
and/or reported through the automated quotation system of a registered
securities association during the four weeks prior to the filing of a notice of
sale by a securities holder. A person who is not an affiliate of ours who
beneficially owns restricted securities is also subject to the foregoing volume
limitations but may, after the expiration of two years, sell unlimited amounts
of such securities under certain circumstances. Possible or actual sales of our
outstanding common stock by our stockholders under Rule 144 could have a
depressive effect on the price of the our common stock. There are currently
4,380,119 shares of our common stock eligible for sale pursuant to Rule 144, 97%
of which are owned by our officers and directors. The market price of our common
stock could drop due to sales of a large number of shares of our common stock or
the perception

                                       23
that these sales might occur. These factors could also make it more difficult to
raise funds through future offerings of common stock or other equity.

      Directors and officers control over 50% of Riddell; their interests may be
different and conflict with yours. After the offering, over 51% of outstanding
shares of common stock could be owned by our officers and directors assuming all
exercise their rights on a pro-rata basis. Management may also increase their
holdings as a result of the offering and participation in the standby group. See
"Security Ownership of Certain Beneficial Owners and Management" As a result,
certain officers and directors will own a sufficient number of shares of the
outstanding voting stock of Riddell to elect the directors of Riddell and
approve corporate actions and transactions on behalf of Riddell and otherwise
control the business and operations of the Riddell. The interest of management
could conflict with yours.

      Increased government regulation could harm our business. At present, no
national governing body regulates cheerleading and dance team activities at the
collegiate level. Although voluntary guidelines relating to safety and
sportsmanship have been issued by the NCAA and some of the athletic conferences,
to date, cheerleading and dance teams generally are free from rules and
restrictions similar to those imposed on other competitive athletics at the
college level. However, if rules limiting off-season training are applied to
cheerleading and/or dance teams (similar to rules imposed by the NCAA on other
sports), it is likely that we would be unable to offer a significant number of
our camps either because participants would be prohibited from participating
during the summer or because suitable sites would not be available. Although we
are not aware of any school officially adopting these activities as a
competitive sport, recognition of cheerleading and/or dance teams as "sports"
would increase the possibility that these activities may become regulated. If we
were restricted from training during the off-season, such regulations would
likely have a material adverse effect on our business, financial condition and
results of operations.

      At the high school level, some state athletic associations have classified
cheerleading as a sport and have in some cases imposed certain restrictions on
off-season practices and out-of-state travel to competitions. However, in all
cases to date, we have been able to work with these state athletic associations
to designate acceptable times for the cheerleaders within these states to attend
camps. We have agreements with several state associations to assist with
sponsoring and execution of official competitions with these states. To date,
state regulations have not had a material effect on our ability to conduct
normal business activities within those states.

      Our success depends on our key personnel. Our executive officers and other
key employees have been primarily responsible for the development and expansion
of our business and the loss of services of one or more of these individuals
could have a material adverse effect on our financial condition.

      A material decline in revenues from the MacGregor trademark could hurt our
business. If there were a material decline in the revenues from the MacGregor
trademark, then the carrying amount of the MacGregor trademark rights could be
deemed to have been impaired. A write-down for such impairment could have a
material adverse effect on our financial position and results of operations.

      Our information systems may be subject to potential year 2000 problems. We
have substantially completed the process of assessing which of our information
systems may

                                       24
be subject to year 2000 problems and are taking corrective actions to minimize
the potential impact of year 2000 problems. Our corrective actions may not be
sufficient to protect us from year 2000 problems and all of the corrective
actions may not be completed. We also face potential year 2000 issues with third
parties such as our customers, our suppliers and travel systems. If year 2000
problems impact our business, our operating results and financial condition
could be materially harmed.

Risks relating to the rights offering

      We cannot assure you that the subscription price set by the rights
offering will be below the trading price for our stock, or that the trading
price for our stock will not decline during or after the rights offering.

      You are not allowed to revoke or change your exercise of rights after you
send in your subscription forms and payment. If the rights offering is canceled,
we are obligated only to refund payments actually received, without interest.

      You need to act promptly and follow subscription instructions to exercise
your rights. Stockholders who desire to purchase shares in the rights offering
or to transfer or sell their rights must act promptly to ensure that all
required forms and payments are actually received by American Stock Transfer &
Trust Company prior to the expiration date. If you fail to complete and sign the
required subscription forms, send an incorrect payment amount, or otherwise fail
to follow the subscription procedures that apply to your desired transaction,
American Stock Transfer & Trust Company may, depending on the circumstances,
reject your subscription or accept it to the full extent of the payment
received. Neither Riddell, the solicitation agent, nor American Stock Transfer &
Trust Company undertakes to contact you concerning, or attempt to correct, an
incomplete or incorrect subscription form. We have the sole discretion to
determine whether a subscription exercise properly follows the subscription
procedures.

      If you use a personal check to pay for shares, the check must clear prior
to the expiration date, and the clearing process may require 5 or more business
days.

      There may be a delay in your ability to resell the shares that you
purchase. If you exercise rights, you may not be able to resell the new shares
purchased until you (or your broker or other nominee) have received a stock
certificate for the shares purchased. Although we will endeavor to issue the
appropriate certificates as soon as practicable after completion of the rights
offering, there may be some delay between the expiration date and the time we
are able to issue the new stock certificates.

      Our failure to meet certain conditions of the standby commitment may
result in a failure to have a standby commitment. To enable us to receive gross
proceeds of approximately $______________ from the rights offering, a group
consisting of certain of our officers and directors and certain outsiders has
agreed to act as a standby purchaser and purchase up to $____________ of our
common stock offered hereby, less amounts subscribed for by other holders of
rights. However, this commitment is subject to certain conditions to closing.
Our failure to meet any of these conditions, unless waived, may result in the
failure to have a standby commitment.

      You will experience dilution in your ownership of Riddell. In the event
that the rights offering is completed and you do not exercise all of the rights
that have been issued to

                                       25
you in the rights offering, your percentage ownership of Riddell will decline
because those who do exercise rights will receive additional shares of common
stock of Riddell. Further, even if the rights offering is not completed, or it
is completed and you do exercise all of your rights, if we complete the
concurrent offering in which we are selling additional shares of our common
stock to the general public, your percentage ownership in Riddell will decline.

      Your potential interest in an Internet subsidiary is subject to future
dilution. If you exercise your rights you will receive common stock purchase
warrants which, upon exercise, will represent your pro rata portion of _______%
of our ownership of a new or existing subsidiary through which we will conduct
substantially all of our Internet operations. If we form an Internet subsidiary
and prior to a public offering, we issue shares of common stock or other
securities issuable or convertible into shares of common stock of the subsidiary
to third parties to raise capital, or issue warrants or options to employees,
consultants or directors of the Internet subsidiary, your pro rata interest of
the Internet subsidiary will be diluted. Therefore, any interest that you may
have in our Internet subsidiary by virtue of your common stock purchase warrants
may be substantially diluted.

      We cannot assure you that your common stock purchase warrants will be of
any value. In the event that we do not, in the future, decide to conduct
substantially all of our Internet operations through a newly-formed or existing
subsidiary and effect an initial public offering of that subsidiary by December
31, 2002 your warrants will expire and will be of no value. Even if we do
establish such a subsidiary and effect an initial public offering by December
31, 2002, there can be no assurance that your warrants will have any value, or
that the shares underlying the warrants issuable to you upon your exercise of
the warrants will have any value. Even if we do establish an Internet subsidiary
and take it public by December 31, 2002 we cannot assure you that our Internet
subsidiary will be successful.

Risks relating to the Internet business

      We face difficulties typically encountered by development stage companies
in new and rapidly evolving markets because of our new Internet initiative. We
have just recently begun developing our web sites. An investor purchasing our
common stock must therefore consider the risks and difficulties frequently
encountered by early stage companies in new and rapidly evolving markets, such
as online commerce. These risks include our ability to:

      o     develop our web sites;

      o     acquire rights to content for our web sites;

      o     create a customer base for our web sites;

      o     respond to changes in a rapidly evolving and unpredictable business
            environment;

      o     maintain current and develop new strategic relationships;

      o     manage growth;

      o     continue to develop and upgrade our technology; and

      o     attract, retain and motivate qualified personnel to run our web
            sites.

                                       26
We cannot assure you that our sale of products and offering of services on
the Internet will achieve market acceptance with customers.

      We do not yet have all of our planned web sites operational. We are in the
process of building additional web sites. Our initial web sites became
operational in the fourth quarter of 1999 and may encounter programming and
other problems. We have not sold any advertising and, as a result, our revenues
from our Internet business may be low for some time.

      We have never been engaged in electronic commerce. In addition, none of
the management's key executives or other personnel have, until recently, been
engaged in the business of electronic commerce. Accordingly, we cannot assure
you that we will be able to establish and maintain an Internet business that
will be successful. In order to successfully establish and operate an electronic
commerce, or Internet related business, we have to attract and retain a number
of individuals who are capable of effectively helping to formulate the Internet
business plan and thereafter establish, maintain and expand the Internet
operations. There is heavy competition for these individuals and there can be no
assurances that we will be able to attract and retain qualified individuals.

      Content on our web sites may not attract sufficient numbers of customers
and advertisers. Our future success on the Internet will depend upon our ability
to attract users to our web sites to purchase our merchandise and to attract
advertisers to our web sites. We cannot assure you that we will be attractive to
a sufficient number of users or advertisers to generate significant revenues. We
cannot assure you that we will be able to anticipate, develop, monitor and
successfully respond to rapidly changing consumer tastes and preferences to
continually attract large numbers of users to our web sites. If we are unable to
develop Internet content that allows us to attract, retain and expand a loyal
user base, our operating results and financial condition could be materially
adversely affected.

                                       27
We will rely, in part, on licensed third-party content on our web sites.
We plan to license some of the content for our web sites to build communities
and attract and retain customers, users and advertisers. If we are unable to
obtain desirable content from current licensors or from new licensors, it will
affect the number of visitors to our web sites, which could materially harm our
Internet business. In addition, if we are unable to obtain content at an
acceptable cost, it could materially harm our ability to compete in our Internet
business and our operating results and financial condition could be materially
adversely affected.

      Our success depends on the continued growth of online commerce. Use of the
Internet by consumers is in its early stages and, as a result, the degree of
acceptance of the Internet as a medium for commerce is uncertain. If online
commerce does not continue to grow or grows more slowly than expected, our
Internet business will be materially harmed. A number of factors could slow the
growth of online commerce, including the following:

      o     the network infrastructure required to support a substantially
            larger volume of transactions may not be developed;

      o     government regulation may increase;

      o     telecommunications capacity problems may result in slower response
            times; and

      o     consumers may have concerns about the security and privacy of online
            commerce transactions.

      We may not be able to compete successfully against current and future
competitors on the Internet. Our success will depend upon our ability to attract
customers by providing efficient means to buy our products and providing
high-quality content and value-added services to build our communities for
advertising revenues and the sale of additional products. The market for our
products and services is intensely competitive. In addition, the online commerce
market for our products and services is new, rapidly evolving and competitive.
There are no substantial barriers to entry in electronic commerce. Many of our
competitors have longer operating histories, larger customer bases, greater
brand recognition and significantly greater financial, marketing and other
resources than we have. If we are unable to successfully compete, our operating
results and financial condition could be materially adversely affected.

      If we fail to keep pace with rapid technological changes on the Internet,
it could materially harm our ability to attract and retain customers. Internet
technology, commercial applications and online uses are all rapidly evolving. If
we do not successfully respond to rapid changes involving the Internet, our
Internet business will be materially harmed. In this regard, we must continue to
develop, enhance and improve the responsiveness and features of our web sites
and develop new features to meet customer needs. We also must respond to
technological advances and emerging industry standards and practices on a
cost-effective and timely basis.

      We are subject to government regulation and legal liabilities that may be
costly and may interfere with our ability to conduct business on the Internet.
Laws and regulations directly applicable to online commerce or Internet
communications are becoming more prevalent. Laws and regulations directly
applicable to Internet communications, commerce and advertising are becoming
more prevalent. The most recent session of the United States Congress resulted
in Internet laws regarding children's privacy, copyrights and

                                       28
taxation. Such legislation could hamper the growth in use of the Internet
generally and decrease the acceptance of the Internet as a communications,
commercial and advertising medium. Although our transmissions originate in New
York, the governments of other states or foreign countries might attempt to
regulate our transmissions or levy sales or other taxes relating to our
activities. The European Union recently enacted its own privacy regulations that
may result in limits on the collection and use of certain user information. The
laws governing the Internet, however, remain largely unsettled, even in areas
where there has been some legislative action. It may take years to determine
whether and how existing laws such as those governing intellectual property,
privacy, libel and taxation apply to the Internet and Internet advertising. In
addition, the growth and development of the market for Internet commerce may
prompt calls for more stringent consumer protection laws, both in the United
States and abroad, that may impose additional burdens on companies conducting
business over the Internet. Furthermore, the Federal Trade Commission has
recently investigated the disclosure of personal identifying information
obtained from individuals by Internet companies. In the event the Federal Trade
Commission or other governmental authorities adopt or modify laws or regulations
relating to the Internet, our business, results of operations and financial
condition could be adversely affected.

      We may be subject to liability for sales and other taxes. We do not plan
to collect sales or other similar taxes in most states for sales on the
Internet. Our Internet business could be materially harmed if additional sales
and similar taxes are imposed on us, or if penalties are assessed on us for past
nonpayment of these taxes. Recently adopted legislation provides that, prior to
November 2001, a state cannot impose sales taxes on products sold on the
Internet unless these taxes could be charged on non-Internet transactions
involving the products. During this moratorium, it is possible that taxing
mechanisms may be developed that would, following the moratorium, impose
increasing sales and similar tax burdens on us. If these burdens are placed on
us, our Internet business could be materially harmed and there could be a
material adverse effect on our operating results and financial condition.

      We may experience problems from computer systems that are not ready on a
timely basis to process information associated with the year 2000. Many existing
software programs may not accurately process dates arising in the year 2000 and
after because they use only two digits to identify a year and assume that the
two missing digits are always "19." We cannot assure you that all of the
computer systems and related products and software that are important to our
Internet business will be ready by the deadline to address the concerns arising
from the year 2000 problem. If they are not ready, we may experience difficulty
in properly managing our web sites and face the possibility of business
interruptions, financial loss, reputational harm and legal liability. Any of
these could materially harm our Internet business, operating results and
financial condition.

      Our Internet business will depend upon the operations and technology of
various other Internet sites, credit card issuers, as well as other third
parties. Our Internet business, operating results and financial condition may be
materially harmed if these or other third parties are not year 2000 compliant on
a timely basis. We have not developed any contingency plans to address the worst
case scenario that might if occur if year 2000 issues make the Internet or our
web sites unavailable.

      We may be subject to privacy regulations which could limit the
effectiveness of our Internet sales and marketing efforts. Web sites typically
place certain "cookies" on a user's hard drive without the user's knowledge or
express consent. Our web sites and other web sites use cookies for a variety of
reasons, including for the collection of data derived

                                       29
from the user's Internet activity. Most currently available web browsers allow
users to remove cookies at any time or to prevent cookies from being stored on
their hard drive. In addition, some commentators, privacy advocates and
governmental bodies have suggested limiting or eliminating the use of cookies.
Any reduction or limitation in the use of cookies could limit the effectiveness
of our sales and marketing efforts. In addition, the European Union recently
adopted a directive addressing data privacy that may limit the collection and
use of certain information regarding Internet users. This directive may limit
our ability to target advertising or collect and use information in certain
European countries.

      We display a privacy policy on our web sites. The policy is accessible to
all users of our sites. Notwithstanding this policy, any penetration of our
network security or other misappropriation of our users' personal or credit card
information could subject us to liability. We may be liable for claims based on
unauthorized purchases with credit card information, impersonation or other
similar fraud claims. Claims could also be based on other misuses of personal
information, such as misuses for unauthorized marketing purposes. These claims
could result in litigation. In addition, the Federal Trade Commission and
several states have investigated the use by certain Internet companies of
personal information. We could incur expenses if new regulations regarding the
use of personal information are introduced or if our privacy practices are
investigated.

      In 1998, the U.S. Congress enacted the Children's Online Privacy
Protection Act of 1998. The principal provisions of the law are to become
effective on April 21, 2000. Among other things, subject to certain limited
exceptions, this act:

      o     makes it unlawful for an operator of a web site or online service
            directed to children under age 13, and for any operator that has
            actual knowledge that it is collecting personal information from
            such a child, to collect personal information from the child without
            having obtained verifiable parental consent; and

      o     prohibits conditioning the participation of a child under age 13 in
            a game, the offering of a prize, or another activity on the child
            disclosing more personal information than is reasonably necessary to
            participate in such activity.

      The Federal Trade Commission has not yet promulgated regulations
interpreting this act. We depend upon collecting personal information from our
customers. We believe that the promulgation of regulations under this act will
make it more difficult for us to collect personal information from certain users
of a community web site.

      General security concerns could affect our Internet business. The need to
securely transmit confidential information (such as credit card and other
personal information) over the Internet has been a significant barrier to
e-commerce and communications over the Internet. Any compromise of security
could deter more people from using the Internet or from using it to transmit
confidential information. Furthermore, decreased traffic and e-commerce sales as
a result of general security concerns could cause advertisers to reduce their
amount of online spending. Such security concerns could reduce our market for
e-commerce and indirectly influence our ability to sell online advertising. We
may also incur significant costs to protect Riddell against the threat of
problems caused by such security breaches. Further, if third parties were to
misappropriate our users' personal information or credit card information, users
could possibly bring claims against us.

                                       30
TRADE NAMES AND TRADEMARKS

      This prospectus also includes trade names and trademarks of other
companies. Our use or display of other parties' trade names, trademarks or
products is not intended to and does not imply a relationship with, or
endorsement or sponsorship of Riddell by, the trade name or trademark owners.

                                       31
FORWARD-LOOKING STATEMENTS

      This prospectus contains certain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934, as amended. Our statements of plans,
intentions, objectives and future economic or operating performance contained in
this prospectus are forward-looking statements. Forward-looking statements
include but are not limited to statements containing terms such as "believes,"
"does not believe," "no reason to believe," "expects," "plans," "intends,"
"estimates," "will," "would," "anticipated" or "anticipates."

      Forward-looking statements involve known and unknown risks and
uncertainties which may cause our actual results in future periods to differ
materially from results anticipated in the forward-looking statements. We make
cautionary statements in certain sections of this prospectus, including in the
Risk Factors beginning on page 20. You should read these cautionary statements
as being applicable to all related forward-looking statements wherever they
appear in this prospectus, the materials referred to in this prospectus. No
forward-looking statement is a guarantee or promise of future performance. We
undertake no obligation to update publicly any forward-looking statements for
any reason, even if new information becomes available or other events occur in
the future.

                                       32
THE RIGHTS OFFERING

Basic Subscription Right

      As soon as practicable after the date of this prospectus, Riddell is
distributing, at no charge, to holders of our common stock on the record date,
December 27, 1999, rights to purchase additional shares of its common stock. We
are distributing 0.10795 of a right for each share of common stock held on the
record date. Each full right is exercisable for one share of common stock at a
subscription price of $___________ per share. We have reserved a total of
1,000,000 shares of common stock for the exercise of the rights. Further, if you
exercise your rights, you will also receive, for no additional money, a common
stock purchase warrant that may entitle you to purchase stock in a new or
existing subsidiary of ours that may be created sometime in the future to
conduct substantially all of our Internet operations. All of the warrants that
are issued to those individuals and entities who exercise rights will, in the
aggregate, be exercisable for __________ of our ownership interest in such
subsidiary at the time the warrants first become exercisable. See "Common stock
purchase warrants" in this section below and "Description of Securities --
Warrants".

      We are sending a subscription certificate and related instructions to each
record holder along with this prospectus to evidence the rights. In order to
exercise rights, you must fill out and sign the appropriate subscription
certificate and timely deliver it with full payment for the shares to be
purchased.

      A depository bank, trust company or securities broker or dealer which is a
record holder for more than one beneficial owner of shares may divide or
consolidate subscription certificates to represent shares held on the record
date by their beneficial owners, upon proper showing to American Stock Transfer
& Trust Company.

Fractional shares

      We will not issue any fractional shares. If your rights would allow you to
purchase a fractional share, you may exercise your rights only by rounding down
to and paying for the nearest whole share, or paying for any lesser number of
whole shares. We will accept any inadvertent subscription indicating a purchase
of fractional shares by rounding downward to the nearest number of whole shares
and refunding without interest any payment received for a fractional share as
soon as practicable.

Expiration time and date

      The subscription privilege expires at 5:00 p.m., New York City time, on
February __, 1999. After the expiration date, rights will no longer be
exercisable by anyone.

      In order to exercise rights in a timely manner, you must assure that
American Stock Transfer & Trust Company actually receives, prior to expiration
of the rights, the properly executed and completed subscription certificate (or
form of "Notice of Guaranteed Delivery"), together with full payment in good
funds for all shares you wish to purchase.

                                       33
Reasons for the rights offering

      We are offering the rights to finance our Internet business and for
additional working capital.

No Board investment recommendation to stockholders

      Our Board of Directors does not make any recommendation to you about
whether you should exercise any rights. If you do not exercise all of your
rights, you will own a smaller percentage of the total outstanding common stock
after completion of the rights offering. If you exercise rights, you risk
investment loss on new money invested. We can not ensure that the subscription
price will be below the market price for the common stock during the rights
offering, or that anyone purchasing shares will be able to sell those shares in
the future at a higher price.

Common stock purchase warrants

      Holders who exercise their rights shall receive, for no additional
consideration, common stock purchase warrants that are exercisable for a portion
of Riddell's ownership interest in a future subsidiary (either newly formed or
presently existing) whose principal business is Riddell's Internet operations.
All of the warrants issued, in the aggregate, will represent the right to
purchase ______ (_____%) percent of Riddell's ownership interest in this
Internet subsidiary at the time the warrants first become exercisable. These
warrants will only become exercisable if (i) we form or use a presently existing
subsidiary to conduct substantially all of our Internet operations, and (ii) we
effect an initial public offering for this subsidiary on or before December 31,
2002. If we effect an initial public offering of our Internet subsidiary by
December 31, 2002, the warrants will be exercisable for six (6) months after the
closing of the initial public offering, after which time they will expire. If we
do not establish an Internet subsidiary by December 31, 2002, or establish such
a subsidiary but do not effect an initial public offering for our Internet
subsidiary on or before December 31, 2002, these common stock purchase warrants
shall expire on December 31, 2002 and shall no longer be exercisable. If we do
effect an initial public offering of our Internet subsidiary on or before
December 31, 2002 we will also register at that time the shares of common stock
issuable to you upon your exercise of the common stock purchase warrants. The
common stock purchase warrants will have an exercise price of $.01 per share,
are not transferable (except in the event of the death of the holder, in which
event they are transferable to the estate of the holder), are subject to
dilution, and will only be issued to those individuals or entities who exercise
rights.

General terms and assumptions

      The record date is December 27, 1999.

      Only holders of record of common stock at the close of business on the
record date, or those to whom rights have been validly transferred, may exercise
rights. You are a record holder for this purpose only if your name is registered
as a stockholder with our transfer agent, American Stock Transfer & Trust
Company, as of the record date.

      o     The text below generally assumes that you are a record holder of
            shares, unless otherwise noted.

                                       34
o     If you own shares held in a brokerage, bank or other custodial or
            nominee account, you should promptly send the proper instruction
            form to your broker or other person holding your shares, in order to
            exercise rights. Your broker or other person holding your shares is
            the record holder and will have to act in order for you to exercise
            rights. We have asked the securities brokers and other nominee
            holders of our stock to contact you to obtain your instructions
            concerning rights you are entitled to exercise.

      o     No interest will be paid on your funds delivered to exercise rights,
            regardless of whether the funds are applied to the purchase of
            shares or returned for any reason.

American Stock Transfer & Trust Company

      American Stock Transfer & Trust Company is acting as the subscription
agent for the rights offering under an agreement with Riddell.

      All subscription certificates, payments of the subscription price, nominee
holder certifications and notices of guaranteed delivery, to the extent
applicable to your exercise of rights, must be delivered to:

      American Stock Transfer & Trust Company
      40 Wall Street, 46th floor
      New York, NY 10005

      We will pay the fees and expenses of American Stock Transfer & Trust
Company, except applicable brokerage commissions, taxes and other expenses
relating to the sale of rights for your account by American Stock Transfer &
Trust Company. Riddell has also agreed to indemnify American Stock Transfer &
Trust Company against certain liabilities in connection with the rights
offering.

Solicitation agent

      We have engaged the services of H.C. Wainwright & Co., Inc. to act as
solicitation agent in the rights offering. See "Plan of Distribution."

Standby purchase

      It is currently anticipated that, pursuant to a Standby Purchase
Agreement, certain of our directors and executive officers and certain other
individuals (the "Standby Group"), will agree to exercise all of their
respective rights granted to them by this prospectus, which is ____% of all
rights being offered to stockholders, and to stand by to purchase up to
$___________ worth of the shares that are offered by this prospectus that are
not purchased by the other stockholders who have failed to exercise their
rights.

Conditions relating to the rights offering

      If the proposed Standby Purchase Agreement is not consummated in
accordance with its terms for any reason, including the failure to satisfy
applicable conditions specified in the agreement, we may terminate the rights
offering in its entirety. If the rights offering is terminated for this or any
other reason, we will instruct American Stock Transfer & Trust

                                       35
Company to refund without interest to those persons who subscribed for shares in
the rights offering all payments received by American Stock Transfer & Trust
Company.

      The material conditions to the Standby Purchase Agreement will likely
include the following, which must be satisfied or waived as of the date and time
the rights expire:

      o     we must not have experienced any material adverse change affecting
            our business, prospects, financial position, stockholders' equity or
            results of operations;

      o     the Securities and Exchange Commission must not have issued a stop
            order relating to the registration statement filed with the
            Securities and Exchange Commission relating to this prospectus;

      o     representations made by the parties in the agreement must be true
            and correct; and

      o     the rights offering must have been completed in the manner described
            in this prospectus.

Method of exercise of rights

      Please do not send subscription certificates or related forms to Riddell.
Please send the properly completed and executed form of subscription
certificates with full payment to American Stock Transfer & Trust Company at:

      American Stock Transfer & Trust Company
      40 Wall Street, 46th floor
      New York, NY 10005

      You should read carefully the subscription certificates and related
instructions and forms which accompany this prospectus. You should call American
Stock Transfer & Trust Company or the solicitation agent promptly with any
questions you may have.

      You may exercise your rights by delivering to American Stock Transfer &
Trust Company, at the address specified in the instructions accompanying this
prospectus, at or prior to expiration of the rights:

      o     the properly completed and executed subscription certificate(s)
            which evidence the rights that you wish to exercise, and

      o     payment in full in good funds of the subscription price for each
            share you wish to purchase under the subscription privilege.

      If you are not a broker, bank or other eligible institution, you must
obtain a signature guarantee on the subscription certificates from a broker,
bank or other institution eligible to guarantee signatures in order to transfer
the subscription certificates in whole or to transfer a portion of your rights.

Required forms of payment for exercise

      If you exercise any rights, you must deliver full payment in the form of:

                                       36
o     a check or bank draft drawn upon a U.S. bank, or U.S. postal money
            order, payable to American Stock Transfer & Trust Company
            Subscription Agent, or by wire transfer of funds to the account
            maintained by the American Stock Transfer & Trust Company for this
            rights offering at _______________________, Attention:
            _____________________.

      In order for you to timely exercise your rights, American Stock Transfer &
Trust Company must actually receive the subscription price before expiration of
the rights in the form of:

      o     a personal check which must have timely cleared payment, or

      o     a certified or cashier's check or bank draft drawn upon a U.S. bank
            or a U.S. postal money order, or collected funds in American Stock
            Transfer & Trust Company's account designated above.

      Funds paid by uncertified personal check may take at least five business
days to clear. Accordingly, if you pay the subscription price by means of
uncertified personal check, you should make payment sufficiently in advance of
the expiration time to ensure that your check actually clears and the payment is
received before that time. We are not responsible for any delay in payment by
you and suggest that you consider payment by means of certified or cashier's
check, money order or wire transfer of funds.

Special procedure under "Notice of Guaranteed Delivery" form

      If you wish to exercise rights but cannot ensure that American Stock
Transfer & Trust Company will actually receive the executed subscription
certificate before the expiration of the rights, you may alternatively exercise
rights by causing all of the following to occur within the time prescribed:

      o     American Stock Transfer & Trust Company must receive full payment
            prior to the expiration time for all shares you desire to purchase
            under the subscription privilege.

      o     American Stock Transfer & Trust Company must receive a properly
            executed "Notice of Guaranteed Delivery" substantially in the form
            distributed by us with your subscription certificate at or prior to
            the expiration time.

      o     The "Notice of Guaranteed Delivery" must be executed by both you and
            one of the following: a member firm of a registered national
            securities exchange, an NASD member, a commercial bank or trust
            company having an office or correspondent in the United States, or
            other eligible guarantor institution qualified under a guarantee
            program acceptable to American Stock Transfer & Trust Company. The
            cosigning institution must guarantee in the Notice of Guaranteed
            Delivery that the subscription certificate will be delivered to
            American Stock Transfer & Trust Company within three AMEX trading
            days after the date of the form. You must also provide in that form
            other relevant details concerning the intended exercise of rights.

      o     American Stock Transfer & Trust Company must receive the properly
            completed

                                       37
subscription certificate(s) with any required signature guarantee
            within three AMEX trading days following the date of the related
            Notice of Guaranteed Delivery.

      o     If you are a nominee holder of rights, the "Nominee Holder
            Certification" must also accompany the Notice of Guaranteed
            Delivery.

      A Notice of Guaranteed Delivery may be delivered to American Stock
Transfer & Trust Company in the same manner as subscription certificates at the
address set forth above under "The Rights Offering--American Stock Transfer &
Trust Company," or may be delivered by telegram or facsimile transmission
(telecopier no. (718) 234-5001).

      Additional copies of the form of Notice of Guaranteed Delivery are
available upon request from American Stock Transfer & Trust Company.

Incomplete forms; insufficient or excess payment

      If you do not indicate the number of rights being exercised, or do not
forward sufficient payment for the number of rights that you indicate are being
exercised, then we are entitled to accept the subscription forms and payment for
the maximum number of rights that may be exercised based on the actual payment
delivered.

      If your payment exceeds the amount required to pay for the shares you
indicate in your subscription certificate, then we will return any payment not
applied to the purchase of shares under the rights offering procedures without
interest to those who made these payments as soon as practicable by mail.

Exercise of less than all rights

      If you subscribe for fewer than all of the shares represented by your
subscription certificate, you may (1) attempt to sell your remaining rights, or
(2) receive from American Stock Transfer & Trust Company a new subscription
certificate representing the unused rights. See "The Rights Offering-how to
transfer rights" below.

Instructions to nominee holders

      If you are a broker, trustee or depository for securities or other nominee
holder of common stock for beneficial owners of our stock, we are requesting
that you contact the beneficial owners as soon as possible to obtain
instructions and related certifications concerning their rights. Our request to
you is further explained in the suggested form of letter of instructions from
nominee holders to beneficial owners accompanying this prospectus.

      To the extent so instructed, nominee holders should complete appropriate
subscription certificates on behalf of beneficial owners and submit them on a
timely basis to American Stock Transfer & Trust Company with the proper payment.

Risk of loss on delivery of subscription certificate forms and payments

      Each holder of rights bears all risk of the method of delivery to American
Stock Transfer & Trust Company of subscription certificates and payments of the
subscription

                                       38
price.

      If subscription certificates and payments are sent by mail, you are urged
to send these by registered mail, properly insured, with return receipt
requested, and to allow a sufficient number of days to ensure delivery to
American Stock Transfer & Trust Company and clearance of payment prior to the
expiration time.

      Because uncertified personal checks may take at least five business days
to clear, you are strongly urged to pay, or arrange for payment, by means of
certified or cashier's check, money order or wire transfer of funds.

How procedural and other questions are resolved

      Riddell is entitled to decide all questions concerning the timeliness,
validity, form and eligibility of any exercise of rights. Any such determination
will be final and binding. Riddell, in our sole discretion, may waive any defect
or irregularity, or permit a defect or irregularity to be corrected within such
time as it may determine, or reject the purported exercise or any right because
of any defect or irregularity.

      Subscription certificates will not be considered received or accepted
until all irregularities have been waived or cured within such time as Riddell
determines, in our sole discretion. Neither Riddell nor American Stock Transfer
& Trust Company have any duty to give notification of any defect or irregularity
in connection with the submission of subscription certificates or any other
required document. They will not incur any liability for failure to give such
notification.

      Riddell reserves the right to reject any exercise of rights if the
exercise does not comply with the terms of the rights offering or is not in
proper form or if the exercise of rights would be unlawful or materially
burdensome. See "The Rights Offering-right to block exercise due to regulatory
issues" below.

Questions and assistance concerning the rights

      You should direct any questions or requests for assistance concerning the
method of exercising rights or requests for additional copies of this
prospectus, forms of instructions or the Notice of Guaranteed Delivery to
American Stock Transfer & Trust Company, at 40 Wall Street, 46th floor, New
York, NY 10005, (800) 937-5449, (212) 936-5100 or (718) 921-8200.

No revocation

      Once you have exercised the subscription privilege, you may not revoke or
change your exercise.

How to transfer rights

      It is not anticipated that a formal market will be made in the rights or
that they will be traded on any exchange. Although an informal market may
develop, there is no assurance that any market will develop for the rights.

      You may transfer all of the rights evidenced by a single subscription
certificate by

                                       39
signing the subscription certificate for transfer in accordance with the
appropriate form printed on the subscription certificate.

      You may transfer a portion of the rights evidenced by a single
subscription certificate by delivering to American Stock Transfer & Trust
Company the subscription certificate properly signed for transfer, with separate
written instructions to register a portion of the rights in the name of your
transferee and to issue a new subscription certificate to the transferee
covering the transferred rights. In that event and by appropriate written
instructions, you may elect to receive a new subscription certificate covering
the rights you did not transfer, or may request that American Stock Transfer &
Trust Company sell your retained rights in the manner described below.

      If you wish to transfer all or a portion of your rights, you should allow
a sufficient amount of time prior to the expiration time for (1) the transfer
instructions to be received and processed by American Stock Transfer & Trust
Company, (2) new subscription certificates to be issued and transmitted and (3)
the rights evidenced by the new subscription certificates to be exercised or
sold by the intended recipients.

      It may require from two to ten business days, or more, to complete
transfers of rights, depending upon how you deliver the subscription certificate
and payment and the number of transactions you request. Neither Riddell nor
American Stock Transfer & Trust Company will be liable to you or any transferee
of rights if subscription certificates or any other required documents are not
received in time for exercise or sale prior to the expiration time.

      If you exercise or sell rights in part, a new subscription certificate for
the remaining rights will be issued to you only if American Stock Transfer &
Trust Company receives a properly endorsed subscription certificate from you no
later than 5:00 p.m., New York City time, on the fifth business day prior to the
expiration date. It will not issue new subscription certificates for partially
exercised or sold warrants submitted after that time and date. If you do submit
a partial exercise or sale after that time and date, you will not be able to
exercise the unexercised or unsold rights.

      Unless you make other arrangements with American Stock Transfer & Trust
Company, a new subscription certificate issued after 5:00 p.m., New York City
time, on the fifth business day before the expiration date will be held for
pick-up by you at American Stock Transfer & Trust Company.

      If you request a reissuance of a subscription certificate, the delivery of
that document will be at your risk.

      You, and not Riddell or American Stock Transfer & Trust Company, will be
responsible for paying any commissions, fees and other expenses (including
brokerage commissions and transfer taxes) you may incur for a purchase, sale or
exercise of rights.

      If you do not exercise your rights prior to the expiration time, those
rights will expire and will no longer be exercisable by you.

