1157817--12/29/2008--SINGLE_TOUCH_SYSTEMS

related topics

{stock, price, share}

{product, market, service}

{system, service, information}

{stock, price, operating}

{personnel, key, retain}

{acquisition, growth, future}

{control, financial, internal}

{property, intellectual, protect}

{customer, product, revenue}

{condition, economic, financial}

{regulation, government, change}

{provision, law, control}

RISKS RELATED TO OUR COMPANY We have a history of operating losses which may continue. We operate in the evolving wireless market, which may make it difficult to evaluate our business. We currently rely on only a few customers for a majority of our revenues. We currently rely on wireless carriers to market and distribute our products and services and to generate our revenues. The loss of or a change in any of these significant carrier relationships could cause us to lose access to their subscribers and thus materially reduce our revenues. We may be unable to successfully keep pace with the rapid technological changes that may occur in the wireless communication and e-commerce arenas which would adversely affect its business operations We will need to raise additional capital to meet our business requirements in the future and such capital raising may be costly or difficult to obtain and could dilute current stockholders ownership interests. We may not be able to effectively manage our growth. We may be unable to attract and retain qualified, experienced, highly skilled personnel, which could adversely affect the implementation of our business plan. Our senior management s limited recent experience managing a publicly traded company may divert management s attention from operations and harm our business. Applicable rules, including those contained in and issued under the Sarbanes-Oxley Act of 2002, may make it difficult for us to retain or attract qualified officers and directors, which could adversely affect the management of our business and our ability to retain listing of our Common Stock. If we fail to maintain an effective system of internal controls, we may not be able to accurately report our financial results or detect fraud. Consequently, investors could lose confidence in our financial reporting and this may decrease the trading price of our stock. The acquisition of other companies, businesses or technologies could result in operating difficulties, dilution and other harmful consequences. Adverse conditions in the global economy and disruption of financial markets could negatively impact our customers and therefore our results of operations. RISKS RELATED TO OUR INDUSTRY If wireless subscribers do not continue to use their mobile handsets to access mobile content and other applications, our business growth and future revenues may be adversely affected. System or network failures could reduce our sales, increase costs or result in a loss of end users of our products and services. Our business depends on the growth and maintenance of wireless communications infrastructure. Actual or perceived security vulnerabilities in mobile handsets or wireless networks could adversely affect our revenues. Changes in government regulation of the media and wireless communications industries may adversely affect our business. A decline in, or limitation on, the use of mobile phones would negatively impact our business. Our inability to adequately protect our proprietary technology could adversely affect our business. We may become subject to litigation for infringing the intellectual property rights of others. We may experience unexpected expenses or delays in service enhancements if we are unable to license third-party technology on commercially reasonable terms. RISKS RELATED TO OUR COMMON STOCK You may have difficulty trading and obtaining quotations for our Common Stock. The trading of our common stock on the OTCBB and the potential designation of our common stock as a penny stock could impact the trading market for our common stock. The price of our Common Stock may become volatile, which could lead to losses by investors and costly securities litigation. We have not paid dividends in the past and do not expect to pay dividends for the foreseeable future, and any return on investment may be limited to potential future appreciation on the value of our common stock. Securities analysts may not initiate coverage or continue to cover our Common Stock and this may have a negative impact on its market price. You may experience dilution of your ownership interests because of the future issuance of additional shares of our Common Stock and our Preferred Stock. Substantial future sales of our common stock in the public market could cause our stock price to fall. Our Common Stock is controlled by insiders. Even though we are not a California corporation, our common stock could still be subject to a number of key provisions of the California General Corporation Law.

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1157817--12/29/2008--SINGLE_TOUCH_SYSTEMS_INC