1027207--3/1/2010--EPIQ_SYSTEMS

related topics

{system, service, information}

{financial, litigation, operation}

{property, intellectual, protect}

{stock, price, operating}

{operation, international, foreign}

{regulation, change, law}

{acquisition, growth, future}

{stock, price, share}

{tax, income, asset}

{product, market, service}

{interest, director, officer}

{personnel, key, retain}

{provision, law, control}

{condition, economic, financial}

We compete with other third party providers on the basis of the technological features, capabilities and price of our products and services, and we could lose existing customers and fail to attract new business if we do not keep pace with technological changes and offer competitive pricing for our products and services. Security problems with our software products, systems or services could cause increased service costs and damage to our reputation. Improper disclosure of personal data could harm our reputation and result in liability and increased expense for litigation and diversion of management time. Errors or fraud related to our business processes could cause increased expense for litigation and diversion of management attention. Any claims or threats of litigation could distract us from business operations and strategic planning, and costs of litigation or settlement could adversely affect our financial condition or results of operations. Interruptions or delays in service at the data centers we utilize could impair the delivery of our service and harm our business. Releases of new software products or upgrades to our existing software products may have undetected errors, which could cause litigation claims against us or damage to our reputation. Our software solutions may not achieve our customer's desired objectives, which could cause loss of business and potential litigation claims against us or damage to our reputation. We rely on third-party hardware and software, which could cause errors or failures of our software or services. Revenue in our bankruptcy segment related to trustee deposits is collected through a few financial institutions, and the adverse modification or termination of any of those arrangements, including a component of pricing tied to prevailing interest rates, could cause uncertainty and adversely affect our future bankruptcy segment revenue and earnings. We depend upon our key personnel, and we may not be able to retain them or to attract, assimilate and retain highly qualified employees in the future. The integration of acquired businesses is time consuming, may distract our management from our other operations, and can be expensive, all of which could reduce or eliminate our expected earnings. We continue to expand our business internationally, which subjects us to additional risks associated with these international operations. To the extent our revenues are paid in foreign currencies, and currency exchange rates become unfavorable, we may lose some of the economic value of the revenues in U.S. dollar terms. Our intellectual property is not protected through patents or formal copyright registration. Therefore, we do not have the full benefit of patent or copyright laws to prevent others from replicating our software. We may be sued by third parties for alleged infringement of their proprietary rights. Compliance with changing regulation of financial reporting, corporate governance and public disclosure may result in additional expenses and diversion of management time and attention from operational activities. Future government legislation or changes in court rules could adversely affect one or more of our business segments. Goodwill comprises a significant portion of our total assets. We assess goodwill for impairment at least annually, which could result in a material, non-cash write-down and could have a material adverse effect on our results of operations and financial condition. The continuing uncertainty in national and global economic conditions could negatively affect our business, results of operations and financial condition. Our quarterly results have fluctuated in the past and may fluctuate in the future. If they do, our operating results may not meet the expectations of securities analysts or investors. This could cause fluctuations in the market price of our common stock. The market price of our common stock may be volatile even if our quarterly results do not fluctuate significantly. We historically have not paid cash dividends on our common stock and our common stock may not appreciate in value or even maintain the price at which it was purchased. The use of our common stock to fund acquisitions or to refinance debt incurred for acquisitions could dilute existing shares. Our articles of incorporation and Missouri law contain provisions that could be used by us to discourage or prevent a takeover of our company.

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1027207--3/1/2010--EPIQ_SYSTEMS_INC