1378706--3/18/2008--AMERICAN_DG_ENERGY

related topics

{stock, price, share}

{control, financial, internal}

{acquisition, growth, future}

{system, service, information}

{competitive, industry, competition}

{condition, economic, financial}

{regulation, change, law}

{customer, product, revenue}

{personnel, key, retain}

{gas, price, oil}

{product, market, service}

{provision, law, control}

{product, liability, claim}

We have incurred losses, and these losses may continue. Because unfavorable utility regulations make the installation of our systems more difficult or economic, any slowdown in the utility deregulation process would be an impediment to the growth of our business. Our onsite utility concept is largely unproven and may not be accepted by a sufficient number of customers. The economic viability of our projects depends on the price spread between fuel and electricity, and the variability of the prices of these components creates a risk that our projects will be uneconomic. We may fail to make sales to certain prospective customers because of resistance from facilities management personnel to the outsourcing of their service function. Future government regulations, such as increased emissions standards, safety standards and taxes, may adversely impact the economics of our business. If we cannot expand our network of skilled technical support personnel, we will be unable to grow our business. The company operates in highly competitive markets and may be unable to successfully compete against competitors having significantly greater resources and experience. Future technology changes may render obsolete various elements of equipment comprising our on-site utility installations. We have limited historical operating results upon which to base projections of future financial performance, making it difficult for prospective investors to assess the value of our stock. We will need to raise additional capital for our business, which will dilute existing shareholders. We may make acquisitions that could harm our financial performance. We are controlled by a small group of majority shareholders, and our minority shareholders will be unable to effect changes in our governance structure or implement actions that require shareholder approval, such as a sale of the company. We may be exposed to substantial liability claims if we fail to fulfill our obligations to our customers. Our common stock is quoted on the OTC Bulletin Board which may have an unfavorable impact on our stock price and liquidity . Future sales of common stock by our existing stockholders may cause our stock price to fall. We have never paid dividends on our capital stock, and we do not anticipate paying any cash dividends in the foreseeable future. Because we do not intend to pay cash dividends, our stockholders will receive no current income from holding our stock. Trading of our common stock is restricted by the SEC S penny stock regulations which may limit a stockholder s ability to buy and sell our stock. There has been a material weakness in our financial controls and procedures, which could harm our operating results or cause us to fail to meet our reporting obligations.

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1378706--3/18/2008--AMERICAN_DG_ENERGY_INC