Aspen Aerogels (ASPN) Risk Analysis

Our Certificate of Incorporation provides that, subject to limited exceptions, a state or federal court located within the State of Delaware will be the exclusive forum for (1) any derivative action or proceeding brought on our behalf, (2) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers or other employees to us or our stockholders, (3) any action asserting a claim against us arising pursuant to any provision of the DGCL, our Certificate of Incorporation or our restated bylaws, or (4) any other action asserting a claim against us that is governed by the internal affairs doctrine. This exclusive forum provision does not apply to suits brought to enforce a duty or liability created by the Exchange Act. It could apply, however, to a suit that falls within one or more of the categories enumerated in the exclusive forum provision and asserts claims under the Securities Act of 1933, as amended (the Securities Act), inasmuch as Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rule and regulations thereunder. There is uncertainty as to whether a court would enforce such provision with respect to claims under the Securities Act, and our stockholders will not be deemed to have waived our compliance with the federal securities laws and the rules and regulations thereunder. Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock shall be deemed to have notice of and to have consented to the provisions of our Certificate of Incorporation described above. This choice of forum provision may limit a stockholder's ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers or other employees, which may discourage such lawsuits against us and our directors, officers and employees. Alternatively, if a court were to find these provisions of our Certificate of Incorporation inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters in other jurisdictions, which could adversely affect our business and financial condition.

Anti-takeover provisions in our restated certificate of incorporation, as amended (our Certificate of Incorporation), and restated bylaws and Delaware law may have the effect of deterring or delaying attempts by our stockholders to remove or replace management, engage in proxy contests and effect changes in control. The provisions of our charter documents include: - procedures for advance notification of stockholder nominations and proposals;- the inability of our stockholders to call a special meeting of the stockholders and the inability of our stockholders to act by written consent;- the ability of our Board of Directors to create new directorships and to fill any vacancies on the Board of Directors;- the ability of our Board of Directors to amend our restated bylaws without stockholder approval; and - the ability of our Board of Directors to issue up to 5,000,000 shares of preferred stock without stockholder approval upon the terms and conditions and with the rights, privileges and preferences as our Board of Directors may determine. In addition, as a Delaware corporation, we are subject to Delaware law, including Section 203 of the Delaware General Corporation Law (DGCL). In general, Section 203 prohibits a Delaware corporation from engaging in any business combination with any interested stockholder for a period of three years following the date that the stockholder became an interested stockholder unless certain specific requirements are met as set forth in Section 203. These provisions, alone or together, could have the effect of deterring or delaying changes in incumbent management, proxy contests or changes in control.

The trading market for our common stock relies in part on the research and reports that industry or financial analysts publish about us or our business. Securities analysts may elect not to provide research coverage of our common stock. If securities analysts do not cover or continue to cover our common stock, the lack of research coverage may cause the market price of our common stock to decline. If one or more of the analysts who elects to cover us downgrades our stock, our stock price would likely decline substantially. If one or more of these analysts ceases coverage of us, we could lose visibility in the market, which in turn could cause our stock price to decline. Many investment banking firms are required to contract with independent financial analysts for their stock research. It may be difficult for companies such as ours, with smaller market capitalizations, to attract independent financial analysts that will cover our common stock. This could have a negative effect on the market price of our stock.

The price of our common stock has fluctuated in the past and may continue to fluctuate in a broad range. Such fluctuations may be due to a number of factors, including the following, some of which are beyond our control: - volume and timing of orders for our products;- quarterly and yearly variations in our or our competitors' results of operations;- our announcement or our competitors' announcements regarding new products, product enhancements, significant contracts, number of distributors, acquisitions or strategic investments;- announcements or speculation regarding the activities or plans of our automotive OEM customers and the perceived impact on their demand for our products;- announcements of technological innovations relating to aerogels, thermal management and energy industrial insulation;- results of operations or projections that vary from the expectations of securities analysts and investors;- the periodic nature of our sales cycles, in particular for capital projects in the energy industrial market;- our ability to develop, obtain regulatory clearance or approval for and market new and enhanced products on a timely basis;- future sales of our common stock, including sales by our executive officers, directors and significant stockholders and their respective affiliates;- announcements by third parties of significant claims or proceedings against us, including with regard to intellectual property and product liability;- changes in accounting principles;- general U.S. and global economic conditions and other factors, including factors unrelated to our operating performance or the operating performance of our competitors; and - other risks described herein. Furthermore, the U.S. stock market has at times experienced extreme volatility that in some cases has been unrelated or disproportionate to the operating performance of particular companies. These broad market and industry fluctuations may adversely affect the market price of our common stock, regardless of our actual operating performance. In the past, following periods of market volatility, stockholders have instituted securities class action litigation. If we become involved in securities litigation, it could have a substantial cost and divert resources and the attention of our senior management team from our business regardless of the outcome of such litigation.