1095330--3/6/2006--SYMYX_TECHNOLOGIES

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Most of our revenue is generated from a small number of key customers and the loss of a key customer could substantially reduce our revenues and be perceived as a loss of momentum in our business Failure to integrate our various software products and achieve customer acceptance of the electronic laboratory notebook technology would harm our revenue and operating results Business activities such as the development of a new line of business or the acquisition of a company or technology could disrupt our business, affect our operating results and distract our management team We may not be able to maintain and grow a profitable business Failure to successfully commercialize our discoveries would reduce our revenues and profitability and harm our business We are dependent on the research and development activities of companies in the chemical, energy, pharmaceutical, electronics, consumer goods, and automotive industries, and declines or reductions in research and development activities in these industries could harm our business We cannot predict the pace, quality or number of discoveries we may generate, and any inability of ours to generate a significant number of discoveries would reduce our revenues and harm our business Difficulties we may encounter managing our growth may divert resources and limit our ability to successfully expand our operations We conduct research programs for our own account and for a number of collaborative partners, and any conflicts between these programs would harm our business We have a limited number of contracts for the sale of Symyx Tools systems and for the licensing of intellectual property, software, technologies, and materials to date, and we cannot assure you that we will be able to build a sustainable business related to either the sale of additional systems or the licensing of intellectual property, software, technologies, and materials The loss of key personnel or the inability to attract and retain additional personnel could have a material adverse effect on our results of operations Competition could increase, and competitive developments could render our technologies obsolete or noncompetitive, which would reduce our revenues and harm our business Our inability to adequately protect our proprietary technologies could harm our competitive position and have a material adverse effect on our business Failure to adequately enforce our intellectual property rights could harm our competitive position and have a material adverse effect on our business Our business may be harmed if we are found to infringe proprietary rights of others We expect that our quarterly results of operations will fluctuate, and this fluctuation could cause our stock price to decline, causing investor losses Our stock price has been and may continue to be volatile We depend on a limited number of suppliers and will be delayed in our manufacture or unable to manufacture our Symyx Tools if shipments from these suppliers are delayed or interrupted Our investments could lose market value and consequently harm our ability to fund continuing operations Changes in accounting standards regarding stock option plans have limited the desirability of granting stock options, which may harm our ability to attract and retain employees, reduce our profitability and may affect our stock price Failure to maintain effective internal controls in accordance with Section 404 of the Sarbanes-Oxley Act could have a material adverse effect on our business and stock price If our products contain defects, it could harm our revenues and expose us to litigation We are exposed to general global economic and market conditions We are exposed to risks associated with export sales and operations that may limit our ability to generate revenue from our products and intellectual property Any inability of ours to keep pace with technological advances and evolving industry standards would harm our business We use hazardous materials in our business, and any claims relating to improper handling, storage or disposal of these materials could subject us to significant liabilities Our facilities are located near known earthquake fault zones, and the occurrence of an earthquake or other disaster could cause damage to our facilities and equipment and harm our business Some of our existing stockholders can exert control over us, and may not make decisions that are in the best interests of all stockholders Provisions of our charter documents may have anti-takeover effects that could prevent a change in our control, even if this would be beneficial to stockholders

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1095330--3/6/2006--SYMYX_TECHNOLOGIES_INC