1100885--3/14/2006--DIGITAS

related topics

{system, service, information}

{product, market, service}

{acquisition, growth, future}

{stock, price, operating}

{provision, law, control}

{financial, litigation, operation}

{regulation, government, change}

{condition, economic, financial}

{stock, price, share}

{loan, real, estate}

{operation, natural, condition}

{property, intellectual, protect}

{competitive, industry, competition}

{regulation, change, law}

{cost, contract, operation}

{interest, director, officer}

{cost, regulation, environmental}

Risks Related to our Business The loss of even one significant client or any significant reduction in the use of our services could have a material adverse effect on our business, financial condition and results of operations. The bankruptcy or insolvency of a significant client could have a material adverse effect on our business, financial condition and results of operations. We may be held liable for financial or other commitments that we enter into for or on behalf of our clients. Our failure to meet clients expectations could result in losses or negative publicity and could subject us to liability for the services we provide. Failure to manage our growth may impact operating results. Actual and perceived conflicts of interest may restrict us in obtaining new clients. We may need to increase reserves for surplus office space if subtenants fail to pay their rent. Fluctuations in our quarterly revenues and operating results may lead to reduced prices for our stock. Our business will be negatively affected if we do not keep up with rapid technological changes, evolving industry standards and changing client requirements. If we are not successful in expanding our ability to service clients on a worldwide basis, we may jeopardize relationships with existing clients and limit our ability to attract new clients. Failure to maintain our reputation and expand name recognition could impair our ability to remain competitive. Our industry is highly competitive, rapidly changing and has low barriers to entry; if we cannot effectively compete, our revenue may decline. Past and potential future acquisitions could be difficult to integrate, disrupt business, adversely affect operating results and dilute shareholder value. Increased government regulation of various direct marketing channels and the marketing of some products could adversely affect our business. We may need to raise additional capital, which may not be available, and which may dilute the ownership interests of current investors. Acts of war or terrorism, or related effects could adversely affect our business, operating results and financial condition. An economic recession or downturn in the United States or abroad may result in a reduction in our revenues and operating results. Risks Related to the Securities Markets Our stock price has been and is likely to continue to be volatile and may result in substantial losses for investors. Risks Related to Legal Uncertainty We may be subject to claims that our client work, or our client s use of our work, violates the intellectual property rights of a third party. We may not be able to protect our intellectual property and proprietary rights. Changes in government regulation of the Internet and other emerging technologies could adversely affect our business. We may become subject to claims regarding foreign laws and regulations that could result in increased expenses. Provisions of Delaware law and of our charter and by-laws may make a takeover more difficult. Anti-takeover provisions could make it more difficult for a third party to acquire us.

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1100885--3/14/2006--DIGITAS_INC