Foreign and unknown addresses

      Riddell is not mailing subscription certificates to stockholders whose
addresses are

                                       40
outside the United States or who have an APO or FPO address. In those cases, the
subscription certificates will be held by American Stock Transfer & Trust
Company for those stockholders. To exercise their rights, these stockholders
must notify American Stock Transfer & Trust Company prior to 11:00 a.m., New
York City time, on _____________, 2000. At that time, if a foreign holder has
not given any other instructions, these rights will be sold, subject to
availability of buyers. If the rights can be sold, a check for the proceeds from
the sale of these rights, less a pro rata portion of any applicable brokerage
commissions, taxes and other expenses, will be sent by mail to the foreign
holders. These sales for foreign holders will be aggregated so that each foreign
holder will receive a weighted average price for the sales, if any.

      If you have sold rights through American Stock Transfer & Trust Company
but it does not know your address or cannot otherwise make delivery of sale
proceeds to you, your sale proceeds will be held in a special account. These
proceeds will be delivered to Riddell if you do not claim them within two years
after the expiration date of the rights offering.

Right to block exercise due to regulatory issues

      We reserve the right to refuse the exercise of rights by any holder of
rights who would, in our opinion, be required to obtain prior clearance or
approval from any state, federal or foreign regulatory authorities for the
exercise of rights or ownership of additional shares if, at the expiration date,
this clearance or approval has not been obtained. We are not undertaking to pay
for any expenses incurred in seeking that clearance or approval.

                                       41
We are not offering or selling, or soliciting any purchase of, rights or
underlying shares in any state or other jurisdiction in which this is not
permitted. We reserve the right to delay the commencement of the rights offering
in certain states or other jurisdictions if necessary to comply with local laws.
However, we may elect not to offer rights to residents of any state or other
jurisdiction whose law would require a change in the rights offering in order to
carry out the rights offering in that state or jurisdiction.

No adjustment to outstanding stock options or other stock awards

      Riddell will not, solely as a result of the rights offering, adjust the
number of shares of common stock reserved for issuance under our stock award
plans for employees and other eligible participants, the number of shares
subject to outstanding awards of stock options or awards of restricted stock.
Riddell may, as a result of the rights offering, be required to adjust the
number of shares of common stock reserved in the event of the conversion of the
outstanding Convertible Note into shares of common stock.

Amendment, extension and withdrawal

      If the standby agreement with the Standby Group is not consummated, we may
terminate the rights offering in its entirety and, if we do, we will refund all
funds received for the exercise of rights, as described under "The Rights
Offering - conditions relating to the rights offering."

      Subject to the foregoing, Riddell reserves the right to withdraw the
rights offering at any time prior to the expiration date for any reason, in
which event all funds received in the rights offering will be returned to those
persons who subscribed for shares in the rights offering.

Issuance of stock certificates

      Stock certificates for shares purchased in the rights offering will be
issued to you as soon as practicable after the expiration date. American Stock
Transfer & Trust Company will deliver subscription payments to Riddell only
after consummation of the rights offering and the issuance of stock certificates
to those exercising rights.

      If you exercise rights, you will have no rights as a stockholder until
certificates representing shares you purchased are issued. Unless otherwise
instructed in your subscription certificate form, shares purchased by the
exercise of rights will be registered in the name of the person exercising the
rights.

Issuance of warrant certificates

      Warrant certificates representing the common stock purchase warrants
granted to you upon the exercise of your rights will be issued to you as soon as
practicable after the expiration date.

                                       42
THE CONCURRENT OFFERING

      In addition to the rights offering, we are also selling an additional
250,000 shares of our common stock for $_________ per share. There will be
10,513,957 shares outstanding after the concurrent offering and assuming the
sale of 1,000,000 shares pursuant to the rights offering. The proceeds generated
by the concurrent offering shall be used to finance our Internet business and
for additional working capital.

      Riddell's common stock is traded on the American Stock Exchange under the
symbol "RDL".

                                       43
USE OF PROCEEDS

      The net proceeds to Riddell from the exercise of rights in the rights
offering and the sale of common stock in the concurrent offering are
approximately $____________ (or $___________ if the underwriters' over-allotment
option is exercised in full), after deducting fees and estimated expenses. We
will use the net cash proceeds from the rights offering and the concurrent
offering to finance our Internet business and for additional working capital
purposes.

                                       44
DILUTION

      Our net tangible book value, as of September 30, 1999, was $(73,039,000),
or $(7.89) per share of common stock. Net tangible book value per share
represents the amount of total tangible assets less total liabilities divided by
the number of shares of common stock outstanding at September 30, 1999.

      After giving effect to our sale of the 1,250,000 shares of common stock in
this rights offering and the concurrent offering, at an assumed offering price
of $_____ per share, and after deducting estimated expenses related to this
rights offering and the concurrent offering, our pro forma net tangible book
value as of September 30, 1999, would have been $________, or $_____ per share.
This represents an immediate increase in pro forma net tangible book value of
$_____ per share to existing shares, and an immediate dilution of $____ per
share to new shares.

      The following table illustrates this per share dilution:

            Assumed offering price per share                          $

            Net tangible book value per share at
            September 30, 1999                            $ (7.89)

            Increase per share attributable to new shares ______

            Pro     forma net tangible book value
            per share after the offering                              __________

            Dilution per share to new shares                          $
                                                                      ==========

      Assuming the exercise in full of the underwriter's over-allotment option,
the pro forma as adjusted net tangible book value of Riddell at September 30,
1999 would have been approximately $____ per share, representing an immediate
increase in net tangible book value of $___ per share to Riddell's existing
stockholders and an immediate dilution in net tangible book value of $___ per
share to new investors.

      The foregoing discussion and tables assume no exercise of any outstanding
stock options. As of December 1, 1999 there were outstanding options to purchase
2,435,025 shares of common stock at a weighted average exercise price of $4.28
per share. The discussion and table also assumes no conversion of the
Convertible Subordinated Note. Riddell's 4.1% Convertible Subordinated Note is
convertible into 1,395,011 shares of common stock at a conversion rate of
$5.3763 per share, subject to certain adjustments.

                                       45
CAPITALIZATION

      The table also shows, in the column labeled "As Adjusted", our
capitalization as adjusted for the completion of the rights offering at a
subscription price of $_____ per share and the concurrent offering at a price of
$_____ per share and includes the application of the net cash proceeds from the
offering.

      You should read this table in conjunction with the consolidated financial
statements and the notes to those statements which are included elsewhere in
this prospectus.

                                                        September 30, 1999
                                                        --------- --- ----

                                                        Actual       As Adjusted
                                                        ------       -- --------
                                                             (Unaudited)
                                                             (In thousands)

Long-term debt                                           $145,144    $

Stockholders' equity (Note 8):

      Preferred stock, $0.01 par; authorized 5,000,000         --           --
      shares; none issued

      Common stock, $0.01 par; authorized 40,000,000           93
      shares; issued and outstanding  9,258,957 and
      __________shares, respectively

Capital in excess of par                                   36,849

Accumulated deficit                                        (3,307)      (3,307)
                                                        ---------    ---------
      Total Stockholders' equity                           33,635
                                                        ---------
      Total capitalization                               $178,779    $
                                                        =========

                                       46
SELECTED FINANCIAL DATA

      Our selected consolidated financial information presented below as of and
for the years ended, December 31, 1994, 1995, 1996, 1997 and 1998 has been
derived from our audited consolidated financial statements. The selected
financial information as of and for the nine months ended, September 30, 1998
and September 30, 1999 has been derived from our unaudited condensed
consolidated financial statements, which, in our opinion, reflect all
adjustments, consisting only of adjustments of a normal and recurring nature,
necessary for a fair presentation of our financial position and results of
operations information for such periods. Our historical results are not
necessarily indicative of future operating results or financial position. You
should read this information together with the other information contained under
the captions "Capitalization," "Management's Discussion and the Analysis of
Financial Condition and Results of Operations" and with our audited consolidated
financial statements and unaudited condensed consolidated financial statements
and related notes to those financial statements included elsewhere in this
prospectus.
(In thousands, except per share amounts)
                 ----------------------------------------------------------------------------------
Operating Data                           Year Ended December 31,                Nine Months Ended
(1)                                                                                September 30
                 ----------------------------------------------------------------------------------
                   1994         1995        1996        1997       1998(7)      1998        1999
                 ---------    ---------   ---------   ---------   ---------   ---------   ---------
                                                                                    Unaudited
                                                                                    ---------
Net revenues       $55,412      $67,043     $72,382    $138,273    $186,600    $159,326    $179,750

Cost of             29,792       35,794      38,813      80,675     113,541      95,239     104,969
revenues         ---------    ---------   ---------   ---------   ---------   ---------   ---------

Gross profit        25,620       31,249      33,569      57,598      73,059      64,087      74,781

Selling,
general and
administrative
expenses (2)        28,614       25,983      27,853      46,278      64,617      49,169      54,024

Other charges        1,188           --          --          --         925          --          --
(6)              ---------    ---------   ---------   ---------   ---------   ---------   ---------

Income (loss)       (4,182)       5,266       5,716      11,320       7,517      14,918      20,757
from
operations

Interest             2,001        2,795       2,763      11,879      14,656      11,114      11,668
expense          ---------    ---------   ---------   ---------   ---------   ---------   ---------
47
(In thousands, except per share amounts)
                 ----------------------------------------------------------------------------------
Operating Data                           Year Ended December 31,                Nine Months Ended
(1)                                                                                September 30
                 ----------------------------------------------------------------------------------
                   1994         1995        1996        1997       1998(7)      1998        1999
                 ---------    ---------   ---------   ---------   ---------   ---------   ---------
                                                                                    Unaudited
                                                                                    ---------
Income (loss)
before taxes,
extraordinary
item and
cumulative
effect of
changes in
accounting
principles          (6,183)      2,471       2,953        (559)     (7,139)      3,804       9,089

Income taxes        (1,250)        100         110          --          --          --         905
(credits)         --------    --------    --------    --------    --------    --------    --------

Income (loss)
before
extraordinary
item(3)            $(4,933)     $2,371      $2,843       $(559)    $(7,139)     $3,804      $8,184
                  ========    ========    ========    ========    ========    ========    ========
Earnings
(loss) per
share before
extraordinary
item:

      Basic         $(0.62)      $0.29       $0.35      $(0.07)     $(0.78)      $0.42       $0.88

      Diluted        (0.62)       0.29        0.33       (0.07)     $(0.78)       0.37        0.78

EBITDA(5)          $(2,229)     $7,433      $7,909     $15,330     $13,230     $19,164     $25,042
48
Balance                               December 31,                         September 30,
Sheet Data                            ------------                         -------------
(1)(4)

                 -------------------------------------------------------------------------
                   1994       1995       1996       1997       1998       1998       1999
                 -------    -------    -------    -------    -------    -------    -------
                                                                               Unaudited
                                                                               ---------
Working          $11,036    $19,286    $25,957    $37,599    $37,963    $59,634    $65,110
capital

Total assets      72,252     74,125     76,361    181,761    186,211    201,942    210,300

Long-term
debt, less
current
portion           20,168     23,600     29,984    122,500    126,900    138,200    145,144

Stockholders'     24,431     24,902     27,745     32,125     25,451     36,129     33,635
equity
1)    In June 1997 Riddell acquired Varsity Spirit Corporation.

2)    In 1994 selling, general and administrative expenses included an
      adjustment to record a $4.6 million charge for a product liability
      litigation loss.

3)    An extraordinary item in 1995 consisted of a $1,900,000 ($0.23 per share)
      provision for costs relating to fraudulent transfer litigation.

4)    See Note 11 to Riddell's audited consolidated financial statements
      relating to contingent liabilities.

5)    EBITDA is the sum of our earnings or loss before extraordinary items (and
      the cumulative effect of changes in accounting principles (as
      applicable)), interest, income taxes, depreciation and amortization
      expense. EBITDA is a widely accepted financial indicator of a company's
      ability to service indebtedness. However, EBITDA should not be considered
      as an alternative to income from operations or to cash flows from
      operating activities (as determined in accordance with generally accepted
      accounting principles) and should not be construed as an indication of our
      operating performance or as a measure of our liquidity.

(6)   Other charges of $1,188,000 in 1994 consisted of certain costs relating to
      a change in Riddell's method of distributing team sports products. Other
      charges of $925,000 in 1998 consisted of lease termination and employee
      severance costs related to a restructuring plan adopted in 1998, see
      "Management's Discussion and Analysis of Financial Condition and Results
      of Operations."

(7)   Operations for 1998 were impacted by $1.5 million of losses relating to
      new product initiatives and $3.1 million of costs (including the
      restructuring plan costs referred to in note 6 above) relating to certain
      strategic changes which were undertaken to

                                       49
improve future profitability, see "Management's Discussion and Analysis of
      Financial Condition and Results of Operations."

                                       50
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

General

      We acquired Varsity Spirit Corporation on June 19, 1997. The Varsity
acquisition significantly increased the size of our business and significantly
changed our financial structure. Varsity's operations include the design and
marketing of cheerleader and dance team uniforms and the operation of
cheerleader and dance team camps, clinics and special events. These operations
have become a part of our extracurricular segment which we have previously
referred to as the institutional segment. Accordingly, references to our
extracurricular segment in this prospectus refers to that portion of our
business that we have historically referred to as our institutional segment.

      The Varsity acquisition significantly increased the size of our business.
On a pro forma basis, revenue for Riddell combined with Varsity was $174.1
million, more than double our 1996 historical stand alone revenues for the year
before the acquisition. Revenues have since grown to $186.6 million for the year
ended December 31, 1998.

      Our historical operating results for 1997 and 1996 do not include
Varsity's operations for the portion of the periods before the Varsity
acquisition. This makes comparisons of operating results less meaningful. In
order to overcome this limitation, part of the discussion and analysis that
follow is based on comparisons to operating results for 1997 and 1996 adjusted
on a pro forma basis to include Varsity's results for the period before the
acquisition and other matters related to the Varsity acquisition. The pro forma
adjustments are described in Note 2 of the Audited Consolidated Financial
Statements included in this prospectus.

      Set forth below is the percentage of our revenues generated by each of our
three principal segments for each of the twelve month periods ending December
31, 1996, 1997 and 1998 and for each of the nine month periods ended September
30, 1998 and 1999. Information for each of the twelve month periods ending
December 31, 1996 and 1997 is pro forma, giving effect to our acquisition of
Varsity in June, 1997.

                                           Year ended December 31,  Nine month
                                                                   period ended
                                                                   September 30,

                                           1996    1997    1998    1998    1999
                                           ----    ----    ----    ----    ----
Extracurricular Segment:
   Spirit and dance products and services  55.0%   58.2%   60.1%   60.8%   58.8%
   Team Sports products and services       30.2%   30.0%   29.3%   30.1%   34.0%
                                           ----    ----    ----    ----    ----
        Total extracurricular segment      85.2%   88.2%   89.4%   90.9%   92.8%

Retail Segment                             13.3%   10.4%    9.7%    8.2%    6.8%

Licensing Segment                           1.5%    1.4%    0.9%    0.9%    0.4%

                                       51
Results of Operations

      Nine Months Ended September 30, 1999 Compared to the Nine Months Ended
September 30, 1998

Overview

      Operations for the nine-month period ended September 30, 1999 resulted in
net income of $8.1 million, or $0.78 per share on a diluted basis as compared to
$3.8 million, or $0.37 per share on a diluted basis, for the first nine-months
of 1998.

      Tax expense for the nine-month period was higher in 1999 than 1998 because
of an adjustment arising from certain changes in estimates.

      Income before taxes for the nine-month period increased $5.3 million to
$9.1 million, a 139% improvement in comparison to $3.8 million of income before
taxes for the 1998 year-to-date period. The improvement was principally due to
increased revenues and related improvements in gross margin and operating
expense rates.

Revenues

      Revenues for the nine-month period ended September 30, 1999 increased 13%,
or $20.4 million, to $179.7 million from $159.3 million for the year-to-date
period of 1998.

      The revenue gain came from our extracurricular segment which includes: (i)
cheerleading uniforms, camps and special events, (ii) athletic equipment and
reconditioning lines and a new line of game uniforms and (iii) Umbro-branded
team soccer apparel, equipment and footwear. For the nine-month period,
extracurricular revenues increased 15%, or $22.0 million, to $166.8 million for
1999 from $144.8 million for the year-to-date period of 1998. All
extracurricular product lines showed sales volume increases over the year ago
period and generally higher selling prices also contributed to the revenue
increases. Revenues also benefitted from first year sales of our new line of
Umbro-branded team soccer products and our new line of athletic game uniforms.
These two new product lines generated 37% of the revenue growth for the
nine-month period.

      Revenues from the retail segment were $12.2 million for the first nine
months of 1999, down $0.9 million from the year-ago period. The declines were
anticipated as part of a strategy which called for lower sales and higher
profitability and are principally the result of a decrease in the volume of
youth football equipment sold to retailers because we are shifting our emphasis
on youth football equipment sales to the direct sales force within our
extracurricular segment.

      Revenues from trademark licensing declined to $0.2 million in the third
quarter of 1999 from $0.3 million for the third quarter of 1998. For the
nine-month period royalty revenues declined to $0.8 million for the nine-month
period of 1999 from $1.4 million for the 1998 period. The decline was
anticipated due to the expiration of certain licenses in 1998.

Gross profit

      Gross profit increased to $74.8 million for the nine-month period of 1999
from $64.1

                                       52
million in 1998. Gross margins improved in both the extracurricular and retail
segments. Gross margin rates increased by 1.4 points to 41.6% for 1999 from
40.2% for the year-to-date period of 1998. Margin rates improved as a result of
modest increases in selling prices, favorable negotiations with vendors and
contractors, improved leverage due to higher absorption of the fixed portion of
operating costs against higher revenue and certain other actions taken at the
end of 1998 which also reduced costs for 1999.

Selling, general and administrative expenses

      Selling, general and administrative expenses decreased as a percentage of
revenues for the third quarter and the year-to-date period.

      Selling, general and administrative expenses decreased as a percentage of
revenues to 30.1% of revenues in the 1999 nine-month period from 30.9% last
year. The improvement is principally the result of cost savings initiatives
implemented at the end of 1998 and improved absorption of the relatively fixed
portions of selling, general and administrative expenses resulting from the
increase in revenues.

Interest expense

      Interest expense increased by $0.6 million to $11.7 million for the
nine-month period ended September 30, 1999 from $11.1 million for the first nine
months of 1998. The increase is attributable to an increase in average
indebtedness which was principally due to higher indebtedness at the beginning
of 1999 than at the beginning of 1998, increased working capital demands related
our new line of Umbro-branded team soccer products and volume growth in other
product lines.

Income taxes

      Income tax expense for the nine-month period ending September 30, 1999
reflects an adjustment relating to the valuation of deferred taxes. No tax
expense, other than this adjustment, has been recorded for the 1999 period as we
have net operating loss carryforwards which offset any such taxes. As a result,
tax expense is not comparable between the nine-month periods of 1999 and 1998.

      We have net operating loss carryforwards that offset most income tax
payments which would otherwise be due for the year.

      Year Ended December 31, 1998 compared to Pro forma Year Ended December 31,
1997

Overview

      Operations for 1998 resulted in a net loss of $7.1 million. While we
achieved satisfactory performance in our core extracurricular business, we
incurred a loss of $1.5 million relating to several new product initiatives and
suffered from weak performance in our retail and licensing segments. We also
incurred costs of $3.1 million relating to certain strategic changes being
undertaken to improve future profitability. These factors are discussed in
greater detail in the following paragraphs and comparisons.

                                       53
The loss of $1.5 million from new initiatives within our extracurricular
segment included start up costs for a new line of team soccer apparel, equipment
and footwear to be marketed under the newly acquired license to use the Umbro
trademark in the United States; entry into new areas of the school and private
dance studio dance market including the Company Dance(Registered) program; and
the introduction of athletic game uniforms. These activities were unprofitable
during 1998 due to start up costs and because some activities were started too
late in the year to generate enough revenues to offset the costs. We believe
that the losses incurred for these activities are valuable investments in the
future and views these areas as important to our future growth potential.

      Operations for 1998 were also impacted by lower profits from the trademark
licensing and retail product segments. Licensing declined as our license to
Kmart for MacGregor(Registered) branded apparel and bags was not renewed when it
expired in June 1998, although the license was renewed for other products.
Profitability of the retail segment decreased due to a decline in sales of
sports collectible products.

      We also initiated a series of strategic actions in late 1998 which we
believe will assist in facilitating future profitability. These actions include
the implementation of a restructuring plan involving the consolidation of
several of our reconditioning facilities and the elimination of approximately 40
jobs including two senior positions. Together these actions led to a $925,000
restructuring charge in 1998. The charge includes a provision of $800,000,
included in accrued liabilities at December 31, 1998, for certain lease
termination and employee severance costs, most of which will be expended during
1999. The restructuring actions are expected to yield annual savings of over
$1.0 million after 1999, once facility closures are completed and new
centralized operations are fully implemented.

      Other strategic actions generated additional charges in excess of $2.0
million in 1998. The charges include costs relating to changes in product lines
and marketing materials which are discussed further in the comparisons of gross
margins and selling, general and administrative expenses, below.

      Several cost saving measures were also implemented late in 1998 as part of
our strategic review. Areas which should generate future savings include
negotiated vender cost reductions, consolidation of general insurance policies
and a move of our corporate offices in New York City to smaller, less costly
space. We believe these cost savings actions, combined with the benefits from
the above mentioned restructuring plan, should reduce our costs by $2.0 to $3.0
million annually in 1999 and future years.

Revenues

      Revenues for 1998 increased $12.5 million, or 7%, to $186.6 million in
comparison to pro forma revenues of $174.1 million for 1997.

      All of our revenue gains came from the extracurricular segment where
revenues increased 9% or $13.2 million, from $153.6 million on a pro forma basis
for 1997 to $166.8 million for 1998. Increased volume in cheerleading and dance
uniform and accessory products accounted for the largest part of this revenue
increase, registering a sales increase of $7.1 million, with most of the gain
occurring in the line's core products. In addition, camp and event revenue
increased $3.7 million primarily due to a strong increase in special event
attendance. Athletic product volume increased $2.4 million due largely to
expanded offerings

                                       54
of athletic practice wear and a new emphasis on the youth football market where
sales had previously been declining in recent years.

      Revenues from the retail segment were relatively stable with 1998 revenues
of $18.1 million compared to 1997 revenues of $18 million. Sales of athletic
products to recreational team dealers and distributors increased, offsetting
declines in the sales of sports collectible products. Sales of sports
collectible products decreased due to lower demand for certain products
introduced in recent years such as miniature hockey and baseball helmets.

      Royalty income from trademark licensing decreased by $0.8 million to $1.6
million in 1998 in comparison to trademark licensing royalties of $2.4 million
in 1997. This decrease is attributable to the expiration in June 1998 of a
license for MacGregor branded apparel and bags with Kmart.

Gross profit

      Gross profit for 1998 increased to $73.1 million from $71.0 million on a
pro forma basis for 1997. Gross margins decreased as a percentage of sales to
39.2% for 1998 from 40.8% on a pro forma basis for 1997. Gross profits were
impacted by a 1998 charge to reflect product line changes and other strategic
decisions which affected the realizable value of inventories. This charge, along
with the decrease in royalty income discussed above, accounted for most of the
decline in margins. Margins were also impacted by a shift in the mix of products
sold as most of the year's revenue gains occurred in product lines that carry
lower margins than the average of our other products.

Selling, general and administrative expenses

      Selling, general and administrative expenses for 1998 increased by $1.6
million to $64.6 million from $63.0 million on a pro forma basis for 1997. In
addition to a normal level of growth related increases, expenses for 1998
included charges taken late in the year relating to strategic changes in product
lines and marketing materials as discussed above and over $2.0 million of
expenses related to the new initiatives mentioned in the overview above.

      Selling, general and administrative expenses decreased as a percentage of
sales to 34.6% for 1998 from 36.2% on a pro forma basis for 1997. However, 1997
expenses included unusual expenses from the Varsity acquisition and the
settlement of certain non-product liability litigation as discussed below in the
comparison of 1997 to 1996.

Interest expense

      Interest expense for 1998 increased 3%, or $0.4 million over 1997 interest
computed on a pro forma basis. The increase is due to a higher level of working
capital indebtedness during the year.

Income taxes

      We did not recognize income tax benefits arising from the 1998 net loss.
The unrecognized tax benefits, together with unrecognized tax benefits arising
from net operating losses in prior years, would be utilized with the generation
of approximately $7.0 million in future pre-tax income and adjustments.

                                       55
We have certain nondeductible annual expenses which would be added as
adjustments to pretax income to calculate taxes. These expenses include
nondeductible amortization of approximately $2.1 million, most of which arises
from goodwill associated with the Varsity acquisition.

      Pro Forma Year Ended December 31, 1997 Compared to Pro Forma Year Ended
December 31, 1996

Revenues

      Pro forma revenues for the year ending December 31, 1997 increased $13.3
million, or 8%, to $174.1 million from $160.8 million in 1996. We achieved
revenue gains in our extracurricular segment while experiencing offsetting
declines in the Retail and Licensing segments.

      Extracurricular segment revenues increased 12%, or $16.7 million, from
$136.9 million on a pro forma basis for 1996 to $153.6 million on a pro forma
basis for 1997. Most of the gains related to the operations acquired from
Varsity. Uniforms and accessories sales increased by $7.0 million due to volume
growth. Growth in the number of summer camp participants contributed an
additional $6.0 million to camp and event revenues. Extracurricular sales of
athletic products and reconditioning services increased $3.7 million as we
experienced volume gains from our newly introduced line of athletic practice
clothing and from most of our core football protective product lines. These
gains more than offset a decline in sales of youth athletic products.

      Retail segment revenues declined by 15%, or $3.3 million, from $21.4
million for 1996 to $18.1 million for 1997. The decline was principally due to
decreased volume of sports collectible products. We believe the principal
reasons for the decline are related to an industry-wide cautiousness in making
inventory commitments for licensed sports products.

      Royalty income from licensing in 1997 decreased by 4%, or $0.1 million. We
recognized gains in MacGregor royalties from Kmart and royalties from our
Riddell apparel and sock licenses. These gains were offset by royalty declines
due to the expiration of a MacGregor license with Thom McAnn which had generated
$0.3 million in prior years and the temporary cessation of royalty receipts from
our Riddell footwear licensee. As described elsewhere in this prospectus, we
have assigned certain portions of the future royalties from our Riddell footwear
licensee, for up to ten years, to other parties to settle certain litigation.
While the license was transferred to a new licensee in 1998, the assignment
remains in place.

Gross profit

      Pro forma gross profit for 1997 was $71.0 million, an increase over pro
forma gross profit of $68.4 million for 1996. Gross margins, on a pro forma
basis, decreased as a percentage of revenues to 40.8% in 1997 from 42.5% for
1996. There were several factors which influenced the decline in gross margin
rates. Pro forma gross profit was reduced by $0.8 million of charges stemming
from a revaluation of inventory in June 1997 and included in Varsity's
preacquisition results. There was an increase in freight and overtime costs
incurred in the extracurricular segment's cheerleading uniform business in order
to overcome certain production delays which occurred during the year. The
decline in sales of sports collectibles discussed above significantly impacted
gross profit and the margins as these

                                       56
products carried higher than average margins. Sales of our new line of practice
wear reduced gross margins, as expected, since these products carry a lower
margin than our historical product lines. Introduction of our practice wear line
also negatively impacted 1997 margins due to start up costs of related screen
printing operations and introductory pricing. Finally, while the volume of our
reconditioning business increased, margins were down due to higher costs
associated with the initial year of reconditioning work on equipment from new
customers gained during the year and an increase in material and parts usage.

Selling, general and administrative expenses

      On a pro forma basis, selling, general and administrative expenses for
1997 increased by $7.6 million to $63.0 million from pro forma expenses of $55.5
for 1996. Expenses relating to various litigations (exclusive of product
liability matters) that were resolved during 1997 amounted to $2.8 million for
1997 and $1.2 million for 1996. Expenses for 1997 also included a charge of $0.6
million relating to in-the-money Riddell stock options contractually granted to
certain of our employees who previously were employed by Varsity (as further
discussed in Note 9 of the Consolidated Financial Statements) and a charge of
$0.4 million stemming from a revaluation of receivable reserves in June 1997
that was included in Varsity's preacquisition results. Pro forma selling,
general and administrative expenses excluding these items were relatively stable
as a percentage of revenues, increasing from 33.7% of revenues for 1996 to
approximately 34.0% of revenues in 1997.

Interest expense

      Interest expense computed on a pro forma basis for 1997 increased 2%, or
$0.2 million over pro forma 1996 levels. The increase was principally due to
increases in base interest rates relating to our revolving line of credit.
Historical interest expense, excluding any pro forma adjustments for 1997,
included a $3.0 million onetime commitment fee for bridge financing relating to
the Varsity acquisition.

Income taxes

      The pro forma net loss for 1997 did not include any tax benefit. Pro forma
tax expense for 1996 was reduced by the benefit of net operating loss
carryforwards available for recognition during the year. Even though the pro
forma operating results for 1996 resulted in a loss before taxes, tax expense of
approximately $0.6 million would have been included if net operating loss
carryforwards had not been available to offset the expense. The tax would have
been due to adjustments for nondeductible expenses, as discussed above in the
1998 to 1997 comparison of operating results.

Umbro license

      In 1998, we entered into a license agreement with Umbro International,
Inc. which entitles us to market and manufacture Umbro brand soccer team
apparel, footwear, equipment and accessories on an exclusive basis to the team
channel of distribution throughout the United States, Puerto Rico and the U.S.
Virgin Islands. The term of the license is five years with an option to renew
for an additional five-year period if we achieve certain performance levels. The
license is royalty-free in 1999. We are required to begin paying royalties in
the year 2000, at which time we are also required to meet annual minimum sales
figures. If we fail to meet required minimum sales levels subsequent to 1999

                                       57
for two consecutive annual periods, Umbro has the right to terminate the
license.

MacGregor trademark

      We acquired certain rights to the MacGregor trademark as part of an
acquisition in 1988 at an allocated cost of approximately $18.0 million. We are
amortizing the trademark over a period of forty years. The unamortized cost of
this asset included in intangible assets at September 30, 1999 was approximately
$12.9 million (See Note 7 of the Audited Consolidated Financial Statements). If
there were a material decline in the revenues from the MacGregor trademark, then
the carrying amount of the MacGregor trademark rights could be deemed to have
been impaired. A write-down for such impairment could have a material adverse
effect on our financial position and results of operations.

Liquidity and capital resources

      The seasonality of our working capital needs is primarily impacted by
three factors. First, a significant portion of the products we sell into the
extracurricular segment are sold throughout the year on dated-payment terms,
with the related receivables becoming due when the school year begins during the
following July to October period. Second, we incur costs relating to our summer
camp business from the fourth quarter and into the second quarter as we prepare
for the upcoming camp season, while camp revenues are mostly collected in the
June to August period. Lastly, our debt structure impacts our working capital
requirements as the semi-annual interest payments on our $115 million, 10.5%
Senior Notes come due each January and July.

      To finance these seasonal working capital demands, we maintain a credit
facility in the form of a revolving line of credit. The outstanding balance on
the credit facility follows the seasonal cycles described above, increasing
during the early part of the operating cycle in the first and second quarters of
each year and then decreasing from the third quarter and into the fourth quarter
as collections are used to reduce the outstanding balance.

      At September 30, 1999 the outstanding balance under the credit facility
was $22.6 million. This compares with outstanding balances of $4.4 million at
December 31, 1998 and $15.7 million at September 30, 1998. The change in the
outstanding balance between December 31, 1998 and September 30, 1999 reflects
the seasonal working capital pattern presented above, while the increase in
outstanding borrowings between September 30, 1999 and September 30, 1998
reflects the factors discussed above in the paragraph on interest expense in the
comparison of results of operations between these periods.

      In April 1999, we entered into a revised credit facility with Bank of
America National Trust and Savings Association. The revised credit facility
matures at the end of December 2003 and provides for borrowings of up to $48
million depending on certain levels of receivables and inventories. The revised
credit facility replaced our $35 million credit facility with NationsBank, now
named Bank of America, and NBD Bank. NBD Bank subsequently became a participant
in the new facility. We sought the increased size of the credit facility to
provide working capital for new initiatives, especially our new line of
Umbro-branded team soccer products.

      Our current debt service obligations are significant and, accordingly, our
ability to meet our debt service and other obligations will depend on our future
performance and is

                                       58
subject to financial, economic and other factors, some of which are beyond our
control. Furthermore, due to the seasonality of working capital demands
described above, year-over-year growth in our business and working capital could
lead to higher debt levels in future periods. We believe that operating cash
flow together with funds available from our credit facility will be sufficient
to fund our current debt service, seasonal and other current working capital
requirements.

      We are conducting the rights offering and concurrent offering to finance
our Internet business and for additional working capital. We believe we could
finance our Internet business from the existing capital resources described
above. However, the resources provided by the offering will provide us with
greater flexibility in developing our Internet business and not require that we
divert capital that we would otherwise use for our base business. It is likely
that our Internet business will not be profitable and could generate losses
which could exceed the proceeds from the rights offering and the concurrent
offering.

Year 2000 issues

      Riddell, like virtually all companies and organizations, is faced with
addressing the Year 2000 issue which relates to the possibility that computer
systems and computer chips embedded in equipment may not be able to properly
process data after December 31, 1999.

      The most significant Year 2000 issues facing Riddell are associated with
the computer information systems used to plan, operate and track our business.
We have substantially completed the process of assessing which of our
information systems are subject to potential Year 2000 problems and of taking
corrective action to minimize the potential impact of Year 2000 problems. The
status of this program on each of our four major computer information systems
follows:

      Helmet manufacturing and retail operations: Year 2000 issues have been
addressed by replacing hardware and software with new systems certified as Year
2000 compliant by the vendor. The system replacement is part of a modernization
effort that was initiated in early 1997 and was completed in November 1999.

      Extracurricular athletic product distribution and reconditioning
operations: Existing system software was upgraded and modified to address Year
2000 issues. The process was completed in the fourth quarter of 1998, and the
system has been tested and certified by our vendor as Year 2000 compliant.

      Spirit products: Year 2000 issues have been satisfied through corrective
modifications of existing software. The process was completed early in October
1999 and we have tested the software. We are also in the process of replacing
the existing software with a new system, that is certified as Year 2000
compliant by the vendor, as part of an overall upgrade of system capabilities,
but we made the Year 2000 corrections to the existing software as the new system
will not be fully implemented before the end of 1999.

      Camps and events: Year 2000 issues have been satisfied through corrective
modifications of existing software. The process was completed early in the
second quarter of 1999 and has been tested by Riddell.

      We have other minor systems for which Year 2000 corrective action is in
various

                                       59
stages of completion, all scheduled for completion before the end of 1999.

      We face potential Year 2000 problems relating to embedded computer chips
which control equipment used in our business, such as telephone equipment and a
limited amount of machinery. We have completed assessments of equipment
considered most susceptible to Year 2000 issues and repair or replacement has
been arranged for equipment found to have Year 2000 problems.

      We also face potential Year 2000 issues with third parties. These third
parties include customers who purchase our extracurricular and retail products
and suppliers of raw materials and finished goods, among others. Because our
extracurricular products and services are sold to a large number of schools and
other customers, it is impractical to poll them all in order to determine their
Year 2000 readiness. However, because this customer base is large, the potential
of a negative impact on us may be lowered as none of these customers
individually account for a material portion of our revenues. Third parties also
include airlines and air transportation systems. A disruption of domestic or
foreign air travel systems, or fear of such a disruption among our customers,
could have a negative impact on our special events, many of which occur at the
end of the calendar year or shortly thereafter. We have had discussions with
certain other key customers and vendors in order to assess the potential impact
that their Year 2000 problems might have on us. However, the process of
communications with key customers and vendors and planning for the impact of any
problems arising from their systems are ongoing.

