918709--3/30/2007--ACT_TELECONFERENCING

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{product, market, service}

{stock, price, share}

{provision, law, control}

{stock, price, operating}

{system, service, information}

{control, financial, internal}

{customer, product, revenue}

{operation, international, foreign}

{cost, operation, labor}

{acquisition, growth, future}

{competitive, industry, competition}

While we were profitable in 2006, we have experienced losses during the past several years, and we may be unable to maintain profitability. Holders of a majority of our Series AA Preferred Stock may require that we redeem all outstanding shares of Series AA Preferred Stock on or after August 19, 2010, and we are unlikely to have sufficient funds to satisfy the resulting obligation. Our preferred stock carries a substantial liquidation preference, which could significantly impact the return to common equity holders upon an acquisition. The Series AA Preferred Stock increases in stated value at a rate of 9.55% per quarter. Conversion of our Series AA Preferred Stock could result in a substantial number of additional shares of common stock outstanding, which could decrease the price of our common stock. Dolphin, the beneficial owner of approximately 56.4% of our voting securities at March 31, 2007, is able to exert substantial control over us. The terms of our Series AA Preferred Stock have been amended to provide for a forced conversion feature over which Dolphin has substantial influence and may outright control. Our revenues may fluctuate because we draw significant revenues from major clients, who may transfer their business away from us. We may be adversely affected by downward price pressure in the teleconferencing industry. Our plans to operate, grow or continue as a going concern may be limited if we are unable to obtain sufficient financing. Restructuring plans may impact our operating performance. Our common stock is quoted on the Pink Sheets and the OTC Bulletin Board (the OTCBB ), which may reduce the price of our common stock and the levels of liquidity available to our shareholders and cause confusion among investors. Increased use of automated teleconferencing services may result in a decrease in the average prices we charge our customers. We face operational and financial risks relating to our international operations. Our major competitors in the telecommunications industry have greater capital resources and brand name recognition than we have, which makes it difficult for us to compete with them. We have made only a limited entry into the web conferencing market. If our Internet telephony conferencing services do not gain market acceptance or we are unable to finance this opportunity, our potential for growth in this market sector will be limited. Other technological innovations could render our current services obsolete. We occasionally experience technical malfunctions and other hazards which adversely affect our operations and create costs. There are few regulatory barriers to entry into our current markets, and new competitors may enter at any time. Our common stock price has been highly volatile and this volatility may continue. Provisions of our restated articles of incorporation and agreements we have entered could delay or prevent a change in control of ACT.

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918709--3/30/2007--ACT_TELECONFERENCING_INC