1016100--3/30/2006--DIGITAL_LIGHTWAVE

related topics

{stock, price, share}

{stock, price, operating}

{product, market, service}

{customer, product, revenue}

{acquisition, growth, future}

{regulation, change, law}

{control, financial, internal}

{operation, international, foreign}

{product, candidate, development}

{condition, economic, financial}

{financial, litigation, operation}

{cost, operation, labor}

{personnel, key, retain}

{competitive, industry, competition}

{property, intellectual, protect}

{debt, indebtedness, cash}

{interest, director, officer}

Our ability to continue as a going concern is uncertain. We are unable to meet our current obligations. We need to raise additional capital. We are dependent on contract manufacturers to produce our printed circuit assemblies and rely on sole and limited source suppliers which could adversely affect our operations. Our largest stockholder has substantial influence over us and could dilute the interests of our other stockholders as a result of his interests as our largest stockholder and principal creditor. We experience fluctuations in our operating results. The initiatives we have undertaken to reduce costs may have long-term adverse effects on our business. Changes in United States and worldwide economies and fluctuations in capital expenditures within the telecommunications industry could adversely affect us. Economic, political and other risks associated with international sales and operations could adversely affect our results of operations. We may not be able to achieve sustained operating profitability. Future changes in financial accounting standards or taxation rules may adversely affect our reported results of operations. Compliance with the Sarbanes-Oxley Act will cause us to incur additional expenses. We may engage in acquisitions, mergers, strategic alliances, joint ventures and divestitures that could result in financial results that are different than expected. We are dependent on key personnel and our ability to recruit and retain such personnel may affect our business. We are dependent on a limited number of products and are uncertain of the market for our current products and planned new products. Our industry is subject to rapid technological change. Our products serve an industry that is extremely competitive, and such competition may negatively affect our business. We are dependent on a limited number of major customers and a decrease in orders from any major customer could decrease our net sales. We are dependent on our products continuing to meet changing regulatory and industry standards. We are dependent on proprietary technology. The market price of our common stock may be volatile. The sale or issuance of a significant number of shares of our stock could depress the price of our stock. We are exposed to various risks related to legal proceedings or claims. Our common stock is classified as a penny stock under SEC rules, which may make it more difficult for our stockholders to resell our common stock.

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1016100--3/30/2006--DIGITAL_LIGHTWAVE_INC