      Expense for Year 2000 remedial programs for the years ended December 31,
1997 and 1998 was $200,000 and $250,000, respectively, and a similar level of
expense is anticipated for 1999. We have also incurred capital expenditures for
computer hardware and software related to the system replacements described
above, of approximately $150,000 and $800,000 for the years ended December 31,
1997 and 1998, respectively. These capital expenditures include all of the
system upgrade and modernization aspects of the replacement programs discussed
above. Approximately $700,000 of similar capital expenditures are anticipated
for 1999.

      Our remedial actions are intended to reduce the possibility of a
disruption of our business due to Year 2000 issues. While we believe these
actions will be successful, the issues involved are full of complexities and
uncertainties, so there can be no assurance that a disruption of our business
will not occur. If a material disruption of our business were to occur, it could
have a material adverse impact on our results of operations, liquidity and
financial condition.

      Readers are cautioned that forward-looking statements contained in the
Year 2000 disclosure should be read in conjunction with our Special Cautionary
Notice Regarding Forward-Looking Statements located at the beginning of this
prospectus.

                                       60
PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY

      Our common stock was quoted on The Nasdaq National Stock Market System
under the symbol RIDL in 1997 and through November 20, 1998. Commencing November
23, 1998 our common stock was listed on the American Stock Exchange under the
symbol RDL. As of December 10, 1999, there were approximately 732 holders of
record of our common stock. The following table sets forth the high and low
sales prices for the common stock as reported by the NASDAQ-NMS for 1997 and
through November 23, 1998, and as reported by the American Stock Exchange for
the rest of 1998 and for 1999:

Year Ended December 31, 1997:             High        Low
                                          ----        ---
First Quarter                             5 1/2       3 7/8
Second Quarter                            5 7/8       3 5/8
Third Quarter                             6           4 5/16
Fourth Quarter                            5 3/8       3 7/8

Year Ended December 31, 1998:
First Quarter                             5 5/8       4
Second Quarter                            6 3/8       4 7/8
Third Quarter                             5           3 3/4
Fourth Quarter                            6 5/8       2 5/8

Year Ended December 31, 1999:
First Quarter                             7 7/8       3 5/8
Second Quarter                            4 3/16      3
Third Quarter                             4           2 7/8
Fourth Quarter*                           3 1/2       2 13/16

      The last sale price of the common stock on December 10, 1999 was $3.125.

*     Represents the period from September 1, 1999 through December 10, 1999.

Dividend Policy

      Since our inception, we have not declared or paid, and do not currently
intend to declare or pay, any dividends on shares of our common stock, and
intend to retain future earnings for reinvestment in our business. Any future
determination to pay cash dividends will be at the discretion of our Board of
Directors and will be dependent upon our results of operations, financial
condition, contractual restrictions and other factors deemed relevant by our
Board of Directors. Our financing arrangements impose restrictions on our
ability to pay cash dividends or make other distributions on our common stock.

                                       61
BUSINESS

General

      Riddell is a leading marketer and manufacturer of branded products and
services to the extracurricular activities portion of the educational market. We
believe that the extracurricular activities market encompasses approximately 30
million young men and women in the United States who participate in team sports
and other organized activities outside the classroom. We estimate that this
market generates approximately $5 billion in sales annually, including
approximately $2 billion of sales in athletic equipment and uniforms for team
sports and various products and services for cheerleaders and dancers.

      Under our many brands, the best known of which are Riddell and Varsity
Spirit (which we own) and Umbro (which we license), we are:

      o     a leading provider of athletic equipment and clothing for team
            sports;

      o     the only national reconditioner of football protective and other
            athletic equipment;

      o     The largest designer, marketer and supplier of innovative
            cheerleader and dance team uniforms and accessories;

      o     The biggest operator of cheerleading and dance team training camps
            and clinics;

      o     A leading organizer of special events for extracurricular
            activities;

      o     A major provider of soccer apparel, equipment and footwear for team
            play; and

      o     A supplier of sports collectible products through retailers in the
            United States and internationally.

      Our success in building our various brands and lines of business is due,
in large part, to our long-standing marketing strategy through which our direct,
proprietary sales force establishes and builds relationships with the
participants, coaches and instructors among the 40,000 junior and senior high
schools, colleges and various youth organizations throughout the United States.
We believe that our sales force is unique within the extracurricular activities
market and provides us with a significant competitive advantage.

      Our relationship marketing strategy is a year-round, integrated approach,
which includes conducting training camps, clinics and conventions and producing
various nationally-televised and regional championships and performance events
in the U.S. and Europe. These activities, which are in themselves profitable,
reinforce each other and the sale of our products, while they enhance
participation and build loyalty to our brands.

      We believe that Riddell branded football equipment is worn by more than
50% of all high school and collegiate football players. We also have a
longstanding agreement with the NFL for the promotion of our Riddell brand. Over
80% of the NFL players choose to wear

                                       62
our helmets. We also use the Riddell brand to sell sports collectible products
through retailers in the U.S. and internationally. We believe that our Varsity
Spirit brand cheerleading uniforms are worn by approximately 40% of all high
school and 75% of all collegiate cheerleaders. Our cheerleading camps are
attended by more than 200,000 students annually, and in 1999, more than 25,000
people traveled to the Walt Disney Resort in Orlando, Florida to participate in
and view our various cheerleading and dance competitions.

      In the fourth quarter of 1998, we became the exclusive U.S. licensee for
Umbro branded soccer apparel, footwear, equipment and accessories for team
channel distribution. Umbro is one of the leading soccer brands worldwide.

      Over the last few years, we have expanded the array of products and
services for the extracurricular activities market that can be readily sold
using our comprehensive marketing strategy. We have added:

      o     baseballs and baseball equipment in 1996

      o     practice wear (silk-screened t-shirts, shorts and sweat pants and
            shirts) in 1997

      o     instructional conventions and competitions for young participants
            from private dance studios in late 1997

      o     game uniforms for football and baseball in late 1998

      o     team soccer apparel, equipment and footwear in 1999

      Game clothing represents the largest category of sporting goods in the
extracurricular activities market. Based on the results in our first full year
of selling football uniforms, which exceeded our expectations, we believe that
the game uniform market has significant growth potential for us because we
presently have such a small share of this large market. As a result, we plan on
increasing our athletic game uniform production capabilities and expanding our
product offerings to other men's and women's sports, such as basketball and
softball.

      We also plan to build upon our presence in dance through a comprehensive
marketing approach to private dance studios.

Our objectives and strategy

      We believe that these actions will enable us to:

      o     expand the sales of our traditional team sports and school spirit
            products and services

      o     develop relationships with participants in other team sports and
            additional extracurricular activities that we are not currently
            servicing effectively, such as youth baseball

      o     establish new Internet-based revenue streams, through our sale of
            advertising, product sales and third-party alliances

                                       63
Our business strategy is to further capitalize on our relationship
marketing strategy by:

      o     adding sales people and shrinking sales territories, while having
            more product lines to sell at each school or organization

      o     developing new special events, competitions and conventions to
            reinforce and promote participation in each extracurricular activity

      o     implementing our Internet plans

Opportunities for growth

      We believe that we are poised to experience significant growth in three
product categories over the next twelve months:

      Game uniforms to high schools

      According to the National Federation of High Schools, there are 6.3
million high school athletes who play team sports in the United States. We
believe that the market for game uniforms and practice wear (t-shirts, sweat
shirts, shorts, etc.) exceeds $500 million in the U.S. and that we can capture
an increasing share of this market over each of the next few years.
This market is a natural extension of our core business because:

      o     the decision-makers for the purchase of these products is often the
            same person that our sales force already calls upon to sell football
            equipment and reconditioning services

      o     we have in-house expertise in the manufacturing of cheerleading
            uniforms which is readily transferable to game uniforms

      o     we believe that we can provide faster service than our competitors
            as a result of our efficient manufacturing and outsourcing
            capabilities

      Game uniforms and equipment for recreational youth leagues

      We estimate that the market for game uniforms and equipment for
recreational youth leagues is a $750 million market in the U.S. and that it
consists of approximately 15 million participants in organized youth leagues,
such as Little League, Pop Warner and parks and recreational leagues for
football, baseball, softball and basketball. This market is currently serviced
by a highly fragmented range of suppliers. To address this market, we are using
our in-house sales force and have recently established a dedicated sales force
to service this market in major metropolitan areas. We also plan to continue to
add sales people for this market.

      Apparel, equipment and footwear to the team soccer market

      Soccer has recently become the fastest growing sport in the U.S. among
boys and girls. We believe that there are over 4 million participants from high
school teams and youth leagues nationwide who spend $750 million annually for
apparel, equipment and footwear.

                                       64
o     the Umbro brand, which we license, is one of the leading soccer
            brands worldwide

      o     our expertise in manufacturing uniforms for cheerleaders, coupled
            with our ability to out-service our competitors gives us a
            competitive advantage

Our advantages

      We believe that we have four advantages that will support our growth.

      Direct, proprietary sales force

      Our direct, proprietary sales force is comprised of approximately 320
people who are responsible for developing and maintaining relationships among
the 40,000 junior and senior high schools, colleges and numerous recreational
youth organizations throughout the United States. As the only national,
factory-direct marketer of athletic products and services in the extracurricular
activities market, we are able to bypass the middlemen and independent dealer
networks used by our competitors. As a result, we can provide competitive
pricing and enhanced services to our customers.

      Efficient manufacturing and outsourcing capabilities

      Our efficient manufacturing and outsourcing capabilities support our
direct sales force and enable us to produce and deliver competitively priced
high quality customized products faster than our competitors. We accomplish our
efficiencies by manufacturing only those low labor-intensive items and
components that are difficult for outsourcing partners to make, thereby allowing
us to avoid bottlenecks in the production process. By outsourcing the
manufacturing of most of the items that we sell, we are able to focus on design,
marketing, sales and new product development. The result is that we are able to
minimize our capital commitments, operate more efficiently and be better
positioned to respond to changing market conditions.

      Relationship marketing

      Our relationship marketing, which we began 25 years ago, is a year-round,
integrated marketing approach. We enjoy longstanding relationships with the
participants, coaches and instructors of various team sports, school spirit
programs and other extracurricular activities in youth leagues and
organizations. Our sales force develops relationships with coaches and athletic
directors throughout the U.S. by providing value-added services that enhance the
coach's ability to efficiently manage his or her team. Examples of this include
fitting of football helmets and other equipment, quick repair service, and the
design and fitting of custom-uniforms for participants in cheerleading and team
sports. In the case of cheerleading, it also includes conducting training camps,
clinics and conventions, and producing various nationally-televised and regional
championships and performance events in the U.S. and Europe. Our relationship
marketing is designed so that each of our products and services reinforce one
another, as well as strengthen our overall brand awareness. We believe that our
new Internet operations are a logical extension of, and will effectively
reinforce, this marketing strategy.

      Internet operations

                                       65
Our Internet operations began in the fourth quarter of 1999. We believe it
is a logical extension and application of our sales and marketing strategy. We
believe that our Internet operations, which have a community and a commerce
orientation, will provide us with a direct link to our customers, enhance our
existing relationships with the participants and coaches in the various
extracurricular activities and expand our business beyond our historical
football and cheerleading product and service offerings, all in a cost-efficient
manner.

Our business segments

      We presently employ our sales and marketing strategy and operate our
business through various wholly-owned subsidiaries in three business segments:

      Extracurricular

      Our extracurricular segment, which we have historically referred to as our
institutional segment, markets, manufactures and distributes products and
services primarily through our 320 person direct sales force to customers such
as schools, recreational groups and other organizations. It is our largest
segment, and was responsible for almost 90% of our revenues in 1998 and
approximately 93% of our revenues for the first nine months of 1999. Over 6.3
million boys and girls participate in team sports in high schools within the
U.S. We estimate that there are an additional 15 million team sports
participants in organized youth leagues and an additional 10 million
participants in school-sponsored bands and choirs and youngsters who take dance
lessons at private studios.

      Retail

      Our retail segment markets products through retailers in the U.S. and
internationally. Most of the products sold by this segment are sports
collectible products, such as authentic and replica football helmets which bear
licensed NFL and collegiate team logos. This segment's operations also include
sales of a limited amount of recreational football, baseball and other athletic
products sold internationally and in the U.S. through consumer product retailers
and distributors.

      Licensing

      Our licensing segment consists of the licensing of our Riddell and
MacGregor trademark rights to other entities for use in marketing products such
as athletic footwear and equipment.

      Extracurricular segment

      We believe that we are a leading marketer and manufacturer of branded
products and services to the extracurricular branch of the U.S. educational
market. Today, our extracurricular products and services segment includes our
team sports and school spirit business units.

      The extracurricular activities market includes most of the organized
activities for children that take place outside of classrooms in the United
States. It includes team sports, school spirit activities, private dance groups,
bands, orchestras, choirs and a wide variety of

                                       66
other school- sponsored clubs, such as drama, debate and chess.

      These activities take place in approximately 40,000 junior and senior high
schools and in colleges, as well as in youth leagues and organizations like
Little League, Pop Warner and parks and recreation leagues. In addition to the
6.3 million participants in high school team sports in the U.S., we estimate
that there are an additional 15 million participants in team sports at junior
high schools and youth leagues. We also estimate that there are an additional 10
million participates in other extracurricular activities. We estimate that
spending by these various participants on the extracurricular activities that we
are already targeting exceeds $2 billion a year and that the extracurricular
industry is highly-fragmented and represents aggregate spending of $5 billion
annually.

      Relationship marketing

      Our marketing model is based upon our longstanding relationships with
three distinct but equally important groups. First, our direct sales
organization, through personalized service, creates an important connection to
the participants, coaches and instructors of various team sports, school spirit
activities and other extracurricular activities in schools, youth leagues and
organizations and colleges. Second, instructors and staff at our camps, clinics
and performance tours and events motivate participants to get more instruction
and become better competitors. Third, we increase our brand awareness and
enhance our relationships with our customers through our affiliations with
strategic partners such as the Walt Disney Company, ESPN and other media and
marketing entities. These strategic relationships and the televised shows that
we produce reinforce the importance of our events and competitions.

      Our cheerleading operations serve as the template for our
relationship-based marketing strategy. We intend to develop similar events,
conventions and competitions for other extracurricular activities, with soccer
and dance the most likely near-term extensions of our integrated marketing
approach. The marketing of our various activities is designed to provide logical
extensions to basic participation and to encourage participants as they improve
to increasingly utilize more of our products and services.

      Our extracurricular segment is supported and based upon our sales and
marketing strategy, which we believe provides us with a competitive advantage,
and features the following key components.

      o     Our proprietary, direct sales force

      o     Cross marketing of products and promotional activities

            -     Camps

            -     Special events, conventions and competitions

            -     Uniforms and accessories

      o     Key marketing alliances

      Proprietary, direct sales force

                                       67
Our comprehensive relationship marketing and sales strategy is made
possible by our 320 person direct sales force who are responsible for developing
and maintaining relationships among the 40,000 junior and senior high schools,
and colleges in the United States, visiting between 10,000 and 15,000 schools
every five weeks during the sales season. We believe that there is no other
nationwide direct sales force focusing on the product lines that we sell to the
extracurricular branch of the educational market and that this gives us a
significant competitive advantage. Our sales force develops relationships with
coaches and athletic directors throughout the U.S. by providing value-added
services that enhance the coach's management of his team. Examples of this
include: providing clinics, fitting football helmets and equipment, and quickly
servicing, designing and fitting custom-uniforms for participants in
cheerleading and team sports.

      Over the last several years, we have been increasing the size of our sales
force, and intend to continue to do so over the next few years. Increasing the
size of the sales force goes hand-in-hand with expanding the array of products
and services marketed by the sales force. In this way, we can shrink the size of
sales territories, while sales people become more efficient and increase their
incomes. As a result, we are seeking to make it easier for each salesperson to
better concentrate on and become more intimate with a smaller sales territory,
while at the same time having more products and services to offer to the
customers in that territory. The desired effect is to enable each salesperson to
generate increased sales by spending less time traveling and more time with
customers selling a greater array of products and services. Increased sales
enables the sales force to increase their incomes, because their compensation is
commission-based and smaller territories can also increase their incomes because
the our salespeople pay for all of their travel and other related expenses.

      Promotional activities

      Since 1974, we have conducted (and we continue to refine) profit
generating activities, which are an integral part of our promotional efforts.
Our sales and marketing strategy, as we have developed it for the school spirit
industry, is illustrated in the diagram below. We create relationships through
our camps and events and believe that these relationships naturally translate to
a sales opportunity for our cheerleading uniforms or dance costumes when the
campers return to school. When the sales force interacts with cheerleaders or
dance team participants and their coaches during the design and fitting of
custom uniforms, they also have the opportunity to reinforce participation in
our camps and special events. We intend to extend this strategy to other
extracurricular activities. The marketing of our various activities is designed
to provide logical extensions to basic participation and to encourage
participants, as they improve, to increasingly utilize more of our products and
services. All of our marketing activities are designed so that each of our
various products and services reinforce one another, as well as strengthen
overall brand awareness and loyalty.

      [INSERT BASIC MARKETING TEMPLATE DIAGRAM WHICH DEPICTS THE CROSS-MARKETING
ASPECT OF EACH OF THE THREE ELEMENTS OF OUR INTEGRATED MARKETING STRATEGY]

      How we cross-market is evident from our marketing of special events and
competitions for cheerleaders. For example, in order to attend and participate
in the various special events that we run, such as the nationally-televised
Macy's Thanksgiving Day parade in New York City, a cheerleader must attend and
excel at one of our camps. Our camps are

                                       68
the only place that a cheerleader can get an invitation to appear in one of our
special events. Similarly, we hold local cheerleading competitions that progress
to various regional levels during the course of the fall, which are the only way
for a team to qualify for our championships which are held at the Walt Disney
Resort in Orlando, Florida and nationally-televised on ESPN.

      Camps

      Because our approach to relationship building has inter-related parts, the
marketing process can begin at any point on the above diagram, but in the case
of cheerleading it is our camps which, more than anything else, build brand
loyalty.

      Special events, conventions and competitions enhance relationship
      marketing

      Just as our camps build loyalty to us in cheerleading, special events,
conventions and competitions for other extracurricular activities can build new
allegiances from participants in a wide variety of other extracurricular
activities. We run regional and national cheerleading and dance team
competitions, organize a national dance competition for young individuals and
sponsor youth soccer tournaments. The national competitions and finals for these
activities are typically held at The Walt Disney Resort in Orlando, Florida and
televised on ESPN and/or ESPN2. Participants in the school spirit activities
that we target are also given the opportunity to take part in various
performance events in the U.S. and Europe. These events include parades, such as
the annual Macy's Thanksgiving Day parade in New York City and year-end parades
in London and Paris. We also arrange half-time shows for college football bowl
games. We intend to extend our promotional activities to a greater number of
extracurricular activities with soccer and dance the most likely first
additions.

      Uniforms and accessories

      In addition, the cheerleaders who participant in our special events, such
as parades, often come from a variety of schools, they need a uniform for the
special event so they portray a unified appearance. We design and sell such
uniforms and also sell a travel package, including hotel arrangements, to the
participants in our special events.

      At the same time, because participation in our various promotional
activities enhances our bond with cheerleaders, we believe that their team is
more likely to buy our uniforms and accessories.

      Key Marketing Alliances

      We have a promotional rights agreement with the NFL's licensing division
which requires that our Riddell brand name appear on the front and on the chin
strap of all of our helmets used in NFL play. Our agreement with the NFL further
requires all teams in the NFL to cover any indicia of brand identification of
any other manufacturers that might otherwise appear on helmets, face masks or
chin straps not manufactured by us, but used during league play. In return, we
agree to supply specified quantities of Riddell helmets, shoulder pads and
related equipment, either at no cost or at reduced cost to each NFL team which
has a requisite percentage of its roster using the Riddell helmet. Presently,
over 80% of NFL players choose to wear our Riddell brand football helmets.

                                       69
We also have longstanding marketing alliances with other strategic
partners such as the Walt Disney Company, ESPN and other media and marketing
entities through which we create visibility on nationally-televised shows. These
shows further reinforce the importance of the activity and competitor. All of
these relationships enhance one another and serve to reinforce and cross-market
our products and services.

      We believe that our new Internet operations, which are described further
below, are a logical extension and application of this approach and are designed
to enhance our contact with customers and build brand loyalty.

      [INSERT DIAGRAM OF MARKETING TEMPLATE WITH INTERNET ADD-ON WHICH DEPICTS
HOW OUR NEW INTERNET OPERATIONS FIT INTO AND AUGMENT THE CROSS MARKETING ASPECTS
OF OUR INTEGRATED MARKETING STRATEGY]

      Our extracurricular segment, which we have historically referred to as our
institutional segment, is comprised of two divisions that relate to the sales of
products for both team sports and the school spirit industry.

      Team Sports

      We are the world's leading manufacturer of football helmets, which we sell
under our Riddell brand. Our Riddell brand football helmets are worn by football
players throughout the world, including players on all NFL teams, certain other
professional leagues and on most teams in the NCAA. High school teams, however,
have historically been the largest market for our football helmets. We offer
several types of varsity and youth helmets which are different in their
configurations, padding and other features. Our helmets are known for their
quality and performance and meet the industry standards set by the National
Operational Committee for Safety in Athletic Equipment ("NOCSAE"). NOCSAE, an
independent entity, is organized by various participants from the sporting goods
industry which establishes industry-wide standards for protective athletic
equipment.

      We also sell a professional and collegiate line of shoulder pads under the
Power(Registered) name and several other lines of shoulder pads under the
Riddell name. The shoulder pads are used by NFL, college, high school and youth
players.

      We have been steadily increasing the categories of athletic products we
sell to the extracurricular market. In 1998, we introduced a line of custom team
uniforms for high school and youth participants. In 1996, we introduced a line
of baseball and softball products designed for high school and college players
and expanded this line to the youth market in 1998.

      Game Uniforms

      We are seeking to capitalize on the same expertise and efficiency, and
apply the same design and manufacturing techniques that we have employed in
producing custom-made cheerleading and dance apparel in connection with
producing game uniforms for various team sports. We believe that the game
uniform market for team sports is a larger market than our other team sports
products and services lines of business. We believe that by using the suppliers
of our Varsity cheerleader uniforms we will be able to produce and deliver

                                       70
competitively priced, high quality game uniforms faster than our competitors.

      In 1998, we began offering our Umbro team soccer uniforms, along with a
line of equipment and apparel, through a network of independent sales
representatives. These independent sales representatives market and sell Umbro
team soccer apparel, footwear and equipment to the team channel of distribution
in the United States.

      In 1998, we also began manufacturing athletic team uniforms for other
sports. We believe that the manufacturing capabilities of our cheerleader
uniform operations, coupled with the breadth and depth of our direct sales
organization to schools and youth organizations across the country, provide us
with an opportunity to successfully expand our historical line of athletic
equipment into game uniforms.

      Reconditioning

      We are the leading national reconditioner of football helmets, shoulder
pads and related equipment with what we believe to be an over 50% share of the
reconditioning market. Reconditioning typically involves the cleaning,
sanitizing, buffing or painting, and recertifying of helmets as conforming to
NOCSAE standards. Reconditioning may also include replacing face guards,
interior pads and chin straps. We also recondition shoulder pads, as well as
equipment for other sports, including baseball and lacrosse helmets, catchers'
masks and baseball gloves. Our reconditioning services are sold by our sales
force to the same athletic coaches responsible for equipment purchases. Our
reconditioning customers are primarily high schools, colleges and youth
recreational groups.

      School Spirit

      Cheerleader Dance Team and Game Uniforms and Accessories

      We design, market and manufacture cheerleader and dance team uniforms and
accessories, including sweaters, sweatshirts, jumpers, vests, skirts, warm-up
suits, t-shirts, shorts, pompons, socks, jackets, pins and gloves. We market all
of our cheerleading uniforms and accessories under the Varsity Spirit trademark.
Over 100,000 catalogs are mailed annually to schools and school spirit advisors
and coaches containing color photographs and descriptions of our Varsity Spirit
line of uniforms and accessories. We supplement our direct sales force and
catalog sales efforts with a telemarketing sales force of 13 full and part-time
employees.

      Cheerleader and Dance Team Camps

      We operate cheerleader and dance team camps in the United States. Camp
enrollment has increased every year since the camp division commenced operation
in 1975 with 20 cheerleading camps and 4,000 participants. During the 1999 camp
season, approximately 218,000 participants (consisting of students and their
coaches) attended Varsity's Universal Cheerleader Association and United Spirit
Association camps, including over 8,000 participants representing colleges and
junior colleges. During 1999, cheerleading and/or dance team squads from
approximately 75% of the universities comprising the Atlantic Coast, Big East,
Big Ten, Big Twelve, Pacific 10 and Southeastern collegiate athletic conferences
attended our camps.

                                       71
Camp sessions for high school and junior high school students are held
primarily in June, July and August while camp sessions for college cheerleaders
and dance team participants are held primarily in August. We also offer mascot
training clinics at certain cheerleader and dance team camps.

      A significant majority of our cheerleader and dance team camps are
conducted on college or junior college campuses. We contract with the colleges
and universities for the provision of housing, food and conference facilities.
The camps generally are conducted over a four-day period and are attended by
resident and commuting students. We generally market the camp, establish and
collect participation fees, register students, provide instruction and perform
all related administrative services.

      Our instructors are mostly college cheerleaders who may have previously
attended our camp, and we believe that our training of many of the top college
cheerleading squads augments our recruiting of high school and junior high
school camp participants. Prior to the commencement of our camps, instructors
participate in an intensive six-day training session where they are taught new
cheerleading and dance material. We also place a high degree of emphasis on
teaching our instructors the most up-to-date teaching, training and safety
techniques. We hire instructors by utilizing applications given to talented camp
participants, supervisor evaluations and numerous nationwide tryouts. As a
result of this process, we believe that we hire the most qualified and talented
instructors available.

      We were a founding member of and remain an active participant in the
American Association of Cheerleading Coaches and Advisors ("AACCA"), an industry
trade group whose mission is to improve the quality of cheerleading and to
maintain established safety standards. In 1990, AACCA published comprehensive
certification and safety guidelines for cheerleading coaches. We follow the
AACCA safety guidelines in the training of our instructional staff and in the
conduct of our cheerleader and dance team camps and competitions.

      Special Events

      We promote our Varsity Spirit brand products and services, as well as the
school spirit industry, through active and visible association with the
following annual championships and television specials:

      o     National High School Cheerleading Championship(Registered)

      o     National Dance Team Championship(Registered)

      o     College Cheerleading and Dance Team National
            Championship(Registered)

      o     National All Star Cheerleading Championship(Registered)

      o     Company Dance Championship(Registered)

      These championships and special events have been regularly televised on
the ESPN television network and have been sponsored by various companies and
products, including Nike, Unilever, Sprint, The Walt Disney World Resort,
Johnson & Johnson and Claire's Accessories.

                                       72
In addition to promoting cheerleading and dance team activities, these
championships, television specials and events are a source of revenues for us.
In 1999, over 25,000 persons, including cheerleaders and their families,
participated in our special events.

      Other Extracurricular Operations

      We are seeking to expand our uniform design, manufacturing and special
event expertise from cheerleading into the private dance studio market through a
venture called Company Dance. Company Dance operates weekend dance conventions
in seventeen U.S. cities and an annual championship from the Walt Disney Resort
in Orlando that is televised on ESPN. We also design, manufacture and market
costumes for dance recitals.

      We also operate a tour company, which does business as Intropa,
specializing in organizing trips for cheerleaders, bands, choirs and orchestras,
dance and theater groups and other school affiliated or performing groups, which
tour in the continental United States, Hawaii, Canada, Europe and Israel.

      Production

      Team Sports Products

      We design, manufacture and package all of our full sized football and
baseball batting helmets at our plant in Chicago, Illinois. Our Elk Grove,
Illinois warehouse facility also has a screen printing operation which can
customize practicewear and uniforms with almost any logo, team name or other
design or numbering that a customer requests.

      Power shoulder pads are manufactured for us by a single source in Canada,
and we have a facility in Pennsylvania that can customize these shoulder pads.
All of our other shoulder pads are imported as finished products from sources in
the Far East.

      We purchase our baseball products, other than baseball batting helmets,
from suppliers in the Far East and source our practicewear from four domestic
suppliers. Athletic uniforms are purchased on a made-to-order basis from
domestic suppliers.

      All of our manufactured protective products are subjected to at least four
separate quality control procedures. Quality control inspections for helmets are
conducted when the product is molded, when liners are inserted, when face guards
are attached and when the product is finished, and samples of all models
produced are tested in accordance with NOCSAE standards. We continually monitor
our products for quality.

      All varsity protective football helmet shells are covered by a five-year
warranty and youth football helmet shells are covered by a three-year warranty.
Helmet liners, protective padding and shoulder pads are covered by a one-year
warranty.

      Principal raw materials purchased by us for use in our protective products
include various custom and standard grades of resins, plastic and foam as well
as metal fasteners, paints and cardboard. Similar materials are used in most
purchased components and finished products along with steel wire used in
purchased face guard components and textile products used in purchased
practicewear and athletic uniforms. We rely on a single supplier with respect to
fulfilling all of our requirements for resin, which is an integral component in
the

                                       73
manufacture of helmets.

      We employ an engineering staff principally with respect to the design,
development and improvement of our helmets and shoulder pads and to the testing
of raw materials which are used in our products or in the development of new
products. We have eight employees devoted principally to design, development and
quality and have several patents and patents pending that are applicable to our
protective products.

      Reconditioning

      Our reconditioning services include the sanitizing, buffing or painting,
replacing certain parts and recertifying of athletic equipment as conforming to
NOCSAE standards. These services are performed at our reconditioning facilities
which are located throughout the United States.

      Cheerleading and Dance Team Uniforms and Accessories

      Cheerleading and dance team uniforms designed, manufactured and marketed
by us are made to order. During 1999, we contracted for our production
requirements with nine independent garment manufacturers. The manufacturers
provide knitting, cutting, sewing, finishing and shipping for all orders, and we
provide the patterns, fabrics, yarn and manufacturing specifications and quality
control supervision. We also provide some cutting, knitting and lettering at two
specialized production facilities. The use of independent manufacturing
facilities to fulfill our production needs affords us with the flexibility to
adjust our production output to meet our highly seasonal selling cycle. The use
of independent manufacturers also reduces our fixed costs, which we believe is
beneficial in a highly seasonal business.

      Cheerleading accessories such as shoes, pompons and campwear are purchased
from various suppliers including Nike(Registered), Capezio(Registered) and
Converse(Registered), among others. We have expanded the variety and number of
accessories we market, which has contributed to the increase in our merchandise
sales revenue in recent years.

      Retail Segment

      Our retail segment markets our Riddell branded products primarily through
retailers. In the fourth quarter of 1999, we launched our collectible web site,
www.riddell.com. Most of our branded retail products are sports collectible
products which consist primarily of authentic and replica helmets of
professional and college sports teams. These helmets are offered in various
miniature and full-size models bearing the colors and logos of NFL and other
professional or collegiate teams. Our full-size authentic football helmets are
the same helmets used by players on these teams. Other sports collectible
products bearing licensed team logos include lamps and desk organizers fashioned
from miniature helmets and a line of smaller, less expensive miniature helmets
tailored for the mass market. In early 1999, we also announced the introduction
of a desk organizer bearing logos and designs licensed from NASCAR and various
professional drivers.

      Our retail segment also includes sales of certain recreational football
and baseball products sold through retailers and distributors in the United
States and athletic products sold internationally.

                                       74
In connection with the sale of our collectible helmets, NFL Properties
Inc. has granted us a license to use the names, symbols, emblems, designs and
colors of the member clubs of the NFL and the "League Marks" (i.e., "National
Football League," "NFL," "NFC," "AFC," "Super Bowl," "Pro Bowl," the "NFL
Shield" design and other insignia adopted by the NFL) on authentic and replica
football helmets sold for display purposes.

      Marketing sales and promotion

      Our retail segment products are sold primarily to retail and specialty
sporting goods stores and distributors through approximately 57 independent
commissioned sales representatives. We strategically target different channels
of trade based on the type and price of each retail product.

      In support of our sports collectible products, we have initiated various
advertising and public relations efforts. Advertisements are placed in
publications targeted toward the sports collectible industry as well as other
licensed products retailers. We also provide incentives to retail outlets to
advertise and display Riddell products during promotional periods and
participate in a major national sporting goods show where we promote our
products.

      The retail segment also benefits from the promotional exposure of the NFL
Agreement described above under the extracurricular segment.

      Production

      We engineer, manufacture and package our full size collectible helmets at
our plant in Chicago, Illinois in a process similar to that used for our
competitive helmets. We purchase our miniature helmets and other collectible
products principally from two sources in China.

      We have retained a design company to assist us in developing new retail
collectible products on terms that we believe are customary in the industry and
from time to time we work with other design companies.

      Athletic products sold as part of the retail segment are manufactured or
purchased, together with similar products sold through our extracurricular
segment.

      Licensing Segment

      We license our Riddell and MacGregor trademarks to third parties for use
on various products, including athletic clothing and footwear.

      We are continually exploring additional opportunities for licensing the
MacGregor and Riddell trademarks and retain the services of an independent
licensing agent to assist our efforts in this regard worldwide.

      The licensing segment also benefits from the promotional exposure of our
agreement with the NFL because it gives our brand national television exposure
on a weekly basis during the football season.

      Riddell licensing

                                       75
We license the Riddell trademark to third parties for certain types of
athletic clothing, socks and athletic footwear.

      Pursuant to an agreement settling an action commenced against us in March
1995 by the trustee for MacGregor Sporting Goods, Inc., which filed for
bankruptcy protection in 1989, we license the "Riddell" name to an affiliate of
Enterprise Rent-a-Car, which purchased this license from the party with whom we
initially settled. This license relates to the use of the Riddell brand on
footwear. We will not receive any royalties from this license until the earlier
of the second half of 2007 or such time as the license produces $3.0 million
(plus interest) of royalties.

      MacGregor licensing

      We have granted Kmart Corporation a non-exclusive license to use the
MacGregor trademark on athletic socks until June 30, 2001. We have also granted
Footstar, Inc. an exclusive license to use the MacGregor trademark on athletic
footwear sold at Kmart stores under a license with an initial term expiring on
June 30, 2001. The license granted to Footstar is renewable at Footstar's option
for an additional two-year period if certain conditions are satisfied.

Our Internet business

      We believe that we are uniquely positioned to take advantage of commercial
opportunities offered by electronic community-building and commerce. We believe
that our Internet strategy of building community sites and simultaneously
establishing complementary commerce sites affords us a unique opportunity to
extend our relationship sales and marketing strategy to expand our core business
as well as develop new lines of business.

      We plan to devote a substantial portion of our initial efforts towards
developing community sites. We launched our Internet business in the fourth
quarter of 1999 with our first two web sites: a community web site with
e-commerce elements for cheerleaders, www.varsity.com, and our e-commerce web
site for our sports collectibles, www.riddell.com.

      We intend to develop additional community sites, for various activities,
expanding to the 20 million young men and women who participate in team sports
in schools, colleges and various recreational leagues and organizations
throughout the U.S. It is likely that future Internet sites will include the 10
million other young men and women who participate in other extracurricular
activities, such as dance, band, etc.

      Unlike the Internet operations of other companies, which are looking for a
portion of a large, often ill-defined market, such as teenage girls, our
approach to the Internet is to focus on well-defined distinct special interest
groups (such as participants in team sports, including football, soccer,
baseball and softball, and cheerleading and dance teams). We also plan to
develop sites for communities that participate in other extracurricular
activities. The age group of our target market includes the demographic sector
commonly called Generation Y, the 56 million boys and girls between the ages of
10 and 24.

      Our Internet advantages

      Strong community identification

                                       76
We believe that our target customers are so dedicated to the
extracurricular activities in which they participate that the activity often
becomes a defining aspect of their lives. For example, cheerleaders, football
players and other high school and youth athletes are typically very enthusiastic
about their activities. We believe that we can aggregate a large audience
through our Internet operations by gradually adding additional web sites for
each distinct group.

