1391390--2/24/2009--BOISE

related topics

{debt, indebtedness, cash}

{cost, operation, labor}

{cost, regulation, environmental}

{stock, price, operating}

{customer, product, revenue}

{product, market, service}

{cost, contract, operation}

{condition, economic, financial}

{stock, price, share}

{provision, law, control}

{competitive, industry, competition}

{acquisition, growth, future}

Conditions in the global capital and credit markets and the economy in general may have a material adverse effect on our business, results of operations, and financial position. Our substantial debt adversely affects our financial flexibility and could impair our ability to operate. Our operations may not be able to generate sufficient cash flows to meet our debt service obligations. A default under our indebtedness may have a material adverse effect on our business and financial condition. Our senior secured credit facilities contain restrictive covenants that limit our overall liquidity and corporate activities. Our operations require substantial capital, and we may not have adequate capital resources to provide for all of our capital requirements. Since the Acquisition, the market price of our common stock has declined significantly, and we face possible delisting from the New York Stock Exchange (NYSE). We have significant obligations for pension and post-employment benefits. Some of our paper products are vulnerable to long-term declines in demand due to competing technologies or materials. The paper industry is cyclical. Fluctuations in the prices of and the demand for our products could result in smaller profit margins and lower sales volumes. We face strong competition in our markets. We depend on a small number of customers for a significant portion of our business. Our recent decision to terminate our newsprint marketing arrangement with ACSC (Abitibi Consolidated Sales Corporation) and sell newsprint on our own may adversely affect our financial results. A material disruption at one of our manufacturing facilities could prevent us from meeting customer demand, reduce our sales, and/or negatively affect our net income. Increases in the cost of our purchased energy or chemicals would lead to higher manufacturing costs, thereby reducing our margins. Our manufacturing businesses may have difficulty obtaining logs and fiber at favorable prices or at all. We are subject to significant environmental regulation and environmental compliance expenditures, as well as other potential environmental liabilities. Labor disruptions or increased labor costs could materially adversely affect our business. Our stock ownership is highly concentrated, and as a result, Boise Cascade may influence our affairs significantly. Registration rights held by Boise Cascade and certain of our stockholders may have an adverse effect on the market price of our common stock. Delaware law and our amended and restated charter documents may impede or discourage a takeover that our stockholders may consider favorable.

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1391390--2/24/2009--BOISE_INC.