1232229--9/13/2006--SYNTAX-BRILLIAN

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{product, market, service}

{tax, income, asset}

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{stock, price, operating}

{property, intellectual, protect}

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Our revenue depends on sales by various retailers and distributors. Competing companies and technologies could reduce the demand for our products. We rely on contract manufacturers and assemblers for a portion of our HDTV production requirements, and any interruptions of these arrangements could disrupt our ability to fill customer orders. Our contract manufacturers and assemblers must maintain satisfactory delivery schedules and their inability to do so could increase our costs, disrupt our supply chain, and result in our inability to deliver our HDTV products, which would adversely affect our results of operations. Shortages of components and materials may delay or reduce our sales and increase our costs. Our business depends on new products and technologies. We must protect our intellectual property and could be subject to infringement claims by others. Our operations in foreign countries expose us to a variety of risks. The cyclical nature of the consumer electronics industry may cause substantial period-to-period fluctuations in our operating results. Our operating results may have significant periodic and seasonal fluctuations. Our products are complex and may require modifications to resolve undetected errors or unforeseen failures, which could lead to an increase in our costs, a loss of customers, or a delay in market acceptance of our products. We are subject to lengthy development periods and product acceptance cycles. Our LCoS microdisplay products may not achieve commercial success or widespread market acceptance. Various target markets for our LCoS microdisplays are uncertain, may be slow to develop, or could use competing technologies. We do not sell our LCoS microdisplays to end users and depend on the market acceptance of the products of our customers. We have not reached definitive agreements with any traditional consumer electronics retailers to sell our LCoS HDTVs, and we do not have long-term purchase commitments from OEM customers for our home theater or near-to-eye microdisplay products. We have encountered delays in the procurement and production of light engines, and additional delays would harm our ability to manufacture LCoS HDTVs. Our Arizona facility and its high-volume LCoS microdisplay manufacturing line are important to our success. We have previously experienced low manufacturing yields in commencing production of LCoS microdisplays, and we must achieve satisfactory manufacturing yields. We must effectively manage our growth. We depend on key personnel. Any acquisitions that we undertake could be difficult to integrate, disrupt our business, dilute stockholder value, and harm our operating results. We may not realize the benefits we expected from our merger with Syntax. Charges to earnings resulting from the application of the purchase method of accounting may adversely affect the market value of our common stock. We incur costs as a result of being a public company. The market price for our common stock may be volatile, and many factors could cause the market price of our common stock to fall. We are subject to governmental regulations. Provisions in our certificate of incorporation, our bylaws, and Delaware law could make it more difficult for a third party to acquire us, discourage a takeover, and adversely affect existing stockholders. Our effective tax rate may increase or fluctuate, which could increase our income tax expense and reduce our net income.

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1232229--9/13/2006--SYNTAX-BRILLIAN_CORP