      Our community sites will feature original, frequently-updated,
highly-relevant content that speaks directly to each targeted group's need for
information which help individuals improve the quality of their participation
and increase their enjoyment of their activity. Through their involvement with
our Internet sites, community members will not only be able to get information,
but will also have the opportunity to be interactively involved to benefit
themselves and their teams. They will be encouraged to submit articles and
pictures, ask questions of the experts, make postings on various message boards,
enter contests, play games, etc.

      For example, for cheerleaders, there would be information on new routines,
safety tips, upcoming competitions, etc., as well as discussions of other
logical outside interests of cheerleaders, such as beauty, fashion, style, etc.
The site will also serve as a secure Intranet among the cheerleading squad
itself, allowing the squad to post the schedule of games and practices, letting
the coach communicate with the cheerleading squad, and permit squad members to
exchange ideas, schedule practice times, and otherwise chat or communicate.

      Cost-effective web site promotion

      We will use our direct sales force to promote our web sites. When the
sales force is calling on coaches and squads, they will be educating them about
the benefits of our web sites. In addition the sales force will be able to help
them to get their own pages up on our site at no cost to the team, group or
school.

      We believe that we have a marketing advantage as compared to other
Internet companies in promoting our web sites, because we already have our own
320 salespeople calling on 10,000 to 15,000 high schools every four or five
weeks during our sales season.

      In addition, we also run cheerleading camps for over 200,000 cheerleaders
in the summer, recondition approximately 600,000 helmets, and sell approximately
200,000 new helmets and approximately 2,200,000 million pieces of cheerleading
and team sport clothing, equipment and accessories each year. In connection with
all of these activities, we plan to gather e-mail addresses, distribute fliers
at schools and cheerleading camps and attach hang tags on all of our uniforms,
equipment and accessories, promoting the appropriate community web site. We
believe these efforts will increase the awareness of our brands and web sites.

      We believe that the coaches and instructors who have come to rely on us
for various goods and services will find that their jobs can be made easier by
our Internet offerings and therefore are likely to become even more supportive
of us and our products.

      Internet Benefits

      New Revenue Streams

                                       77
We believe that the Internet will give rise to new streams of revenue and
help us expand and enhance the relationships in our traditional business.

      Direct link to our customers

      The content and community-building aspects of our web sites will enhance
existing relationships with coaches and participants in extracurricular
activities.

      Market penetration

      We believe that the Internet will be particularly effective in selling
uniforms and equipment to the recreational youth leagues, a large market. In
particular, we believe that the greatest potential for expanding our traditional
sales through electronic commerce is the recreational youth sports market. This
is a highly fragmented market which we believe includes approximately 20 million
boys and girls between the ages of 5-18 who participate in a variety of sports
and purchase approximately $1 billion of athletic equipment and clothing for use
in these activities each year. The coaches and parents who typically organize
and are in charge of these various recreational youth leagues (i.e., not
directly a part of a public or private school system) are typically pressed for
time. The ability of these individuals to readily access, order and purchase
uniforms, equipment and accessories easily over the Internet in a single
transaction will be highly attractive to these individuals. As a consequence, we
believe that electronic commerce can rapidly increase the our sales to this
market.

      Broaden distribution of sports collectibles and customized products

      We believe that our web sites dedicated to our retail products will
overcome the geographical limitation of stores, which preclude our ability to
offer collectibles of every team in every city. Over the Internet, our extensive
line of NFL, MLB and collegiate full and miniature size helmets and other
collectibles (such as our lamps and desk organizers) will be far more readily
available to consumers. For instance, on the Internet, even a Cincinnati Bengals
fan living in Phoenix, Arizona can readily obtain any of the Cincinnati Bengals
collectible items, many if not all of which are not likely to be carried in the
local Phoenix stores. The Internet will also enable us to offer customized
products (i.e., your high school team's helmet for Father's Day with a memento
printed on the helmet) that cannot readily be sold through traditional
commercial channels. Further, orders for customized versions of our full size
and miniature, authentic and replica collectibles can easily be ordered and
delivered through our Internet site.

      We operate our electronic commerce business through several of our
existing subsidiaries, although we may at some future date establish a separate
subsidiary to run our Internet business.

Seasonality and backlog

      Our operations are highly seasonal. In recent years operations have been
most profitable in the second and third quarters, with the third quarter
typically the strongest and losses have been incurred in the first and fourth
quarters. This seasonal pattern is influenced by the following factors:

                                       78
Orders for the extracurricular segment's athletic products and
reconditioning services are solicited over a sales cycle that begins in the fall
of each year and continues until just before the start of a new school year at
the end of the following summer. Delivery of products and performance of
reconditioning services reach a low point in the fall of each year after school
begins and during the football playing season. These activities contribute most
to profitability in the first through third quarters of each calender year.

      Cheerleading and dance uniforms and accessories are typically ordered
commencing late March through August and are shipped prior to or contemporaneous
with the start of the school year.

      Most of the extracurricular segment's camp revenues relate to our
cheerleading camps. We incur costs relating to our camp business from the fourth
quarter through the second quarter as we prepares for the upcoming camp season,
while most revenue relating to camps is earned during the June to August period.

      Our retail segment's sports collectible products are sold to retailers
throughout the year. However, sales are usually at their highest during the
third and fourth quarters as retailers build inventory in anticipation of both
the football and the holiday shopping seasons.

      We believe that the sale of Umbro branded items will also be seasonal,
substantially following the pattern of our existing extracurricular athletic
products as soccer, like football, is primarily a fall sport. Soccer, however
experiences a spring season as well, which may somewhat temper the seasonality
of the sale of Umbro branded products.

      Our sales order backlog was $9.4 million at October 31, 1999, a 69%
increase over October 31, 1998 backlog of $5.6 million. Backlog increased in all
areas of our business. The increase includes $2.1 million of orders for our line
of Umbro soccer products, introduced in 1999.

Competition

      Athletic Products

      Our principal competitor in the football helmet market is Schutt,
manufacturer of the AIR helmet. We compete principally with Bike Athletic Co.,
Inc., Douglas, Inc., Gear 2000, Inc. and Rawlings Sporting Goods Company, Inc.
in the football shoulder pad business, with Diamond Sports Co., Rawlings
Sporting Goods Company, Inc., Wilson Sporting Goods Company and other companies
in baseball and softball products, with Champion Products, Inc., Russell
Athletic, Inc., and other companies for practicewear and athletic game uniforms
and with Adidas, Nike, and other companies for soccer team apparel, footwear and
equipment. We also compete with numerous independent dealers throughout the
United States who market the competitor's products. Some of our competitors are
substantially larger and have greater resources than us.

      We believe that we compete in the football market on the basis of quality,
price, reliability, service, comfort and ease of maintenance. With respect to
football and other athletic products, our believe that our direct sales force
provides us with a competitive advantage in terms of our ability to provide
superior customer service and a significant price advantage due to the
elimination of independent dealers which are used by our competitors.

                                       79
Reconditioning

      Reconditioners compete on the basis of quality, price, reputation,
convenience and customer loyalty. We believe that we are the largest nationwide
participant among the approximately 30 competitors in the highly fragmented
athletic reconditioning industry.

      Spirit products and services

      We are one of two major companies that design and market cheerleader,
dance team and booster club uniforms and accessories on a national basis.
Besides us and our major national competitor, National Spirit Group, there are
many other smaller regional competitors serving the uniform and accessories
market in the United States. We believe that the principal factors governing the
selection of cheerleader and dance team uniforms and accessories are the
quality, variety, design, delivery, service and, to a lesser extent, price.

      We are also one of two companies that annually operate a significant
number of cheerleader and dance team camps in the United States (the other being
National Spirit Group). There are also many other smaller companies and schools
that operate camps and clinics on a regional basis. We believe that the
principal factors governing the selection of a cheerleader or dance team camp or
clinic are the reputation of the camp operator for providing quality instruction
and supervision, location, schedule and the tuition charged for camp
participation.

      Retail collectible products

      Our collectible products compete with a large number and wide array of
manufacturers and sellers of sports and other collectible and memorabilia
products, some of which have greater resources than us. Among our competitors in
this large marketplace are sellers of products such as autographed photographs
and uniforms and other memorabilia and manufacturers of clothing, such as caps
and jackets.

      Licensing

      Competition in the licensing of sports equipment, apparel and footwear is
substantial, and the Riddell and MacGregor brands compete with numerous
companies also having significant brand recognition, many of which have greater
financial, distribution, marketing and other resources. Brand recognition and
reputation for quality are important competitive factors in the licensing of
sports apparel and footwear. Competing brands include Adidas(Registered),
Champion(Registered), Converse(Registered), Nike(Registered),
Rawlings(Registered), Reebok(Registered), Russell(Registered) and
Wilson(Registered).

Patents and trade secrets

      Certain of our football helmet liner systems and other items are protected
by patents and trade secrets, including a patent on our inflatable liner
expiring in 2010. Other patents on the liners will expire in 2008. We also have
patents expiring in 2006, 2007 and 2008 on various components of our shoulder
pads which improve absorption of shock.

Trademarks and service marks

      We own various common law and registered trademarks in the U.S. and
various

                                       80
foreign countries including the following: Riddell, MacGregor, ProEdge, Power,
Air Pac, Warrior, Biolite, Maxpro, Universal Cheerleaders Association, Varsity
Spirit, United Spirit Association, National High School Cheerleading
Championship, the Universal Dance Association, Universal Dance Camps, Varsity
Spirit Fashions and The National Dance Team Championship, among others.

      Our use of the MacGregor trademark is limited by an agreement with Global
Licensing Corporation, which owns the similar trademark McGregor. Under this
agreement, the parties have agreed on certain restrictions in the use of their
respective trademarks. We have licensed the MacGregor trademark in connection
with certain team sports items sold to extracurricular customers. We do not have
the MacGregor trademark rights to golf products.

Governmental regulation

      Our products and accessories are subject to the Federal Consumer Product
Safety Act, which empowers the Consumer Product Safety Commission to protect
consumers from hazardous sporting goods and other articles. The Consumer Product
Safety Commission has the authority to exclude from the market certain articles
which are found to be hazardous and can require a manufacturer to repurchase
such goods. Similar local laws exist in some states and cities in the United
States, Canada and Europe. We maintain a quality control program for our
protective equipment operations and other products that is designed to comply
with applicable laws. To date, none of our products have been deemed to be
hazardous by any governmental agency.

      There is no national governing body regulating cheerleading and dance team
activities at the collegiate level. Although voluntary guidelines relating to
safety and sportsmanship have been issued by the NCAA and some of the athletic
conferences, to date cheerleading and dance teams are generally free from rules
and restrictions similar to those imposed on other competitive athletics at the
college level. However, if rules limiting off-season training are applied to
cheerleading and/or dance teams (similar to rules imposed by the NCAA on certain
sports), it is likely that we would be unable to offer a significant number of
our camps either because participants would be prohibited from participating
during the summer or because enough suitable sites would not be available.
Although we are not aware of any school officially adopting these activities as
a competitive sport, recognition of cheerleading and/or dance teams as "sports"
would increase the possibility that cheerleader or dance activities may become
regulated. We currently do not believe that any regulation of collegiate
cheerleading or dance teams as a "sport" is forthcoming in the foreseeable
future, and in the event any rules are proposed to be adopted by athletic
associations, we expect to participate in the formulation of such rules to the
extent permissible.

      At the high school level, some state athletic associations have classified
cheerleading as a sport and in some cases have imposed certain restrictions on
off-season practices and out-of-state travel to competitions. However, in all
cases to date, we have been able to work with these state athletic associations
to designate acceptable times for the cheerleaders within these states to attend
camps. We have also signed agreements with several state associations to assist
with sponsoring and executing official competitions within these states. To
date, state regulations have not had a material effect on our ability to conduct
our normal business activities.

      Operations at all of our facilities are subject to regulation by the
Occupational Safety

                                       81
and Health Agency and various other regulatory agencies.

      Our operations are also subject to environmental regulations and controls.
While some of the raw materials used by us may be potentially hazardous, it has
not received any material environmental citations or violations and has not been
required to spend significant amounts to comply with applicable law.

Employees

      At October 31, 1999, we had approximately 1,230 employees. Approximately
1,035 of these employees were employed on a full time basis and 195 were part
time or temporary employees. Approximately 34 employees employed in
manufacturing at the Chicago factory are represented by the Chicago and Central
States Joint Board, Amalgamated Clothing and Textile Workers Union, under a
collective bargaining agreement which expires in March 2002. Approximately 28 of
our employees working in reconditioning at our New York facility are represented
by the Local #500A United Food and Commercial Workers Union (AFL-CIO) under a
collective bargaining agreement that expires in January 2000, but is presently
being renegotiated.

      During the summer of 1999, we employed approximately 1,900 summer camp
instructors, trainers and administrators on a seasonal basis.

      We believe that our relations with our employees are satisfactory.

Insurance and product liability proceedings

      Insurance

      We also carry general liability insurance with coverage limits which we
believe is adequate for our business.

      We also maintain product liability insurance. The policy is an
occurrence-based policy providing coverage against claims currently pending
against us and future claims relating to injuries occurring between December
1994 and January 2005 even if such claims are filed after the end of the policy
period. The insurance program provides certain basic and excess coverages with
combined aggregate coverage of over $40,000,000 subject to the limitations
described below.

      The first level of insurance coverage under the policy provides coverage
of up to $2,250,000 per claim (with an annual limit of $4,500,000) in excess of
an uninsured retention (deductible) of $750,000 per occurrence. This basic
coverage has an aggregate limit which is currently $4,900,000, but the policy
requires us to increase this maximum limit to $7,700,000 by paying a fixed
annual payment or by prepaying the required premium at any time, which counts at
120% of the amount paid toward the limit.

      The insurance program also provides for additional coverage, which may be
subject to

                                       82
certain state statutes limiting the applicability of such coverage in certain
instances, of up to $20,000,000 per occurrence, in excess of the first
$3,000,000 of each claim which is covered by the uninsured retention and basic
coverage, to the extent available. Claims covered by this excess coverage are
subject to one of two separate $20,000,000 aggregate policy limits, depending on
the date of the related injury. The first $20,000,000 aggregate limit applies to
claims for injuries occurring prior to January 31, 1998 while claims occurring
after January 1998, are covered under the second separate $20,000,000 aggregate
limit.

      There is no certainty that coverage will remain available to us after
January 2005 or that the insured amounts will be sufficient to cover all future
claims.

      Our product liability insurance carrier is a division of American
International Group, Inc., which has been rated A++XV by A.M. Best Property and
Casualty Insurance Rating Company.

      In March 1999, a jury rendered a verdict against us in a Texas product
liability lawsuit for approximately $11.4 million plus interest from February
1996. We have filed an appeal of the verdict. If the verdict was paid in full it
would be covered by the insurance described above, except for an amount equal to
the $750,000 uninsured retention. This amount, however, is already included in
our balance sheet reserves. Any such payment by the insurance company would
reduce the aggregate limits of insurance coverage available for other claims, as
discussed above.

      Product Liability Proceedings

      We have historically been a defendant in product liability personal injury
suits allegedly related to the use of football helmets manufactured or
reconditioned by us. As of November 30, 1999, five product liability cases were
pending against us.

      We have established reserves for pending product liability claims and
determine our reserves based on the level of insurance that is available and
estimates of losses and defense and settlement costs which we anticipate would
result from such claims based on information available at the time the financial
statements are issued. Due to the uncertainty involved with estimates, actual
results have at times varied substantially from earlier estimates and could do
so in the future. Accordingly, there can be no assurance that the ultimate costs
of these claims or potential future claims will fall within the established
reserves. See Note 11 to the Audited Consolidated Financial Statements.

Properties

      We own our principal football helmet manufacturing facility located in
Chicago, Illinois and we lease various facilities throughout the U.S.

      We believe our properties, machinery and equipment are adequate for our
current requirements.

      Set forth below is information regarding our principal properties:

                                       83
--------------------------------------------------------------------------------
                                                   Square
Location                     Principal Use        Footage  Lease Expiration Date
--------                     -------------        -------  ---------------------
--------------------------------------------------------------------------------
New York, New          Corporate headquarters         650  September 2000
York
--------------------------------------------------------------------------------
Chicago, Illinois      Headquarters of             95,000  Owned
                       Riddell, Inc. and helmet
                       manufacturing
--------------------------------------------------------------------------------
Elk Grove Village,     Warehouse and              105,000  March 2000
Illinois               distribution center
--------------------------------------------------------------------------------
Elyria, Ohio           Headquarters for All        72,000  September 2014
                       American Sports
                       Corporation
                       reconditioning
                       operations and
                       customer service
--------------------------------------------------------------------------------
Stroudsburg,           Reconditioning and          44,000  October 2001
Pennsylvania           shoulder pad
                       customizing
--------------------------------------------------------------------------------
Memphis, Tennessee     Headquarters for            64,000  November 2000
                       Varsity's Operations
                       and Manufacturing
--------------------------------------------------------------------------------
Olive Branch,          Warehouse                   80,000  October 2000
Mississippi
--------------------------------------------------------------------------------

      We also lease several smaller facilities throughout the country.

                                       84
MANAGEMENT

      Our directors and executive officers are set forth below as of December
10, 1999.

                                                Positions
Name                             Age            with Riddell
----                             ---            ------------

Robert E. Nederlander (1)        67             Chairman of the Board

David M. Mauer (1)               51             Director, President and Chief
                                                Executive Officer

Jeffrey G. Webb (1) (2)          49             Vice Chairman of the Board of
                                                Riddell, President and Chief
                                                Operating Officer of the Varsity
                                                Group Division

David Groelinger                 49             Executive Vice President and
                                                Chief Financial Officer

Leonard Toboroff (1)             67             Director and Vice President

Don R. Kornstein                 48             Director

John McConnaughy, Jr. (1)        71             Director

Glenn E. "Bo" Schembechler       70             Director

Arthur N. Seessel, III (2)       61             Director

--------------------
(1)   Messrs. Nederlander, Mauer, Webb, Toboroff and McConnaughy and certain
      entities controlled by them, are parties to a shareholders' agreement that
      requires the parties thereto to vote the shares of Riddell's common stock
      owned by them directly and beneficially in the same manner as does Mr.
      Nederlander and for the election of Mr. Webb and his designee as members
      of our Board of Directors during the term of Mr. Webb's employment
      agreement. See "Employment Agreements and Change of Control Arrangements."
      In addition, the shareholders' agreement generally provides that the
      voting restrictions are terminated when a party transfers his shares. The
      Shareholders' Agreement expires on the earlier of May 28, 2001 or upon Mr.
      Nederlander's death.

(2)   In accordance with the agreements entered into in connection with
      Riddell's acquisition of Varsity in 1997, our Board of Directors increased
      the number of its members from seven to eight and agreed to nominate Mr.
      Webb and his designee to become members of the Board for the three-year
      period commencing at June 1997 and terminating on the third anniversary of
      such date or upon earlier termination of Mr. Webb's employment. Mr.

                                       85
Webb, who was elected a member of our Board at our 1998 annual meeting of
      stockholders and is our Vice Chairman, has named Arthur N. Seessel, III to
      serve on our Board as his designee.

      Set forth below is biographical information regarding each director and
executive officer of Riddell based on information supplied by them.

      Robert E. Nederlander. Mr. Nederlander has been Chairman of the Board of
Riddell since April 1988 and was Riddell's Chief Executive Officer from April
1988 through April 1, 1993. Mr. Nederlander has been President and/or a Director
since November 1981 of the Nederlander Organization, Inc., owner and operator of
one of the world's largest chains of live theaters. Since December 1998 Mr.
Nederlander has been a co-managing member of the Nederlander Company LLC, an
operator of live theaters outside of New York City. He served as the Managing
General Partner of the New York Yankees from August 1990 until December 1991,
and has been a limited partner since 1973. Mr. Nederlander has been President
since October 1985 of the Nederlander Television and Film Productions, Inc. and
Chairman of the Board since January 1988 of Mego Financial Corporation. Mr.
Nederlander was a director of Mego Mortgage Corporation from December 1996 until
June 1998. Mr. Nederlander became Chairman of the Board of Allis-Chalmers Corp.
in May 1989; from 1993 through October 1996 he was Vice Chairman, and thereafter
he remained solely a director. In 1995, Mr. Nederlander became a director of HFS
Incorporated, which recently merged into Cendant Corporation. In October 1996
Mr. Nederlander became a director of News Communications, Inc., a publisher of
community-oriented free circulation newspapers.

      David M. Mauer. Mr. Mauer became Riddell's Chief Executive Officer on
April 1, 1993, succeeding Mr. Nederlander. Mr. Mauer was President of Mattel
U.S.A. from late 1990 through the beginning of 1993 and was President of Tonka
U.S.A. Toy Group from 1988 until 1990. In 1995, Mr. Mauer was elected a member
of the Board of Directors of The Topps Company, Inc. Mr. Mauer is also a
director of the National Center for Missing and Exploited Children.

      Jeffrey G. Webb. Mr. Webb has been the Vice Chairman of the Board of
Riddell and the President and Chief Operating Officer of the Varsity Group
Division since Varsity was acquired by Riddell in June 1997. Prior to the
Varsity acquisition, Mr. Webb was Chairman of the Board, President and Chief
Executive Officer of Varsity Spirit Corporation since our formation in 1974.

      David Groelinger. In March of 1996, Mr. David Groelinger was appointed
Riddell's Chief Financial Officer, and in June 1996 our Executive Vice
President. From 1994 to 1995 he was a member of the Board of Directors,
Executive Vice President and Chief Financial Officer of Regency Holdings
(Cayman) Inc., which owned and operated a major international cruise line. Prior
to 1994 Mr. Groelinger served in various senior financial capacities during his
twelve years at Chiquita Brands International, Inc. In 1990, he was promoted to
Vice President reporting to the Chiquita's President and Chief Operating
Officer. Regency Holdings (Cayman) Inc. filed a petition to reorganize under
Chapter 11 of the United States Bankruptcy Code in November 1995.

      Leonard Toboroff. Mr. Toboroff has been Vice President of Riddell since
April 1988. Since May 1989, Mr. Toboroff has been a Vice President and Vice
Chairman of the Board of Allis-Chalmers Corp. Mr. Toboroff has been a practicing
attorney since 1961 and from

                                       86
January 1, 1988 to December 31, 1990, was counsel to Summit Solomon & Feldesman
in New York City, which was counsel to Riddell from April 1988 through February
1993. He has been a Director since August 1987 and was Chairman and Chief
Executive Officer from December 1987 to May 1988 of Ameriscribe Corp. Mr.
Toboroff was Chairman and Chief Executive Officer from May through July 1982,
and then was Vice Chairman from July 1982 through September 1988 of American
Bakeries Company. Mr. Toboroff has been a director of Banner Aerospace, Inc., a
supplier of aircraft parts, since September 1992. He has been a director of
Engex, Inc. and director of Saratoga Springs Beverage Co. since 1993, and a
director of Hi Rise Recycling since March 1999.

      Don R. Kornstein. Mr. Kornstein has been a member of the Board of
Directors, Chief Executive Officer and President of Jackpot Enterprises, Inc.
since September 1994. Prior to this Mr. Kornstein was a Senior Managing Director
at Bear, Stearns & Co. Inc. for 17 years through September 1994. Mr. Kornstein
has been a director of Riddell since April 1995.

      John McConnaughy, Jr. Mr. McConnaughy has been Chairman and Chief
Executive Officer of JEMC Corp. since 1988. From 1969 to 1986, Mr. McConnaughy
served as Chairman and Chief Executive Officer of Peabody International Corp.
("Peabody"). From 1981 to 1992, he served as Chairman and Chief Executive
Officer of GEO International Corp. when it was spun off from Peabody in 1981.
Mr. McConnaughy is a Director of DeVlieg Bullard Inc., Mego Financial
Corporation, Transact International, Inc., Levcor International, Inc., Wave
Systems, Inc. and Adrien Arpel, Inc. He has been a director of Riddell since
September 1989.

      Glenn E. "Bo" Schembechler. Mr. Schembechler was President of the Detroit
Tigers from January 1990 through August 1992 and a member of the Tigers Board of
Directors from 1989 through 1990. He is also a Director of Midland Company. From
1968 through 1989, Mr. Schembechler was head football coach of the University of
Michigan and served as its Athletic Director in 1988 and 1989. He has been a
director of Riddell since September 1991.

      Arthur N. Seessel, III. Mr. Seessel was the Chief Executive Officer of
Seessel Holdings Inc., a supermarket chain located in Memphis, Tennessee, until
the company was sold in 1996. Mr. Seessel currently serves as a consultant to
Albertson's Inc. and is a member of the Board of Directors of Red River
Bankshares and Auto Radio Inc. He has been a director of Riddell since February
1999.

                                       87
Structure and Compensation of Board of Directors

      Directors' fees and board meeting attendance

      Directors who are not officers of Riddell received a fee in 1999 of
$20,000 per annum. In 1999, directors who were members of the Audit and
Compensation Committees of the Board (Messrs. McConnaughy, Kornstein,
Schembechler and Seessel) were also each paid an aggregate additional amount of
$5,000 per annum for their Committee memberships.

      During 1999, Messrs. Nederlander, Toboroff, McConnaughy, Kornstein and
Schembechler were each granted an option to purchase up to 7,500 shares of
Riddell's common stock at an exercise price of $3.125 per share and Mr. Seessel
was granted an option to purchase up to 15,000 shares of Riddell's common stock
at an exercise price of $6.50 per share. These grants were pursuant to
provisions of the 1991 and 1997 Stock Option Plans which provide for fixed
automatic grants of options to eligible directors as described below under
"General Description of 1997 Stock Option Plan." In 1999, Messrs. Nederlander,
McConnaughy, Toboroff and Schembechler each received a payment of $16,875 in
exchange for the surrender of stock options granted to them in 1994 for 15,000
shares each, at an exercise price of $2.625. The payment was computed based on
the "in the money" value of the options at the time of the payments.

      See "Summary Compensation Table" and "Options Granted in 1999" for a
discussion of compensation paid to Mr. Mauer, a director and Riddell's Chief
Executive Officer and Mr. Webb, Riddell's Vice Chairman and the President and
Chief Operating Officer of our Varsity Group Division.

      Riddell has agreed to indemnify each director and officer against certain
claims and expenses for which the director might be held liable in connection
with service on the Board. In addition, Riddell maintains an insurance policy
insuring our directors and officers against such liabilities.

      During calendar year ended December 31, 1999, there were four meetings of
the Board of Directors. One meeting was attended by all of the members of the
Board of Directors, one meeting was attended by all of the members other than
Mr. Schembechler, one meeting was attended by all of the members other than Mr.
Webb and one meeting was attended by all of the members other than Mr.
McConnaughy.

      Committee Structure and Meetings

      The Board of Directors maintains an Executive Committee consisting of Mr.
Nederlander, the Committee's Chairman, Mr. Mauer, Mr. Toboroff and Mr. Webb.
Under Riddell's bylaws the Executive Committee has the power of the full Board.
The Executive Committee did not hold any meetings in 1999.

      The Board of Directors also maintains a Compensation Committee comprised
in 1999 of Messrs. McConnaughy, Schembechler, Seessel and Kornstein. Mr.
Kornstein was Chairman of the Committee in 1999. None of these individuals has
ever been an officer of Riddell. The Compensation Committee reviews and
establishes the cash and non cash compensation of key employees and recommends
grants of options under Riddell's 1991 Stock Option Plan and 1997 Stock Option
Plan. It considers recommendations of

                                       88
management and, when it deems appropriate, the advice of outside experts in
connection with these determinations. The Compensation Committee had one
meeting, which was attended by all of the members of the Compensation Committee.

      The Board of Directors has established an Audit Committee which in 1999
consisted of Messrs. McConnaughy, Schembechler, Seessel and Kornstein. Mr.
Kornstein was Chairman of the Committee in 1999. No member of the Audit
Committee has ever been an officer of Riddell. The Audit Committee reviews
Riddell's internal controls and the objectivity of our financial reporting and
the scope and results of the auditing engagement. It meets with appropriate
Riddell financial personnel and independent public accountants in connection
with these reviews. The auditors have access to such Committee at any time. The
Audit Committee had one meeting in 1999 which was attended by all of the members
of the Audit Committee.

      The members of each committee are appointed by the Board of Directors for
a term beginning after the first regular meeting of the Board following the
Annual Meeting and until their respective successors are elected and qualified.
Each committee elects its own Chairman.

                                       89
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

      The following table sets forth certain information as of November 12, 1999
pertaining to ownership of the Riddell's common stock by persons known to
Riddell to own 5% or more of Riddell's common stock and common stock owned
beneficially by each director and named executive officer of Riddell and by
directors and named executive officers of Riddell as a group.

      The information contained herein has been obtained from Riddell's records,
or from information furnished directly by the individual or entity to Riddell
made by such persons with the U.S. Securities and Exchange Commission.
Percent
                                                           of
                                       Shares Owned      Common               As Adjusted (Assuming Completion of Rights
                                       Beneficially       Stock                    Offering and Concurrent Offering)
                                       ------------       -----                    ---------------------------------

                                                                               Minimum (1)                   Maximum (2)
                                                                               -----------                   -----------

                                                                        Shares         Percentage       Shares       Percentage
                                                                        ------         ----------       ------       ----------
Robert E. Nederlander                  5,289,747(3)       51.9%        5,760,917          50.4%
810 Seventh Avenue
New York, NY 10019

David M. Mauer                           480,645(4)        5.0%          486,921           4.5%
c/o Riddell Sports Inc
50 East 42nd Street, Suite
1808
New York, NY 10017

Jeffrey G. Webb                        1,214,370(5)       12.6%        1,303,374          12.0%
c/o Varsity Spirit
Corporation
2525 Horizon Lake Drive
Memphis, TN 38133

David Groelinger                          71,000(6)           *           71,918           *
c/o Riddell Sports Inc.
50 East 42nd Street, Suite
1808
New York, NY 10017

Leonard Toboroff                       1,303,585(7)       14.0%        1,440,253          13.6%
c/o Riddell Sports Inc.
50 East 42nd Street, Suite
1808
New York, NY 10017
90
Don R. Kornstein                          50,000(8)           *           50,000           *
c/o Riddell Sports Inc.
50 East 42nd Street, Suite
1808
New York, NY 10017

John McConnaughy, Jr.                  1,038,937(9)       11.2%        1,147,037          10.9*
c/o JEMC Corp.
1011 High Ridge Road
Stamford, CT  06905

Glenn E. "Bo"                             37,500(8)           *           37,500           *
Schembechler
c/o Riddell Sports Inc.
50 East 42nd Street, Suite
1808
New York, NY 10017

Arthur N. Seessel, II                       None           None             None           None
c/o Seessel's Supermarkets
1745 Union Avenue
Memphis, TN 38104

All officers and directors as          5,448,247          52.7%        5,920,335          51.1%
a group (9 individuals)

Angelo, Gordon & Co., L.P.             1,395,000(10)      13.1%        1,395,000          11.7%
245 Park Avenue,
26th Fl.
New York, NY 10167
--------------------

      * Less than 1%

      (1)   Adjusted to reflect the assumed exercise of each individual's pro
            rata rights granted pursuant to the rights offering and assuming no
            shares of common stock are purchased by the standby group pursuant
            to rights issued to other stockholders.

      (2)   Adjusted to reflect the assumed exercise of each individual's pro
            rata rights granted pursuant to the rights offering and assuming the
            standby group purchases all of the shares of common stock pursuant
            to the standby purchase commitment.

      (3)   Of the 5,289,747 shares beneficially owned by Mr. Nederlander: (i)
            1,252,210 shares are owned by Mr. Nederlander directly or through
            entities controlled by him having dispositive power over these
            shares (37,500 of these 1,252,210 shares underlie options granted
            under Riddell's 1991 Stock Option Plan that are exercisable
            currently or within 60 days of November 12, 1999; 646,037 of such
            1,252,210 shares are subject to a voting trust expiring May 29, 2001
            pursuant to which Robert Nederlander is voting trustee and has sole
            voting power (except to the limited extent described in Note 6
            below) and (ii) an

                                       91
additional 4,037,537 shares are beneficially owned by Mr.
            Nederlander as voting trustee under the voting trust and pursuant to
            a shareholders' agreement to which Mr. Nederlander and certain other
            officers and directors of Riddell and their affiliates are parties.
            Under Rule 13-d of the Securities Exchange Act of 1934, Mr.
            Nederlander is deemed to beneficially own the shares of stock
            subject to the voting trust and the stockholders' agreement. The
            stockholders' agreement terminates upon the earliest May 28, 2001 or
            the death of Mr. Nederlander, or the date of the transfer of shares
            subject to the stockholders' agreement (other than to certain
            parties) as to the shares transferred.

      (4)   The shares of common stock beneficially owned by Mr. Mauer are
            subject to the stockholders' agreement and 422,500 of these shares
            are issuable in connection with options granted under Riddell's 1991
            Stock Option Plan and the warrant that are exercisable currently or
            within 60 days of November 12, 1999.

      (5)   The shares of common stock beneficially owned by Mr. Webb are
            subject to the stockholders' agreement and 389,843 of these shares
            underlie options granted under Riddell's 1997 Stock Option Plan that
            are exercisable currently or within 60 days of November 12, 1999.

      (6)   Includes 62,500 shares underlying that portion of an option granted
            under Riddell's 1991 Stock Option Plan that is exercisable within 60
            days of November 12, 1999.

      (7)   The shares of common stock beneficially owned by Mr. Toboroff are
            subject to the stockholders' agreement and 37,500 shares underlie
            options granted under Riddell's 1991 Stock Option Plan that are
            exercisable currently or within 60 days of November 12, 1999

      (8)   Represents shares underlying options granted under Riddell's 1991
            Stock Option Plan that are exercisable currently or within 60 days
            of November 12, 1999.

      (9)   Of the shares of common stock beneficially owned by Mr. McConnaughy:
            (i) 484,530 are subject to the voting trust; (ii) 554,407 are
            subject to the stockholders' agreement and (iii) 37,500 shares
            underlie options granted under Riddell's 1991 Stock Option Plan that
            are exercisable currently or within 60 days of November 12, 1999.
            Mr. McConnaughy has pledged his interest in 989,155 shares of
            Riddell's common stock to financial institutions to secure loans.
            The voting trust provides that if Mr. McConnaughy defaults on the
            loan pursuant to which the pledge was made, the voting restrictions
            are removed from the pledged shares.

      (10)  Based on a Schedule 13G filed February 13, 1997, Angelo, Gordon &
            Co., L.P. may be deemed to be the beneficial owner of 1,395,000
            shares as a result of voting and dispositive powers it holds with
            respect to $1,000,000 principal amount of Riddell's 4.10%
            Convertible Subordinated Note due November 1, 2004 (the "Notes")
            convertible at $5.3763 per share into 186,000 shares of

                                       92
Riddell's common stock held for its own account and $6,500,000
            principal amount of Notes convertible into 1,209,000 shares of
            common stock which it holds for the account of private investment
            funds for which it acts a general partner and/or investment advisor
            or investment manager.

Section 16(a) Disclosure

      Riddell believes, based solely on our review of the copies of the Forms 3,
4 and 5 required to be filed with Riddell pursuant to Section 16(a) of the
Exchange Act by our officers, directors and beneficial owners of more than 10%
of Riddell's common stock, that during the eleven (11) month period ended
December 1, 1999, all filing requirements applicable to such persons were
complied with.

