910638--3/2/2006--3D_SYSTEMS

related topics

{stock, price, share}

{customer, product, revenue}

{debt, indebtedness, cash}

{stock, price, operating}

{product, market, service}

{operation, international, foreign}

{system, service, information}

{tax, income, asset}

{provision, law, control}

{financial, litigation, operation}

We face risks in connection with our announced plans to relocate our corporate headquarters and principal R D facilities to Rock Hill, South Carolina. We face risks in connection with our current project to install a new enterprise resource system for our business. The mix of products that we sell could cause significant quarterly fluctuations in our gross margins, and those fluctuations in margins could cause fluctuations in net income or net loss. We may be subject to product liability claims, which could result in material expense, diversion of management time and attention and damage to our business reputation. We face significant competition in many aspects of our business, which could cause our revenue and gross margins to decline. The competition in our industry could cause us to reduce sales prices or incur additional marketing or production costs, which could result in decreased revenue, increased costs and reduced margins. We believe that our future success may depend on our ability to deliver products that meet changing technology and customer needs. We depend on a single or limited number of suppliers for components and sub-assemblies used in our systems and raw materials used in our materials. If these relationships were to terminate, our business could be disrupted while we locate an alternative supplier and our expenses may increase. If any of our suppliers suffers business disruptions or financial difficulties, or if there is any significant change in the condition of our relationship with the supplier, our cost of goods sold may increase and we may be unable quickly to obtain these components from alternative sources. We face risks in connection with the outsourcing of the assembly of our equipment models to selected design and manufacturing companies. Our operating results vary from quarter to quarter, which could impact our stock price. Many factors, many of which are beyond our control, may cause fluctuations in our operating results. The number of shares of Common Stock issuable upon conversion of our 6% convertible subordinated debentures and Series B Convertible Preferred Stock and the number of shares of Common Stock issuable upon the exercise of outstanding stock options could dilute your ownership and negatively impact the market price for our Common Stock. To the extent that all of our subordinated debentures and the Series B Convertible Preferred Stock are converted or our outstanding stock options are exercised, a significantly greater number of shares of our Common Stock will be outstanding, and the ownership interests of our existing stockholders may be diluted. We face risks associated with conducting business outside of the U.S., and, if we do not manage these risks, our costs may increase, our revenue from non-U.S. operations may decline, and we may suffer other adverse effects to our results of operations and financial condition. Political and economic events and the uncertainty resulting from them may have a material adverse effect on our market opportunities and operating results. The price of our Common Stock may be volatile. Historically, our Common Stock has been characterized by generally low daily trading volume, and our Common Stock price has been volatile. Our debt level could adversely affect our financial health and our ability to run our business. If we were unable to generate net cash flow from operations or if we were unable to raise additional capital, our financial condition would be adversely affected. Our balance sheet contains several categories of intangible assets totaling $52.7 million that we could be required to write off or write down in the event of the impairment of certain of those assets and our future performance, which could adversely impact our future earnings and stock price, our ability to obtain financing and adversely affect our customer relationships. Laws that inhibit takeovers may adversely affect the market price of our Common Stock. Our Board of Directors is authorized to issue up to 5 million shares of preferred stock, of which approximately 2.6 million shares are outstanding as Series B Convertible Preferred Stock.

Full 10-K form ▸

910638--3/2/2006--3D_SYSTEMS_CORP