896429--9/28/2006--USA_TECHNOLOGIES

related topics

{stock, price, share}

{product, market, service}

{debt, indebtedness, cash}

{interest, director, officer}

{system, service, information}

{control, financial, internal}

{loan, real, estate}

{property, intellectual, protect}

{personnel, key, retain}

{customer, product, revenue}

{regulation, government, change}

We have a history of losses since inception and if we continue to incur losses the price of our shares can be expected to fall. Our existence is dependent on our ability to raise capital that may not be available. We received an opinion from our auditor which raises substantial doubt about our ability to continue as a going concern. We depend on our key personnel and if they would leave us, our business could be adversely affected. USA's dependence on proprietary technology and limited ability to protect our intellectual property may adversely affect our ability to compete. Competition from others with greater resources could prevent USA from increasing revenue and achieving profitability. The termination of any of our relationships with third parties upon whom we rely for supplies and services that are critical to our products could adversely affect our business and delay achievement of our business plan. Our reliance on our telecommunication service provider exposes us to a number of risks over which we have no control, including risks with respect to increased prices and termination of essential services. We may not be able to adapt to changing technology and our customers technology needs. We do not expect to pay cash dividends in the foreseeable future and therefore investors should not anticipate cash dividends on their investment. Our products may fail to gain widespread market. As a result, we may not generate sufficient revenues or profit margins to become successful. The lack of an established trading market may make it difficult to transfer our stock and you may not be able to sell your shares on our trading market. The substantial market overhang of our shares will tend to depress the market price of our shares. Sales of shares eligible for future sale from exercise of warrants and options and our 2006 Common Stock Agreement could depress the market price of our common stock. We are obligated to make substantial principal and interest payments to the holders of the Senior Notes for which funds may not be available or would use our available working capital. Credit card issuers have promulgated credit card security guidelines as part of their ongoing efforts to battle identity theft and credit card fraud. We are subject to laws and regulations that affect the products, services and markets in which we operate. Failure by us to comply with these laws or regulations would have an adverse effect on our business, financial condition, or results of operations.

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896429--9/28/2006--USA_TECHNOLOGIES_INC