202058--9/7/2006--HARRIS_CORP

related topics

{acquisition, growth, future}

{tax, income, asset}

{condition, economic, financial}

{operation, international, foreign}

{regulation, government, change}

{operation, natural, condition}

{financial, litigation, operation}

{cost, contract, operation}

{product, candidate, development}

{property, intellectual, protect}

{product, market, service}

We depend significantly on our U.S. Government contracts, which often are only partially funded, subject to immediate termination, and heavily regulated and audited. The termination or failure to fund one or more of these contracts could have an adverse impact on our business. We enter into fixed-price contracts that could subject us to losses in the event of cost overruns. We derive a substantial portion of our revenue from international operations and are subject to the risks of doing business in foreign countries, including fluctuations in foreign currency exchange rates. Our future success will depend on our ability to develop new products that achieve market acceptance. We cannot predict the consequences of future geo-political events, but they may affect adversely the markets in which we operate, our ability to insure against risks, our operations or our profitability. We have made, and may continue to make, strategic acquisitions that involve significant risks and uncertainties. The inability of our subcontractors to perform, or our key suppliers to timely deliver our components or products, could cause our products to be produced in an untimely or unsatisfactory manner. Third parties have claimed in the past and may claim in the future that we are infringing upon their intellectual property rights, and third parties may infringe upon our intellectual property rights. The outcome of litigation or arbitration in which we are involved is unpredictable and an adverse decision in any such matter could have a material adverse affect on our financial position and results of operations. We are subject to customer credit risk. The fair values of our portfolio of passive investments are subject to significant price volatility or erosion. Developing new technologies entails significant risks and uncertainties. We have significant operations in Florida that could be impacted in the event of a hurricane and operations in California that could be impacted in the event of an earthquake. Changes in our effective tax rate may have an adverse effect on our results of operations.

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202058--9/7/2006--HARRIS_CORP_/DE/