912365--3/1/2007--EVERGREEN_ENERGY

related topics

{gas, price, oil}

{stock, price, share}

{property, intellectual, protect}

{cost, regulation, environmental}

{provision, law, control}

{control, financial, internal}

{personnel, key, retain}

{competitive, industry, competition}

{operation, international, foreign}

{capital, credit, financial}

{regulation, government, change}

{acquisition, growth, future}

{stock, price, operating}

We have a history of losses, deficits, and negative operating cash flows and will likely continue to incur losses in the future. Such losses may impair our ability to pursue our business plan. We have substantial capital requirements and, as a result, we have been and continue to be dependent on sales of our equity securities to fund our operating costs. We have a limited operating history as an energy solutions company, and our business and prospects should be considered in light of the risks and difficulties typically encountered by a company with a limited operating history. We rely on key personnel and if we are unable to retain or attract qualified personnel, we may not be able to execute our business plan. Our acquisition activities may not be successful. Technical and operational problems may adversely impact our ability to operate or develop K-Fuel facilities, resulting in delays in the production of our K-Fuel refined coal. Any negative results from the continuing evaluation of K-Fuel refined coal produced at our Fort Union plant site or future plant sites by us or third parties could have a material adverse effect on the marketability of K-Fuel refined coal and future prospects. Due to the uncertain market for, and commercial acceptance of, our K-Fuel refined coal, we may not be able to realize significant revenues from the sale of K-Fuel refined coal. If we are unable to construct and operate commercial K-Fuel production plants profitably, our ability to generate revenue from this process will be impaired. Competition from other companies in the clean coal and alternative fuel technology industries could adversely affect our market share. Deregulation in the United States power generating industry may result in increased competition, which could result in lower margins for our product. Regulation of the K-Fuel process and K-Fuel refined coal may adversely affect our financial condition and results of operations and cash flows. Compliance with environmental laws and regulations may increase our costs and reduce our revenues. Future changes in the law may adversely affect our ability to sell our products and services. Our inability to adequately protect and defend our proprietary process could harm our business, increase our costs and decrease the sales volume of our products and services. Our success will depend on our ability to operate without infringing on or misappropriating the proprietary rights of others. Any overseas development of our business is subject to international risks, which could adversely affect our ability to license, construct or operate profitable overseas plants. A substantial or extended decline in coal prices could reduce our revenues and the value of our coal reserves. Our coal mining production and delivery is subject to conditions and events beyond our control, which could result in higher operating expenses and/or decreased production and sales and adversely affect our operating results. Our business will be adversely affected if we are unable to develop or acquire additional coal reserves that are economically recoverable. We face numerous uncertainties in estimating our recoverable coal reserves, and inaccuracies in our estimates could result in decreased profitability from lower than expected revenues or higher than expected costs. Risks Relating to Our Common Stock and Other Risks Our stock price has been volatile, and your investment in our common stock could suffer a decline in value. Provisions in our articles of incorporation, bylaws and Delaware law may make it more difficult to effect a change in control, which could adversely affect the price of our common stock. A substantial number of shares we have issued in exempt transactions are, or are being made, available for sale on the open market, and the resale of these securities might adversely affect our stock price. We have not paid cash dividends on our common stock and do not anticipate paying any dividends on our common stock in the foreseeable future.

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912365--3/1/2007--EVERGREEN_ENERGY_INC