1044435--5/14/2007--ACTIVE_POWER

related topics

{customer, product, revenue}

{stock, price, operating}

{control, financial, internal}

{product, market, service}

{personnel, key, retain}

{operation, international, foreign}

{property, intellectual, protect}

{acquisition, growth, future}

{financial, litigation, operation}

{provision, law, control}

{competitive, industry, competition}

The matters relating to the investigation by the Special Committee of our Board of Directors into our stock option granting practices and the restatement of our consolidated financial statements may result in future litigation or regulatory inquiries which could harm our financial condition and results of operations. We have incurred significant losses and anticipate losses for at least the next several quarters. Due to our limited operating history and the uncertain market acceptance of our products, we may never achieve significant revenue and may have difficulty accurately predicting revenue for future periods and appropriately budgeting for expenses. If we do not achieve significant sales of our CoolAir products, we may be forced to take an impairment charge for inventory we keep relating to that product line. Our financial results may vary significantly from quarter to quarter. We derive a substantial portion of our revenues from international markets and plan to continue to expand such efforts, which subjects us to additional business risks including increased logistical and financial complexity, political instability and currency fluctuations. We are subject to risks relating to product concentration and lack of revenue diversification. We must expand our distribution channels and manage our existing and new product distribution relationships to continue to grow our business. We must continue to hire and retain skilled personnel. We are significantly dependent on our relationship with Caterpillar, our primary OEM customer. If this relationship is unsuccessful, for whatever reason, our business and financial prospects would likely suffer. We have underutilized manufacturing capacity and have no experience manufacturing our products in large quantities. We must build quality products to ensure acceptance of our products. We currently operate without a significant backlog. Seasonality may contribute to fluctuations in our quarterly operating results. We depend on sole and limited source suppliers, and outsource selected component manufacturing. We face significant competition from other companies. We may be unable to protect our intellectual property and proprietary rights. We may require substantial additional funds in the future to finance our product development and commercialization plans. We have anti-takeover provisions that could discourage, delay or prevent our acquisition. Volatility in our stock price could result in claims against us.

Full 10-K form ▸

1044435--5/14/2007--ACTIVE_POWER_INC