SanDisk 2009 Annual Report Download - page 82

Our international business activities could also be limited or disrupted by any of the following factors:
• the need to comply with foreign government regulation;
• changes in diplomatic and trade relationships;
• reduced sales to our customers or interruption to our manufacturing processes in the Pacific Rim that
may arise from regional issues in Asia;
• imposition of regulatory requirements, tariffs, import and export restrictions and other barriers and
restrictions;
• changes in, or the particular application of, government regulations;
• 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 intellectual property 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.
Our stock price and convertible notes price 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 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, including financing plans, future announcements concerning us, our
competitors or our principal customers regarding financial results or expectations, technological innovations,
industry supply or 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
have an adverse affect on the market price of our common stock as well as the price of our outstanding
convertible notes.
We may engage in business combinations that are dilutive to existing stockholders, result in unanticipated
accounting charges or otherwise harm our results of operations, and result in difficulties in assimilating and
integrating the operations, personnel, technologies, products and information systems of acquired companies or
businesses. We continually evaluate and explore strategic opportunities as they arise, including business
combinations, strategic partnerships, collaborations, capital investments and the purchase, licensing or sale of
assets. If we issue equity securities in connection with an acquisition, the issuance may be dilutive to our existing
stockholders. Alternatively, acquisitions made entirely or partially for cash would reduce our cash reserves.
Acquisitions may require significant capital infusions, typically entail many risks and could result in
difficulties in assimilating and integrating the operations, personnel, technologies, products and information
systems of acquired companies. We may experience delays in the timing and successful integration of acquired
technologies and product development through volume production, unanticipated costs and expenditures,
changing relationships with customers, suppliers and strategic partners, or contractual, intellectual property or
employment issues. In addition, key personnel of an acquired company may decide not to work for us. The
acquisition of another company or its products and technologies may also result in our entering into a geographic
or business market in which we have little or no prior experience. These challenges could disrupt our ongoing
business, distract our management and employees, harm our reputation, subject us to an increased risk of
intellectual property and other litigation and increase our expenses. These challenges are magnified as the size of
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