763846--4/7/2008--China_Industrial_Waste_Management

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Risks Related to our Business Our failure to compete effectively may adversely affect our ability to generate revenue. We rely on our governmental permits to operate our business in Dalian, China and the loss of the permits would have a material adverse impact on our business. If we fail to introduce new services or our existing services are not accepted by potential customers we may not gain or may lose market share. Our inability to fund our capital expenditure requirements may adversely affect our growth and profitability. We may not be able to effectively control and manage our growth. If we are unable to successfully complete and integrate new operational locations in a timely manner, our growth strategy could be adversely impacted. Our waste treatment operations are risky and we may be subject to civil liabilities as a result of hazards posed by such operations. We do not presently maintain liability insurance which leaves us with exposure in the event of loss or damage to our properties or claims filed against us. Failure to retain services of key personnel will affect our operations and results We may not be able to protect our processes, technologies and systems against claims by other parties We may face claims for infringement of third-party intellectual property rights We are reliant on a few major suppliers We are subject to risks relating to BOT (Build-Operate-Transfer) projects in which we have started to invest Risks Related to Doing Business in the PRC We face the risk that changes in the policies of the PRC government could have a significant impact upon the business we may be able to conduct in the PRC and the profitability of such business. Introduction of new laws or changes to existing laws by the PRC government may adversely affect our business The PRC laws and regulations governing our current business operations are sometimes vague and uncertain. Any changes in such PRC laws and regulations may have a material and adverse effect on our business. A slowdown or other adverse developments in the PRC economy may materially and adversely affect our customers, demand for our services and our business. Inflation in the PRC could negatively affect our profitability and growth. Our PRC subsidiaries are subject to restrictions on paying dividends and making other payments to us. Governmental control of currency conversion may affect the value of your investment. The fluctuation of the Renminbi may materially and adversely affect your investment. Any recurrence of severe acute respiratory syndrome, or SARS, or another widespread public health problem, could adversely affect our operations. Because our principal assets are located outside of the United States and all of our directors and all our officers reside outside of the United States, it may be difficult for you to enforce your rights based on U.S. Federal Securities Laws against us and our officers and directors or to enforce a judgment of a United States court against us or our officers and directors in the PRC. We may face obstacles from the communist system in the PRC. We may have difficulty establishing adequate management, legal and financial controls in the PRC. Risks Related to Our Common Stock Our officers, directors and affiliates control us through their positions and stock ownership and their interests may differ from other stockholders. We are not likely to pay cash dividends in the foreseeable future. Our common stock is illiquid and subject to price volatility unrelated to our operations. Our common stock is subject to the Penny Stock rules of the SEC, which will make transactions in our common stock cumbersome and may reduce the value of an investment in our common stock. The elimination of monetary liability against our directors, officers and employees under our certificate of incorporation and the existence of indemnification rights to our directors, officers and employees may result in substantial expenditures by our Company and may discourage lawsuits against our directors, officers and employees.

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763846--4/7/2008--China_Industrial_Waste_Management_Inc.