Executive Compensation Summary Compensation Table

      The table below sets forth the cash compensation paid to or accrued for
Riddell's Chief Executive Officer and our five other most highly paid executive
officers in 1998 for services rendered in all capacities to Riddell and our
subsidiaries during the fiscal years ended December 31, 1998, 1997 and 1996.
Annual Compensation                    Long Term Compensation Awards
                                  ---------------------------------------------------------------------------------
                                                                                   Securities
Name and                                                       Other Annual        Underlying      All Other
Principal Position       Year      Salary           Bonus      Compensation (1)     Options(2)     Compensation (3)
------------------       ----      ------           -----      ----------------     ----------     ----------------
Robert E.
Nederlander              1998     $196,160               -             -               7,500                 -
Chairman of the          1997      189,511         $50,000             -               7,500                 -
Board                    1996      180,656               -             -               7,500                 -

David M. Mauer
Chief Executive          1998     $575,000               -             -              40,000            $1,000
Officer                  1997      550,000         $60,000             -              50,000             4,750
                         1996      500,000               -                            50,000             4,620

Jeffrey G. Webb
President and            1998     $375,000        $207,090             -              35,000                 -
Chief Operating          1997      200,914(4)      133,380(5)          -             397,760(4)              -
Officer of The
Varsity Group
Division since the
Varsity
Acquisition date
of June 19, 1997
93
Annual Compensation                    Long Term Compensation Awards
                                  ---------------------------------------------------------------------------------
                                                                                   Securities
Name and                                                       Other Annual        Underlying      All Other
Principal Position       Year      Salary           Bonus      Compensation (1)    Options(2)      Compensation (3)
------------------       ----      ------           -----      ----------------     ----------     ----------------
David Groelinger
Chief Financial          1998     $220,385               -               -            15,000            $1,000
Officer and              1997      195,977         $50,000               -            20,000             4,302
Executive Vice           1996      143,308          25,000               -            65,000                 -
President since
March 7, 1996

Thomas L. Clark
Senior Vice              1998     $132,693         $88,000        $164,467(6)         20,000                 -
President,
Consumer
Products, of
Riddell Group
Division since
February 8, 1999

Dan Cougill
President and            1998     $252,275               -               -            45,000          $457,667
Chief Operating          1997      259,231               -               -            20,000             4,750
Officer of Riddell       1996      230,000               -               -            15,000             4,750
Group Division
until November
27, 1998
---------------------------

(1)   Other perquisites and other personal benefits paid for the named executive
      officers are omitted from the table as permitted by the rules of the U.S.
      Securities and Exchange Commission because they aggregated less than the
      lesser of $50,000 and 10% of the total annual salary and bonus set forth
      in the columns entitled, "Salary" and "Bonus" for each named executive
      officer.

(2)   These options were issued under Riddell's 1991 Stock Option Plan or 1997
      Stock Option Plan. Options granted to Mr. Cougill were forfeited upon his
      separation from Riddell.

(3)   Represents Riddell's contribution to a 401(k) plan on behalf of the
      employee and in the case of Mr. Cougill, also includes $456,667 of
      separation payments paid or accrued in 1998.

(4)   Pursuant to an employment agreement between Riddell and Mr. Webb effective
      in June 1997 which provides for an annual base salary of $375,000 and
      certain stock options to be granted in 1997. See "Employment Agreements
      and Change of Control Arrangements."

(5)   Includes unrestricted stock awards of Riddell's common stock valued at
      $153,400 for 1998 and $98,800 for 1997 based on quoted market values on
      the date the awards were granted. The 1998 award of 41,600 was valued at
      approximately $3.69 per

                                       94
share and the 1997 award of 20,800 shares was valued at $4.75 per share.

(6)   Includes one-time relocation related expenses of $164,467 for Mr. Clark.

                                       95
Stock Options Granted in 1998

      The following table sets forth information concerning individual grants of
stock options made during 1998 to each executive officer listed below pursuant
to Riddell's 1991 and 1997 Stock Option Plans.
% of Total                                             Potential Realizable
                              Number of           Options                                                 Value at Assumed
                              Securities         Granted to                                               Annual Rates of
                              Underlying         Employees          Exercise                                Stock Price
                               Options           In Fiscal         Price Per        Expiration            Appreciation for
Name                           Granted              Year             Share             Date               Option Term (1)
----                           -------              ----             -----             ----                           ---

                                                                                                         5%             10%
                                                                                                         --             ---
Robert                           7,500               2%              $5.38          6/24/2008         $25,352         $64,248
Nederlander (2)

David M. Mauer                  40,000               9%              $5.38          6/24/2008         135,212         342,655
(3)

Jeffrey Webb (3)                35,000               8%              $5.38          6/24/2008         118,311         299,823

David                           15,000               3%              $5.38          6/24/2008          50,705         128,495
Groelinger (3)

Thomas L.                       20,000               4%              $4.88           2/9/2008          61,317         155,390
Clark (4)

Dan Cougill (5)                 45,000              10%              $5.38          6/24/2008              (5)             (5)
(1)   Based upon the per share market price on the date of grant and an annual
      appreciation of such market price at the rate stated in the table through
      the expiration date of such options. Gains, if any, are dependent upon the
      actual performance of the common stock, as well as the continued
      employment of the executive officers through the vesting period. The
      potential realizable values indicated have not taken into account amounts
      required to be paid as income tax under the Internal Revenue Code and any
      applicable state laws.

(2)   This option was granted pursuant to provisions of the 1991 Stock Options
      Plan which provides for annual fixed automatic grants of options to
      certain eligible directors. The option is fully exercisable commencing
      June 24, 1999 through June 24, 2008. In the event Mr. Nederlander's Board
      membership terminates, generally, other than for cause, the option becomes
      fully exercisable for 90 days. The option terminates if Mr. Nederlander's
      Board membership terminates for cause.

(3)   This option vests as to 25% of the underlying shares on each of the first,
      second, third and

                                       96
fourth anniversaries of the date of grant. The option is canceled upon a
      termination of employment for cause. In the event the employee's
      employment is terminated by Riddell, generally, other than for cause, this
      stock option becomes fully exercisable for one year. The option fully
      vests immediately upon a change in control.

(4)   This option vests as to 25% of the underlying shares on each of the first,
      second, third and fourth anniversaries of the date of grant. The option is
      canceled upon a termination of employment for cause. In the event the
      employee's employment is terminated by Riddell, generally, other than for
      cause, the stock option remains exercisable for 90 days to the extent of
      any underlying shares which were vested on the termination date.

(5)   Options granted to Mr. Cougill were forfeited upon his separation from
      Riddell.

                                       97
Stock Options Held at End of 1998

      The following table indicates the total number of exercisable and
unexercisable stock options held by each executive officer listed below on
December 31, 1998. No options to purchase Riddell's common stock were exercised
by any of these individuals during 1998. On December 31, 1998, the last sale
price of the common stock on the American Stock Exchange was $5.625 per share.
Number of Securities Underlying                Value of Unexercised
                                  Unexercised Options at                   in-the-Money Options at
                                     December 31, 1998                        December 31, 1998
                                     -----------------                        -----------------

Name                         Exercisable         Unexercisable         Exercisable          Unexercisable
----                         -----------         -------------         -----------          -------------
Robert Nederlander                45,000                 7,500            $107,325                 $1,875

David M. Mauer                   387,500               102,500             741,188                 45,063

Jeffrey G. Webb                  364,427                68,333             638,079                 15,583

David Groelinger                  37,500                 7,500              33,425                 39,025

Thomas L. Clark                       --                20,000                  --                 15,000
Employment Agreements and Change of Control Arrangements

      In June 1992, Riddell entered into an employment agreement with each of
Messrs. Nederlander and Toboroff. Each agreement continues until terminated by
Riddell, with termination effective three years after Riddell delivers notice of
termination or, if earlier, until the death or disability of the employee. The
agreements are immediately terminable by Riddell for cause (as defined therein).
Bonuses are at the discretion of the board. Each agreement provides a base
salary of $162,500 which may be increased in the discretion of the board,
provided that in any event each year the salaries are increased at least by the
percentage increase in the Consumer Price Index. Each agreement provides that in
the event Riddell terminates the employee's employment, generally, other than
for cause, the employee will receive his full salary through the end of the term
of his agreement and annual bonuses for the remainder of the term equal to the
average of the annual bonuses awarded to the employee prior to termination. Each
agreement acknowledges that the employee will devote time and provide services
to entities other than Riddell.

      In April 1993, Riddell entered into an employment agreement with Mr.
Mauer. The agreement, as amended in 1994, provides an annual base salary in such
amount in excess of $400,000 as the Board of Directors may determine from time
to time. The agreement provides for the years subsequent to 1993, that the Board
of Directors and Mr. Mauer establish target bonuses based upon measures to be
agreed upon before the beginning of each calendar year, and that Mr. Mauer's
bonus will be a percentage, not to exceed 100%, of his base salary based upon
the percent of the targets achieved. The agreement continues until terminated by
Riddell, with termination effective three years after Riddell delivers notice of
termination or, if earlier, until Mr. Mauer's

                                       98
death or disability. The agreement is immediately terminable for cause (as
defined therein). Mr. Mauer was granted an option for ten years to acquire
300,000 shares of Riddell's common stock pursuant to the Agreement at an average
price of $3.63 per share. In the event Mr. Mauer's employment is terminated,
generally, other than for cause, Mr. Mauer will receive his salary for a period
of three years plus a pro rata portion of the bonus earned through the date of
termination, and his options become fully exercisable for one year.

      In addition, in connection with the acquisition of Varsity Spirit
Corporation, Riddell entered into an employment agreement with Mr. Webb
effective June 1997. Under the provisions of such agreement Mr. Webb serves as
Vice Chairman of the Board of Directors of Riddell as well as President and
Chief Operating Officer of the Varsity Group Division. Mr. Webb is entitled to a
base salary of no less than $375,000 per year and is eligible to participate in
those bonus arrangements which are made available to other senior officers of
Riddell at a target level of 40% of his base salary. Pursuant to his employment
agreement, Mr. Webb received options to purchase 50,000 shares of common stock
of Riddell with a per share exercise price of $5.44 and "special options" to
purchase an additional 347,760 shares at a per share exercise price of $3.80.
Upon termination of Mr. Webb's employment (i) by Riddell without cause (as
defined therein), (ii) by Mr. Webb with good reason (as defined therein,
including a material adverse alteration in his status or responsibilities and
relocation more than 50 miles from Memphis, Tennessee), or (iii) following a
change in control (as defined therein), Mr. Webb will receive continued payments
of base salary for the longer of the remainder of the term and one year (two
years in case of termination following a change in control), as well as certain
benefits. Mr. Webb is subject to a non-competition covenant generally for a
period of two years following the termination of his employment for any reason.
Pursuant to his employment agreement, Mr. Webb agreed to become a party to the
Shareholders' Agreement to which Messrs. Mauer, Nederlander, Toboroff and
McConnaughy are parties.

      Riddell entered into an employment agreement with Mr. Groelinger effective
March 1996 in connection with his joining Riddell as Chief Financial Officer.
The agreement provides for an annual base salary of $180,000 and a guaranteed
minimum bonus for 1996 of $25,000. Thereafter, bonuses will be a percentage of
his salary, with a target of 40%. Pursuant to the Agreement, Mr. Groelinger was
granted a ten-year option to purchase 65,000 shares of Riddell's common stock at
an exercise price of $4.63 per share. The agreement is immediately terminable
for cause (as defined therein) and expires, unless renewed, in March 2001. The
agreement provides, generally, that if Mr. Groelinger's employment is terminated
other than for cause he will be paid no less than one year's salary (two years'
salary in the event termination arises in connection with a change of control
(as defined therein)) plus a pro rata portion of his bonus through the date of
termination and his stock options become immediately exercisable for one year to
the extent then vested.

      The stock options granted to Messrs. Mauer, Webb and Groelinger in
connection with their employment become immediately exercisable in the event a
change of control of Riddell occurs.

                                       99
Compensation committee interlocks and insider participation

      Mr. McConnaughy is a member of Riddell's Board of Directors and our
Compensation and Audit Committees and a member of a group of stockholders who
may be deemed to beneficially own and exercise control over approximately 52% of
Riddell's outstanding common stock as of November 12, 1999. See "Security
Ownership of Certain Beneficial Owners and Management."

Our 1991 Stock Option Plan and 1997 Stock Option Plan

      Introduction

      Riddell maintains two stock option plans: the 1991 Riddell Sports Inc.
Stock Option Plan (the "1991 Plan") and the 1997 Riddell Sports Inc. Stock
Option Plan (the "1997 Plan") pursuant to which there are 305,650 shares of
common stock available for grant of options as of November 12, 1999. Riddell has
granted an aggregate of 2,609,850 shares of our common stock under options and
stock grants made in accordance with the 1991 Plan and 1997 Plan as of November
12, 1999 (net of past grants canceled or expired).

      1991 Stock Option Plan

      Riddell's Board of Directors adopted the 1991 Stock Option Plan, which was
approved by Riddell's stockholders, to attract and retain qualified management.
Options to acquire an aggregate of 1,415,500 shares of common stock were
originally reserved for issuance under the 1991 Plan

      Under the 1991 Plan, options may be granted from time to time to key
employees, including officers, directors, advisors and independent consultants
to Riddell or to any of our subsidiaries. The board is generally empowered to
interpret the 1991 Plan, to determine the terms of the option agreements, to
determine the employees to whom options are to be granted, and to determine the
number of shares subject to each option and the exercise price thereof. Upon
exercise of an option, the optionee may pay the purchase price with previously
acquired securities of Riddell, or at the discretion of the Board, Riddell may
loan some or all of the purchase price to the optionee.

      Each Riddell director other than any director who is also a Chief
Executive Officer, President, Executive Vice President or Senior Vice President
of Riddell or any of our subsidiaries will receive an option to acquire 7,500
shares of common stock each year. In addition, each such individual (other than
current directors) will receive an option to acquire 15,000 shares of common
stock upon becoming a member of the board and, after the first anniversary of
his joining the board, the annual grant of an option to acquire 7,500 shares
concurrently with the grants to the other directors. All such directors' options
will become exercisable in full on the first anniversary of the date of grant
will have an exercise price equal to the fair market value of the common stock
on the date of grant, which will be the closing price of the common stock on the
date of each annual meeting of stockholders. For tax reasons, the 1991 Plan
limits the number of shares of common stock with respect to which options may be
granted to any individual in any year to no more than 150,000.

      'The board may modify, suspend or terminate the 1991 Plan, provided
however, that certain material modifications affecting the 1991 Plan must be
approved by the stockholders, and any change in the 1991 Plan that may adversely
affect an optionee's rights under an option previously granted under the 1991
Plan requires the consent of the optionee.

                                      100
1997 Stock Option Plan

      Under the 1997 Plan a maximum of 1,500,000 shares of common stock has been
reserved for issuance, subject to equitable adjustment upon the occurrence of
any stock dividend, stock split, recapitalization, combination or exchange of
shares.

      Unless otherwise determined by the board, the 1997 Plan shall be
administered by a committee appointed by the board, which shall consist of two
or more members of the board who are "outside directors" within the meaning of
section 162(m) of the Internal Revenue Code. The full board shall also have the
authority, in its discretion, to grant stock options or other stock-based awards
under the 1997 Plan and to administer the 1997 Plan. For all purposes under the
1997 Plan, any entity which performs the duties described, shall be referred to
as the "Committee." The Committee shall have full authority, subject to the
provisions of the 1997 Plan, among other things, to determine the persons to
whom options or other stock-based awards will be granted, to determine the
exercise price of the stock options and to prescribe, amend and rescind rules
and regulations relating to the 1997 Plan. Grants of stock options or other
stock-based awards may be made under the 1997 Plan to selected employees,
directors (including directors who are not employees) and consultants of Riddell
and our present or future affiliates, in the discretion of the Committee.

      The 1997 Plan also provides for automatic grants of stock options (with an
exercise price equal to the fair market value of a share of common stock on the
date of grant) to each member of the board who is not a Chief Executive Officer,
President, Senior Vice President or Executive Vice President of Riddell or our
subsidiaries ("Eligible Directors"). Except as otherwise determined by the
Committee, options to purchase 15,000 shares of common stock will be
automatically granted to Eligible Directors upon commencement of their service
on the board, except with respect to Eligible Directors serving on the date of
the 1997 annual stockholders meeting. Thereafter Eligible Directors are granted
an option to purchase 7,500 shares of common stock on the date of each
subsequent annual meeting of stockholders (unless such Eligible Director has
received an initial option grant less than one year prior to the date of such
meeting). Options automatically granted to Eligible Directors become exercisable
as to all shares on the first anniversary of the date of grant or on the
retirement of the Eligible Director from the Board, whichever is first. Options
automatically granted to Eligible Directors expire on the earliest of (i) the
tenth anniversary of the date of grant, (ii) the second anniversary of the
termination of the Eligible Directors' service on the Board for reasons other
than cause, or (iii) thirty days after the termination of the Eligible
Directors' service on the Board of Directors for cause (as defined in the 1997
Plan).

      Except to the extent the committee provides otherwise, stock options
granted under the 1997 Plan shall not be transferable otherwise than by will or
by the laws of descent and distribution. The 1997 Plan may, at any time and from
time to time, be altered, amended, suspended, or terminated by the board, in
whole or in part; provided that, unless otherwise determined by the board, an
amendment that requires stockholder approval in order for the 1997 Plan to
continue to comply with Section 162(m) of the Internal Revenue Code or any other
law, regulation or stock exchange requirement shall not be effective unless
approved by the requisite vote of stockholders. In addition, no amendment may be
made which adversely affects any of the rights of a optionee under any award
theretofore granted, without such grantee's written consent.

                 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      In 1994 Riddell granted a common stock purchase warrant to a limited
partnership owned in part by Messrs. Nederlander, Toboroff and McConnaughy to
purchase 150,000 shares of our

                                      101
common stock in consideration for the extension of a note in the amount of
$2,000,000 issued by the partnership in favor of Riddell. In August 1995 certain
of the original partners withdrew from the partnership, and Messrs. Cougill,
Mauer, McConnaughy, Nederlander and Toboroff or entities controlled by them
acquired their interests in the warrant.

      In 1998, based on a resolution of the Compensation Committee with Mr.
McConnaughy abstaining, Riddell allowed the holders of the warrant to effect a
cashless exercise of the warrant, in effect accepting shares issuable upon
exercise as payment for the exercise based on per share value one-eighth of a
point higher than the quoted market value. As a result, 42,362 shares of common
stock were issued in exchange for the 150,000 share warrant based on an exercise
price of $2.96 per share and an exchange price of $4.125 per share. The exchange
price of $4.125 per share was set on a date when the quoted market price of a
share of common stock was $4.00.

                                      102
PLAN OF DISTRIBUTION

      We are offering the shares of common stock in the rights offering directly
to holders of our common stock.

      As soon as practicable after the date of this prospectus, we will
distribute the rights and copies of this prospectus to individuals who owned
shares of common stock on December ___, 1999.

      We currently anticipate that a group of our officers, directors and some
other individuals will agree to exercise all of the rights granted to those
members of the standby group who are stockholders as of the record date, and, in
addition, will also agree to purchase up to $__________ worth of the shares
offered under the rights offering that are not purchased by the other
stockholders.

      We will pay the fees and expenses of American Stock Transfer & Trust
Company, as subscription agent in the rights offering. We have also have agreed
to indemnify the subscription agent from any liability which it may incur in
connection with the rights offering, including liabilities under the Securities
Act of 1933.

      We will pay H.C. Wainwright & Co., Inc., as solicitation agent, an agency
fee equal to 3% of the gross proceeds received upon the exercise of rights in
the rights offering.

      In addition to the rights offering, we are also conducting an underwritten
offering of 250,000 shares of our common stock, the concurrent offering. In the
concurrent offering, H.C. Wainwright & Co. shall act as underwriter. In its
capacity as underwriter, H.C. Wainwright & Co., Inc. shall receive a 7% discount
on all shares underwritten in the concurrent offering. We have also granted the
underwriter an option, exercisable during the 45-day period commencing on the
date of this prospectus, to purchase at the public offering price per share,
less the underwriting discount, up to an aggregate of 37,500 shares of common
stock. In addition, we have agreed to issue to H.C. Wainwright & Co. as
underwriter of the concurrent offering, five-year warrants to purchase up to
_____% of the number of shares of common stock sold in the concurrent offering.

      We have also agreed to reimburse H.C. Wainwright & Co. for its actual
out-of-pocket expenses incurred in connection with the rights offering and the
concurrent offering, including the fees and expenses of its counsel.

      In addition, we have agreed to indemnify H.C. Wainwright & Co. against
some liabilities, including civil liabilities under the Securities Act, or to
contribute to payments H.C. Wainwright & Co. may be required to make in this
respect.

                                      103
DESCRIPTION OF CAPITAL STOCK

General

      We are authorized to issue 45,000,000 shares of common stock, $0.01 par
value, and 5,000,000 shares of undesignated preferred stock, $0.01 par value.
The following description of our capital stock does not purport to be complete
and is subject to and qualified by our certificate of incorporation and by-laws,
which are included as exhibits to the Registration Statement of which this
prospectus forms a part of, and by the provisions of applicable Delaware law.

Common stock

      As of December 10, 1999 there were 9,263,957 shares of common stock
outstanding which were held of record by approximately 732 stockholders.

      The holders of common stock are entitled to one vote per share on all
matters to be voted upon by the stockholders. The holders of common stock are
entitled to receive ratably dividends, if any, as may be declared from time to
time by the Board of Directors out of funds legally available for such purpose.
In the event of a liquidation, dissolution or winding up of Riddell, the holders
of common stock are entitled to share ratably in all assets remaining after
payment of liabilities subject to prior distribution rights of preferred stock,
if any, then outstanding. The common stock has no preemptive or conversion
rights or other subscription rights. There are no redemption or sinking fund
provisions applicable to the common stock. All outstanding shares of common
stock are fully paid and non-assessable, and the shares of common stock to be
issued upon the closing of this offering will be fully paid and non-assessable.

Preferred stock

      As the proper language was inadvertently omitted from our certificate of
incorporation in connection with a previous amendment, we are currently amending
our certificate of incorporation to provide the Board of Directors with the
authority, without action by the stockholders, to designate and issue preferred
stock in one or more series and to designate the rights, preferences and
privileges of each series, any or all of which may be greater than the rights of
the common stock. We cannot state the actual effect of the issuance of any
shares of preferred stock upon the rights of holders of common stock until the
Board determines the specific rights of the holders of such preferred stock.
However, effects on the holders of common stock might include, among other
things, restricting dividends on a common stock, deleting the voting power of
the common stock, and paring the liquidation rights of the common stock and
delaying or preventing a change of control of Riddell without further action by
the stockholders. As of December ____, 1999, there are 5,000,000 shares of
preferred stock authorized, although none were issued and outstanding. We have
no present plans to issue any shares of preferred stock.

                                      104
Common stock purchase warrants

      Holders who exercise their rights shall receive, for no additional
consideration, common stock purchase warrants that are exercisable for a portion
of Riddell's ownership interest in a future subsidiary (either newly formed or
presently existing) whose principal business is Riddell's Internet operations.
All of the warrants issued, in the aggregate, will represent the right to
purchase ______ (____%) percent of Riddell's ownership interest in this Internet
subsidiary at the time the warrants first become exercisable. These warrants
will only become exercisable if (i) we form or use a presently existing
subsidiary to conduct substantially all of our Internet operations, and (ii) we
effect an initial public offering for this subsidiary on or before December 31,
2002. If we close on an initial public offering of our Internet subsidiary by
December 31, 2002, the warrants will be exercisable for six (6) months after the
closing of the initial public offering, after which time they will expire. If we
do not form an Internet subsidiary by December 31, 2002, or form such a
subsidiary but do not effect an initial public offering for our Internet
subsidiary on or before December 31, 2002, these common stock purchase warrants
shall expire on December 31, 2002 and shall no longer be exercisable. If we do
effect an initial public offering of our Internet subsidiary on or before
December 31, 2002 we will also register at that time the shares of common stock
issuable to you upon your exercise of the common stock purchase warrants. The
common stock purchase warrants will have an exercise price of $.01 per share,
are not transferable (except in the event of the death of the holder, in which
event they are transferable to the estate of the holder), are subject to
dilution, and will only be issued to those individuals or entities who exercise
rights.

Delaware anti-takeover law and certain charter and bylaw provisions

      Certain provisions of Delaware law and our certificate of incorporation
and by-laws could make it more difficult to acquire us by means of a tender
offer, a proxy contest or otherwise and the removal of incumbent officers and
directors. These provisions, summarized below, are expected to discourage
certain types of coercive takeover practices and inadequate takeover bids and to
encourage persons seeking to acquire control of us to first negotiate with us.
We believe that the benefits of increased protection of our potential ability to
negotiate with the proponent of an unfriendly or unsolicited proposal to acquire
or restructure us outweigh the disadvantages of discouraging takeover or
acquisition proposals because, among other things, negotiation of these
proposals could result in an improvement of their terms.

      We are subject to Section 203 of the Delaware General Corporation Law, an
anti-takeover law. In general, Section 203 prohibits a publicly held Delaware
corporation from engaging in a "business combination" with an "interested
stockholder" for a period of three years following the date the person became an
interested stockholder, unless (with certain exceptions) the "business
combination" or the transaction in which the person became an interested
stockholder is approved in a prescribed manner. Generally, a "business
combination" includes a merger, asset or stock sale, or other transaction
resulting in a financial benefit to the interested stockholder. Generally, an
"interested stockholder" is a person who, together with affiliates and
associates, owns (or within three years prior to the determination of interested
stockholder status, did own) 15% or more of a corporation's voting stock. The
existence of this provision would be expected to have an anti-takeover effect
with respect to transactions not approved in advance by the Board of Directors,
including discouraging attempts that might result in a premium over the market
price for the shares of common stock held by stockholders.

      Our certificate of incorporation and by-laws require that special meetings
of our

                                      105
stockholders may be called only by the Board of Directors or certain of our
officers.

                         DESCRIPTION OF DEBT SECURITIES

      In April 1999, we entered into a revised credit facility with Bank of
America National Trust and Savings Association. The revised credit facility
replaced our $35 million credit facility with NationsBank (now named Bank of
America) and NBD Bank which subsequently became a participant in the revised
facility. The revised credit facility consists of a line of credit in a
principal amount not to exceed $48 million, expiring at the end of December
2003. Draws under the line of credit are limited to a percentage of certain
receivables and inventory. The outstanding balance of the line accrues interest
at a rate of LIBOR plus a margin of 2.25% on draws so designated by us, payable
at the end of the applicable interest period, but not less frequently than
quarterly, and on other draws at the higher of the bank's prime rate plus a
margin of 0.75% or the Federal Funds rate plus 1.25%, payable monthly. The
credit facility also calls for an unused line fee equal to an annual rate of
0.375% applied to the amount by which the lesser of $40 million and the then
maximum revolving amount exceeds the average daily balance of outstanding
borrowings under the line. After December 31, 1999, the margin of the interest
rate over the related rates is subject to quarterly adjustment dependent on
certain financial ratios. The interest rate margin can vary between 1.75% and
2.75% over LIBOR, 0.25% to 1.25% over the prime rate and 0.75% and 1.75% over
the Federal Funds rate. The credit facility agreement contains certain covenants
which, among other things, require us to meet certain financial ratio and net
worth tests, restrict the level of additional indebtedness we may incur, limit
payments of dividends, restrict the sale of assets and limit investments we may
make. The credit facility also requires repayment of the principal amount upon
the occurrence of a change in the control, as defined, of Riddell. We have
pledged essentially all of our tangible assets as collateral for the credit
facility.

      The 10.5% Senior Notes due 2007 contain certain covenants that, among
other things, restrict the level of other indebtedness we may incur, the amounts
of investments we may make in other businesses, the sale of assets and use of
proceeds therefrom, and the payment of dividends. The Senior Notes also restrict
payment of junior indebtedness prior to the maturity of the junior indebtedness.
The interest on the Senior Notes is payable semiannually on January 15 and July
15. The holders of the Senior Notes have the right to require the Senior Notes
to be redeemed at 101% of the principal amount in the event of a change of
control (as defined in the Senior Notes). The Senior Notes contain certain
prepayment restrictions and have no mandatory redemption provisions. The Senior
Notes are guaranteed by all of our subsidiaries. Each of these subsidiaries are
wholly-owned subsidiaries of Riddell and have fully and unconditionally
guaranteed the Senior Notes on a joint and several basis. Riddell itself is a
holding company with no assets or operations other than those relating to our
investments in our subsidiaries.

      The 4.1% convertible subordinated note is subordinated in right to prior
payment in full of Senior Indebtedness, which is generally defined in the
governing agreements to include debt under the senior notes and revolving line
of credit described above and any refinancing, renewal or replacement thereof as
well as certain other debt. Repayments of 25% and 33 1/3% of the then
outstanding principal balance is due on November 1, 2002 and 2003, respectively,
with the remaining balance due November 1, 2004. Interest is payable
semiannually each May 1 and November 1. The note limits our ability to grant
certain stock options and requires repayment of 101% of the principal amount in
the event of a change in control (as defined). In connection with obtaining
consents needed for various aspects of the Varsity acquisition, we amended the
note to provide for a reduction from $6.00 to $5.3763 per share in the
conversion price.

                                      106
CERTAIN FEDERAL INCOME TAX CONSEQUENCES

General

      This section discusses certain federal income tax consequences of the
rights offering to (1) beneficial owners of our common stock upon distribution
of the rights, (2) holders of rights upon the exercise and disposition of the
rights, and (3) holders of common stock purchase warrants. The discussion is
based on the Internal Revenue Code of 1986, as amended, the Treasury regulations
thereunder, judicial authority, and current administrative rulings and practice,
all of which are subject to change prospectively or retroactively. The
discussion is limited to U.S. taxpayers who hold our common stock, and will hold
the rights and common stock purchase warrants and any shares acquired upon the
exercise of such rights or warrants, as capital assets (generally, property held
for investment). This discussion deals only with stockholders who receive the
rights in the initial offering and does not include any tax consequences under
state, local and foreign law. Financial institutions, broker-dealers, nominee
holders of our common stock or rights or common stock purchase warrants, life
insurance companies, tax-exempt organizations and possibly other types of
taxpayers may be subject to special provisions of the tax law or subject to
other tax considerations not discussed below.

      HOLDERS SHOULD CONSULT THEIR OWN TAX ADVISORS CONCERNING THEIR OWN
RESPECTIVE TAX SITUATIONS OR SPECIAL TAX CONSIDERATIONS THAT MAY APPLY TO THEM,
INCLUDING WITHOUT LIMITATION FOREIGN, STATE AND LOCAL LAWS THAT MAY APPLY.

Tax Consequences of Rights

      Distribution of rights

      Owners of our common stock will not recognize taxable income as a result
of the distribution of the rights.

      Basis and holding period of the rights

      The tax basis of the rights received by an owner of our common stock will
be zero, unless the stockholder elects to allocate a portion of the tax basis of
the common stock to the rights received in proportion to their respective fair
market values. The election to allocate a portion of the tax basis to the rights
must be made on the holders federal income tax return for the taxable year in
which the rights are received.

      The holding period of a stockholder with respect to the rights received as
a distribution on such stockholders common stock will include the stockholders
holding period for the common stock with respect to which the rights were
distributed.

      Transfer of the rights

      A holder of rights who sells the rights prior to exercise will recognize
capital gain or loss equal to the difference between the sale proceeds and the
tax basis (if any) in the rights sold.

      Lapse of the rights

                                      107
If rights expire prior to their sale or other disposition, the holders of
those rights will not recognize any gain or loss, assuming the holder did not
elect to allocate tax basis to the rights upon the initial distribution;
therefore no adjustment will be made to the tax basis of our common stock, if
any, owned by such holders.

      Exercise of the rights and basis and holding period of the common stock

      Holders of rights will not recognize any gain or loss upon the exercise of
rights except as discussed below with respect to the common stock purchase
warrants. The tax basis of our common stock acquired through exercise of the
rights will be equal to the sum of the subscription price allocated to our
common stock received upon exercise and the holders tax basis (if any) in the
rights. We believe that a holder should first allocate a portion of the
subscription price to the common stock purchase warrants received based upon the
proportion of the fair market value of such warrants on the date of receipt to
the sum of the fair market value of the common stock purchase warrants and the
common stock. A holder should allocate the remainder of the subscription price
to our common stock acquired through exercise of the rights. An independent
appraiser retained by us has determined the fair market value of the common
stock purchase warrants to be $_______ per warrant as of _______________.
Holders of rights should consult with their own tax advisors regarding the tax
consequences of exercising the rights and the tax basis of our common stock
received upon exercise.

      The holding period for our common stock acquired through exercise of the
rights will begin on the date the rights are exercised.

      Sale of common stock

      A stockholder will recognize gain or loss upon the sale of our common
stock acquired by exercise of rights in an amount equal to the difference
between the amount realized and the stockholders tax basis in the shares. The
gain or loss so recognized will be long-term or short-term capital gain or loss,
depending on whether the shares have been held for more than one year.

Tax Consequences of Common Stock Purchase Warrants

      Distribution of common stock purchase warrants

      Upon exercise of the rights, we believe that receipt of the common stock
purchase warrants will be treated as a distribution of property and taxable as a
dividend to the stockholders upon receipt to the extent the fair market value of
the common stock purchase warrants on the date of receipt exceeds the
subscription price allocated to said warrants. An independent appraiser retained
by us has determined the fair market value of the common stock purchase warrant
to be $_______ per warrant as of __________.

      The tax basis of the common stock purchase warrants will be equal to the
allocated portion of the subscription price plus the amount of dividend
resulting thereon; accordingly, Riddell believes that the total tax basis of the
common stock purchase warrants will be equal to the fair market value of the
common stock purchase warrants as of the date of receipt.

      We believe that the proper measurement date to value the common stock
purchase warrant is the date the warrant is issued (i.e., the date the rights
are exercised). However, the Internal Revenue Service may assert that the proper
date of measurement occurs on the date of exercise of

                                      108
the common stock purchase warrant, in which case the exercise of the common
stock purchase warrants would be treated as a distribution of property and
taxable as a dividend to the stockholders to the extent that the fair market
value of the shares received upon exercise of the warrants exceeds the amount
paid for such shares, subject to the current and accumulated earnings and
profits of Riddell. We will aggressively contest any such assertion by the
Internal Revenue Service. Holders of common stock purchase warrants should
consult with their own tax advisors regarding the tax consequences of exercising
the warrants.

      Holding period of common stock purchase warrants

      The holding period of the common stock purchase warrants will begin on the
date following the day of distribution.

      Lapse of common stock purchase warrants

      In the event the common stock purchase warrants expire, the holder will
recognize a loss to the extent of the tax basis allocated to the common stock
purchase warrant. Such a loss would be a capital loss.

      Exercise of the common stock purchase warrant

      To the extent the common stock purchase warrant is exercised, there should
not be a taxable event. The tax basis in the shares received would be the basis
of the warrant and the exercise price paid for the shares of stock.

                                      109
LEGAL MATTERS

      The validity of the common stock, the rights and warrants in this offering
will be passed upon for Riddell by Zukerman Gore & Brandeis, LLP, New York, New
York. Orrick, Herrington & Sutcliffe LLP will pass upon various legal matters
for the underwriter.

                                     EXPERTS

      The consolidated financial statements and schedules as of December 31,
1998 and 1997 and for each of the three years in the period ended December 31,
1996 included in this prospectus and elsewhere in this registration statement
have been audited by Grant Thornton LLP independent public accountants, as
indicated in their reports with respect thereto, and are included herein in
reliance upon the authority of said firm as experts in accounting and auditing.

                       WHERE YOU CAN FIND MORE INFORMATION

      We file annual, quarterly and special reports and other information with
the Securities and Exchange Commission. You may read and copy any document we
file at the SEC's public reference rooms in Washington, D.C., New York, New York
and Chicago, Illinois. You may call the SEC at 1-800-SEC-0330 for further
information on the public reference rooms. Our recent SEC filings also are
available to you at the SEC's web site at http://www.sec.gov.

      This prospectus, which constitutes a part of a registration statement on
Form S-1 filed by us with the Securities and Exchange Commission under the
Securities Act of 1933, omits certain of the information set forth in the
registration statement. Accordingly, for further information, you should refer
to the registration statement and its exhibits on file with the Securities and
Exchange Commission. Furthermore, statements contained in this prospectus
concerning any document filed as an exhibit are not necessarily complete and, in
each instance, we refer you to the copy of such document filed as an exhibit to
the registration statement.

