8x8 2008 Annual Report Download - page 28

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performance of particular companies. These broad market fluctuations may adversely affect the market price of our common
stock. In the past, following periods of volatility in the market price of a company's securities, securities class action litigation
has often been initiated against the issuing company. If our stock price is volatile, we may also be subject to such litigation.
Such litigation could result in substantial costs and a diversion of management's attention and resources, which would disrupt
business and could cause a decline in our operating results. Any settlement or adverse determination in such litigation would
also subject us to significant liability.
We may not be able to maintain our listing on the NASDAQ Capital Market.
Our common stock trades on the NASDAQ Capital Market, which has certain compliance requirements for continued listing of
common stock. We have, in the past, been subject to delisting procedures due to a drop in the price of our common stock. If our
minimum closing bid price per share falls below $1.00 for a period of 30 consecutive trading days in the future, we may again
be subject to delisting procedures. As of the close of business on May 20, 2008, our common stock had a closing bid price of
approximately $1.15 per share. We also must meet additional continued listing requirements contained in NASDAQ
Marketplace Rule 4310(c)(2)(b), which requires that we have a minimum of $2,500,000 in stockholders' equity or $35,000,000
market value of listed securities held by non-affiliates or $500,000 of net income from continuing operations for the most
recently completed fiscal year (or two of the three most recently completed fiscal years). As of May 20, 2008, based on our
closing price as of that day, the market value of our securities held by non-affiliates approximated $70,622,000 and we were in
compliance with NASDAQ Marketplace Rule 4310(c)(2)(b). There can be no assurance that we will continue to meet the
continued listing requirements.
Delisting could reduce the ability of our shareholders to purchase or sell shares as quickly and as inexpensively as they have
done historically. For instance, failure to obtain listing on another market or exchange may make it more difficult for traders to
sell our securities. Broker-dealers may be less willing or able to sell or make a market in our common stock. Not maintaining
our NASDAQ Capital Market listing may:
• result in a decrease in the trading price of our common stock;
• lessen interest by institutions and individuals in investing in our common stock;
• make it more difficult to obtain analyst coverage; and
• make it more difficult for us to raise capital in the future.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 2. PROPERTIES
Our principal operations are located in an approximately 47,000 square foot facility in Santa Clara, California that is leased
through August 2009. Design, testing, research and development, sales and marketing, shipping, customer service and
administrative activities are performed at this facility. We also lease office space for our research and development operation
in Sophia-Antipolis, France. We believe that our existing facilities are adequate to meet our current and foreseeable future
needs. For additional information regarding our obligations under leases see Note 4 to the consolidated financial statements
contained in Part II, Item 8 of this Report.