71829--3/14/2006--NEWPARK_RESOURCES

related topics

{cost, regulation, environmental}

{product, market, service}

{property, intellectual, protect}

{loss, insurance, financial}

{gas, price, oil}

{debt, indebtedness, cash}

{competitive, industry, competition}

{personnel, key, retain}

{stock, price, operating}

{tax, income, asset}

{regulation, government, change}

Our operating results have fluctuated during recent years, and these fluctuations may continue, which may have an adverse effect on the market price of our common stock. We employ borrow funds as an integral part of our long-term capital structure. In an adverse industry cycle, we may not have sufficient cash flow from operations to meet our debt service requirements. We may not be able to comply with all of the restrictions imposed by the terms of our indebtedness and could be placed in default by our lenders. We have high levels of fixed costs that may not be covered if there are any downturns in our business. We have high levels of goodwill in relation to our total assets and stockholders equity as a result of acquisitions. This could have a significant impact on our results of operations and financial condition. We may not be able to keep pace with the continual and rapid technological developments that characterize the market for our products and services, and our failure to do so may result in our loss of market share. Demand for our services may be adversely affected by shortages of critical equipment and personnel trained to operate this equipment in the oil and gas industry. If we lose key personnel or are unable to hire additional qualified personnel, we may not be successful. A rescission or relaxation of government regulations could reduce the demand for our services and reduce our revenues and income. Changes in existing regulations also could require us to change the way we do business, which could have a material adverse effect on our results of operations and financial condition. Our patents or other proprietary technology may not prevent our competitors from developing substantially similar technology, which would reduce any competitive advantages we may have from these patents and proprietary technology. We depend on the continued participation and cooperation of the Mexican group that controls the patented and proprietary water treatment technology. We face intense competition in our existing markets and expect to face tough competition in any markets into which we seek to expand. This will put pressure on our ability to maintain our current market share and may limit our ability to expand our market share or enter into new markets. We must comply with numerous federal, state and local laws, regulations and policies that govern environmental protection, zoning and other matters applicable to our business. If we fail to comply or these regulations and policies change, we may face fines or other penalties or be forced to make significant capital expenditures or changes to our operations. Our business exposes us to potential environmental or regulatory liability, and we could be required to pay substantial amounts with respect to these liabilities, including costs to clean up and close contaminated sites. We may not have adequate insurance for potential liabilities, and any significant liability not covered by insurance or in excess of our coverage limits could have a material adverse effect on our financial condition.

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71829--3/14/2006--NEWPARK_RESOURCES_INC