                                       110
INDEX TO FINANCIAL STATEMENTS
PAGE
                                                                                                              ----
Unaudited Condensed Financial Statements:
  Condensed Consolidated Balance Sheets at September 30, 1999,
     December 31, 1998 and September 30, 1998..............................................................    F-2
  Condensed Consolidated Statements of Operations for the nine months
     ended September 30, 1999 and 1998.....................................................................    F-3
  Condensed Consolidated Statements of Stockholders' Equity for the nine months
     ended September 30, 1999 and 1998.....................................................................    F-4
  Condensed Consolidated Statements of Cash Flows for the nine months
     ended September 30, 1999 and 1998.....................................................................    F-5
  Notes to Condensed Consolidated Financial Statements.....................................................    F-6

Audited Consolidated Financial Statements:
  Report of Independent Certified Public Accountants.......................................................    F-9
  Consolidated Balance Sheets at December 31, 1998 and 1997................................................   F-10
  Consolidated Statements of Operations for the years ended
     December 31, 1998, 1997 and 1996......................................................................   F-11
  Consolidated Statements of Shareholders' Equity for the years
     ended December 31, 1998, 1997 and 1996................................................................   F-12
  Consolidated Statements of Cash Flows for the years ended
     December 31, 1998, 1997 and 1996......................................................................   F-13
  Notes to Consolidated Financial Statements...............................................................   F-14
F-1
RIDDELL SPORTS INC. AND SUBSIDIARIES
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                                  (UNAUDITED)
                                 (IN THOUSANDS)
SEPTEMBER 30,    DECEMBER 31,    SEPTEMBER 30,
                                                                           1999             1998            1998
                                                                        -------------    ------------    -------------
ASSETS
Current assets:
  Cash...............................................................     $     368        $  1,752        $   2,824
  Accounts receivable, trade, less allowance for doubtful accounts
     ($1,619, $1,302 and $933 respectively) (Note 3).................        56,064          28,016           48,761
  Inventories (Note 4)...............................................        30,356          28,763           24,608
  Prepaid expenses...................................................         4,435           6,493            4,393
  Other receivables..................................................         1,612           1,644            1,790
  Deferred taxes.....................................................           271           1,253            1,358
                                                                          ---------        --------        ---------
     Total current assets............................................        93,106          67,921           83,734
Property, plant and equipment, less accumulated depreciation ($9,086,
  $7,213 and $6,532 respectively)....................................         8,095           7,871            7,548
Intangibles and deferred charges, less accumulated amortization
  ($16,903, $13,858 and $16,331 respectively)........................       106,674         108,735          109,035
Other assets.........................................................         2,425           1,684            1,625
                                                                          ---------        --------
                                                                          $ 210,300        $186,211        $ 201,942
                                                                          ---------        --------        ---------
                                                                          ---------        --------        ---------
                LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable...................................................     $  14,224        $ 12,744        $  12,432
  Accrued liabilities................................................        10,876          11,253            9,016
  Customer deposits..................................................         2,896           5,961            2,652
                                                                          ---------        --------        ---------
     Total current liabilities.......................................        27,996          29,958           24,100
Long-term debt, less current portion:................................       145,144         126,900          138,200
Deferred taxes.......................................................           271             348              453
Other Liabilities....................................................         3,254           3,554            3,060
Contingent liabilities (Note 6)......................................            --              --               --
Stockholders' equity
  Common stock.......................................................            93              93               91
  Additional paid in capital.........................................        36,849          36,849           36,586
Accumulated deficit..................................................        (3,307)        (11,491)            (548)
                                                                          ---------        --------        ---------
                                                                             33,635          25,451           36,129
                                                                          ---------        --------        ---------
                                                                          $ 210,300        $186,211        $ 201,942
                                                                          ---------        --------        ---------
                                                                          ---------        --------        ---------
See notes to condensed consolidated financial statements.

                                      F-2
RIDDELL SPORTS INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                  (UNAUDITED)
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
NINE MONTHS ENDED
                                                                                              SEPTEMBER 30,
                                                                                          ----------------------
                                                                                            1999          1998
                                                                                          --------      --------
Net revenues:
  Net sales, products and reconditioning...............................................   $132,767      $115,310
  Camps and events.....................................................................     46,219        42,615
  Royalty income.......................................................................        764         1,401
                                                                                          --------      --------
                                                                                           179,750       159,326
                                                                                          --------      --------
Cost of revenues:
  Products and reconditioning..........................................................     72,993        65,217
  Camps and events.....................................................................     31,976        30,022
                                                                                          --------      --------
Cost of sales..........................................................................    104,969        95,239
                                                                                          --------      --------
Gross profit...........................................................................     74,781        64,087
Selling, general and administrative expenses...........................................     54,024        49,169
                                                                                          --------      --------
Income from operations.................................................................     20,757        14,918
Interest expense.......................................................................     11,668        11,114
                                                                                          --------      --------
Income before taxes....................................................................      9,089         3,804
Income taxes...........................................................................        905            --
                                                                                          --------      --------
Net income.............................................................................   $  8,184      $  3,804
                                                                                          --------      --------
                                                                                          --------      --------
Net earnings per share:
  Basic................................................................................   $   0.88      $   0.42
  Diluted..............................................................................   $   0.78      $   0.37

Weighted average number of common and common equivalent shares outstanding:
  Basic................................................................................      9,259         9,122
  Diluted..............................................................................     10,862        11,066
See notes to condensed consolidated financial statements.

                                      F-3
RIDDELL SPORTS INC. AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                                  (UNAUDITED)
                                 (IN THOUSANDS)
RETAINED
                                                           COMMON STOCK      ADDITIONAL     EARNINGS         TOTAL
                                                         ----------------     PAID IN      (ACCUMULATED    STOCKHOLDERS'
                                                         SHARES    AMOUNT     CAPITAL       DEFICIT)         EQUITY
                                                         ------    ------    ----------    ------------    -------------
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998:

  Balance, January 1, 1998............................   9,079      $ 91      $ 36,386       $ (4,352)        $32,125
     Issuance of common stock upon
       exercise of stock options......................      28        --            72             --              72
     Stock issued to employees........................      27        --           128             --             128
     Net income for the period........................      --        --            --          3,804           3,804
                                                         ------     ----      --------       --------         -------
  Balance, September 30, 1998.........................   9,134      $ 91      $ 36,586       $   (548)        $36,129
                                                         ------     ----      --------       --------         -------
                                                         ------     ----      --------       --------         -------

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999:

  Balance, January 1, 1999............................   9,259      $ 93      $ 36,849       $(11,491)        $25,451
     Net income for the period........................      --        --            --          8,184           8,184
                                                         ------     ----      --------       --------         -------
  Balance, September 30, 1999.........................   9,259      $ 93      $ 36,849       $ (3,307)        $33,635
                                                         ------     ----      --------       --------         -------
                                                         ------     ----      --------       --------         -------
See notes to condensed consolidated financial statements.

                                      F-4
RIDDELL SPORTS INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (UNAUDITED)
                                 (IN THOUSANDS)
NINE MONTHS ENDED
                                                                                                 SEPTEMBER 30,
                                                                                              --------------------
                                                                                                1999        1998
                                                                                              --------    --------
Cash flows from operating activities:
  Net income...............................................................................   $  8,184    $  3,804
  Adjustments to reconcile net income to net cash used in operating activities:
     Depreciation and amortization:
       Amortization of debt issue costs....................................................        633         602
       Other depreciation and amortization.................................................      4,285       4,246
     Provision for losses on accounts receivable...........................................        718         442
     Deferred taxes........................................................................        905          --
     Changes in assets and liabilities:
       (Increase) decrease in:
          Accounts receivable, trade.......................................................    (28,766)    (22,778)
          Inventories......................................................................     (1,593)       (542)
          Prepaid expenses.................................................................      2,058       2,407
          Other receivables................................................................         32        (228)
          Other assets.....................................................................       (741)     (1,027)
       Increase (decrease) in:
          Accounts payable.................................................................      1,480       4,055
          Accrued liabilities..............................................................       (377)     (1,573)
          Customer deposits................................................................     (3,065)     (1,877)
          Other liabilities................................................................       (300)         --
                                                                                              --------    --------
            Net cash provided by (used in) operating activities............................    (16,547)    (12,469)
                                                                                              --------    --------
Cash flows from investing activities:
  Capital expenditures.....................................................................     (2,097)     (1,490)
  Other....................................................................................       (419)         --
                                                                                              --------    --------
            Net cash used in investing activities..........................................     (2,516)     (1,490)
                                                                                              --------    --------
Cash flows from financing activities:
  Net borrowings under line-of-credit agreement............................................     18,244      15,700
  Debt issue costs.........................................................................       (565)         --
  Proceeds from issuance of common stock...................................................         --          72
                                                                                              --------    --------
            Net cash provided by financing activities......................................     17,679      15,772
                                                                                              --------    --------
Net increase (decrease) in cash............................................................     (1,384)      1,813
Cash, beginning............................................................................      1,752       1,011
                                                                                              --------    --------
Cash, end..................................................................................   $    368    $  2,824
                                                                                              --------    --------
                                                                                              --------    --------
See notes to condensed consolidated financial statements.

                                      F-5
RIDDELL SPORTS INC. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION

     The condensed consolidated financial statements include the accounts of the
Company and its wholly-owned subsidiaries. All significant intercompany accounts
and transactions have been eliminated. These statements are unaudited, and in
the opinion of management include all adjustments (consisting only of normal
recurring adjustments) necessary for the fair presentation of the Company's
consolidated financial position and the consolidated results of its operations
and cash flows at September 30, 1999 and 1998 and for the periods then ended.
Certain information and footnote disclosures made in the Company's annual
audited consolidated financial statements have been condensed or omitted from
these interim statements. Accordingly, these condensed consolidated financial
statements should be read in conjunction with the audited consolidated financial
statements appearing elsewhere in this prospectus. Operating results for the
nine months ended September 30, 1999 are not indicative of the results to be
expected during the remainder of 1999.

     Income tax expense for the nine-month period ending September 30, 1999
reflect an adjustment relating to the valuation of deferred taxes. No tax
expense, other than this adjustment, has been recorded for the 1999 period as
the Company has net operating loss carryforwards which offset any such taxes.

2. EARNINGS PER SHARE

     Basic earnings per share amounts have been computed by dividing earnings by
the weighted average number of outstanding common shares. Diluted earnings per
share is computed by adjusting earnings for the effect of the assumed conversion
of dilutive securities and dividing the result by the weighted average number of
common shares and common equivalent shares relating to dilutive securities. A
reconciliation between the numerators and denominators for these calculations
follows:
NINE MONTHS ENDED
                                                                                       SEPTEMBER 30,
                                                                                    -------------------
                                                                                     1999        1998
                                                                                    -------     -------
                                                                                      (IN THOUSANDS)
Earnings--numerator:
  Net income.....................................................................   $ 8,184     $ 3,804
  Effect of assumed conversion of convertible debt,
     interest savings net of tax.................................................       314         314
                                                                                    -------     -------
     Numerator for diluted per share computation.................................   $ 8,498     $ 4,118
                                                                                    -------     -------
                                                                                    -------     -------
Shares--denominator:
  Weighted average number of outstanding common shares...........................     9,259       9,122
  Weighted average common equivalent shares:
     Options, assumed exercise of dilutive options net of treasury shares which
       could have been purchased from the proceeds of the
       assumed exercise based on average market prices...........................       208         549
     Convertible debt, assumed conversion........................................     1,395       1,395
                                                                                    -------     -------
       Denominator for diluted per share computation.............................   $10,862     $11,066
                                                                                    -------     -------
                                                                                    -------     -------
3. RECEIVABLES

     The Company's policy is to record revenues when goods have been shipped.
Accounts receivable include unbilled shipments of approximately $3,053,000,
$1,678,000 and $1,683,000 at September 30, 1999, December 31, 1998 and
September 30, 1998, respectively. Unbilled shipments represent receivables for
shipments that have not been invoiced. These amounts relate principally to
partial shipments to customers who are not invoiced until their order is shipped
in its entirety or customers with orders containing other terms that require a
deferral in the issuance of an invoice. Management believes that substantially
all of the unbilled receivables at September 30, 1999 will be invoiced before
the end of the calendar year.

                                      F-6
RIDDELL SPORTS INC. AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

4. INVENTORIES

     Inventories consist of the following (In thousands):
SEPTEMBER 30,    DECEMBER 31,     SEPTEMBER 30,
                                                                1999             1998             1998
                                                             -------------    -------------    -------------
Finished goods..........................................      $18,696          $16,584          $13,078
  Work-in-process.........................................        1,878            2,769            2,361
  Raw materials...........................................        9,782            9,410            9,169
                                                                -------          -------          -------
                                                                $30,356          $28,763          $24,608
                                                                -------          -------          -------
                                                                -------          -------          -------
5. LONG TERM DEBT

     In April 1999, the Company entered into a revised credit facility with Bank
of America National Trust and Savings Association. The revised credit facility
replaced the Company's $35 million credit facility with NationsBank (now named
Bank of America ) and NBD Bank which subsequently became a participant in the
revised facility. The revised credit facility consists of a line of credit in a
principal amount not to exceed $48 million, expiring at the end of December
2003. Draws under the line of credit are limited to a percentage of certain
receivables and inventory. The outstanding balance of the line accrues interest
at a rate of LIBOR plus a margin of 2.25% on draws so designated by the Company,
payable at the end of the applicable interest period, but not less frequently
than quarterly, and on other draws at the higher of the bank's prime rate plus a
margin of 0.75% or the Federal Funds rate plus 1.25%, payable monthly. The
credit facility also calls for an unused line fee equal to an annual rate of
0.375% applied to the amount by which the lesser of $40 million and the then
maximum revolving amount exceeds the average daily balance of outstanding
borrowings under the line. After December 31, 1999 the margin of the interest
rate over the related rates is subject to quarterly adjustment dependent on
certain financial ratios. The interest rate margin can vary between 1.75% and
2.75% over LIBOR, 0.25% to 1.25% over the prime rate and 0.75% and 1.75% over
the Federal Funds rate. The credit facility agreement contains certain covenants
which, among other things, require the Company to meet certain financial ratio
and net worth tests, restrict the level of additional indebtedness the Company
may incur, limit payments of dividends, restrict the sale of assets and limit
investments the Company may make. The credit facility also requires repayment of
the principal amount upon the occurrence of a change in the control, as defined,
of the Company. The Company has pledged essentially all of its tangible assets
as collateral for the credit facility.

6. LITIGATION MATTERS AND CONTINGENCIES

     At September30, 1999, the Company was a defendant in 4 product liability
suits relating to personal injuries allegedly related to the use of helmets
manufactured or reconditioned by subsidiaries of the Company. The Company
estimates that the uninsured portion of future costs and expenses related to
these claims and incurred but not reported claims will amount to at least
$3,800,000, and accordingly, a reserve in this amount is included in the
Condensed Consolidated Balance Sheet at September 30, 1999 as part of accrued
liabilities and other liabilities. These reserves are based on estimates of
losses and defense costs not covered by insurance that are anticipated to result
from such claims, from within a range of potential outcomes, based on available
information, including an analysis of historical data such as the rate of
occurrence and the settlement amounts of past cases. However, due to the
uncertainty involved with estimates, the ultimate outcome of these claims, or
potential future claims, cannot presently be determined and actual results on
certain claims have at times varied substantially from earlier estimates and
could do so in the future. Accordingly, there can be no assurance that the
ultimate costs of such claims will fall within the established reserves.

                                      F-7
RIDDELL SPORTS INC. AND SUBSIDIARIES
       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

7. SUPPLEMENTAL CASH FLOW INFORMATION

     Cash paid for interest was $14,043,000 and $14,330,000 for the nine-month
periods ended September 30, 1999 and 1998, respectively. Income tax payments or
refunds were not significant for the nine-month periods ended September 30, 1999
and 1998.

     During the nine-month period ended September 30, 1998 the Company issued
shares of its Common Stock, valued at $128,000 based on quoted market values at
the time of grant, to certain employees as consideration for compensation
included in accrued liabilities at December 31, 1997.

8. SEGMENT INFORMATION:

     Net revenues and income or loss from operations for the Company's three
reportable segments are as follows:
NINE MONTHS ENDED
                                                                                       SEPTEMBER 30,
                                                                                    -------------------
                                                                                     1999        1998
                                                                                    -------     -------
                                                                                      (IN THOUSANDS)
Net revenues:
  Institutional products and services............................................  $166,786    $144,790
  Retail products................................................................    12,200      13,135
  Trademark licensing............................................................       764       1,401
                                                                                    -------     -------
     Consolidated total..........................................................  $179,750    $159,326
                                                                                    -------     -------
                                                                                    -------     -------
Income (loss) from operations:
  Institutional products and services............................................   $22,946     $16,261
  Retail products................................................................       676         551
  Trademark licensing............................................................       191         787
  Corporate and unallocated expenses.............................................    (3,056)     (2,681)
                                                                                    -------     -------
     Consolidated total..........................................................   $20,757     $14,918
                                                                                    -------     -------
                                                                                    -------     -------
F-8
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

Board of Directors
Riddell Sports Inc.

     We have audited the accompanying consolidated balance sheets of Riddell
Sports Inc. (a Delaware corporation) and Subsidiaries as of December 31, 1998
and 1997, and the related consolidated statements of operations, shareholders'
equity and cash flows for each of the three years in the period ended December
31, 1998. These financial statements are the responsibility of the management of
Riddell Sports Inc. Our responsibility is to express an opinion on these
financial statements based on our audits.

     We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

     In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Riddell Sports
Inc. and Subsidiaries as of December 31, 1998 and 1997, and the consolidated
results of their operations and their consolidated cash flows for each of the
three years in the period ended December 31, 1998 in conformity with generally
accepted accounting principles.

                                          GRANT THORNTON LLP

Chicago, Illinois
February 19, 1999, except for Note 17
  as to which the date is March 16, 1999

                                      F-9
RIDDELL SPORTS INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS)
DECEMBER 31,
                                                                                             --------------------
                                                                                               1998        1997
                                                                                             --------    --------
ASSETS (Note 8)
Current assets:
  Cash....................................................................................   $  1,752    $  1,011
  Accounts receivable, trade, less allowance for doubtful accounts ($1,302 and $824
     respectively) (Note 4)...............................................................     28,016      26,425
  Inventories (Note 5)....................................................................     28,763      24,066
  Prepaid expenses........................................................................      6,493       6,800
  Other receivables.......................................................................      1,644       1,562
  Deferred taxes (Note 12 )...............................................................      1,253       1,358
                                                                                             --------    --------
          Total current assets............................................................     67,921      61,222
Property and equipment, less accumulated depreciation (Note 6)............................      7,871       7,823
Intangible assets and deferred charges, less accumulated
  amortization (Note 7)...................................................................    108,735     112,118
Other assets..............................................................................      1,684         598
                                                                                             --------    --------
                                                                                             $186,211    $181,761
                                                                                             --------    --------
                                                                                             --------    --------
                           LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
  Accounts payable........................................................................   $ 12,744    $  8,377
  Accrued liabilities (Note 11)...........................................................     11,253      10,717
  Customer deposits.......................................................................      5,961       4,529
                                                                                             --------    --------
          Total current liabilities.......................................................     29,958      23,623
Long-term debt, less current portion (Note 8).............................................    126,900     122,500
Deferred taxes (Note 12)..................................................................        348         453
Other liabilities (Note 11)...............................................................      3,554       3,060
Commitments and contingent liabilities (Notes 10 and 11)
Shareholders' equity (Note 9):
  Preferred stock, $.01 par; authorized 5,000,000 shares; none issued.....................         --          --
  Common stock, $.01 par; authorized 40,000,000 shares; issued and outstanding 9,258,957
     and 9,079,154 shares, respectively...................................................         93          91
  Capital in excess of par................................................................     36,849      36,386
  Accumulated deficit.....................................................................    (11,491)     (4,352)
                                                                                             --------    --------
                                                                                               25,451      32,125
                                                                                             --------    --------
                                                                                             $186,211    $181,761
                                                                                             --------    --------
                                                                                             --------    --------
See notes to consolidated financial statements.

                                      F-10
RIDDELL SPORTS INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
YEARS ENDED DECEMBER 31,
                                                                                  -------------------------------
                                                                                    1998        1997       1996
                                                                                  --------    --------    -------
Net revenues:
  Net sales, products and reconditioning.......................................   $136,283    $103,583    $69,888
  Camps and events.............................................................     48,704      32,302         --
  Royalty income...............................................................      1,613       2,388      2,494
                                                                                  --------    --------    -------
                                                                                   186,600     138,273     72,382
                                                                                  --------    --------    -------

Costs of revenues:
  Products and reconditioning..................................................     79,611      58,718     38,813
  Camps and events.............................................................     33,930      21,957         --
                                                                                  --------    --------    -------
                                                                                   113,541      80,675     38,813
                                                                                  --------    --------    -------
Gross profit...................................................................     73,059      57,598     33,569
Selling, general and administrative expenses...................................     64,617      46,278     27,853
Other charges..................................................................        925          --         --
                                                                                  --------    --------    -------
Income from operations.........................................................      7,517      11,320      5,716
Interest expense (Note 8)......................................................     14,656      11,879      2,763
                                                                                  --------    --------    -------
Income (loss) before taxes and extraordinary item..............................     (7,139)       (559)     2,953
Income taxes...................................................................         --          --        110
                                                                                  --------    --------    -------
Net income (loss)..............................................................   $ (7,139)   $   (559)   $ 2,843
                                                                                  --------    --------    -------
                                                                                  --------    --------    -------

Earnings (loss) per share:
  Basic........................................................................   $  (0.78)   $  (0.07)   $  0.35
  Diluted......................................................................   $  (0.78)   $  (0.07)   $  0.33

Weighted average number of common and common equivalent shares outstanding
  Basic........................................................................      9,134       8,585      8,068
  Diluted......................................................................      9,134       8,585      8,730
See notes to consolidated financial statements.

                                      F-11
RIDDELL SPORTS INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                                 (IN THOUSANDS)
RETAINED
                                                          COMMON STOCK      ADDITIONAL     EARNINGS          TOTAL
                                                        ----------------     PAID-IN      (ACCUMULATED    SHAREHOLDERS'
                                                        SHARES    AMOUNT     CAPITAL       DEFICIT)         EQUITY
                                                        ------    ------    ----------    ------------    --------------
Balance, January 1, 1996.............................   8,068      $ 81      $ 31,457       $ (6,636)        $ 24,902
  Net income for the year............................      --        --            --          2,843            2,843
                                                        ------     ----      --------       --------         --------
Balance, December 31, 1996...........................   8,068        81        31,457         (3,793)          27,745
  Compensation in connection with option grants......      --        --           559             --              559
  Issuance of common stock upon exercise of stock
     options.........................................      25        --            60             --               60
  Sale of common stock, net of costs.................     986        10         4,310             --            4,320
  Net (loss) for the year............................      --        --            --           (559)            (559)
                                                        ------     ----      --------       --------         --------
Balance, December 31, 1997...........................   9,079        91        36,386         (4,352)          32,125
  Issuance of common stock upon exercise of stock
     options and warrants............................      99         1           136             --              137
  Stock issued to employees..........................      81         1           327                             328
  Net (loss) for the period..........................      --        --            --         (7,139)          (7,139)
                                                        ------     ----      --------       --------         --------
Balance, December 31, 1998...........................   9,259      $ 93      $ 36,849       $(11,491)        $ 25,451
                                                        ------     ----      --------       --------         --------
                                                        ------     ----      --------       --------         --------
See notes to consolidated financial statements.

                                      F-12
RIDDELL SPORTS INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
YEARS ENDED DECEMBER 31,
                                                                                    ------------------------------
                                                                                     1998        1997       1996
                                                                                    -------    --------    -------
Cash flows from operating activities:
  Net income (loss)..............................................................   $(7,139)   $   (559)   $ 2,843
  Adjustments to reconcile net income to net cash provided by (used in) operating
     activities:
     Depreciation and amortization:
       Amortization of debt issue costs..........................................       803         502         15
       Other depreciation and amortization.......................................     5,713       4,010      2,193
     Stock options issued........................................................        --         559         --
     Compensation expense for stock issued to employees..........................       199          --         --
     Provision for losses on accounts receivable.................................       929         365        436
     Change in assets and liabilities (net of effects from acquisitions):
       (Increase) decrease in:
          Accounts receivable, trade.............................................    (2,520)      6,426     (1,482)
          Inventories............................................................    (4,697)      1,400     (1,980)
          Prepaid expenses.......................................................       307       2,304        (10)
          Other receivables......................................................       (82)        975        199
          Other assets...........................................................       212          45         39
       Increase (decrease) in:
          Accounts payable.......................................................     4,367      (4,010)    (1,437)
          Accrued liabilities....................................................       664        (502)    (2,842)
          Customer deposits......................................................     1,432      (6,167)    (2,558)
          Other liabilities......................................................       494        (987)        --
                                                                                    -------    --------    -------
            Net cash provided by (used in) operating activities..................       682       4,361     (4,584)
                                                                                    -------    --------    -------
Cash flows from investment activities:
  Capital expenditures...........................................................    (2,494)     (1,814)    (1,139)
  Acquisitions...................................................................        --     (91,245)        --
  Umbro license acquisition fee..................................................      (500)         --         --
  Other investments..............................................................    (1,298)         --         --
  Contingent "earn-out" payments on prior acquisitions...........................      (187)       (166)      (174)
                                                                                    -------    --------    -------
            Net cash used in investing activities................................    (4,479)    (93,225)    (1,313)
                                                                                    -------    --------    -------
Cash flows from financing activities:
  Net borrowings under line-of-credit agreement..................................     4,400     (17,890)       (87)
  Proceeds from issuance of long-term debt.......................................        --     115,000      7,500
  Debt issue costs...............................................................        --      (6,220)      (761)
  Principal payments on long-term debt:
     Shareholders................................................................        --        (439)      (871)
     Banks and other.............................................................        --      (5,313)      (142)
  Proceeds from issuance of common stock.........................................       138       4,380         --
                                                                                    -------    --------    -------
            Net cash provided by financing activities............................     4,538      89,518      5,639
                                                                                    -------    --------    -------
Net increase (decrease) in cash..................................................       741         654       (258)
Cash, beginning..................................................................     1,011         357        615
                                                                                    -------    --------    -------
Cash, ending.....................................................................   $ 1,752    $  1,011    $   357
                                                                                    -------    --------    -------
                                                                                    -------    --------    -------
See notes to consolidated financial statements.

                                      F-13
RIDDELL SPORTS INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Principles of consolidation:  The consolidated financial statements include
the accounts of Riddell Sports Inc. and its wholly-owned subsidiaries (the
"Company"). All significant intercompany accounts and transactions have been
eliminated.

     Business:  The Company provides institutional sporting goods and school
spirit products and services to educational and recreational organizations
through its national, direct sales force. The Company is the leading
manufacturer and reconditioner of football protective equipment and the leading
supplier of products and services to the school spirit industry. The Company
also markets miniature and full-size helmets for collectors and licenses the
Riddell and MacGregor trademarks for use on athletic footwear and apparel. The
Company operates primarily throughout the United States.

     Inventories:  Inventories are stated at the lower of cost (determined on a
first-in, first-out basis) or market and include material, labor and factory
overhead.

     Property and equipment:  Property and equipment are stated at cost.
Depreciation is being computed using the straight-line method over the estimated
useful lives (principally 30 years for buildings and improvements and 3 to 7
years for machinery and equipment) of the related assets.

     Intangible assets and deferred charges:  Debt issue costs are amortized to
interest expense over the term of the related debt. Other intangibles and
deferred charges are being amortized by the straight-line method over their
respective estimated lives.

     Long-lived assets including goodwill and other intangible assets are
reviewed for impairment whenever events or changes in circumstances indicate
that the carrying amount of an asset may not be recoverable. For purposes of
evaluating the recoverability of long-lived assets, the related assets' carrying
value is compared to the undiscounted estimated future cash flows from the
related operations.

     Income taxes:  Deferred tax liabilities and assets are recognized for the
expected future tax consequences of events that have been included in the
financial statements or tax returns. Deferred tax liabilities and assets are
determined based on the difference between the financial statement and tax bases
of assets and liabilities (excluding non-deductible goodwill) using enacted tax
rates in effect for the years in which the differences are expected to become
recoverable or payable.

     Revenues:  Sales of products and reconditioning are generally recorded upon
shipment to customers. Camp and event revenues are recognized over the term of
the respective activity. Royalty income is generally recorded by the Company
when earned based upon contracts with licensees. These contracts provide for
royalties based upon the licensee's sales or purchases of covered products,
subject to periodic minimum amounts of royalties.

     Estimates:  In preparing financial statements in conformity with generally
accepted accounting principles, management is required to make estimates and
assumptions that affect the reported amounts of assets and liabilities and the
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses for the periods
reported. Actual results could differ from those estimates. Estimates relating
to contingent liabilities are further discussed in Note 11.

     Concentration of credit risk:  The Company earns the majority of its
revenues from sales to schools and other institutions. The Company maintains
reserves for potential losses on receivables from these institutions, as well as
receivables from other customers, and such losses have not exceeded managements
expectations.

     Earnings (loss) per share:  Basic earnings (loss) per share is computed by
dividing earnings (loss) by the weighted average number of outstanding common
shares. Diluted earnings per share is computed by adjusting earnings for effect
of the assumed conversion of dilutive securities and dividing the result by the
weighted average number of common shares and common equivalent shares relating
to dilutive securities. Only

                                      F-14
RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES--(CONTINUED)

outstanding shares are considered in computing diluted loss per share. A
reconciliation between the numerators and denominators for these calculations
follows:
YEARS ENDED DECEMBER 31,
                                                                                       ---------------------------
                                                                                        1998       1997      1996
                                                                                       -------    ------    ------
                                                                                             (IN THOUSANDS)
Earnings (loss)--numerator:
  Net income (loss).................................................................   $(7,139)   $ (559)   $2,843
  Effect of assumed conversion, when dilutive, of convertible debt--interest savings
     net of tax.....................................................................        --        --        61
                                                                                       -------    ------    ------
       Numerator for diluted per share computation..................................   $(7,139)   $ (559)   $2,904
                                                                                       -------    ------    ------
                                                                                       -------    ------    ------
Shares--denominator:
  Weighted average number of outstanding common shares..............................     9,134     8,585     8,068
  Weighted average common equivalent shares:
     Options and warrants, assumed exercise of dilutive options and warrants, net of
      treasury shares which could have been purchased from the proceeds of the
      assumed exercise based on average market prices...............................        --        --       480
     Convertible debt, assumed conversion when dilutive.............................        --        --       182
                                                                                       -------    ------    ------
       Denominator for diluted per share computation................................     9,134     8,585     8,730
                                                                                       -------    ------    ------
                                                                                       -------    ------    ------
The convertible debt, which has been outstanding since November 1996, is
described in Note 8 below. Options and warrants are described in Note 9 below.
Options and warrants to purchase 89,500 shares of common stock with a weighted
average exercise price of $10.29 which were outstanding at December 31, 1996
were excluded from the computation of diluted earnings per share for 1996 as
their inclusion would not have been dilutive because their exercise prices were
greater than the average market price of common shares for the year.

     Segment information:  Effective December 31, 1998, the Company adopted
Statement of Financial Accounting Standards (SFAS) No. 131, "Disclosure About
Segments of an Enterprise and Related Information." SFAS No. 131 supersedes SFAS
No. 14, "Financial Reporting for Segments of a Business Enterprise", replacing
the "industry segment" approach with the "management" approach. The management
approach designates the internal organization that is used by management for
making operating decisions and assessing performance as the source of the
Company's reportable segments. SFAS No. 131 also requires disclosures about
products and services, geographic areas, and major customers. 1996 and 1997
segment disclosure have been restated to conform to SFAS No. 131.

     Capitalized software:  Statement of Position (SOP) 98-1, "Accounting for
the Costs of Computer Software Developed or Obtained for Internal Use", is
effective for fiscal years beginning after December 15, 1998. SOP 98-1 provides
guidance on accounting for the costs of computer software developed or obtained
for internal use. The Company plans to adopt SOP 98-1 beginning January 1, 1999.

2. ACQUISITION

     On June 19, 1997 the Company acquired Varsity Spirit Corporation
("Varsity"). Varsity is a leading supplier of cheerleader and dance team
uniforms and accessories to the youth, junior high, high school and college
markets. Varsity is also a leading operator of cheerleader and dance team camps,
clinics and special events. The net purchase price of approximately
$91.2 million, including costs of the acquisition, was paid in cash, and the
acquisition has been accounted for under the purchase method. The purchase price
was allocated based on estimated fair values at the date of acquisition. This
resulted in an excess of the purchase price over the net assets acquired of
$74.8 million, which has been recorded as goodwill and is being amortized on a
straight-

                                      F-15
RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

2. ACQUISITION--(CONTINUED)

line basis over 40 years. A summary of the allocation of the purchase price to
assets acquired based on their estimated fair values follows:
(IN THOUSANDS)
                                                                                                      --------------
Purchase price including costs and
  liabilities paid at closing......................................................................      $ 95,548
Less, cash acquired................................................................................        (4,303)
                                                                                                         --------
Net cash cost......................................................................................        91,245
Current liabilities assumed........................................................................        23,068

Less, acquired assets:
  Current assets, excluding cash...................................................................       (35,055)
  Property and Equipment...........................................................................        (3,926)
  Other assets.....................................................................................          (577)
                                                                                                         --------
Excess cost over net assets acquired (goodwill)....................................................      $ 74,755
                                                                                                         --------
                                                                                                         --------
The operating results of Varsity have been included in the consolidated
statements of operations from the date of acquisition. The following pro forma
information presents the combined operations of the Company and Varsity as if
the acquisition, and relating financing transactions discussed in Note 8, had
occurred at the beginning of each of the periods presented:
YEAR ENDED DECEMBER
                                                                                                   31,
                                                                                          ----------------------
                                                                                            1997          1996
                                                                                          --------      --------
                                                                                          (IN THOUSANDS, EXCEPT
                                                                                            PER SHARE AMOUNTS)
Net revenues...........................................................................   $174,084      $160,831
Cost of revenues.......................................................................    103,076        92,426
                                                                                          --------      --------
Gross profit...........................................................................     71,008        68,405
Selling, general and administrative expenses...........................................     63,048        55,469
                                                                                          --------      --------
Income from operations.................................................................      7,960        12,936
Interest expense.......................................................................     14,230        13,988
                                                                                          --------      --------
Income (loss) before taxes.............................................................     (6,270)       (1,052)
Income taxes...........................................................................         --            --
                                                                                          --------      --------
Net income (loss)......................................................................   $ (6,270)     $ (1,052)
                                                                                          --------      --------
                                                                                          --------      --------
Earnings (loss) per share:
  Basic................................................................................   $  (0.69)     $  (0.12)
  Diluted..............................................................................   $  (0.69)     $  (0.12)
Depreciation and amortization..........................................................   $  5,588      $  5,142
These pro forma results have been presented for comparative purposes only
and include the following pro forma adjustments (amounts shown in thousands and
relate to the years ended December 31, 1997 and 1996, respectively): (1)
additional amortization expense as a result of goodwill arising from the
acquisition ($789 and $1,616); (2) salary increases relating to contracts
entered into in conjunction with the transactions ($75 and $150); (3)
elimination of costs incurred by Varsity in maintaining its status as a separate
public corporation ($165 and $443); (4) adjustments of certain expenses incurred
by the Company or Varsity based on programs existing within the other company
($38 and $95); (5) elimination of one time charges arising from the transaction
for redeeming Varsity stock options ($4,783 for 1997 only), a change in control
payment ($250 for 1997 only) and bridge loan commitment fees ($3,000 for 1997
only); (6) additional interest on acquisition debt and related debt changes
($5,401 and $11,391); and (7) the tax effect of the above ($1,728 credit
elimination and $3,524 expense

                                      F-16
RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

2. ACQUISITION--(CONTINUED)

elimination). The pro forma results are not necessarily indicative of results
that would have occurred had the combination been effected at the dates
indicated nor of future operating results of the combined operations.

