1019737--3/16/2006--NAVIGANT_CONSULTING

related topics

{personnel, key, retain}

{regulation, government, change}

{customer, product, revenue}

{acquisition, growth, future}

{financial, litigation, operation}

{cost, operation, labor}

{stock, price, operating}

{system, service, information}

{tax, income, asset}

{control, financial, internal}

{interest, director, officer}

The Company s inability to retain and, as necessary, strengthen our executive management team would be detrimental to the success of our business. The Company s inability to retain highly skilled consulting professionals could have a material adverse effect on the Company. The Company s profitability will suffer if it is not able to maintain current pricing and utilization rates. The Company s use of equity- based compensation could impact its ability to attract, retain and motivate key employees, if the Company s stock price declines. The Company faces significant challenges in achieving and managing growth. Failure to meet these management challenges could have a material adverse effect on the future profitability of the Company. The Company may be exposed to potential risks if the Company is unable to maintain effective internal controls. Regulatory and legislative changes affecting the Company, its clients, competitors, or staff could have an impact on the Company s business. The Company s client engagements are generally short term in nature, less than one year, and may be terminated. The Company s inability to attract business from new or existing clients could have a material adverse effect on the Company. The Company s client engagements and revenues are frequently event-driven and therefore difficult to forecast. The Company has invested in specialized systems, processes and intellectual capital for which the Company may fail to recover its investment or which may become obsolete. The Company s unsuccessful client engagements could result in damage to its professional reputation or legal liability which could have a material adverse effect on the Company. Some of the work that the Company does involves greater risk than ordinary consulting engagements. As the Company becomes larger, the Company increasingly encounter professional conflicts of interest. The Company cannot be certain that it will be able to raise capital or obtain debt financing to execute future acquisitions or to meet required working capital needs. The Company may not be able to acquire businesses in the future and already acquired business may not achieve expected results. The substantial majority of the purchase price the Company pays for acquired businesses is related to intangible assets and the value of these assets may not be realized. As the Company s work with governmental clients increases, this increases the risks inherent in the governmental contracting process. The Company is subject to unpredictable risks of litigation.

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1019737--3/16/2006--NAVIGANT_CONSULTING_INC