1413486--3/27/2008--PNA_Intermediate_Holding

related topics

{debt, indebtedness, cash}

{customer, product, revenue}

{condition, economic, financial}

{personnel, key, retain}

{acquisition, growth, future}

{competitive, industry, competition}

{cost, regulation, environmental}

{cost, operation, labor}

Our business, financial condition and results of operations are heavily impacted by varying steel prices. Our operating results could be negatively affected during economic downturns. We rely on steel suppliers in our business and purchase a significant amount of steel from a limited number of suppliers. Termination of one or more of our relationships with any of those suppliers could have a negative effect on our business because we may be unable to obtain steel from other sources in a timely manner or at all. We rely upon our steel suppliers as to the specifications of the steel we purchase from them. We operate in a highly fragmented and competitive industry. Our success depends on our ability to retain our key employees. We are subject to extensive environmental regulation. Adverse developments in our relationship with our employees and future shortages of employees could adversely affect our business. We may pursue future acquisitions as well as organic growth. If we incur additional debt that becomes difficult to service, incur contingent liabilities and expenses in connection with future acquisitions or organic growth, or cannot effectively integrate newly acquired operations, your investment may decline in value. We have a substantial amount of indebtedness, which could adversely affect our financial position and prevent us from fulfilling our obligations under the Senior Notes. The Floating Rate Notes are unsecured and effectively subordinated to our existing and future secured indebtedness. Because PNA Intermediate is the sole obligor of the Floating Rate Notes, and its subsidiaries have not guaranteed its obligations under the Floating Rate Notes or have any obligation with respect to the Floating Rate Notes, the Floating Rate Notes are structurally subordinated to the debt and liabilities of PNA Intermediate s subsidiaries. PNA Intermediate may not have access to the cash flow and other assets of its subsidiaries that may be needed to make payments on the Floating Rate Notes. Despite PNA Intermediate s and its subsidiaries current level of indebtedness, we may still be able to incur substantially more indebtedness. This could further exacerbate the risks associated with our substantial indebtedness. The covenants in PNA s senior secured credit facility and the indenture governing the Floating Rate Notes and the mortgages on our properties impose, and covenants contained in agreements governing indebtedness we incur in the future may impose, restrictions that may limit our operating and financial flexibility. If PNA Intermediate s subsidiaries default on their obligations to pay their indebtedness, PNA Intermediate may not be able to make payments on the Floating Rate Notes. PNA Intermediate may be unable to purchase the Floating Rate Notes upon a change of control. PNA may be unable to purchase the Senior Notes upon a change of control. The trading market for the Floating Rate Notes may be limited.

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1413486--3/27/2008--PNA_Intermediate_Holding_CORP