3. UMBRO LICENSE

     In November 1998, the Company entered into an license agreement (the "Umbro
License") with Umbro International, Inc. ("UMBRO") pursuant to which the Company
acquired the right for five years to manufacture, market and sell UMBRO brand
soccer team apparel, footwear, equipment, and accessories on an exclusive basis
to the team channel of distribution throughout the United States, Puerto Rico
and the U.S. Virgin Islands. The Umbro License is royalty-free for 1999. The
Company is required to begin paying royalties in the year 2000, at which time it
is also required to meet annual minimum sales figures. In the event that the
Company fails to meet required minimum sales levels subsequent to 1999 for two
consecutive annual periods, UMBRO has the right to terminate the Umbro License.
The Umbro License, which expires in November of 2003, may be extended for an
additional five years at the Company's option on or before August 15, 2003,
provided that the Company achieves certain performance levels. Simultaneously,
the Company acquired certain inventory, promotional material and a 15% interest
in U.S.I.S.L., Inc., an organization that promotes soccer in the United States,
with an option to increase its ownership to 20%. The Company incurred costs and
expenses approximating $3.4 million allocated as follows:
(IN THOUSANDS)
                                                                                  --------------
Investment in U.S.I.S.L., Inc..................................................       $  300
License Rights.................................................................          500
Inventories....................................................................        2,500
Other..........................................................................          100
                                                                                      ------
                                                                                      $3,400
                                                                                      ------
                                                                                      ------
4. RECEIVABLES

     Accounts receivable include unbilled shipments of approximately $1,678 and
$1,157 at December 31, 1998 and 1997, respectively, principally relating to
Varsity's business. It is the Company's policy to record revenues when the
related goods have been shipped. Unbilled shipments represent receivables for
shipments that have not yet been invoiced. These amounts relate principally to
partial shipments to customers who are not invoiced until their order is shipped
in its entirety or customers with orders containing other terms that require a
deferral in the issuance of an invoice. Management believes that substantially
all of these unbilled receivables will be invoiced within the current sales
season.

5. INVENTORIES

     Inventories consist of the following:
DECEMBER 31,
                                                                           ------------------
                                                                            1998       1997
                                                                           -------    -------
                                                                             (IN THOUSANDS)
Finished goods..........................................................   $16,584    $12,691
Work-in-process.........................................................     2,769      3,571
Raw materials...........................................................     9,410      7,804
                                                                           -------    -------
                                                                           $28,763    $24,066
                                                                           -------    -------
                                                                           -------    -------
F-17
RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

6. PROPERTY AND EQUIPMENT

     Property and equipment consist of the following:
DECEMBER 31,
                                                                           ------------------
                                                                            1998       1997
                                                                           -------    -------
                                                                             (IN THOUSANDS)
Land....................................................................   $   207    $   207
Building and improvements...............................................     1,527      1,428
Machinery and equipment.................................................    13,350     10,955
                                                                           -------    -------
                                                                            15,084     12,590
Less accumulated depreciation...........................................     7,213      4,767
                                                                           -------    -------
                                                                           $ 7,871    $ 7,823
                                                                           -------    -------
                                                                           -------    -------
Depreciation expense relating to all property and equipment amounted to
$2,446,000, $1,423,000, and $598,000 the years ended December 31, 1998, 1997 and
1996, respectively.

7. INTANGIBLE ASSETS AND DEFERRED CHARGES

     Intangible assets and deferred charges consist of the following:
ESTIMATED        DECEMBER 31,
                                                                                  LIVES       --------------------
                                                                                 IN YEARS       1998        1997
                                                                                 ---------    --------    --------
                                                                                                 (IN THOUSANDS)
MacGregor trademark rights....................................................         40     $ 18,040    $ 18,040
MacGregor license agreements..................................................          8           --       2,030
Trademarks....................................................................         40        3,250       3,250
Goodwill......................................................................         40       91,479      91,292
Debt issue costs..............................................................          8        6,981       6,981
Other.........................................................................    7 to 10        2,843       3,773
                                                                                              --------    --------
                                                                                               122,593     125,366
Less accumulated amortization.................................................                  13,858      13,248
                                                                                              --------    --------
                                                                                              $108,735    $112,118
                                                                                              --------    --------
                                                                                              --------    --------
8. LONG-TERM DEBT

     Long-term debt consists of the following:
DECEMBER 31,
                                                                                             --------------------
                                                                                               1998        1997
                                                                                             --------    --------
                                                                                                (IN THOUSANDS)
Outstanding balance under a credit facility expiring in 2002, terms further described
  below...................................................................................   $  4,400    $     --
Senior notes, 10.5%, due 2007, terms further described below..............................    115,000     115,000
Convertible subordinated note payable, interest at 4.1%, due 2002 through 2004, terms
  further described below.................................................................      7,500       7,500
                                                                                             --------    --------
                                                                                              126,900     122,500
Less current portion......................................................................         --          --
                                                                                             --------    --------
                                                                                             $126,900    $122,500
                                                                                             --------    --------
                                                                                             --------    --------
F-18
RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

8. LONG-TERM DEBT--(CONTINUED)

     The aggregate maturities of long-term debt are as follows:
YEARS ENDING DECEMBER 31,                                                                           (IN THOUSANDS)
-------------------------                                                                           --------------
2002             .....................................................................      $  6,275
           2003             .....................................................................         1,875
           2004             .....................................................................         3,750
           2007             .....................................................................       115,000
                                                                                                       --------
                                                                                                       $126,900
                                                                                                       --------
                                                                                                       --------
The credit facility consists of a line of credit with the Company's bankers
in a principal amount not to exceed $35 million, expiring in 2002. Draws under
the line of credit are limited under the terms of the related loan agreement to
a percentage of certain receivables and inventory. The outstanding balance of
the line accrues interest, payable monthly, at a rate of LIBOR plus a margin of
2.5% on draws so designated by the Company, and on other draws at the higher of
the bank's prime rate plus a margin of 1% or the Federal Funds rate plus 1.5%.
At December 31, 1998 LIBOR rates averaged approximately 4.9% and the prime rate
was 7.75%. The credit facility also calls for a commitment fee equal to an
annual rate of 0.5% applied to the unused portion of the line. The margin of the
interest rate over the related rates, as well as the commitment fee rate, is
subject to quarterly adjustment dependent on certain financial ratios. The
interest rate margin can vary between 1.5% and 2.5% over LIBOR, 0% to 1% over
the prime rate, 0.5% and 1.5% over the Federal Funds rate and 0.4% to 0.5% on
the commitment fee. The credit facility agreement contains certain covenants
which, among other things, require the Company to meet certain ratio and net
worth tests, restrict the level of additional indebtedness the Company may
incur, limit payments of dividends, restrict the sale of assets and restricts
investments the Company may make. The credit facility also requires repayment of
the principal amount upon the occurrence of certain changes in the control of
the Company. The Company has pledged essentially all of its tangible assets as
collateral for the credit facility.

     The 10.5% senior notes due 2007 (the "Senior Notes") contain certain
covenants that, among other things, restrict the level of other indebtedness the
Company may incur, the amounts of investments it may make in other businesses,
the sale of assets and use of proceeds therefrom, and the payment of dividends.
The Senior Notes also restrict payment of junior indebtedness prior to the
maturity of the junior indebtedness. The interest on the Senior Notes is payable
semiannually on January 15 and July 15. The holders of the Senior Notes have the
right to require the Senior Notes to be redeemed at 101% of the principal amount
in the event of a Change of Control (as defined). The Senior Notes contain
certain prepayment restrictions and have no mandatory redemption provisions. The
Senior Notes are guaranteed by all of the Company's subsidiaries. Each of these
subsidiaries are wholly-owned subsidiaries of the Company and have fully and
unconditionally guaranteed the Senior Notes on a joint and several basis. The
Company itself is a holding company with no assets or operations other than
those relating to its investments in its subsidiaries. The separate financial
statements of the guaranteeing subsidiaries are not presented in this report
because, considering the facts stated above, the separate financial statements
and other disclosures concerning the guaranteeing subsidiaries are not deemed
material to investors by management.

     The 4.1% convertible subordinated note is subordinated in right to prior
payment in full of Senior Indebtedness, which is generally defined in the
governing agreements to include debt under the senior notes and revolving line
of credit described above and any refinancing, renewal or replacement thereof as
well as certain other debt. Repayments of 25% and 33 1/3% of the then
outstanding principal balance is due on November 1, 2002 and 2003, respectively,
with the remaining balance due November 1, 2004. Interest is payable
semiannually each May 1 and November 1. The note limits the Company's ability to
grant certain stock options and requires repayment of 101% of the principal
amount in the event of a change in control (as defined). In connection with
obtaining consents needed for various aspects of the Varsity acquisition, the
Company amended the note to provide for a reduction from $6.00 to $5.3763 per
share in the conversion price.

                                      F-19
RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

8. LONG-TERM DEBT--(CONTINUED)

     The Senior Notes were issued and the revolving credit facility was entered
into in connection with the 1997 acquisition of Varsity Spirit Corporation (see
Note 2). In connection with these financing transactions, all other long-term
debt of the Company, except the convertible notes, was repaid. The Company
incurred debt issue costs of approximately $5.4 million in connection with the
Senior Notes and approximately $0.8 million of costs in connection with the new
credit facility. These costs are included with intangibles and deferred charges
(see Note 7) and are being amortized to interest expense over the life of the
related debt. The Company also incurred costs of $3.0 million in connection with
a bridge loan commitment needed to support the acquisition. The bridge loan was
not drawn-down and the commitment fee was charged to interest expense in June
1997.

9. SHAREHOLDERS' EQUITY AND STOCK OPTION PLANS

     In conjunction with the Varsity Acquisition in June 1997, the Company sold
986,169 shares of its Common Stock to certain key employees of Varsity at $4.50
per share for an aggregate, net of related costs, of approximately $4.3 million
pursuant to Stock Purchase Agreements, dated May 15, 1997.

     Stock option plans:  The 1991 Stock Option Plan, as amended, and the 1997
Stock Option Plan provide for the granting of options to key employees,
directors, advisors and independent consultants to the Company for the purchase
of up to an aggregate of 2,915,500 shares of the Company's common stock. Under
the 1991 Stock Option Plan, options for an aggregate of 1,415,500 shares may be
granted at an option price of no less than 85% of the market price of the
Company's common stock on the date of grant and may be exercisable between one
and ten years from the date of grant. Under the 1997 Stock Option Plan, options
or other stock-based awards may be granted for an aggregate of 1,500,000 shares.
The 1997 Stock Option Plan generally does not restrict the option price or
exercise terms of grants.

     During 1998, the Company issued 81,000 shares of its Common Stock to
certain employees for incentive compensation as a stock award under the terms of
the 1997 Stock Option Plan. These shares were recorded at a value of $328,000
based on quoted market values at the date of grant. The grants include 27,000
shares, valued at $128,000, granted in consideration for compensation included
in accrued liabilities at December 31, 1997.

     During 1997, in connection with the terms of certain agreements entered
into in connection with the Varsity acquisition, the Company issued options for
the purchase of approximately 950,000 shares of its Common Stock to Varsity
employees. Included in this amount are 450,000 options to certain key employees
of Varsity which vested immediately with an option price of $3.80. A charge of
approximately $559,000 was recorded in June, 1997, and credited to additional
paid in capital to reflect the intrinsic value of these options based on their
in-the-money position on the measurement date for this grant. The remaining
500,000 options were issued to a broad group of Varsity employees with exercise
prices at market. Both of these sets of option grants are included in the
information summarized below.

     Options granted through December 31, 1998 generally have been designated as
non-qualified stock options and, except as described above, have had option
prices equal to market values on the date of grant, have had

                                      F-20
RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

9. SHAREHOLDERS' EQUITY AND STOCK OPTION PLANS--(CONTINUED)

terms of five or ten years, and have had vesting periods of one or four years.
Information relating to stock option transactions over the past three years is
summarized as follows:
OPTIONS OUTSTANDING        OPTIONS EXERCISABLE
                                                                    -----------------------    -----------------------
                                                                                   WEIGHTED                   WEIGHTED
                                                                                   AVERAGE                    AVERAGE
                                                                                    PRICE                      PRICE
                                                                      NUMBER         PER         NUMBER         PER
                                                                    OUTSTANDING     SHARE      EXERCISABLE     SHARE
                                                                    -----------    --------    -----------    --------
Balance, January 1, 1996.........................................    1,032,050      $ 4.02        485,775      $ 5.21
  Granted........................................................      239,500      $ 4.57
  Forfeited......................................................       (5,500)     $ 2.89
  Expired........................................................      (80,000)     $ 8.00
                                                                     ---------
Balance, December 31, 1996.......................................    1,186,050      $ 3.87        712,913      $ 3.79
  Granted........................................................    1,085,925      $ 4.75
  Exercised......................................................      (25,000)     $ 2.39
  Forfeited......................................................       (7,000)     $ 4.46
  Expired........................................................      (82,000)     $10.75
                                                                     ---------
Balance, December 31, 1997.......................................    2,157,975      $ 4.05      1,284,425      $ 3.37
  Granted........................................................      461,600      $ 5.08
  Exercised......................................................      (58,825)     $ 2.48
  Forfeited......................................................     (291,925)     $ 3.59
  Expired........................................................      (16,300)     $ 4.05
                                                                     ---------
Balance, December 31, 1998.......................................    2,252,525      $ 4.36      1,362,106      $ 3.81
                                                                     ---------
                                                                     ---------
Options granted in 1998 include grants for 56,600 shares, granted in
November 1998, to certain employees (none of which were directors of the
Company) in exchange for cancellation of options for 69,850 shares which had
previously been granted to these employees. The canceled options, which are
included in the forfeited category above, would have expired in December 1998
and had a weighted average option price of $2.65 per share. The new grants had a
term of ten years and a weighted average option price of $3.76 per share.

     Further information about stock options outstanding at December 31, 1998 is
summarized as follows:
OPTIONS OUTSTANDING                  OPTIONS EXERCISABLE
                    ----------------------------------------     ------------------------
                                     WEIGHTED       WEIGHTED                     WEIGHTED
                                     AVERAGE        AVERAGE                      AVERAGE
                                    REMAINING        PRICE                        PRICE
   RANGE OF           NUMBER        CONTRACTUAL       PER          NUMBER          PER
EXERCISE PRICES     OUTSTANDING        LIFE          SHARE       EXERCISABLE      SHARE
---------------     -----------     -----------     --------     -----------     --------
$1.80 - $2.49           136,500     2.4 years        $ 1.99         135,000       $ 1.99
$2.50 - $3.99           764,100     7.2 years        $ 3.56         721,250       $ 3.54
$4.00 - $5.44         1,351,925     8.9 years        $ 5.05         505,856       $ 4.67
At December 31, 1998 there were 498,150 shares available for future option
grants.

     In accordance with the provisions of Statement of Financial Accounting
Standards No. 123, "Accounting for Stock-Based Compensation" (SFAS 123), the
Company has elected to continue to account for stock-based compensation under
the intrinsic value based method of accounting prescribed by Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees" (APB
25). Under APB 25, generally, no cost is recorded for stock options issued to
employees unless the option price is below market at the time options are
granted. The following pro forma net income and earnings per share are presented
for informational purposes and

                                      F-21
RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

9. SHAREHOLDERS' EQUITY AND STOCK OPTION PLANS--(CONTINUED)

have been computed using the fair value method of accounting for stock-based
compensation as set forth in SFAS 123:
YEARS ENDED DECEMBER 31,
                                                                                      ----------------------------
                                                                                       1998       1997       1996
                                                                                      -------    -------    ------
                                                                                             (IN THOUSANDS)
Pro forma net income (loss)........................................................   $(7,953)   $(1,973)   $2,669
Pro forma earnings (loss) per share
     Basic.........................................................................   $ (0.87)   $ (0.23)   $ 0.33
     Diluted.......................................................................   $ (0.87)   $ (0.23)   $ 0.31
These pro forma amounts may not be representative of future disclosures
because they do not take into effect pro forma compensation expense related to
grants made before 1995. The pro forma results include expense related to the
fair value of stock options estimated at the date of grant using the
Black-Scholes option pricing model and the following weighted average
assumptions for the years ended December 31, 1998, 1997 and 1996, respectively:
risk-free interest rates of 5.3%, 6.4% and 6.6%; expected volatility of 56%, 50%
and 38%; expected option life of 7.0 years, 7.0 years and 6.9 years, and no
dividend payments. The weighted average estimated fair value of options granted
during 1998, 1997 and 1996 was $3.16, $3.28 and $2.40 per share, respectively.

     Warrants:  At December 31, 1998 warrants were outstanding for the purchase
of an aggregate of 172,152 shares of the Company's common stock. These warrants
are held by one of the Company's banks and are exercisable through October 1999
at an exercise price of $3.72 per share.

     During 1998 certain officers and directors of the Company exercised
outstanding warrants for shares of the Company's Common Stock which would have
expired in January 1999. The Company agreed to a cashless exercise of the
warrants, in effect accepting shares issuable upon exercise as payment for the
exercise. As a result, 42,362 shares of Common Stock were issued in exchange for
warrants for 150,000 shares based on an exercise price of $2.96 per share and an
exchange price of $4.125 per share. The exchange price of $4.125 per share was
set on a date when the quoted market price of a share of Common Stock was $4.00.

10. COMMITMENTS

     Leases:  The Company leases various facilities and equipment under
operating leases. Rent expense amounted to approximately $2,792,000, $1,958,000
and $1,451,000 for the years ended December 31, 1998, 1997 and 1996,
respectively.

     Future minimum rental payments for all non-cancelable lease agreements for
periods after December 31, 1998 are as follows:
YEARS ENDING DECEMBER 31,                                                                           (IN THOUSANDS)
-------------------------                                                                           --------------
1999                        .....................................................................      $  2,828
2000                        .....................................................................         2,023
2001                        .....................................................................           789
2002                        .....................................................................           557
2003                        .....................................................................           431
Later years                 .....................................................................         3,370
                                                                                                       --------
          Total minimum payments required........................................................      $  9,998
                                                                                                       --------
                                                                                                       --------
Employee benefits:  The Company has three noncontributory defined benefit
pension plans that cover, or have covered, certain employee groups. These plans
consist of two "Union Plans" covering certain unionized employees and a
"Non-Union Plan" that covered other employees of certain subsidiaries. The
Non-Union Plan

                                      F-22
RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

10. COMMITMENTS--(CONTINUED)

was amended in 1994 to provide that no benefits would accrue under the plan on
or after December 31, 1994. Expense for these plans for the year ended
December 31, 1998 was approximately $200,000 including a provision for expense
of an anticipated termination of the Non-Union Plan. Total pension expense for
these plans was under $50,000 in each of the years ended December 31, 1997 and
1996.

     The Company maintains defined contribution (401-k) plans covering
substantially all of its employees, other than those covered by the Union Plans.
Company contributions to these plans are based on a percentage of employee
contributions and are funded and charged to expense as incurred. Expenses
related to the plans amounted to $95,000, $342,000 and $307,000 for the years
ended December 31, 1998, 1997 and 1996, respectively.

11. ACCRUED LIABILITIES AND CONTINGENCIES

     Recorded liabilities:  In regards to the product liability contingencies
discussed below, the Company has recorded certain liabilities. While these
amounts are discussed in the remaining sections of this note, a summary of these
amounts together with other items comprising the balance sheet line items
"accrued liabilities" and "other liabilities" follows:
ACCRUED        OTHER
                                                                                           LIABILITIES  LIABILITIES
                                                                                           (CURRENT)    (NON-CURRENT)
                                                                                           ---------    -------------
                                                                                                 (IN THOUSANDS)
December 31, 1998:
  Product liability matters, reserves for pending and other contingencies...............    $   700        $ 3,300
  Accrued interest......................................................................      5,690             --
  Other accrued liabilities.............................................................      4,863            254
                                                                                            -------        -------
     Total of balance sheet category....................................................    $11,253        $ 3,554
                                                                                            -------        -------
                                                                                            -------        -------

December 31, 1997:
  Product liability matters, reserves for pending and other contingencies...............    $   700        $ 3,000
  Accrued interest......................................................................      6,536             --
  Other accrued liabilities.............................................................      3,481             60
                                                                                            -------        -------
     Total of balance sheet category....................................................    $10,717        $ 3,060
                                                                                            -------        -------
                                                                                            -------        -------
Product liability litigation matters and contingencies:  At December 31,
1998, the Company was a defendant in 5 product liability suits relating to
personal injuries allegedly related to the use of helmets manufactured or
reconditioned by subsidiaries of the Company. The ultimate outcome of these
claims, or potential future claims, cannot presently be determined. The Company
estimates that the uninsured portion of future costs and expenses related to
these claims, and incurred but not reported claims, will amount to at least
$4,000,000 and, accordingly, a reserve in this amount is included in the
Consolidated Balance Sheet at December 31, 1998 as part of accrued liabilities
and other liabilities. These reserves are based on estimates of losses and
defense costs anticipated to result from such claims, from within a range of
potential outcomes, based on available information, including an analysis of
historical data such as the rate of occurrence and the settlement amounts of
past cases. However, due to the uncertainty involved with estimates actual
results have at times varied substantially from earlier estimates and could do
so in the future. Accordingly there can be no assurance that the ultimate costs
of such claims will fall within the established reserves.

     The Company maintains product liability insurance under a policy expiring
in January 2005. The policy is an occurrence-based policy providing coverage
against claims currently pending against the Company and future claims relating
to all injuries occurring prior to January 2005 even if such claims are filed
after the end of the

                                      F-23
RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

11. ACCRUED LIABILITIES AND CONTINGENCIES--(CONTINUED)

policy period. The insurance program provides certain basic and excess coverage
on product liability claims with a combined aggregate coverage of over
$40,000,000 subject to the limitations described below.

     The first level of insurance coverage under the policy ("Basic Coverage")
provides coverage of up to $2,250,000 per claim in excess of an uninsured
retention (deductible) of $750,000 per occurrence. The Basic Coverage is subject
to an aggregate program limit and certain annual aggregate sub limits. The Basic
Coverage, which does not affect the availability of the excess coverage
described below, has an aggregate limit which is currently $4.9 million, but the
policy allows the Company to increase this maximum limit to $7.7 million at any
time by prepaying the required premium, which counts at 120% of the amount paid
toward the limit. The Basic Coverage, to the extent available, covers the
insured portion of the first $3,000,000 of a claim. The insurance program also
provides for additional coverage ("Excess Coverage") of up to $20,000,000 per
occurrence, in excess of the first $3,000,000 of each claim. Claims covered by
the Excess Coverage are subject to one of two separate $20,000,000 aggregate
policy limits, depending on the date of the related injury. The first
$20,000,000 aggregate limit applies to claims for injuries occurring prior to
January 31, 1998, and claims occurring after January 1998 are covered by the
second separate $20,000,000 aggregate limit.

     Other contingencies and litigation matters:  In addition to the matters
discussed in the preceding paragraphs, the Company has certain other claims or
potential claims against it that may arise in the normal course of business,
including without limitation, claims relating to personal injury as well as
employment related matters. Management believes that the probable resolution of
such matters will not materially affect the financial position or results of
operations of the Company.

12. INCOME TAXES

     Income taxes on income (loss), before extraordinary items, for the years
ended December 31, 1998, 1997 and 1996 is summarized below:
YEARS ENDED DECEMBER
                                                                                                   31,
                                                                                          ----------------------
                                                                                          1998     1997     1996
                                                                                          ----     ----     ----
                                                                                              (IN THOUSANDS)
Current tax expense:
  Federal.............................................................................    $ --     $ --     $ 50
  State...............................................................................      --       --       60
                                                                                          ----     ----     ----
                                                                                            --       --      110
                                                                                          ----     ----     ----
Deferred tax expense:
  Federal.............................................................................      --       --       --
  State...............................................................................      --       --       --
                                                                                          ----     ----     ----
                                                                                            --       --       --
                                                                                          ----     ----     ----
                                                                                          $ --     $ --     $110
                                                                                          ----     ----     ----
                                                                                          ----     ----     ----
For the years ended December 31, 1997 and 1996, tax expense was reduced by
offsetting tax benefits of approximately $500,000 and $1,200,000, respectively,
of net operating loss carryforwards which were not recognized in prior years.

                                      F-24
RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

12. INCOME TAXES--(CONTINUED)

     Significant components of deferred income tax assets and liabilities at
December 31, 1998, 1997 and 1996 are as follows:
YEARS ENDED DECEMBER 31,
                                                                                 -------------------------------
                                                                                  1998        1997        1996
                                                                                 -------     -------     -------
                                                                                         (IN THOUSANDS)
Deferred income tax assets:
  Accrued expenses and reserves..............................................    $ 2,843     $ 2,267     $ 3,509
  Inventory..................................................................        711         733         492
  Intangible assets..........................................................         --          --          26
  Net operating loss, and credit, carryforwards..............................      6,551       4,832       3,689
  Other......................................................................        308         276          36
                                                                                 -------     -------     -------
                                                                                  10,413       8,108       7,752
  Valuation allowances.......................................................     (3,215)     (1,031)     (1,386)
                                                                                 -------     -------     -------
  Total deferred income tax assets...........................................      7,198       7,077       6,366
                                                                                 -------     -------     -------
Deferred income tax liabilities:
  Intangible assets and deductible goodwill..................................      5,648       5,498       6,014
  Property and equipment.....................................................        442         481          86
  Prepaid expenses...........................................................        203         193         266
                                                                                 -------     -------     -------
  Total deferred income tax liabilities......................................      6,293       6,172       6,366
                                                                                 -------     -------     -------
Total net deferred income tax asset..........................................    $   905     $   905     $     0
                                                                                 -------     -------     -------
                                                                                 -------     -------     -------
The net current and non-current components of the deferred income taxes
were recognized in the balance sheet at December 31, 1998, 1997 and 1996 as
follows:
YEARS ENDED DECEMBER 31,
                                                                                    ----------------------------
                                                                                     1998       1997       1996
                                                                                    ------     ------     ------
                                                                                           (IN THOUSANDS)
Net current assets, included with prepaid expenses..............................    $1,253     $1,358     $1,820
Net non-current deferred tax liabilities........................................       348        453      1,820
                                                                                    ------     ------     ------
                                                                                    $  905     $  905     $    0
                                                                                    ------     ------     ------
                                                                                    ------     ------     ------
A reconciliation of effective tax rates to federal statutory tax rates is
as follows:
YEARS ENDED
                                                                                                  DECEMBER 31,
                                                                                             -----------------------
                                                                                             1998     1997     1996
                                                                                             -----    -----    -----
Statutory Federal tax rate................................................................   (34.0%)  (34.0%)   34.0%
Differences resulting from:
  Effective state tax rate, net of federal tax benefit....................................      --       --      3.1
  Amortization not deductible for tax purposes............................................    10.2     87.1      5.8
  Travel & entertainment expenses not deductible for tax purposes.........................     3.9     33.9      1.2
  Losses with no current benefit..........................................................    20.2
  Benefit of prior periods net operating losses not previously recognized.................            (86.4)   (40.2)
  Other differences.......................................................................    (0.3)    (0.6)    (0.2)
                                                                                             -----    -----    -----
                                                                                               0.0%     0.0%     3.7%
                                                                                             -----    -----    -----
                                                                                             -----    -----    -----
At December 31, 1998 the Company had estimated net operating loss
carryforwards for federal income tax purposes of approximately $17,700,000
expiring between 2008 to 2013. While this loss carryforward is available

                                      F-25
RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

12. INCOME TAXES--(CONTINUED)

to reduce the payment of taxes that might otherwise be payable in future years,
the benefit of most of the net operating losses have been recognized in the
computation of income tax expense reflected in the Company's consolidated
financial statements in prior years. Benefits relating to approximately $7.0
million of net operating loss carryforwards have not yet been recognized in the
computation of income tax expense for financial reporting purposes and have been
reserved for as part of the deferred income tax asset valuation allowance. These
unrecognized carryforwards would be recognized through a reduction of income tax
expense in future periods upon the generation of an offsetting amount of taxable
earnings.

13. RELATED PARTY TRANSACTIONS

     In 1997, in connection with certain financing transactions occurring in
connection with the Varsity acquisition, notes payable to shareholders of
$439,000 plus accrued interest were repaid in advance of maturity. Interest of
$17,000 and $111,000 on the note was included in interest expense for the years
ended December 31, 1997, and 1996, respectively. In 1996 the Company paid
consulting fees of $75,000 to one director and paid another director $20,000 for
services in connection with a series of promotional football clinics sponsored
by the Company.

14. SUPPLEMENTAL CASH FLOW INFORMATION

     Cash payments for interest were $14,700,000, $5,260,000 and $2,662,000 for
the years ended December 31, 1998, 1997 and 1996, respectively. Interest
payments for 1997 included $3,000,000 relating to bridge financing commitment
fees--see Note 8. Income tax payments, or refunds, were not significant for
1998, 1997 or 1996.

     In 1998, the Company issued shares of its Common Stock, valued at $128,000
based on quoted market values at the time of grant, to certain employees as
consideration for compensation included in accrued liabilities at December 31,
1997.

     In June 1997, in connection with the Varsity acquisition, the Company
assumed liabilities of $23,068,000.

15. FAIR VALUES OF FINANCIAL INSTRUMENTS

     The Company's financial instruments include cash, accounts receivable,
accounts payable and long-term debt. The carrying values of cash, accounts
receivable and accounts payable approximate their fair values. The Company's
long-term debt include the Senior Notes which at December 31, 1998 had a
carrying value of $115,000,000 and a fair value, based on quoted market values,
of $109,250,000. The Company's remaining long-term debt is not traded and has no
quoted market value, however management believes any difference between its
carrying value and fair value would not be material in relation to these
Consolidated Financial Statements.

16. SEGMENT AND PRODUCT LINE INFORMATION

     The Company has three reportable segments: institutional products and
services, retail products and trademark licensing:

     Institutional products and services:  This segment markets products and
services primarily through the Company's direct sales force for institutional
customers such as schools, leagues, recreational groups and other organizations
for competitive and recreational sport and spirit activities. Operations include
the manufacture and sale of athletic products (including football helmets),
spirit products (including cheerleading and dance uniforms and accessories), and
athletic equipment reconditioning. The segment also operates cheerleader and
dance team camps, clinics and special events.

     Retail products:  This segment markets products through retailers in the
U.S. and internationally. Most of the products sold by this segment are sports
collectible products, such as authentic and replica football helmets,

                                      F-26
RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

16. SEGMENT AND PRODUCT LINE INFORMATION--(CONTINUED)

which bear licensed sports team logos. The segment's operations also include
sales of certain recreational football and other athletic products sold through
consumer product retailers and distributors.

     Trademark licensing:  This segment consists of the licensing of the
Company's Riddell and MacGregor trademark rights to other entities for use in
marketing products such as athletic footwear and apparel.

     The Company's reportable segments are strategic business units that differ
and are managed separately because of the nature of their markets and channels
of distribution. The Institutional products and services segment includes the
company's institutional athletic products business unit and its spirit
(cheerleading and dance) business unit. Information about these two business
units has been combined and reported as the institutional products and services
segment as the units have similar economic and other business traits.

     The accounting policies of the segments are the same as those described in
the summary of significant accounting policies except for the inclusion of
operating results for Varsity Spirit Corporation, and related pro forma
adjustments, for the period prior to its acquisition in June 1997 (see Note 2).
The company evaluates performance of the institutional products and services
segment based on these pro forma results. Total assets are as reported and do
not include pro forma amounts or adjustments.
YEARS ENDED DECEMBER 31,
                                                                             ----------------------------------
                                                                               1998         1997         1996
                                                                             --------     --------     --------
                                                                                       (IN THOUSANDS)
Net revenues:
  Institutional products and services....................................    $166,845     $153,641     $136,974
  Retail products........................................................      18,142       18,055       21,363
  Trademark licensing....................................................       1,613        2,388        2,494
                                                                             --------     --------     --------
                                                                              186,600      174,084      160,831
  Less, preacquisition results of Varsity Spirit Corporation included
     above...............................................................          --       35,811       88,449
                                                                             --------     --------     --------
  Consolidated total.....................................................    $186,600     $138,273     $ 72,382
                                                                             --------     --------     --------
                                                                             --------     --------     --------

Income from Operations:
  Institutional products and services....................................    $ 11,416     $ 10,841     $ 11,423
  Retail products........................................................          56        1,742        3,727
  Trademark licensing....................................................         841        1,476        1,536
  Corporate and unallocated expenses.....................................      (4,796)      (6,099)      (3,750)
                                                                             --------     --------     --------
                                                                                7,517        7,960       12,936
  Less, preacquisition results of Varsity Spirit Corporation included
     above...............................................................          --       (3,360)       7,220
                                                                             --------     --------     --------
  Consolidated total.....................................................    $  7,517     $ 11,320     $  5,716
                                                                             --------     --------     --------
                                                                             --------     --------     --------

Depreciation and amortization, exclusive of debt issue costs:
  Institutional products and services....................................    $  4,497     $  4,253     $  3,854
  Retail products........................................................         557          595          541
  Trademark licensing....................................................         614          696          702
  Corporate and unallocated..............................................          45           44           45
                                                                             --------     --------     --------
                                                                                5,713        5,588        5,142
  Less, preacquisition results of Varsity Spirit Corporation included
     above...............................................................          --        1,578        2,949
                                                                             --------     --------     --------
  Consolidated total.....................................................    $  5,713     $  4,010     $  2,193
                                                                             --------     --------     --------
                                                                             --------     --------     --------
F-27
RIDDELL SPORTS INC. AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

16. SEGMENT AND PRODUCT LINE INFORMATION--(CONTINUED)
YEARS ENDED DECEMBER 31,
                                                                             ----------------------------------
                                                                               1998         1997         1996
                                                                             --------     --------     --------
                                                                                       (IN THOUSANDS)
Capital expenditures:
Institutional products and services....................................    $  2,265     $  2,562     $  2,698
  Retail products........................................................         229          139          269
                                                                             --------     --------     --------
                                                                                2,494        2,701        2,967
  Less, preacquisition results of Varsity Spirit Corporation included
     above...............................................................          --          887        1,828
                                                                             --------     --------     --------
  Consolidated total.....................................................    $  2,494     $  1,814     $  1,139
                                                                             --------     --------     --------
                                                                             --------     --------     --------

Total assets:
  Institutional products and services....................................    $150,163     $143,414     $ 43,302
  Retail products........................................................      10,253       11,497       11,468
  Trademark licensing....................................................      16,898       17,835       17,807
  Corporate and unallocated..............................................       8,897        9,015        3,784
                                                                             --------     --------     --------
  Consolidated total.....................................................    $186,211     $181,761     $ 76,361
                                                                             --------     --------     --------
                                                                             --------     --------     --------

Revenues by product line for all reportable segments in the aggregate were as follows:
  Cheerleader and dance products.........................................    $ 63,491     $ 56,453     $ 49,472
  Camps and events.......................................................      48,704       44,966       38,977
  Athletic products......................................................      34,276       30,177       27,884
  Athletic product reconditioning........................................      23,415       22,892       21,700
  Sports collectibles....................................................      15,101       17,208       20,304
  Trademark licensing....................................................       1,613        2,388        2,494
                                                                             --------     --------     --------
                                                                              186,600      174,084      160,831
  Less, preacquisition results of Varsity Spirit Corporation included
     above...............................................................          --       35,811       88,449
                                                                             --------     --------     --------
  Consolidated revenues..................................................    $186,600     $138,273     $ 72,382
                                                                             --------     --------     --------
                                                                             --------     --------     --------
17. SUBSEQUENT EVENT

     On March 16, 1999, a jury rendered a verdict against the Company in a Texas
product liability lawsuit for approximately $11.4 million plus interest from
February 1996. The Company intends to appeal the verdict. If the verdict was
paid in full it would be covered by the insurance described above, except for an
amount equal to the $750,000 uninsured retention. This amount, however, is
already included in the Company's balance sheet reserves. Any such payment by
the insurance company would reduce the amount of the aggregate limits of the
Company's product liability insurance coverage described in Note 11, above.

