Commitments and Contingencies

9 Months Ended

Sep. 30, 2011

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

17. Commitments and Contingencies

The Equipment Sale Agreement Addendum No. 1 between Ballard and the Company was executed on June 30, 2011. This addendum relates to a committed purchase by the Company of a total of 3,250 Ballard fuel cell stacks between the dates of July 1, 2011 and December 31, 2012. The amount of this commitment is approximately $9.4 million. In conjunction with this agreement, the Company paid a one-time non-recurring engineering fee of $450,000 to Ballard to be used at Ballard’s sole discretion for the purposes of product development, cost reduction and production implementation.  This fee will be amortized to research and development expense over a period of eighteen months.

Concentrations of credit risk with respect to receivables exist due to the limited number of select customers that the Company has initial commercial sales arrangements with and government agencies. To mitigate credit risk, the Company performs appropriate evaluation of a prospective customer’s financial condition.

At September 30, 2011, five customers comprise approximately 76.8% of the total accounts receivable balance, with each customer individually representing 31.1%, 14.0%, 11.9%, 10.1% and 9.7% of total accounts receivable, respectively. At September 30, 2010, three customers comprise approximately 84.0% of the total accounts receivable balance, with each customer individually representing 39.0%, 23.6%, and 21.4% of total accounts receivable, respectively.

For the nine months ended September 30, 2011, contracts with two customers and two federal government agencies each accounted for 10% or more of total consolidated revenues. For the nine months ended September 30, 2010, contracts with two customers and one federal government agency each accounted for 10% or more of total consolidated revenues.