1012887--3/13/2006--BOSTON_COMMUNICATIONS_GROUP

related topics

{financial, litigation, operation}

{product, market, service}

{system, service, information}

{cost, operation, labor}

{acquisition, growth, future}

{customer, product, revenue}

{operation, natural, condition}

{capital, credit, financial}

{personnel, key, retain}

{stock, price, operating}

{property, intellectual, protect}

{operation, international, foreign}

{product, candidate, development}

{regulation, change, law}

{regulation, government, change}

If we lose, in whole or significant part, our appeal of the Freedom Wireless lawsuit in the U.S. Court of Appeals for the Federal Circuit ( Appeals Court ) or the lawsuits with Freedom Wireless in United States District Court in Massachusetts ( District Court ), it would have a material adverse impact on our business, including potential asset impairment charges and the possibility of bankruptcy, impairing our ability to continue as a going concern. We may continue to seek a settlement agreement with Freedom Wireless but we may not be able to reach a reasonable settlement or we may reach a settlement that could negatively impact our financial performance. The Funding of Security for Appeal ( Appeal Agreement ) with Cingular Wireless, in addition to any future requirement to provide additional security on our own, may substantially reduce our working capital and access to cash. A class action lawsuit has been filed against us, which may result in litigation that is costly to defend and the outcome of which is uncertain and may harm our business. As the uncertainty surrounding the status of the Freedom Wireless lawsuits continues, we face significant challenges retaining existing customers, vendors and employees and attracting new customers, vendors and employees, all of which has had a material adverse effect on our business. The loss or significant reduction of business from one of our major customers, including Verizon Wireless, Cingular Wireless or Sprint Nextel Corporation, would have a material adverse effect on our business. Our future success depends partly on the global acceptance of our new products, including bcgi Access Management, Payment Manager and bcgi Network. Our future operating results are difficult to predict and may materially fluctuate, which may result in significant fluctuations in our stock price. If we do not continue to develop and offer more desirable functionality and features in our solutions at competitive prices, including bcgi Billing, bcgi Access Management, bcgi Payment, bcgi Network and the new solutions currently in our pipeline, we will not be able to compete effectively, and our business will be materially and adversely affected. Our international sales and operations subject us to additional risks that can adversely affect our operating results. We entered into a strategic investment agreement with an early stage entity with which we have a commercial relationship. We rely on complex information technology systems and networks to operate our business. If any significant system or network disruption occurs, we will be subject to financial penalties that could adversely affect our business and operating results. Our business would be materially adversely impacted if we cannot protect our intellectual property. We may never realize the anticipated benefits of any acquisitions. We may not be able to effectively manage the expansion of our business, which would adversely impact our ability to offer competitive solutions and grow. Our business may suffer if we are unable to attract and retain key employees. The market for our solutions is very competitive and depends on the growth and health of the wireless industry and wireless operators. To provide our solutions, we depend on a number of third-party software, hardware and service vendors, and our business, financial condition and results of operations would be materially adversely affected if we are unable, or are delayed in our ability to obtain these components and applications. Changes in government regulations could adversely impact our business.

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1012887--3/13/2006--BOSTON_COMMUNICATIONS_GROUP_INC