                                      F-28
================================================================================

                          Riddell Sports Inc. [Logo]

                          H.C. Wainwright & Co., Inc.

================================================================================
[Alternate Page]

The information in this prospectus is not complete and may be changed. Riddell
Sports may not sell these securities until the registration statement filed with
the Securities and Exchange Commission is effective. This prospectus is not an
offer to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.

SUBJECT TO COMPLETION DECEMBER 15, 1999

Preliminary Prospectus

                         250,000 Shares of Common Stock

                           RIDDELL SPORTS INC. [LOGO]

      We are a leading marketer and distributor of branded products and services
to the extracurricular portion of the educational market. We are selling 250,000
shares of our common stock.

      Our shares are listed for trading on the American Stock Exchange under the
symbol "RDL." On December 10, 1999, the last reported sale price for our common
stock on the American Stock Exchange was $3.125 per share.

      Simultaneously with this underwritten offering, we are conducting a rights
offering to our stockholders to sell an additional 1,000,000 shares of our
common stock under a separate prospectus.

      See "Risk Factors" beginning on page [   ] to read about factors you
should consider before buying shares of our common stock.

      Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is a
criminal offense.

                                                      Per Share      Total
Public offering price........................       $              $

Underwriting discounts and commissions.......       $              $

Proceeds, before expenses, to Riddell........       $              $

      Delivery and payment for the shares will be on [ ], 2000.

      The underwriter may, under some circumstances, for 45 days after the date
of this prospectus, purchase up to an additional 37,500 shares of our common
stock from us at the public offering price, less underwriting discounts and
commissions.

                        H.C. Wainwright & Co., Inc.

                    Prospectus dated [          ], 2000

                                      A-1
[Alternate Page]

      You should rely only on the information contained in this prospectus. We
have not authorized anyone to provide you with information different from that
contained in this prospectus. This prospectus is not an offer to sell or a
solicitation of an offer to buy any securities in any state or other
jurisdiction in which the offer or solicitation is not permitted. You should not
assume that the information in this prospectus is accurate as of any date other
than the date of this prospectus.

      In this prospectus, "Riddell," "we," "us" and "our" refer to Riddell
Sports Inc. and our subsidiaries, unless the context specifically indicates
otherwise.

                                      A-2
[Alternate Page]

                                TABLE OF CONTENTS

                                                                           Page

PROSPECTUS SUMMARY.........................................................

RISK FACTORS...............................................................

TRADE NAMES AND TRADEMARKS.................................................

FORWARD-LOOKING STATEMENTS.................................................

THE CONCURRENT OFFERING....................................................

THE RIGHTS OFFERING........................................................

USE OF PROCEEDS............................................................

DILUTION...................................................................

CAPITALIZATION.............................................................

SELECTED FINANCIAL DATA....................................................

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
      CONDITION AND RESULTS OF OPERATIONS..................................

PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY............................

BUSINESS ..................................................................

MANAGEMENT.................................................................

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
      AND MANAGEMENT.......................................................

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.............................

UNDERWRITING...............................................................

DESCRIPTION OF CAPITAL STOCK...............................................

DESCRIPTION OF DEBT SECURITIES.............................................

LEGAL MATTERS..............................................................

EXPERTS....................................................................

WHERE YOU CAN FIND MORE INFORMATION........................................

INDEX TO FINANCIAL STATEMENTS.............................................. F-1

                                      A-3
[Alternate Page]

                               RIGHTS OFFERING

Securities Offered                             Rights to purchase 1,000,000
                                               shares of our common stock at
                                               $___ per share pro rata to all of
                                               our common stockholders as of
                                               December 27, 1999.  Further, to
                                               those individuals and entities
                                               who exercise rights, we will
                                               issue warrants which, upon
                                               exercise, will represent in the
                                               aggregate, _____ (____%) percent
                                               of Riddell's ownership in a new
                                               or existing subsidiary that we
                                               may establish in the future to
                                               conduct most of our Internet
                                               operations.

                                      A-4
[Alternate Page]

                                 RIGHTS OFFERING

      In addition to the concurrent offering, we are also granting rights to
purchase 1,000,000 additional shares of our common stock at $________ per share
pro rata to all of our common stockholders as of December 27, 1999, the record
date. Each stockholder has been granted 0.10795 rights for every share of common
stock they hold on the record date. Further, if the stockholders exercise their
rights, they will also receive, for no additional money, the right, if certain
conditions are met, to purchase stock from Riddell of a new or existing
subsidiary that will conduct substantially all of our Internet operations.

                                      A-5
[Alternate Page]

                                  UNDERWRITING

      Subject to the terms and conditions contained in the underwriting
agreement, we have agreed to sell to H.C. Wainwright & Co., Inc. and H.C.
Wainwright & Co., Inc. has agreed to purchase on a firm commitment basis 250,000
shares of our common stock offered in this offering.

      A copy of the underwriting agreement has been filed as an exhibit to this
registration statement.

      The underwriter has advised us that it proposes to offer the shares to the
public at the initial public offering price on the cover page of this prospectus
and that it may allow some dealers who are members of the NASD, concessions not
in excess of $   per share and the dealers who receive concessions may reallow a
sum not in excess of $   per share to other dealers who are members of the NASD
and to some foreign dealers. Upon completion of this offering, the offering
price, the concession to selected dealers, and the reallowance to other dealers
may be changed by the underwriter. The underwriter has informed us that it does
not expect discretionary sales by the underwriter to exceed five percent of the
shares offered by this prospectus.

      The underwriter shall also receive a discount of 7% per share for all
shares underwritten in this offering. We have also granted the underwriter an
option, exercisable during the 45-day period commencing an the date of this
prospectus, to purchase at the public offering price per share, less the
underwriting discount, up to an aggregate of 37,500 shares of common stock. The
underwriter may exercise this right of purchase only for the purpose of covering
over-allotments, if any, made in connection with the sale of shares.

      We have also agreed to sell to the underwriter, for nominal consideration,
the underwriters warrants to purchase up to ___% of the number of shares of
common stock sold in the concurrent offering. The underwriter's warrants are
exercisable for a period of four years commencing one year after the date of
this prospectus at an exercise price per share equal to $____ (_____% of the
public offering price).

      We have granted demand registration rights at our expense for a period of
five years from the effective date of this offering upon the written demand of
holder(s) representing a majority of the warrants and piggyback registration
rights for a period of seven years from the effective date of this offering with
respect to registration under the Securities Act of the securities directly or
indirectly issuable upon exercise of the underwriter's warrants. In addition,
for a period of five years from the effective date of this offering, we have
agreed, on one occasion and upon the written request of any holder(s), to
promptly register the underlying securities for purposes of a public offering,
solely at the expense of the requesting holder(s).

      The underwriter's warrants contain anti-dilution provisions providing for
adjustments of the exercise price and number of shares issuable on exercise of
the underwriter's warrants, upon the occurrence of some events, including stock
dividends, stock splits, and recapitalizations. The holders of the underwriter's
warrants have no voting, dividend, or other rights as a stockholder with respect
to shares of common stock underlying the underwriter's warrants, unless the
underwriter's warrants shall have been exercised.

                                      A-6
[Alternate Page]

      In connection with this underwritten offering, we are also conducting a
rights offering in which we are offering right evidenced by subscription
certificates to purchase shares of our common stock to our existing
shareholders. H.C. Wainwright & Co. is also acting as solicitation agent in the
rights offering and shall receive an agency fee equal to 3% of the gross
proceeds we receive upon the exercise of certain rights in that offering.

      We have also agreed to reimburse H.C. Wainwright & Co. for its actual
out-of-pocket expenses incurred in connection with the rights offering and the
concurrent offering, including the fees and expenses of its counsel.

      Rules of the Securities and Exchange Commission may limit the ability of
the underwriter to bid for or purchase shares before the distribution of the
shares is completed. However, the underwriter may engage in the following
activities in accordance with the rules:

      Stabilizing transactions. The underwriter may make bids or purchases for
the purpose of pegging, fixing or maintaining the price of the shares, so long
as stabilizing bids do not exceed a specified maximum.

      Over-allotments and coverage transactions. The underwriter may create a
short position in the shares by selling more shares than are set forth on the
cover page of this prospectus. If a short position is created in connection with
the offering, the underwriter may engage in covering transactions by purchasing
shares in the open market. The underwriter may also elect to reduce any short
position by exercising all or part of the over-allotment option.

      Stabilization and covering transactions may cause the price of the shares
to be higher than it would be in the absence of such transactions.

      Neither we nor the underwriter makes any representation or prediction as
to the effect that the transactions described above may have on the price of the
shares. These transactions may occur on the American Stock Exchange, in the
over-the-counter market or on any trading market. If such transactions are
commenced, they may be discontinued without notice at any time.

      We have agreed to indemnify H.C. Wainwright & Co. against some
liabilities, including civil liabilities under the Securities Act, or to
contribute to payments H.C. Wainwright & Co. may be required to make in this
respect.

                                      A-7
PART II

                     INFORMATION NOT REQUIRED IN PROSPECTUS

Item 14. Other Expenses of Issuance and Distribution.

The following table sets forth expenses in connection with the issuance and
distribution of the securities being registered. All amounts shown are
estimated, except the SEC registration fee.

SEC registrationfee..................................................$1064.89

NASD filing fee......................................................$903

Subscription Agent fees and expenses.................................$35,000

Information Agent fees and expenses..................................NA

Registration Agent fees and expenses.................................NA

Legal fees and expenses (including blue sky fees and expenses).......$180,000

Accounting fees......................................................$20,000

Printing and mailing expenses........................................$100,000

Miscellaneous........................................................$113,032.11

Total................................................................$450,000

Item 15. Indemnification of Directors and Officers.

      Pursuant to Section 102(b)(7) of the Delaware General Corporation Law (the
"DGCL"), the Certificate of Incorporation of the Registrant contains provisions
which eliminate the personal liability of our directors for monetary damages
resulting from breaches of their fiduciary duty other than liability for
breaches of the duty of loyalty, acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law, violations under
Section 174 of the DGCL or any transaction from which the director derived an
improper personal benefit.

      Section 145 of the DGCL permits, and under certain circumstances requires,
the Registrant to indemnify our directors, officers, employees, and agents
subject to certain conditions and limitations. The Registrant's Bylaws contain
provisions to indemnify our directors and officers to the fullest extent
permitted by Section 145 of the DGCL, including circumstances in which
indemnification is otherwise discretionary. In addition, the Registrant
maintains officers' and directors' liability insurance which insures against
liabilities that our officers and directors may incur in such capacities.

Item 16. Exhibits and financial statement schedules.

      A list of the exhibits included as part of this Registration Statement is
set forth in the Exhibit Index that immediately precedes such exhibits and is
incorporated herein by this reference.

                                      II-1
(a) EXHIBIT

NUMBER      DESCRIPTION

1.1         Form of Underwriting Agreement, by and between Riddell and H.C.
            Wainwright & Co., Inc. (1)

2.1         Asset Purchase Agreement, dated as of April 11, 1988, among
            Riddellink Holding Corporation, EN&T Associates, Inc., Netlink Inc.,
            Riddell, Inc. (predecessor corporation), Equilink Licensing Corp.,
            and MacGregor Sporting Goods, Inc., as amended on April 18, 1988
            (the formal trademark assignments and license agreements
            implementing this agreement are omitted) (2) and Amendment thereto,
            dated March 1992. (3)

2.2         Agreement and Plan of Merger, dated as of May 5, 1997, by and among
            Riddell Sports Inc., Cheer Acquisition Corp. and Varsity Spirit
            Corporation. (31)

2.3         Asset Purchase Agreement dated as of December 1, 1994 by and between
            Intropa International U.S.A., Inc., Elisabeth Polsterer and
            Varsity/Tours, Inc. (27)

2.4         Asset Purchase Agreement dated as of May 15, 1996 by and between
            United Special Events, Inc., Michael Olmstead and Varsity USA, Inc.
            (26)

3.1         Amended and Restated Articles of Incorporation of Riddell Sports
            Inc. (20)

3.2         First Amended and Restated Bylaws of Riddell Sports Inc. (18)

3.3         Certificate of Incorporation of All American Sports Corporation
            (formerly known as Ameracq Corp). (33)

3.4         Bylaws of All American Sports Corporation (formerly known as Ameracq
            Corp). (33)

3.5         Certificate of Incorporation of Cheer Acquisition Corp. (33)

3.6         Bylaws of Cheer Acquisition Corp. (33)

3.7         Certificate of Incorporation of Equilink Licensing Corporation. (33)

3.8         Bylaws of Equilink Licensing Corporation. (33)

3.9         Certificate of Incorporation of Proacq Corp. (33)

3.10        Bylaws of Proacq Corp. (33)

3.11        Certificate of Incorporation of RHC Licensing Corporation. (33)

3.12        Bylaws of RHC Licensing Corporation. (33)

3.13        Amended and Restated Articles of Incorporation of Riddell, Inc.
            (formerly known as EN&T Associates Inc.). (33)

                                      II-2
3.14        Bylaws of Riddell, Inc. (formerly known as EN&T Associates Inc.).
            (33)

3.15        Amended and Restated Articles of Incorporation of Ridmark
            Corporation. (33)

3.16        Bylaws of Ridmark Corporation. (33)

3.17        Charter of International Logos, Inc. (33)

3.18        Bylaws of International Logos, Inc. (33)

3.19        Charter of Varsity/Intropa Tours, Inc. (33)

3.20        Bylaws of Varsity/Intropa Tours, Inc. (33)

3.21        Amended and Restated Charter of Varsity Spirit Fashions & Supplies,
            Inc. (33)

3.22        Bylaws of Varsity Spirit Fashions & Supplies, Inc. (33)

3.23        Amended and Restated Charter of Varsity USA, Inc. (33)

3.24        Bylaws of Varsity USA, Inc. (33)

4.1         Indenture, dated as of June 19, 1997, between Riddell, certain
            subsidiaries of Riddell Sports Inc., as guarantors, and Marine
            Midland Bank, as Trustee. (23)

4.2         Form of Underwriter's Warrant Agreement by and between Riddell and
            H.C. Wainwright & Co., Inc. (1-A)

4.3         Form of Common Stock Purchase Warrant. (1-A)

4.4         Form of Warrant Agreement between Riddell and American Stock
            Transfer & Trust Company. (1-A)

5.1         Opinion of Zukerman Gore & Brandeis, LLP (1-A)

9.1         Voting Trust Agreement dated May 1991. (2)

10.1        Settlement Agreement, dated April 9, 1981, among McGregor-Doniger
            Inc., Brunswick Corporation and The Equilink Corporation. (2)

10.2        1997 Stock Option Plan (22)

10.3        Agreement, made January 23, 1989, between Equilink Licensing Corp.
            and Kmart Corporation, with supplemental agreements dated November
            16, 1989, August 30, 1990 (2), June 30, 1994 (12) and June 30, 1998.
            (1)

10.4        Lease, dated November 12, 1993, between the International
            Brotherhood of Painters and Allied Trade Union and Industry Pension
            Fund and Riddell, Inc., (16); and amendment dated March 20, 1995
            (16); and Amendment dated September 19, 1996. (21)

10.5        Lease Agreement, dated November 2, 1984 by and between ADI Real
            Estate Joint Venture No. 2 (predecessor to The School Employees
            Retirement Board of Ohio) and Alamo Athletics Inc. (predecessor to
            All American Sports Corporation), and Amendments thereto, dated
            January 30, 1990. (3)

                                      II-3
10.6        Lease Agreement, dated as of September 1, 1988 by and between Exeter
            Management Corporation and All American. (3)

10.7        Lease Agreement, dated April 1991, by and between Stroudsburg Park
            Associates and All American Corp. (3); as amended March 31, 1995.
            (18)

10.8        Lease, dated as of September 1, 1968, by and between Munro M. Grant
            and the All American Company and Extension and Amendment of Lease,
            dated July 11, 1989. (3)

10.9        Lease dated December 12, 1991, between O'Shanter Resources Inc. and
            All American Sports, Inc. (3)

10.10       Lease, dated May 5, 1986, by and between Paul Goldstein, Nathan
            Hoffenberg, All American and Medalist Industries, (3); amendment
            dated January 30, 1997. (21)

10.11       Lease, dated October 28, 1987, as amended and extended by letter
            dated October 31, 1991, by and between GABT Developments Ltd. and
            Marcan Ltd. (a division of All American ), (3); amendment dated
            February 6, 1997. (21)

10.13       1991 Stock Option Plan (2) as amended by amendments described in
            Riddell Sports Inc.'s proxy materials for its annual stockholders
            meetings held on August 20, 1992, September 30, 1993, June 27, 1996
            and June 24, 1997.

10.14       Perpetual License and Trademark Maintenance Agreements among MacMark
            Corporation, Equilink Licensing Corporation and BSN Corp. each dated
            February 19, 1992 (3) and amendment dated November 1, 1992 (7).

10.15       Master Agreement by and among MacGregor Sports Products, Inc., BSN
            Corp. and MacMark Corporation dated February 19, 1992 (3); amendment
            No. 1 dated November 1, 1992. (16)

10.16       Employment Agreement, dated June 22, 1992, between Riddell Sports
            Inc. and Robert Nederlander (5); amended July 27, 1994. (12)

10.17       Employment Agreement, dated June 22, 1992, between Riddell Sports
            Inc. and Leonard Toboroff (5); amended July 27, 1994. (12)

10.18       Lease, dated September 10, 1992, and Amendment, dated October 1,
            1992, and Amendment, dated October 22, 1992, between All American
            Sports Corporation and Ronald K. Howell d/b/a Lakewood Land and
            Cattle Company. (6)

10.19       Lease Addendum letter, dated February 13, 1992, between All American
            Sports Corporation and Paul Goldstein and Nathan Hoffenberg. (6)

10.20       License Agreement, dated October 1, 1992, between All American
            Sports Corporation and NOCSAE. (7)

10.21       Employment Agreement, dated March 19, 1993, commencing March 25,
            1993 between David Mauer and Riddell Sports Inc. (7), as amended
            January 17, 1994; November 1, 1994 (14); November 28, 1994 (16)

                                      II-4
10.22       Settlement agreement, dated February 15, 1994, among Riddell, Inc.,
            Riddell Sports Inc., RHC Licensing Corporation, Ridmark Corporation,
            Pursuit Athletic Footwear, Inc., Riddell Athletic Footwear, Inc.,
            Ernie Wood, Harry Wood, Silver Eagle Holdings, Ltd., Save Power,
            Limited, Extravest Holdings Limited, Frederic Brooks, Donald Engel,
            Alan Tessler, Alan Hirschfield, Jeffrey Steiner, Robert Nederlander,
            Leonard Toboroff, Jeffrey Epstein, John McConnaughy, Connecticut
            Economics Corporation, Stephen Tannen, Woodco Sports, Inc., Arthur
            Tse, Silver Top Limited, Billion Nominees, Limited, Weston Holdings
            Limited. (9)

10.23       Employment Agreement, dated as of February 1, 1994, between Riddell
            Inc. and Dan Cougill (11), as amended February 1, 1995 (17).

10.24       Employment Agreement, dated as of March 7, 1996, between Riddell
            Sports Inc. and David Groelinger (19), as amended March 7, 1998
            (34).

10.25       Note Purchase Agreement, dated October 30, 1996, between Riddell
            Sports Inc. and Silver Oak Capital, L.L.C., as amended by letter
            agreement dated May 2, 1997. (20)

10.26       Registration Rights Agreement, dated November 8, 1996, between
            Riddell Sports Inc. and Silver Oak Capital L.L.C. (20)

10.27       Shareholders Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc., Cheer Acquisition Corp. and certain shareholders of
            Varsity Spirit Corporation. (32)

10.28       Stock Purchase Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc., Cheer Acquisition Corp. and Jeffrey G. Webb (32)

10.29       Stock Purchase Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc. and Gregory C. Webb (32)

10.30       Stock Purchase Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc. and W. Kline Boyd (32)

10.31       Stock Purchase Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc. and J. Kristyn Shepherd (32)

10.32       Employment Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc. and Jeffrey G. Webb (32)

10.33       Employment Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc. and Gregory C. Webb (32)

10.34       Employment Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc. and W. Kline Boyd (32)

10.35       Employment Agreement, dated as of May 5, 1997, between Riddell
            Sports Inc. and J. Kristyn Shepherd (32)

10.36       Registration Rights Agreement, dated as of June 19, 1997, between
            Riddell Sports Inc., and NationsBanc Capital Markets, Inc. and First
            Chicago Capital Markets, Inc., as Purchasers. (23)

                                      II-5
10.37       Sales Representative Agreement between Varsity Spirit Fashions &
            Supplies, Inc. and Stuart Educational Products, Inc., along with
            Security Agreement between Varsity Spirit Fashions & Supplies, Inc.
            and Gary Stuart and Patti Stuart, both individually and collectively
            doing business as Stuart Educational Products. (24)

10.38       Programming Agreement between Universal Cheerleaders Association and
            ESPN, Inc. (24).

10.39       Employment Agreement, dated December 1, 1994, between Varsity Spirit
            Corporation and Deana Roberts. (27)

10.40       Settlement Agreement, dated June 20, 1997, by and among Riddell
            Sports Inc., RHC Licensing Corporation, Riddell, Inc., Equilink
            Licensing Corporation, Ridmark Corporation, MacMark Corporation, NBD
            Bank, f/k/a NBD Bank, N.A., MLC Partners Limited Partnership, Robert
            E. Nederlander, Leonard Toboroff, John McConnaughy, Jr., Lisa J.
            Marroni, Frederic H. Brooks, Connecticut Economics Corporation,
            Robert Weisman, Bruce H. Levitt, as Bankruptcy Trustee of M.
            Holdings Corporation, Paul Swanson, as Bankruptcy Trustee of MGS
            Acquisition, Inc. and MacGregor Sports, Inc., Official Unsecured
            Creditors' Committee of MacGregor Sporting Goods, Inc., M. Holdings
            Corporation, f/k/a MacGregor Sporting Goods Inc., Innovative
            Promotions, Inc., Ernest Wood, Jr., Harry Wood, Pursuit Athletic
            Footwear, Inc., and Riddell Athletic Footwear, Inc. (33)

10.41       License Agreement dated March 4, 1998 between Footstar Corp. and
            Equilink Licensing Corporation (34)

10.42       Umbro License Agreement, dated as of November 23, 1998, between
            Umbro International, Inc. and Varsity Spirit Fashions & Supplies,
            Inc. (1-B)

10.43       Asset and USISL Stock Purchase Agreement, dated as of November 1998,
            between Umbro International, Inc. and Varsity Spirit Fashions &
            Supplies, Inc. (1-A)

10.44       Signal/Riddell Expense Sharing Arrangement dated November 23, 1998,
            between Signal Apparel Company, Inc. and Riddell Sports Inc. (1-B)

10.45       Industrial Lease and Agreement dated October 1, 1998, between
            Laphiew Gin Company and Varsity Spirit Corporation. (1-B)

10.46       Amended and Restated Loan, Guaranty And Security Agreement dated as
            of April 20, 1999 among the financial institutions named therein, as
            the Lenders, Bank of America National Trust and Savings Association,
            as the Agent, Riddell Sports Inc., as the Parent Guarantor, Riddell,
            Inc., All American Sports Corporation, Varsity Spirit Corporation,
            and Varsity Spirit Fashions & Supplies, Inc. collectively, as the
            Borrower and all other subsidiaries of the Parent Guarantor,
            collectively, as the Subsidiary Guarantors. (36)

10.47       Form of Subscription Agent Agreement, by and between Riddell and
            American Stock Transfer & Trust Company. (1-A)

                                      II-6
10.48       Form of Solicitation Agent's Agreement by and between Riddell and
            H.C. Wainwright & Co., Inc. (1)

21          List of subsidiaries. (33)

23          Consent of Grant Thornton LLP regarding Riddell Sports Inc. (1-A)

23.1        Consent of Zukerman Gore & Brandeis, LLP (included in Exhibit 5.1)

99.1        Form of Instructions for Use of Riddell Rights Certificates. (1-A)

99.2        Form of Notice of Guaranteed Delivery for Subscription Rights. (1-A)

99.3        Form of Letter to Stockholders Who Are Record Holders. (1-A)

99.4        Form of Letter to Stockholders Who Are Beneficial Holders. (1-A)

99.5        Form of Letter to Clients of Stockholders Who Are Beneficial
            Holders. (1-A)

99.6        Form of Nominee Holder Certification Form. (1-A)

99.7        Substitute Form W-9 for Use with the Rights Offering. (1-A)

99.8        Form of Beneficial Owner Election Form. (1-A)

----------

      (1)   Filed herewith.

      (1-A) To be filed by amendment.

      (1-B) Incorporated by reference to Riddell Sports Inc.'s Form 10K report
            (Commission File No. 001-14629) for the year ended December 31,
            1998.

      (2)   Incorporated by reference to Riddell Sports Inc.'s Registration
            Statement on Form S-1 (Commission File No. 33-40488) effective June
            27, 1991 (including all pre-effective amendments to the Registration
            Statement).

      (3)   Incorporated by reference to Riddell Sports Inc.'s Form 10-K report
            (Commission File No. 0-19298) for the year ended December 31, 1991.

      (4)   Incorporated by reference to Riddell Sports Inc.'s Registration
            Statement on Form S-1 (Commission File No. 33-40488) effective June
            17, 1992 (including all pre-effective amendments to the Registration
            Statement).

      (5)   Incorporated by reference to Riddell Sports Inc.'s Form 10-Q report
            (Commission File No. 0-19298) for the quarter ended June 30, 1992.

      (6)   Incorporated by reference to Riddell Sports Inc.'s Form 10-Q report
            (Commission File No. 0-19298) for the quarter ended September 30,
            1992.

      (7)   Incorporated by reference to Riddell Sorts Inc.'s Form 10-K report
            (Commission File No. 0-19298) filed on March 30, 1993.

                                      II-7
(8)   Incorporated by reference to Riddell Sports Inc.'s Post Effective
            Amendment No. 2 to Form S-1 Registration Statement (Commission File
            No. 33-47884) filed on January 28, 1994.

      (9)   Incorporated by reference to Riddell Sports Inc.'s Form 10-K for the
            year ended December 31, 1993.

      (10)  Incorporated by reference to Riddell Sports Inc.'s Form 10-K/A
            constituting Amendment No. 1 to Form 10-K for the year ended
            December 31, 1993, filed June 21, 1994.

      (11)  Incorporated by reference to Riddell Sports Inc.'s Form 10-Q for the
            quarter ended March 31, 1994.

      (12)  Incorporated by reference to Riddell Sports Inc.'s Form 10-Q for the
            quarter ended June 30, 1994.

      (13)  Incorporated by reference to Riddell Sports Inc.'s Form 8-K filed
            July 3, 1994.

      (14)  Incorporated by reference to Riddell Sports Inc.'s Form 10-Q for the
            quarter ended September 30, 1994.

      (15)  Incorporated by reference to Riddell Sports Inc.'s Form 8-K filed
            January 11, 1994.

      (16)  Incorporated by reference to Riddell Sports Inc.'s Form 10-K for the
            year ended December 31, 1994.

      (17)  Incorporated by reference to Riddell Sports Inc.'s Form 8-K dated
            June 23, 1995.

      (18)  Incorporated by reference to Riddell Sports Inc.'s Form 10-K for the
            year ended December 31, 1995, dated November 11, 1996.

      (19)  Incorporated by reference to Riddell Sports Inc.'s Form 10-Q dated
            May 14, 1996.

      (20)  Incorporated by reference to Riddell Sports Inc.'s Form 10-Q dated
            November 11, 1996.

      (21)  Incorporated by reference to Riddell Sports Inc.'s Form 10-K for the
            year ended December 31, 1996.

      (22)  Incorporated by reference to Riddell Sports Inc.'s Proxy Statement
            filed June 6, 1997.

      (23)  Incorporated by reference to Riddell Sports Inc..'s Form 8-K dated
            June 19, 1997.

      (24)  Incorporated by reference to the Varsity Spirit Corporation's
            Registration Statement on Form S-1 (Registration Statement No.
            33-44431) filed on December 10, 1991.

      (25)  Incorporated by reference to the Varsity Spirit Corporation's
            Amendment No. 1 to Registration Statement on Form S-1 (Registration
            Statement No. 33-44431) filed on January 21, 1992.

                                      II-8
(26)  Incorporated by reference to the Varsity Spirit Corporation's Annual
            Report on Form 10-K for the year ended March 31, 1993 (File No.
            0-19790).

      (27)  Incorporated by reference to the Varsity Spirit Corporation's
            Transition Report on Form 10-K for the transition period April 1,
            1994 to December 31, 1994 (File No. 0-19790)

      (28)  Incorporated by reference to the Varsity Spirit Corporation's
            Quarterly Report on Form 10-Q for the quarter ended June 30, 1996
            (File No. 0-19790).

      (29)  Incorporated by reference to the Varsity Spirit Corporation's
            Quarterly Report on Form 10-Q for the quarter ended September 30,
            1996 (File No. 0-19790).

      (30)  Incorporated by reference to the Varsity Spirit Corporation's annual
            Report on Form 10-K for the year ended December 31, 1996 (File No.
            0-19790).

      (31)  Incorporated by reference to Riddell Sports Inc.'s Report on Form
            8-K filed May 8, 1996.

      (32)  Incorporated by reference to Varsity Spirit Corporation Schedule 13D
            filed June 25, 1997.

      (33)  Incorporated by reference to Riddell Sports Inc.'s Registration
            Statement on Form S-4 (Registration No. 333-31525) filed July 18,
            1997.

      (34)  Incorporated by reference to Riddell Sports Inc.'s Form 10-K Report
            for the year ended 1997 (file No. 0-19298).

      (35)  Incorporated by reference to Riddell Sports Inc.'s Form 10-Q dated
            May 15, 1998.

      (36)  Incorporated by reference to Riddell Sports Inc's Form 10-Q dated
            March 31, 1999.

      (b)   Financial Statement Schedules

            Report of Independent Certified Public Accountants on Schedules

            Schedule II - Valuation and Qualifying Accounts

            All other financial statement schedules are omitted as the required
            information is presented in the financial statements or the notes
            thereto or is not necessary.

Item 17. Undertakings.

 The undersigned registrant hereby undertakes:

      (1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:

      (i)   To include any prospectus required by section 10(a)(3) of the
            Securities Act of 1933.

                                      II-9
(ii)  To reflect in the prospectus any facts or events arising after the
            effective date of the registration statement (or the most recent
            post-effective amendment thereof) which, individually or in the
            aggregate, represent a fundamental change in the information set
            forth in the registration statement. Notwithstanding the foregoing,
            any increase or decrease in volume of securities offered (if the
            total dollar value of securities offered would not exceed that which
            was registered) and any deviation from the low or high and of the
            estimated maximum offering range may be reflected in the form of
            prospectus filed with the Commission pursuant to Rule 424(b) if, in
            the aggregate, the changes in volume and price represent no more
            than a 20 percent change in the maximum aggregate offering price set
            forth in the "Calculation of Registration Fee" table in the
            effective registration statement.

      (iii) To include any material information with respect to the plan of
            distribution not previously disclosed in the registration statement
            or any material change to such information in the registration
            statement;

      (2) That, for the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.

      (3) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.

      (4) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.

      (5) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the registrant's annual report pursuant to section
13(a) or 15(d) of the Securities Exchange Act of 1934 that is incorporated by
reference in the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.

      (6) The undersigned registrant hereby undertakes to supplement the
prospectus, after the expiration of the subscription period, to set forth the
results of the subscription offer, the transactions by the standby group during
the subscription period, the amount of unsubscribed securities to be purchased
by the standby group, and the terms of any subsequent reoffering thereof. If any
public offering by the standby group is to be made on terms differing from those
set forth on the cover page of the prospectus, a post-effective amendment will
be filed to set forth the terms of such offering.

                                     II-10
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions described under Item 15 above, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of our counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.

Signatures

      Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-1 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of New York, State of New York, on December 14, 1999.

      Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.

                                     RIDDELL SPORTS INC.

                                     By: /s/ David Mauer
                                        ------------------------
                                        David Mauer

                                     Chief Executive Officer

      KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints DAVID M. MAUER and DAVID GROELINGER and each of
them, as his true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution for him and in his name, place and stead, in any
and all capacities to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and
agent full power and authority to do and perform each and every act and thing
requisite or necessary to be done in and about the premises, as fully as to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent or any of them, or his
substitutes, may lawfully do or cause to be done by virtue thereof.

      Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates

                                     II-11
indicated.

/s/ David M. Mauer           Chief Executive Officer           December 14, 1999
--- ----- -- -----           and Director David M. Mauer
(Principal Executive Officer)

/s/ Robert Nederlander       Chairman of the Board             December 14, 1999
--- ------ -----------
Robert Nederlander

/s/ Jeffrey G. Webb          Vice Chairman of the Board        December 14, 1999
--- ------- -- ----          and President and Chief
Jeffrey G. Webb              Operating Officer of
                             Varsity Spirit Corporation

/s/ Leonard Toboroff         Vice President and Director       December 14, 1999
--- ------- --------
Leonard Toboroff

/s/ David Groelinger         Executive Vice President and      December 14, 1999
--- ----- ----------         Chief Financial Officer
David Groelinger             (Principal Financial Officer)

/s/ Lawrence Simon           Senior Vice President             December 14, 1999
--- -------- -----           (Principal Accounting Officer)
Lawrence Simon

/s/ Don Kornstein            Director                          December 14, 1999
--- --- ---------
Don Kornstein

/s/ John McConnaughy, Jr.    Director                          December 14, 1999
--- ---- ------------ ---
John McConnaughy, Jr.

/s/ Glenn E. Schembechler    Director                          December 14, 1999
--- ----- -- ------------
Glenn E. Schembechler

/s/ Arthur N. Seessel, III   Director                          December 14, 1999
--- ------ -- -------- ---
Arthur N. Seessel, III

                                     II-12
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
                                  ON SCHEDULE

Board of Directors
Riddell Sports Inc.

     In connection with our audit of the consolidated financial statements of
Riddell Sports Inc. and Subsidiaries referred to in our report dated February
21, 1998, which is included in the prospectus constituting Part I of this
Registration Statement, we have also audited Schedule II for each of the three
years in the period ended December 31, 1998. In our opinion, this schedule
presents fairly, in all material respects, the information required to be set
forth therein.

                                          GRANT THORNTON LLP

Chicago, Illinois
February 19, 1999

                                      S-1
SCHEDULE II

                      RIDDELL SPORTS INC. AND SUBSIDIARIES
                       VALUATION AND QUALIFYING ACCOUNTS
COL. A                           COL. B              COL. C                COL. D         COL. E
-------------------------------------------------   ----------    -----------------------     ----------     ----------
                                                                         ADDITIONS
                                                                  -----------------------
                                                                                  (2)
                                                                    (1)         CHARGED
                                                    BALANCE AT    CHARGED TO    TO OTHER                     BALANCE AT
                                                    BEGINNING     COSTS AND     ACCOUNTS--                    END OF
                   DESCRIPTION                      OF PERIOD     EXPENSES      DESCRIBE      DEDUCTIONS      PERIOD
                   -----------                      ----------    ----------    ---------     ----------     ----------
Year ended December 31, 1996
  Allowance for doubtful accounts................      $620          $436            --          $543(a)       $  513
Year ended December 31, 1997
  Allowance for doubtful accounts................      $513          $365         $ 325(b)       $379(a)       $  824
Year ended December 31, 1998
  Allowance for doubtful accounts................      $824          $929            --          $451(a)       $1,302
------------------

Notes: (a) Accounts written off net of recoveries

       (b) Addition charged to other accounts for 1997 is the initial balance
           from the Varsity acquisition.

                                      S-2