1104252--3/12/2007--DDI

related topics

{customer, product, revenue}

{product, market, service}

{acquisition, growth, future}

{personnel, key, retain}

{debt, indebtedness, cash}

{property, intellectual, protect}

{stock, price, share}

{cost, regulation, environmental}

{cost, operation, labor}

{competitive, industry, competition}

{condition, economic, financial}

{product, liability, claim}

We may need additional capital in the future and it may not be available on acceptable terms, or not at all. We may issue additional shares of common stock that may dilute the value of our common stock and adversely affect the market price of our common stock. The terms of our senior credit facility may restrict our financial and operational flexibility. Our customers are subject to economic cycles and fluctuations in product demand. A significant downturn in demand for our customers products would similarly affect demand for our products and as such our sales, gross margin and operating performance would be adversely affected. Unless we are able to respond to technological change at least as quickly as our competitors, our services could be rendered obsolete, which would reduce our sales and operating margins. We may experience significant fluctuation in our revenue because we sell primarily on a purchase order basis, rather than pursuant to long-term contracts. We rely on a core group of significant customers for a substantial portion of our revenue, and a reduction in demand from, or an inability to pay by, this core group could adversely affect our revenue. If we experience excess capacity due to variability in customer demand, our gross margins may decline. We are subject to intense competition, and our business may be adversely affected by these competitive pressures. If Asian-based production capabilities increase in sophistication, we may lose market share, and our gross margins may be adversely affected by increased pricing pressure. Defects in our products could result in financial or other damages to our customers, which could result in reduced demand for our services and liability claims against us. If we are unable to protect our intellectual property or infringe or are alleged to infringe others intellectual property, our operating results may be adversely affected. Complying with applicable environmental laws requires significant resources and, if we fail to comply, we could be subject to substantial liability. We depend on our key personnel and may have difficulty attracting and retaining skilled employees. Our manufacturing processes depend on the collective industry experience of our employees. If these employees were to leave and take this knowledge with them, our manufacturing processes may suffer, and we may not be able to compete effectively. We rely on suppliers for the timely delivery of materials used in manufacturing our printed circuit boards, and an increase in industry demand or a shortage of raw materials may increase the price of the raw materials we use and may limit our ability to manufacture certain products and adversely impact our gross margins. Our recent acquisition of Sovereign Circuits or future acquisitions may be costly and difficult to integrate, may divert management resources and may dilute shareholder value.

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1104252--3/12/2007--DDI_CORP