IRIDEX (IRIX)

Risks

• We face quality control and other production issues that could materially and adversely impact our sales and financial results and the acceptance of our products.
• Some of our laser systems are complex in design and may contain defects that are not detected until deployed by our customers, which could increase our costs and reduce our revenues.
• We rely on our direct and independent sales forces and international distributors to sell our products and if we lose our sales force or distributor relationships, it could harm our business.
• Growth in our sales and marketing organization may create operational challenges without immediately offsetting benefits.
• We depend on international sales for a significant portion of our operating results.
• If we fail to develop and successfully introduce new products and applications or fail to improve our existing products, our business prospects and operating results may suffer.
• We are exposed to risks associated with worldwide economic slowdowns and related uncertainties.
• Our operating results may fluctuate from quarter to quarter and year to year.
• We rely on continued market acceptance of our existing products and any decline in sales of our existing products would adversely affect our business and results of operations.
• We face strong competition in our markets and expect the level of competition to grow in the foreseeable future.
• Our operating results may be adversely affected by uncertainty regarding healthcare reform measures and changes in third-party coverage and reimbursement policies.
• If we fail to comply with healthcare laws, we could face substantial penalties and financial exposure, and our business, operations and financial condition could be adversely affected.
• We depend on collaborative relationships to develop, introduce and market new products, product enhancements and new applications.
• If we fail to manage growth effectively, our business could be disrupted which could harm our operating results.
• We rely on patents and proprietary rights to protect our intellectual property and business.
• If we lose key personnel or fail to integrate replacement personnel successfully, our ability to manage our business could be impaired.
• Efforts to acquire additional companies or product lines may divert our managerial resources away from our business operations, and if we complete additional acquisitions, we may incur or assume additional liabilities or experience integration problems.
• We depend on sole source or limited source suppliers.
• If our facilities were to experience catastrophic loss, our operations would be seriously harmed.
• If we fail to maintain our relationships with health care providers, customers may not buy our products and our revenue and profitability may decline. At the same time, relationships with these individuals and entities are the subject of heightened scrutiny and may present the potential for healthcare compliance risks.
• We are subject to government regulations which may cause us to delay or withdraw the introduction of new products or new applications for our products.
• Any clinical trials necessary that we may undertake for regulatory approval or marketing reasons will be an expensive, lengthy, costly, and uncertain process, and could result in delays in new product introductions or even an inability to release a product.
• If we fail to comply with the FDA’s quality system regulation and laser performance standards, our manufacturing operations could be halted, and our business would suffer.
• Our products may be misused, which could harm our reputation and our business.
• Inability of customers to obtain credit or material increases in interest rates may harm our sales.
• Our products could be subject to recalls even after receiving FDA approval or clearance. A recall would harm our reputation and adversely affect our operating results.
• Changes in U.S. tax laws could have a material adverse effect on our business, cash flow, results of operations or financial conditions.
• We are subject to federal, state and foreign laws governing our business practices which, if violated, could result in substantial penalties. Additionally, challenges to or investigation into our practices could cause adverse publicity and be costly to respond to and thus could harm our business.
• Our ability to raise capital in the future may be limited, and future sales and issuances of securities could negatively affect our stock price and dilute the ownership interest of our existing investors.
• Divestitures of some of our businesses or product lines may materially and adversely affect our financial condition, results of operations or cash flows and require us to raise additional capital to replace revenue from those business units or product lines.
• Our stock price has been and may continue to be volatile and an investment in our common stock could suffer a decline in value.
• Because we do not intend to pay dividends, stockholders will benefit from an investment in our common stock only if it appreciates in value.
• If securities or industry analysts do not continue to publish research or publish incorrect or unfavorable research about our business, our stock price and trading volume could decline.
• Ownership of our common stock is concentrated among a few investors, which may affect the ability of a third party to acquire control of us. Substantial sales by such investors could cause our stock price to decline.
• Our charter documents, anti-takeover provisions of Delaware law, and contractual provisions could delay or prevent an acquisition or sale of our company.