1216596--4/2/2007--NORTEK

related topics

{debt, indebtedness, cash}

{cost, regulation, environmental}

{operation, international, foreign}

{customer, product, revenue}

{condition, economic, financial}

{property, intellectual, protect}

{acquisition, growth, future}

{product, liability, claim}

{financial, litigation, operation}

{competitive, industry, competition}

{personnel, key, retain}

{product, market, service}

{cost, operation, labor}

The Company s business is dependent upon the levels of remodeling and replacement activity and new construction activity and could be hurt by economic downturns. Fluctuations in the cost or availability of raw materials and components and increases in freight and other costs could have an adverse effect on the Company s business. The availability of certain raw materials and component parts from sole or limited sources of supply may have an adverse effect on the Company s business. Weather fluctuations may negatively impact the Company s business. If the Company fails to identify suitable acquisition candidates, or to integrate the businesses it has acquired or will acquire in the future, it could negatively impact the Company s business. Because the Company competes against competitors with substantially greater resources, the Company faces external competitive risks that may negatively impact its business. Fluctuations in currency exchange rates could adversely affect the Company s revenues, profitability and cash flows. Because the Company has substantial operations outside the United States, the Company is subject to the economic and political conditions of foreign nations. A decline in the Company s relations with its key distributors and dealers or loss of major customers may negatively impact the Company s business. Labor disruptions or cost increases could adversely affect the Company s business. The Company must continue to innovate and improve its products to maintain its competitive advantage. The Company could incur substantial costs, including cleanup costs, fines and civil or criminal sanctions, as a result of violations of or liabilities under environmental laws. The Company faces risks of litigation and liability claims on product liability, workers compensation and other matters, the extent of which exposure can be difficult or impossible to estimate and which can negatively impact the Company s business, financial condition, results of operations and cash flows. Product recalls or reworks may adversely affect the Company s business. The Company s business operations could be significantly disrupted if it lost members of its management team. The Company s business operations could be negatively impacted if it fails to adequately protect its intellectual property rights, if it fails to comply with the terms of its licenses or if third parties claim that the Company is in violation of its intellectual property rights. The Company s substantial debt could negatively impact its business, prevent the Company from fulfilling its outstanding debt obligations and adversely affect its financial condition. The terms of the Company s debt covenants could limit how the Company conducts its business and its ability to raise additional funds. The Company may be unable to generate sufficient cash to service all of its indebtedness and may be forced to take other actions to satisfy its obligations under such indebtedness, which may not be successful. If the Company is unable to access funds generated by its subsidiaries the Company may not be able to meet its financial obligations.

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1216596--4/2/2007--NORTEK_INC