1130385--2/27/2007--FOSTER_WHEELER

related topics

{debt, indebtedness, cash}

{loss, insurance, financial}

{system, service, information}

{competitive, industry, competition}

{property, intellectual, protect}

{personnel, key, retain}

{cost, contract, operation}

{operation, international, foreign}

{provision, law, control}

{cost, regulation, environmental}

{condition, economic, financial}

{operation, natural, condition}

Failure by us to successfully defend against claims made against us by project owners or by our project subcontractors, or failure by us to recover adequately on claims made against project owners, could have a material adverse effect upon our financial condition, results of operations and cash flow. We require cash repatriations from our non-U.S. subsidiaries to meet our domestic cash needs related to our U.S. pension plans, asbestos-related liabilities and corporate overhead expenses. Our ability to repatriate funds from our non-U.S. subsidiaries is limited by a number of factors. Our international operations involve risks that may limit or disrupt operations, limit repatriation of cash, increase foreign taxation or otherwise have a material adverse effect on our business, financial condition, results of operations and cash flow. Certain of our various debt agreements impose financial covenants, which may prevent us from capitalizing on business opportunities and taking certain corporate actions, which could materially adversely affect our business, financial condition, results of operations and cash flow. We face limitations on our ability to obtain new letters of credit and bank guarantees on the same terms as we have historically. If we were unable to obtain letters of credit and bank guarantees on reasonable terms, our business, financial condition, results of operations and cash flow would be materially adversely affected. We may have high working capital requirements and we may have difficulty obtaining additional financing, which could have a negative impact on our business, financial condition, results of operations and cash flow. Projects included in our backlog may be delayed or cancelled, which could materially adversely affect our financial condition, results of operations and cash flow. The number and cost of our current and future asbestos claims in the United States could be substantially higher than we have estimated and the timing of payment of claims could be sooner than we have estimated, which could materially adversely affect our financial condition, results of operations and cash flow. The adequacy and timing of insurance recoveries of our asbestos-related costs in the United States is uncertain. The failure to obtain insurance recoveries could cause a material adverse effect on our financial condition, results of operations and cash flow. National asbestos trust fund legislation could require us to pay amounts in excess of current estimates of our net asbestos liability, which could adversely affect our financial condition, results of operations and long-term cash flow. Because our operations are concentrated in four particular industries, we may be adversely impacted by economic or other developments in these industries. We may lose business to competitors. A failure by us to attract and retain qualified personnel, joint venture partners, advisors and subcontractors could have an adverse effect on our business, financial condition, results of operations and cash flow. We are subject to various environmental laws and regulations in the countries in which we operate. If we fail to comply with these laws and regulations, we may have to incur significant costs and penalties that could adversely affect our financial condition, results of operations and cash flow. We rely on our information systems in our operations. Failure to protect these systems against security breaches could adversely affect our business and results of operations. Additionally, if these systems fail or become unavailable for any significant period of time, our business could be harmed. We may lose market share to our competitors and be unable to operate our business profitably if our patents and other intellectual property rights do not adequately protect our proprietary products. We have anti-takeover provisions in our bye-laws that may discourage a change of control.

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1130385--2/27/2007--FOSTER_WHEELER_LTD