1114999--4/14/2006--RADVIEW_SOFTWARE

related topics

{acquisition, growth, future}

{stock, price, share}

{stock, price, operating}

{operation, international, foreign}

{control, financial, internal}

{product, market, service}

{personnel, key, retain}

{property, intellectual, protect}

{provision, law, control}

{product, liability, claim}

{cost, contract, operation}

{interest, director, officer}

{product, candidate, development}

{cost, operation, labor}

{competitive, industry, competition}

Risks Relating Our Financing Transaction We will need additional capital to finance our operations. The financing may have an adverse effect on the market price of our ordinary shares. There will be substantial dilution to our existing shareholders as a result of the financing. There may be an adverse effect on the market price of our shares as a result of shares being available for sale in the future. Fortissimo and the other investors in the financing would have control over most matters submitted to a vote of the shareholders, thereby limiting the power of other shareholders to influence corporate action. There would be an adverse effect on the privileges and rights of our ordinary shareholders as a result of changes in our capital structure and Articles of Association as a result of the financing. Our ability to actively seek out other forms of financing or pursue strategic alternatives is significantly restricted under the terms of the financing. We will incur additional costs in connection with the financing. Risks Related to Our Operations We have had losses since our inception and expect to incur losses for the foreseeable future. Our quarterly operating results may fluctuate, and if we fail to meet the expectations of our investors, our share price may decrease significantly and shareholders could lose part or all of their investment. We expect to depend on sales of our WebLOAD product for a substantial majority of our revenues for the foreseeable future. We are licensing WebLOAD to others and sales by our licensees may compete with our sales of this product. If we fail to develop new products or fail to enhance our existing products to respond to emerging technologies and industry trends, we will likely lose market share to our competitors and our revenues will likely decline. We face significant competition from other technology companies and we may not be able to compete effectively. Our sales cycle depends partly on factors outside our control and may cause our revenues to vary significantly. Defects in our products may increase our costs and diminish the demand for our products. Failure to develop strategic relationships could limit our growth. If we fail to manage our geographically dispersed organization, we may fail to implement our business plan and our revenues may decline. The success of our business depends on our senior management, including Ilan Kinreich, our Chief Executive Officer and President, whose knowledge of our business and expertise would be difficult to replace. We may not be able to retain our existing personnel, which could negatively impact development, sales and support of our products. We may not be able to protect our intellectual property rights and we may lose a valuable asset or incur costly and time-consuming litigation attempting to protect our rights. We may be subject to intellectual property infringement claims that, with or without merit, could be costly to defend or settle. We do not have sufficient insurance to cover all of our potential product liability and warranty claims. We have not yet evaluated our internal controls over financial reporting in compliance with Section 404 of the Sarbanes-Oxley Act. Risks Relating to the Market for Our Ordinary Shares Our ordinary shares are listed on the Over-the-Counter Bulletin Board, or OTCBB. The market price of our ordinary shares has fluctuated and may continue to fluctuate significantly. Risks Relating to Our Location in Israel Conditions in Israel affect our operations and may limit our ability to produce and sell our products, which could have a material adverse effect on our business. If our key personnel are required to perform military service, we could experience disruptions in our business. Because substantially all of our revenues are generated in U.S. dollars, while a portion of our expenses is incurred in New Israeli Shekels, or NIS, inflation in Israel could harm our results of operations. Israeli regulations may impact our ability to engage in research and development and export of our products in accordance with our current practices. We currently benefit from government programs and tax benefits that may be discontinued or reduced. It may be difficult to enforce a U.S. judgment against us or certain of our directors, or to assert U.S. securities laws claims in Israel or serve process on these persons. Provisions of the Israeli law could delay, prevent, or make difficult, a change of control, thereby depressing the price of our ordinary shares.

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1114999--4/14/2006--RADVIEW_SOFTWARE_LTD