1046578--8/12/2008--TOUSA

related topics

{debt, indebtedness, cash}

{condition, economic, financial}

{cost, contract, operation}

{financial, litigation, operation}

{acquisition, growth, future}

{investment, property, distribution}

{gas, price, oil}

{interest, director, officer}

{stock, price, share}

{cost, operation, labor}

{tax, income, asset}

{operation, natural, condition}

{personnel, key, retain}

{customer, product, revenue}

A long period of operating under Chapter 11 may harm our business. Operating under the Bankruptcy Code may restrict our ability to pursue our business strategies. Our cash collateral order includes operating budgets and financial covenants that limit our operating flexibility. Limitations in the cash collateral order on making capital expenditures and incurring additional debt may prevent us from pursing new business initiatives, which may place us at a competitive disadvantage. We require a significant amount of cash, which may not be available to us. We may not be able to confirm or consummate a plan of reorganization. Transfers of our equity, or issuances of equity in connection with our restructuring, may impair our ability to utilize our federal income tax net operating loss carryforwards in the future. The Bankruptcy Code may limit our secured creditors ability to realize value from their collateral. Our successful reorganization will depend on our ability to retain and motivate key employees. Our financial results may be volatile and may not reflect historical trends. Risks Related to Capital Resources; Liquidity We have substantial liquidity needs and face liquidity pressure. Our substantial indebtedness could adversely impact our financial health and limit our operations. We may be unable to obtain additional financing in the future. Our cash collateral order imposes significant operating and financial restrictions on us; any failure to comply with these restrictions could have a material adverse effect on our liquidity and our operations. We may incur significant damages and expenses due to the purported class action complaints filed against us and certain of our officers. You may find it difficult to sell our common stock and debt securities. Risks Related to Our Business The homebuilding industry is experiencing a severe downturn that may continue for an indefinite period which may further adversely affect our business and results of operations compared to prior periods. Our strategies in responding to the adverse conditions in the homebuilding industry have had limited success and the continued implementation of these and other strategies may not be successful. Continued high cancellation rates may negatively impact our business. Our revenues and profitability may be adversely affected by natural disasters or weather conditions. We are subject to substantial risks with respect to the land and home inventories we maintain, and fluctuations in market conditions may affect our ability to sell our land and home inventories at expected prices, if at all, which would reduce our profit margins. Reduced home sales may impair our ability to recoup development costs or force us to absorb additional costs. Market conditions in the mortgage lending and mortgage finance industries deteriorated significantly in 2007, adversely impacting us by increasing the supply of inventory housing, negatively impacting pricing conditions, as well as decreasing the demand for our homes, which adversely affected our revenues and profitability. Recent changes in mortgage lending requirements or further reduced mortgage liquidity could adversely affect the availability of credit for some purchasers of our homes and thereby reduce our sales. We are dependent on the continued availability and satisfactory performance of our subcontractors, which, if unavailable, could have a material adverse effect on our business. Supply risks and shortages relating to labor and materials can harm our business by delaying construction and increasing costs. The competitive conditions in the homebuilding industry could increase our costs, reduce our revenues and otherwise adversely affect our results of operations. Future limitations on our ability to obtain bonds may adversely affect our homebuilding operations. We are subject to product liability and warranty claims arising in the ordinary course of business that could adversely affect our results of operations. Our business is subject to governmental regulations that may delay, increase the cost of, prohibit or severely restrict our development and homebuilding projects.

Full 10-K form ▸

1046578--8/12/2008--TOUSA_INC