1132484--4/1/2010--NETEZZA

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{product, market, service}

{customer, product, revenue}

{system, service, information}

{control, financial, internal}

{acquisition, growth, future}

{stock, price, operating}

{property, intellectual, protect}

{operation, international, foreign}

{provision, law, control}

{regulation, change, law}

{regulation, government, change}

{loan, real, estate}

{personnel, key, retain}

{product, candidate, development}

{stock, price, share}

Our limited operating history and the rapid development of the data warehouse market make it difficult to evaluate our current business and future prospects, and may increase the risk of your investment. We have a history of losses, and we may not maintain profitability in the future. We depend on a single product family, our data warehouse appliance family, for nearly all of our revenue, so we are particularly vulnerable to any factors adversely affecting the sale of that product family. If our new data warehouse appliance, the TwinFin tm appliance, does not achieve widespread market acceptance, our operating results will suffer. If we lose key personnel, or if we are unable to attract and retain highly-qualified personnel on a cost-effective basis, it will be more difficult for us to manage our business and to identify and pursue growth opportunities. If we are unable to develop and introduce new products and enhancements to existing products, if our new products and enhancements to existing products do not achieve market acceptance, or if we fail to manage product transitions, we may fail to increase, or may lose, market share. We face intense and growing competition from leading technology companies as well as from emerging companies. Our inability to compete effectively with any or all of these competitors could impact our ability to achieve our anticipated market penetration and achieve or sustain profitability. Our success depends on the continued recognition of the need for business intelligence in the marketplace and on the adoption by our customers of data warehouse appliances, often as replacements for existing systems, to enable business intelligence. If we fail to improve our products to further drive this market migration as well as to successfully compete with alternative approaches and products, our business would suffer. Claims that we infringe or otherwise misuse the intellectual property of others could subject us to significant liability and disrupt our business, which could have a material adverse effect on our business and operating results. Our products must interoperate with our customers information technology infrastructure, including customers software applications, networks, servers and data-access protocols, and if our products do not do so successfully, we may experience a weakening demand for our products. If we fail to enhance our brand, our ability to expand our customer base will be impaired and our operating results may suffer. We may not receive significant revenues from our current research and development efforts for several years, if at all. Our sales cycles can be long and unpredictable, and our sales efforts require considerable time and expense, which contribute to the unpredictability and variability of our financial performance and may adversely affect our profitability. Our company has grown rapidly and we may be unable to manage our growth effectively. Our ability to sell to U.S. federal government agencies is subject to evolving laws and policies that could have a material adverse effect on our growth prospects and operating results, and our contracts with the U.S. federal government may impose requirements that are unfavorable to us. Our international operations are subject to additional risks that we do not face in the United States, which could have an adverse effect on our operating results. Our future revenue growth will depend in part on our ability to further develop our indirect sales channel, and our inability to effectively do so will impair our ability to grow our revenues. Our ability to sell our products and retain customers is highly dependent on the quality of our maintenance and support services offerings, and our failure to offer high-quality maintenance and support could have a material adverse effect on our operating results. Our products are highly technical and may contain undetected software or hardware defects, which could cause data unavailability, loss or corruption that might result in liability to our customers and harm to our reputation and business. It is difficult to predict our future capital needs and we may be unable to obtain additional financing that we may need, which could have a material adverse effect on our business, operating results and financial condition. A substantial portion of our marketable securities is invested in highly rated auction rate securities. Failures in these auctions may affect our liquidity. If we are unable to protect our intellectual property rights, our competitive position could be harmed or we could be required to incur significant expenses to enforce our rights. Our products may be subject to open source licenses, which may restrict how we use or distribute our solutions or require that we release the source code of certain technologies subject to those licenses. As part of our business strategy, we engage in acquisitions, which could disrupt our business, cause dilution to our stockholders, reduce our financial resources and result in increased expenses. We are subject to governmental export controls that could impair our ability to compete in international markets. We rely on a single contract manufacturer to assemble our products, and our failure to manage our relationship with our contract manufacturer successfully could negatively impact our ability to sell our products. We depend on a continued supply of components for our products from third-party suppliers, and if shortages of these components arise, we may not be able to secure enough components to build new products to meet customer demand or we may be forced to pay higher prices for these components. We currently rely on a contract engineering firm for quality assurance and product integration engineering. Future interpretations of existing accounting standards could adversely affect our operating results. If we fail to maintain an effective system of internal controls, we might not be able to report our financial results accurately or prevent fraud; in that case, our stockholders could lose confidence in our financial reporting, which could negatively impact the price of our stock. Risks Related to our Common Stock The trading price of our common stock is likely to be volatile. If securities or industry analysts do not publish research or publish unfavorable research about our business, our stock price and trading volume could decline. Provisions in our certificate of incorporation and by-laws and Delaware law might discourage, delay or prevent a change in control of our company or changes in our management and, therefore, may negatively impact the trading price of our common stock.

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1132484--4/1/2010--NETEZZA_CORP