880807--6/14/2006--AMERICAN_SUPERCONDUCTOR_CORP

related topics

{product, market, service}

{property, intellectual, protect}

{product, candidate, development}

{regulation, government, change}

{personnel, key, retain}

{gas, price, oil}

{acquisition, growth, future}

{control, financial, internal}

{customer, product, revenue}

We have a history of operating losses, and we expect to incur losses in the future. There are a number of technological challenges that must be successfully addressed before our superconductor products can gain widespread commercial acceptance, and our inability to address such technological challenges could adversely affect our ability to acquire customers for our products. The commercial uses of superconductor products are limited today, and a widespread commercial market for our products may not develop. We have limited experience manufacturing our HTS products in commercial quantities, and failure to manufacture our HTS products in commercial quantities at acceptable cost and quality levels would impair our ability to meet customer delivery requirements. We have never manufactured our 2G HTS wire in commercial quantities, and failure to manufacture our 2G HTS wire in commercial quantities at acceptable cost and quality levels would substantially limit our future revenue and profit potential. We have limited experience in marketing and selling our products, and our failure to effectively market and sell our products could adversely affect our revenue and cash flow. Many of our revenue opportunities are dependent upon subcontractors and other business partners. Our contracts with the U.S. government are subject to audit, modification or termination by the U.S. government, and the continued funding of such contracts remains subject to annual congressional appropriation which, if not approved, could adversely affect our results of operations and financial condition. Our products face intense competition both from superconductor products developed by others and from traditional, non-superconductor products and alternative technologies, which could limit our ability to acquire or retain customers. Third parties have or may acquire patents that cover the HTS materials we use or may use in the future to manufacture our products, and our success depends on our ability to license such patents or other proprietary rights. Our patents may not provide meaningful protection for our technology, which could result in us losing some or all of our market position. Our success is dependent upon attracting and retaining qualified personnel, and our inability to do so could significantly damage our business and prospects. We may in the future acquire complementary businesses or technologies, which may require us to incur substantial costs for which we may never realize the anticipated benefits.

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880807--6/14/2006--AMERICAN_SUPERCONDUCTOR_CORP_/DE/