862861--3/20/2009--APPLIANCE_RECYCLING_CENTERS_OF_AMERICA_INC_/MN

related topics
{customer, product, revenue}
{stock, price, share}
{stock, price, operating}
{acquisition, growth, future}
{condition, economic, financial}
{financial, litigation, operation}
{personnel, key, retain}
{debt, indebtedness, cash}
{cost, regulation, environmental}
{product, market, service}
Risks Relating to Our Business Our strategy of opening new retail stores may result in net losses. Most of our revenues are derived from retail sales. We expect this dependence on retail sales to continue in the future. We currently purchase product for resale from a limited number of suppliers. Our revenues from recycling contracts increased in 2008, but future revenues from this source are very difficult to project. Our revenues from recycling contracts are subject to seasonal fluctuations and are dependent on the utilities advertising and promotional activities for contracts in which we do not provide advertising services. We may need new capital to fully execute our growth strategy. A decline in general economic conditions has led to reduced consumer demand for our products and had an adverse effect on our liquidity and profitability. Our market share may be adversely impacted at any time by a significant number of competitors. Changes in governmental regulations relating to our recycling business could increase our costs of operations and adversely affect our business. Our lender has the right to demand payment in full of the borrowings under our line of credit at any time. If it were to do so, we would not be able to pursue our growth strategy and our operations would be severely limited unless and until new financing was obtained. We may not be able to operate successfully if we lose key personnel, are unable to hire qualified personnel or experience turnover of our management team. We have ongoing litigation surrounding intellectual property issues and have successfully avoided a claim of infringement in a second law suit. Risks Relating to Our Common Stock If an active trading market for our Common Stock does not develop, the value and liquidity of your investment in our Common Stock could be adversely affected. Our principal shareholders own a large percentage of our voting stock, which will allow them to control substantially all matters requiring shareholder approval.

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