1030471--10/10/2007--UTSTARCOM

related topics

{operation, international, foreign}

{stock, price, share}

{cost, regulation, environmental}

{financial, litigation, operation}

{system, service, information}

{control, financial, internal}

{investment, property, distribution}

{product, market, service}

{tax, income, asset}

{provision, law, control}

{competitive, industry, competition}

{stock, price, operating}

{regulation, change, law}

FACTORS AFFECTING FUTURE OPERATING RESULTS RISKS RELATED TO OUR COMPANY Our multinational operations subject us to various economic, political, regulatory and legal risks. We do business in markets that are not fully developed, which subjects us to various economic, political, regulatory and legal risks unique to developing economies. Our wireless handset products are subject to a wide range of environmental, health and safety laws, and may expose us to potential health and environmental liability claims. We are subject to a wide range of environmental, health and safety laws and efforts to comply with such laws may be costly and may adversely impact our financial performance. Currency rate fluctuations and exchange controls may adversely affect our cash flow and operating results. Business interruptions could adversely affect our business. We may suffer losses with respect to equipment held at customer sites, which could harm our business. Restrictions on the use of handsets while driving could affect our future growth. We have been named as a defendant in securities litigation and other lawsuits, as well as lawsuits in the ordinary course of business. We face risks related to pending governmental inquiries. Failure to achieve and maintain effective internal controls in accordance with Section 404 of the Sarbanes-Oxley Act of 2002 could have a material adverse effect on our business and stock price. RISKS RELATED TO CONDUCTING BUSINESS IN CHINA China s governmental and regulatory reforms may impact our ability to do business in China. China s changing economic environment may impact our ability to do business in China. Uncertainties with respect to the Chinese legal system may adversely affect us. If tax benefits available to our subsidiaries located in China are reduced or repealed, our business could suffer. Our ability to continue successful deployment of PAS system and sales of PAS handsets are limited by certain factors, including the following: RISKS RELATED TO OUR STOCK PERFORMANCE AND CONVERTIBLE DEBT SECURITIES Our stock price is highly volatile. SOFTBANK CORP. with its related entities, including SOFTBANK America Inc., has significant influence over our management and affairs, which it could exercise against the best interests of our stockholders. Delaware law and our charter documents contain provisions that could discourage or prevent a potential takeover, even if the transaction would benefit our stockholders. Our failure to timely file periodic reports with the Securities and Exchange Commission could result in the delisting of our common stock from the NASDAQ Stock Market.

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1030471--10/10/2007--UTSTARCOM_INC