EMC 2002 Annual Report Download - page 37

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Table of Contents
From time to time, we receive notices from third parties claiming infringement by our products of third-party patent or other intellectual property rights.
Responding to any such claim, regardless of its merit, could be time-consuming, result in costly litigation, divert management's attention and resources and
cause us to incur significant expenses. In the event there is a temporary or permanent injunction entered prohibiting us from marketing or selling certain of our
products or a successful claim of infringement against us requiring us to pay royalties to a third party, and we fail to develop or license a substitute
technology, our business, results of operations or financial condition could be materially adversely affected.
We may become involved in litigation that may materially adversely affect us.
In the ordinary course of business, we may become involved in litigation, administrative proceedings and governmental proceedings. Such matters can
be time-consuming, divert management's attention and resources and cause us to incur significant expenses. Furthermore, there can be no assurance that the
results of any of these actions will not have a material adverse effect on our business, results of operations or financial condition.
We may have exposure to additional income tax liabilities.
As a multinational corporation, we are subject to income taxes in both the United States and various foreign jurisdictions. Our domestic and
international tax liabilities are subject to the allocation of revenues and expenses in different jurisdictions and the timing of recognizing revenues and
expenses. Additionally, the amount of income taxes paid is subject to our interpretation of applicable tax laws in the jurisdictions in which we file. From time
to time, we are subject to income tax audits. While we believe we have complied with all applicable income tax laws, there can be no assurance that a
governing tax authority will not have a different interpretation of the law and assess us with additional taxes. Should we be assessed with additional taxes,
there could be a material adverse affect on our results of operations or financial condition.
Changes in regulations could materially adversely affect us.
Our business, results of operations or financial condition could be materially adversely affected if laws, regulations or standards relating to us or our
products are newly implemented or changed.
Our stock price is volatile.
Our stock price, like that of other technology companies, is subject to significant volatility because of factors such as:
• the announcement of new products, services or technological innovations by us or our competitors
• quarterly variations in our operating results
• changes in revenue or earnings estimates by the investment community
• speculation in the press or investment community
In addition, our stock price is affected by general economic and market conditions and has been negatively affected by unfavorable global economic
and market conditions. If such conditions continue to deteriorate, our stock price could decline further.
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