First Quarter Overview:

During the first quarter of 2009, the company continued to focus its efforts on maintaining adequate liquidity, which included amending certain credit agreements to extend the maturity dates of these agreements and entering into additional financing arrangements to increase cash balances for operating activities. The company also continued its efforts to improve upon its internal control environment, specifically to correct deficiencies and weaknesses that were previously identified and to improve operational effectiveness throughout the organization.

In addition, the company continued to be affected by the current economic downturn and the associated effects of the disruptions in the credit markets. As a result, the company expects to see a continuing economic slowdown in the wind and energy related industries for the foreseeable future as wind turbine manufacturers, wind farm operators and service providers have scaled back existing manufacturing orders and have delayed new projects and service arrangements.

The following is a summary of recent key events for the company:

In January 2009, Tower Tech completed the construction of its new wind tower manufacturing facility located in Abilene, Texas.

In February 2009, federal economic recovery legislation was passed by Congress and signed into law by President Obama. Within this legislation, significant provisions to benefit the renewable energy industry were included, such as: grant programs provided through the Treasury Department to renewable energy developers; the extension of the wind energy production tax credits; loan guarantee programs provided through the Energy Department for renewable energy developers and manufacturers; and tax credits for advanced energy manufacturers.

In March 2009, Brad Foote, Tower Tech and RBA amended certain credit and loan agreements. The amendments to these credit and loan agreements established new financial covenants and extended the maturity dates of these agreements.

In March 2009, the company announced the appointment of William T. Fejes, to the company’s board of directors, replacing William M. Barrett, who resigned from his position on the board in February 2009. Fejes was also appointed to the board’s Audit committee and will serve as chairman of the board’s governance/nominating committee.

In April 2009, the company announced that shares of its common stock have been approved for listing on the NASDAQ Global Select Market (NASDAQ). Shares of the company’s common stock, which were previously listed and traded on the OTC Bulletin board, began trading on NASDAQ on April 9, 2009 under the same BWEN ticker symbol.

In April 2009, the company announced that Tower Tech obtained construction financing from Great Western Bank in the amount of up to $10,000 (the GWB Loan). Proceeds from the GWB Loan will be used to complete construction of Tower Tech’s wind tower manufacturing facility in Brandon, South Dakota.

On May 1, 2009 the company announced that Stephen E. Graham was appointed Interim chief financial officer (and principal financial and accounting officer) of the company. Graham replaced Matthew J. Gadow, who resigned from his positions as the company’s executive vice president and chief financial officer on April 30, 2009.

Revenues:

Total revenues increased $17,898, or 51% from $35,164 during the three months ended March 31, 2008, to $53,062 during the three months ended March 31, 2009.

Products segment revenues increased $12,886 from $30,248 during the three months ended March 31, 2008, to $43,134 during the three months ended March 31, 2009. The increase in revenues within the company’s Products segment is primarily attributable to the inclusion of materials in the selling price of certain of the company’s products. Production volumes were comparable to the prior period as an increase in production volume at the company’s new wind tower manufacturing facility in Abilene, Texas was partially offset by a decline in production volume at the company’s Manitowoc, Wisconsin facility resulting from start-up delays related to a new wind tower manufacturing contract.

Services segment revenues increased $5,313 from $4,916 during the three months ended March 31, 2008, to $10,229 during the three months ended March 31, 2009. The increase in revenues within the company’s Services segment is primarily attributable to an increase in volume capacity related to entering into and completing short-term service contracts during the first quarter, as well as the inclusion of revenues from Badger, which the company acquired in June 2008.

Cost of Sales:

Total cost of sales increased $21,223 from $27,154 during the three months ended March 31, 2008, to $48,377 during the three months ended March 31, 2009.

Products segment cost of sales increased from $24,520 during the three months ended March 31, 2008, to $40,690 during the three months ended March 31, 2009. The increase in cost of sales within the company’s Products segment is primarily attributable to the cost of materials purchased as part of the selling price of certain products, start up costs related to a new manufacturing contract and higher manufacturing overhead costs resulting from the start-up of operations at the company’s wind tower manufacturing facility in Abilene, Texas. In addition, during the three months ended March 31, 2009, the company recorded a $930 inventory reserve provision for scrap and obsolete materials.

Services segment cost of sales increased from $2,634 during the three months ended March 31, 2008, to $7,843 during the three months ended March 31, 2009. The increase in cost of sales within the company’s Services segment is primarily attributable to the inclusion of cost of sales related to Badger and cost of sales associated with volume increases at EMS.

Selling, General and Administrative Expenses:

Selling, general and administrative expenses increased from $7,370 during the three months ended March 31, 2008, to $8,916 during the three months ended March 31, 2009. The increase was primarily attributable to the inclusion of Badger, higher professional fees incurred in connection with amending the company’s credit facility agreements and higher share-based compensation expense. In addition, the company incurred certain selling, general and administrative expense associated with the start-up operations at the Abilene, Texas facility. As a percentage of revenue, selling, general and administrative expenses decreased from 21.0% during the three months ended March 31, 2008, to 16.8% during the three months ended March 31, 2009, as the company continued to reduce one-time expenses associated with the integration of the company’s acquisitions completed during 2007 and 2008 and professional and audit related fees associated with compliance initiatives related to the Sarbanes-Oxley Act and other public reporting obligations.