1073857--4/2/2007--CRDENTIA

related topics

{regulation, government, change}

{personnel, key, retain}

{debt, indebtedness, cash}

{provision, law, control}

{acquisition, growth, future}

{stock, price, share}

{interest, director, officer}

{tax, income, asset}

{control, financial, internal}

{financial, litigation, operation}

{condition, economic, financial}

Our independent registered public accounting firm issued a going concern opinion on our financial statements, questioning our ability to continue as a going concern. We have a history of losses, and we may not achieve or maintain profitability. We may face difficulties identifying acquisitions and integrating these acquisitions into our operations. These acquisitions may be unsuccessful, involve significant cash expenditures or expose us to unforeseen liabilities. There is no active public market for our common stock, and the trading price of our common stock is subject to volatility. Our need to raise additional capital in the future could have a dilutive effect on your investment. Our credit facility and revolving note impose significant expenses on us and we could incur significant additional expenses in the event of default. The agreements governing the convertible debentures contain covenants and restrictions that may limit our ability to operate our business. MedCap Partners L.P. controls a significant amount of our outstanding capital stock, and this may delay or prevent a change of control of the company or adversely affect our stock price. If we do not continue to attract and retain key employees our business could suffer. If we are unable to attract qualified nurses and healthcare professionals for our healthcare staffing business, our business could be negatively impacted. The temporary staffing industry is highly competitive and the success and future growth of our business depend upon our ability to remain competitive in obtaining and retaining temporary staffing clients. Our business depends upon our continued ability to secure and fill new orders from our hospital and healthcare facility clients, because we do not have long-term agreements or exclusive contracts with them. Fluctuations in patient occupancy at our clients hospitals and healthcare facilities and/or nurse turnover rates may adversely affect the demand for our services and therefore the profitability of our business. We could be difficult to acquire due to anti-takeover provisions in our charter documents and Delaware law. We operate in a regulated industry and changes in regulations or violations of regulations may result in increased costs or sanctions that could reduce our revenues and profitability. Further government regulations or healthcare reform could negatively impact our business opportunities, revenues and margins. Significant legal actions could subject us to substantial uninsured liabilities. We may be legally liable for damages resulting from our hospital and healthcare facility clients mistreatment of our healthcare personnel. We have a substantial amount of goodwill and other intangible assets on our balance sheet. Our level of goodwill and other intangible assets may have the effect of decreasing our earnings or increasing our losses. Demand for medical staffing services is significantly affected by the general level of economic activity and unemployment in the United States.

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1073857--4/2/2007--CRDENTIA_CORP