1123316--1/29/2008--VERMONT_PURE_HOLDINGS

related topics

{system, service, information}

{condition, economic, financial}

{stock, price, operating}

{personnel, key, retain}

{regulation, change, law}

{cost, regulation, environmental}

{control, financial, internal}

{product, market, service}

{customer, product, revenue}

{acquisition, growth, future}

{interest, director, officer}

Our success depends on the continued services of key personnel. The personal interests of our directors and officers create a conflict. We face competition from companies with far greater resources than we have. In addition, methods of competition in the distribution of home and office refreshment products continue to change and evolve. If we are unable to meet these changes, our business could be harmed. The bottled water industry is regulated at both the state and federal level. If we are unable to continue to comply with applicable regulations and standards in any jurisdiction, we might not be able to sell our products in that jurisdiction, and our business could be seriously harmed. Legislative and executive action in state and local governments banning the use of municipal funds for purchasing bottled water, enacting local taxes on bottled water or water extraction, and restricting water withdrawal and usage rights from public and private sources could adversely affect our business and financial results. We depend upon maintaining the integrity of our water resources and manufacturing process. If our water sources or bottling processes were contaminated for any reason, our business would be seriously harmed. Fluctuations in the cost of essential raw materials and commodities, including fuel costs, for the manufacture and delivery of our products could significantly impact our business. We have a limited amount of bottling capacity. Significant interruptions of our bottling facilities could adversely affect our business. We rely upon a single software vendor that supplies the software for our route accounting system. Our customer base is located in New England, New York and New Jersey. If there were to be a material decline in the economy in these regions, our business would likely be adversely affected. Our business is seasonal, which may cause fluctuations in our stock price. Acquisitions may disrupt our operations or adversely affect our results We are required to be in full compliance with Section 404 of the Sarbanes-Oxley Act as of our fiscal year ending October 31, 2009. Under current regulations, the financial cost of compliance with Section 404 is significant. Failure to achieve and maintain effective internal

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1123316--1/29/2008--VERMONT_PURE_HOLDINGS_LTD/DE