1086385--3/31/2009--PANOLAM_INDUSTRIES_INTERNATIONAL

related topics

{debt, indebtedness, cash}

{condition, economic, financial}

{customer, product, revenue}

{cost, regulation, environmental}

{acquisition, growth, future}

{operation, international, foreign}

{property, intellectual, protect}

{personnel, key, retain}

{interest, director, officer}

{investment, property, distribution}

{product, market, service}

There is substantial doubt about our ability to continue as a going concern. We may be unable to successfully negotiate the restructuring or refinancing of our existing indebtedness, which could have a negative impact on our ability to continue as a going concern. Prolonged economic downturns affecting the general economy, industries we target, or our customers have materially and adversely affected, and could continue to adversely affect, our business, liquidity and results of operations. If we are able to restructure our indebtedness and continue operations, we will likely require a significant amount of cash to service our indebtedness. Our ability to generate cash depends on many factors beyond our control, and any failure to meet our debt service obligations could harm our business, financial condition and results of operations. Repayment of our indebtedness is dependent in part on cash flow generated by our subsidiaries. Any replacement financing we secure will likely contain operating and financial covenants that may restrict our business and financing activities. We operate in a competitive industry and many of our competitors have greater resources than we do, which could permit them to spend more on marketing and research and development or make them less vulnerable to increases in raw material costs. Our business may be affected by changes in customer preferences and discretionary spending. We have recently been adversely affected by increased costs of raw materials and purchased energy. Further increases in these costs could continue to adversely affect us. We do not generally have any contracts with the ultimate end users of our products or OEMs and they could cease their business relationship with us at any time without notice. We might encounter difficulties and barriers that impede our ability to manage our acquisitions throughout diverse geographical markets, which might result in disruptions to our business and additional expense. Our manufacturing operations involve the use, handling, storage, treatment and disposal of materials and waste products that may be toxic or hazardous, and as a result, we may face environmental liabilities. A material disruption at one of our manufacturing facilities could prevent us from meeting customer demand, reduce our sales, and/or negatively impact our net income. We are dependent upon our Chief Executive Officer and other key employees. Genstar Capital and The Sterling Group control our company and their interests may conflict with those of other investors. Our results may fluctuate based on exchange rates between U.S. and Canadian dollars. We may not be able to protect our intellectual property rights, brands or proprietary technology effectively.

Full 10-K form ▸

1086385--3/31/2009--PANOLAM_INDUSTRIES_INTERNATIONAL_INC