1014672--3/12/2010--CALIPER_LIFE_SCIENCES

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Risks Related To Our Business We expect to incur future operating losses and may not achieve profitability. Our LabChip products may not achieve widespread market acceptance, which could cause our revenue to grow slowly or decline and make it more difficult for us to achieve or maintain profitability. If our in vivo optical imaging products and services do not become more widely used by pharmaceutical, biotechnology and life sciences researchers, our revenue will grow more slowly than expected or decline and make it more difficult for us to achieve or maintain profitability. Failure to maintain our credit facility borrowing base, raise additional capital or generate the significant capital necessary to expand our operations and invest in new products could reduce our ability to compete and result in lower revenue. Failure to remain in compliance with the covenants included in our revolving credit facility could interfere with or prevent our ability to obtain additional advances under this credit facility. We receive significant revenue from out-licensing our patent estates for microfluidic technology and in vivo optical imaging methods, and may not be able to replace such revenue upon the expiration of those patents. We receive significant licensing revenue from commercial users of our patented in vivo optical imaging methods, and our ability to continue to receive this licensing revenue in the future will depend upon our ability to convince commercial users of the value of our patented imaging methods and our ability to enforce and defend the validity of such patents. Because we receive revenue principally from pharmaceutical and biotechnology companies and biomedical research institutions, the current economic conditions faced by and regulatory requirements imposed upon those companies and institutions, as well as their capital spending policies, may have a significant effect on the demand for our products. Our future revenue is unpredictable and could cause our operating results to fluctuate significantly from quarter to quarter. Our intellectual property rights may not provide meaningful commercial protection for our products, which could enable third parties to use our technology, or very similar technology, and could reduce our ability to compete in the market. We have previously been and are currently involved in patent litigation. In connection with this litigation, the patents on which we rely may be challenged and invalidated. We may need to initiate other lawsuits to protect or enforce our patents or other proprietary rights. Patent litigation tends to be expensive and, if we lose, may cause us to lose some of our intellectual property rights, which would reduce our ability to compete in the market and may cause our stock price to decline. Acquisitions may have unexpected consequences or impose additional costs on us. Business divestitures may have unexpected consequences or impose additional costs on us. The delay, termination or non-renewal of a large multi-year contract or the loss of, or a significant reduction in, sales to any of our significant customers could harm our operating results. The temporary or permanent closure of a leased facility could harm our operating results. Our success will depend partly on our ability to operate without infringing or misappropriating the proprietary rights of others. Our rights to the use of technologies licensed to us by third parties are not within our control, and without these technologies, our products and programs may not be successful and our business prospects could be harmed. Our tax net operating losses and credit carryforwards may expire if we do not achieve or maintain profitability, or if tax regulations are changed such that they no longer allow previously generated tax net operating losses to be utilized. If we are unable to meet customer demand, it would adversely impact our financial results and restrict our sales growth. We depend on a limited number of suppliers for components of IVIS imaging systems, and we will be unable to manufacture or deliver our products if shipments from these suppliers are interrupted or are not supplied on a timely basis. Accounting for the potential impairment of goodwill and other intangible assets may have a significant adverse effect on us. If our accounting estimates are incorrect, our financial results could be adversely affected. Terrorist acts, acts of war and natural disasters may seriously harm our business and revenues, costs and expenses and financial condition. We use hazardous materials in our business. Any claims relating to improper handling, storage or disposal of these materials could be time consuming and costly. Compliance with governmental regulations could increase our operating costs, which would adversely affect the commercialization of our technology. Public perception of ethical and social issues may limit or discourage the use of mice for scientific experimentation, which could reduce our revenues and adversely affect our business. Risks Related to Owning Our Common Stock Our stock price is extremely volatile, and you could lose a substantial portion of your investment. Provisions of our charter documents and Delaware law may inhibit a takeover, which could limit the price investors might be willing to pay in the future for our common stock.

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1014672--3/12/2010--CALIPER_LIFE_SCIENCES_INC