1082923--3/14/2006--STAMPS.COM

related topics

{product, market, service}

{stock, price, share}

{system, service, information}

{provision, law, control}

{regulation, change, law}

{property, intellectual, protect}

{control, financial, internal}

{personnel, key, retain}

{tax, income, asset}

{cost, operation, labor}

{stock, price, operating}

Risks Related to Our Business We may not successfully implement strategies to increase the adoption of our services and products which would limit our growth, adversely affect our business and cause the price of our common stock to decline. We have a history of losses and we may incur losses in the future which may reduce the trading price of our common stock. We implemented pricing plans that may adversely affect our future revenues and margins. If we do not successfully attract and retain skilled personnel for permanent management and other key personnel positions, we may not be able to effectively implement our business plan. The success of our business will depend upon the continued acceptance by customers of our service. If we fail to effectively market and sell our services and products, our business will be substantially harmed and could fail. If we fail to meet the demands of our customers, our business will be substantially harmed and could fail. A failure to further develop and upgrade our services and products could adversely affect our business. Third party assertions of violations of their intellectual property rights could adversely affect our business. A failure to protect our own intellectual property could harm our competitive position. System and online security failures could harm our business and operating results. Risks Related to Our Industry US Postal Service regulations or fee assessments may cause disruptions or discontinuance of our business. If we are unable to compete successfully, particularly against large, traditional providers of postage products such as Pitney Bowes, our revenues and operating results will suffer. If we do not respond effectively to technological change, our services and products could become obsolete and our business will suffer. Our operating results could be impaired if we or the Internet become subject to additional government regulation and legal uncertainties. Risks Related to Our Stock Changes in stock option accounting rules will have an adverse affect on our operating results. The tax value of our net operating losses could be impaired if we trigger a change of control pursuant to Section 382 of the Internal Revenue Code. Our charter documents could deter a takeover effort, which could inhibit your ability to receive an acquisition premium for your shares. The US Postal Service may object to a change of control of our common stock. Our stock price is volatile. Shares of our common stock held by existing stockholders may be sold into the public market, which could cause the price of our common stock to decline.

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1082923--3/14/2006--STAMPS.COM_INC