SanDisk 2013 Annual Report Download - page 132

frequent changes and, in the event of a customs compliance issue, our ability to import to, and export from,
our factory in Shanghai, China could be adversely affected, which could harm our operating results and
financial condition.
Our international business activities could also be limited or disrupted by any of the following factors:
• the need to comply with foreign government regulation;
• the need to comply with U.S. regulations on international business, including the Foreign Corrupt
Practices Act and rules regarding conflict minerals;
• changes in diplomatic and trade relationships or government intervention, which may impact our
ability to sell to certain customers;
• reduced sales to our customers or interruption to our manufacturing processes in the Pacific Rim
that may arise from regional issues in Asia, including natural disasters or labor strikes;
• imposition of regulatory requirements, tariffs, import and export restrictions and other barriers and
restrictions;
• a higher degree of commodity pricing than in the U.S.;
• changes in, or the particular application of, government regulations;
• import or export restrictions that could affect some of our products, including those with encryption
technology;
• duties and/or fees related to customs entries for our products, which are all manufactured offshore;
• longer payment cycles and greater difficulty in accounts receivable collection;
• adverse tax rules and regulations;
• weak protection of our IP rights;
• delays in product shipments due to local customs restrictions; and
• delays in research and development that may arise from political unrest at our development centers
in Israel or other countries.
Our common stock and convertible notes prices have been, and may continue to be, volatile, which could
result in investors losing all or part of their investments. The market prices of our common stock and
convertible notes have fluctuated significantly in the past and may continue to fluctuate in the future. We
believe that such fluctuations will continue as a result of many factors, such as financing plans, future
announcements concerning us, our competitors or our principal customers regarding financial results or
expectations, technological innovations, industry supply and demand dynamics, new product introductions,
governmental regulations, the commencement or results of litigation or changes in earnings estimates by
analysts. In addition, in recent years the stock market has experienced significant price and volume
fluctuations and the market prices of the securities of high-technology and semiconductor companies have
been especially volatile, often for reasons outside the control of the particular companies. These
fluctuations as well as general economic, political and market conditions may harm the market price of our
common stock as well as the prices of our outstanding convertible notes.
Our success depends on our key personnel, including our senior management, and the loss of key personnel
or the transition of key personnel could disrupt our business. Our success greatly depends on the continued
contributions of our senior management and other key research and development, sales, marketing and
operations personnel. We do not have employment agreements with any of our executive officers and they
are free to terminate their employment with us at any time. Our success will depend on our ability to
recruit and retain additional highly-skilled personnel. We have relied on equity awards in the form of stock
options and restricted stock units as one means for recruiting and retaining highly skilled talent and a
reduction in our stock price may reduce the effectiveness of these equity awards in retaining employees.
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