1086195--3/16/2007--ART_TECHNOLOGY_GROUP

related topics

{product, market, service}

{system, service, information}

{control, financial, internal}

{stock, price, operating}

{stock, price, share}

{regulation, government, change}

{debt, indebtedness, cash}

{property, intellectual, protect}

{product, liability, claim}

{personnel, key, retain}

{acquisition, growth, future}

Our management has concluded that there were material weaknesses in our internal control over financial reporting which could undermine our investors confidence in our financial statements. We may not be able to sustain or increase our revenue or attain profitability on a quarterly or annual basis. Our lengthy sales cycle makes it difficult to predict our quarterly results and causes variability in our operating results. Our common stock price has historically been volatile and will probably continue to be volatile. If the market for e-commerce does not continue to grow, then demand for our products and services may decrease. If we fail to adapt to rapid changes in the market for online business applications, then our products and services could become obsolete. We face intense competition in the market for online commerce applications and services, and we expect competition to intensify in the future. If we fail to remain competitive, then our revenues may decline, which could adversely affect our future operating results and our ability to grow our business. If the market for our OnDemand service offerings does not develop or develops more slowly than we expect, then our business could be negatively affected. If our clients experience interruptions, delays or failures in our hosted services, then we could incur significant costs and lose revenue opportunities. We depend heavily on key employees in a competitive labor market. If we fail to anticipate and address the risks associated with eStara s business, then our business could be harmed. We could incur substantial costs defending against a claim of infringement or protecting our intellectual property from infringement. If we fail to maintain our existing customer base, then our ability to generate revenues will be harmed. If we fail to address the challenges associated with our international operations, then revenues from our products and services may decline, and the costs of providing our products or services may increase. If we fail to comply with the financial covenants in our line of credit, or if our bank refuses to renew this facility, then our liquidity could be impaired. We may need additional financing in the future, and any additional financing may result in restrictions on our operations or substantial dilution to our stockholders. If systems integrators or value added resellers reduce their support and implementation of our products, then our revenues may fail to meet expectations and our operating results would suffer. If our software products contain serious errors or defects, then we may lose revenues and market acceptance and may incur costs to defend or settle product liability claims. If the Sun Java tm programming language loses market acceptance or if we are not able to continue using Java technologies, then our business could be harmed. Government or industry regulations could directly restrict our business or indirectly affect our business by limiting the growth of e-commerce. The Internet is generating privacy concerns that could result in legislation or market perceptions that could result in reduced sales of our products and harm our business. If NASDAQ were to delist our common stock from The NASDAQ Global Market, then the value of your investment could be reduced, and your shares could be more difficult to sell.

Full 10-K form ▸

1086195--3/16/2007--ART_TECHNOLOGY_GROUP_INC