Artificial Life (PINK:ALIF)

We expect that we will raise additional capital to support our operations, to finance receivables and to accommodate planned future growth. We are currently also in discussions with additional investors about further investments for the third or fourth quarters of 2009.

Economic conditions in the United States and in foreign markets in which we operate could substantially affect our sales and profitability and our cash position and collection of accounts receivable. Economic activity in the United States and throughout much of the world has undergone a sudden, sharp economic downturn in 2008 and 2009 following the housing downturn and subprime lending collapse in the United States and globally. Global credit and capital markets have experienced unprecedented volatility and disruption. Business credit and liquidity have tightened in much of the world. Some of our suppliers and customers may face credit issues and could experience cash flow problems and other financial hardships. These factors have had a substantial impact on the timeliness of receivable collections from our customers. The Company cannot predict at this point in time how this situation will develop and whether accounts receivable may need to be written off in the coming quarters.

Source: SEC Form 10Q (For the quarterly period ended June 30, 2009)