225263--3/11/2008--NEWPORT

related topics

{customer, product, revenue}

{product, market, service}

{property, intellectual, protect}

{debt, indebtedness, cash}

{product, liability, claim}

{system, service, information}

{competitive, industry, competition}

{personnel, key, retain}

{cost, regulation, environmental}

{control, financial, internal}

{operation, international, foreign}

{acquisition, growth, future}

{condition, economic, financial}

We are dependent in part on the semiconductor capital equipment market, which is volatile and unpredictable. A limited number of customers account for a significant portion of our sales to the microelectronics market, and if we lose any of these customers or they significantly curtail their purchases of our products, our results of operations would be harmed. Difficulties in executing our acquisitions could adversely impact our business. Many of the markets and industries that we serve are subject to rapid technological change, and if we do not introduce new and innovative products or improve our existing products, our business and results of operations will be negatively affected. We offer products for multiple industries and must face the challenges of supporting the distinct needs of each of the markets we serve. Because the sales cycle for some of our products is long and difficult to predict, and certain of our orders are subject to rescheduling or cancellation, we may experience fluctuations in our operating results. If we are delayed in introducing our new products into the marketplace, our operating results will suffer. We face significant risks from doing business in foreign countries. We face substantial competition, and if we fail to compete effectively, our operating results will suffer. If we fail to protect our intellectual property and proprietary technology, we may lose our competitive advantage. We have experienced, and may in the future experience, intellectual property infringement claims, which could be costly and time consuming to defend. If we are unable to attract new employees and retain and motivate existing employees, our business and results of operations will suffer. Our reliance on sole source and limited source suppliers could result in delays in production and distribution of our products. Our products could contain defects, which would increase our costs and harm our business. Our convertible debt imposes significant financial obligations upon us, and certain provisions of our convertible notes could discourage a change in control. Proposed accounting changes for convertible debt securities, such as our convertible subordinated notes, may adversely affect our financial results. Our products are subject to potential product liability claims which, if successful, could adversely affect our results of operations. While we believe we currently have adequate internal control over financial reporting, we are required to evaluate our internal control over financial reporting each year, and any adverse results from such evaluation could result in a loss of investor confidence in our financial reports and have an adverse effect on our stock price. Difficulties in implementing a new global information technology system could harm our business. Compliance with environmental regulations and potential environmental liabilities could adversely affect our financial results.

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225263--3/11/2008--NEWPORT_CORP