| CONSUMER PORTFOLIO SERVICES INC ITEM 1A RISK FACTORS WE REQUIRE A SUBSTANTIAL AMOUNT OF CASH TO SERVICE OUR DEBT To service our existing indebtedness, we require a significant amount of cash |
| Our ability to generate cash depends on many factors, including our successful financial and operating performance |
| We cannot assure you that our business strategy will succeed or that we will achieve our anticipated financial results |
| Our financial and operational performance depends upon a number of factors, many of which are beyond our control |
| These factors include, without limitation: 14 o the current economic and competitive conditions in the asset-backed securities market; o the current credit quality of our motor vehicle contracts; o the performance of our residual interests; o any operating difficulties or pricing pressures we may experience; o our ability to obtain credit enhancement; o our ability to establish and maintain dealer relationships; o the passage of laws or regulations that affect us adversely; o any delays in implementing any strategic projects we may have; o our ability to compete with our competitors; and o our ability to acquire motor vehicle contracts Depending upon the outcome of one or more of these factors, we may not be able to generate sufficient cash flow from operations or to obtain sufficient funding to satisfy all of our obligations |
| If we were unable to pay our debts, we would be required to pursue one or more alternative strategies, such as selling assets, refinancing or restructuring our indebtedness or selling additional equity capital |
| These alternative strategies might not be feasible at the time, might prove inadequate or could require the prior consent of our senior secured and unsecured lenders |
| WE NEED SUBSTANTIAL LIQUIDITY TO OPERATE OUR BUSINESS We have historically funded our operations principally through internally generated cash flows, sales of debt and equity securities, including through securitizations and warehouse credit facilities, borrowings from a private equity fund and sales of subordinated notes |
| However, we may not be able to obtain sufficient funding for our operations through either or a combination of (1) future access to the capital markets for equity or debt issuances, including securitizations or (2) future borrowings or other financings on acceptable terms to us |
| If we were unable to access the capital markets or obtain acceptable financing, our results of operations, financial condition and cash flows would be materially and adversely affected |
| Among other things, we use such cash liquidity to: o acquire motor vehicle contracts; o fund overcollateralization in warehouse facilities and securitizations; o pay securitization fees and expenses; o fund spread accounts in connection with securitizations; o satisfy working capital requirements and pay operating expenses; and o pay interest expense |
| Prior to the third quarter of 2003, when we securitized our motor vehicle contracts, we reported a gain on the sale of those contracts |
| This gain represented a substantial portion of our revenues prior to the third quarter of 2003 |
| However, although we reported this gain at the time of sale, we received the monthly cash payments on those contracts (representing revenue previously recognized) over the life of the motor vehicle contracts, rather than at the time of sale |
| As a result, a substantial portion of our reported revenues prior to the third quarter of 2003 did not represent immediate cash liquidity |
| OUR RESULTS OF OPERATIONS WILL DEPEND ON OUR ABILITY TO SECURE AND MAINTAIN CREDIT AND WAREHOUSE FINANCING ON FAVORABLE TERMS We depend on credit and warehouse facilities to finance our purchases of motor vehicle contracts |
| Our business strategy requires that these credit and warehouse financing sources continue to be available to us from the time of purchase or origination of a motor vehicle contract until its sale through a securitization |
| 15 Our primary source of day-to-day liquidity is our warehouse lines of credit, in which we sell or pledge motor vehicle contracts, as often as twice a week, to special-purpose affiliated entities where they are "e warehoused "e until they are securitized |
| We depend substantially on two warehouse lines of credit: (i) a dlra150 million warehouse line of credit, which we opened in November 2005 and, unless earlier terminated upon the occurrence of certain events, will expire in November 2006 and (ii) a dlra200 million warehouse line of credit, which was executed in June 2004 and, unless earlier terminated upon the occurrence of certain events, will expire in June 2007 |
| Both lines are renewable with the mutual agreement of the parties |
| These warehouse facilities will remain available to us only if, among other things, we comply with certain financial covenants contained in the documents governing these facilities |
| These warehouse facilities may not be available to us in the future and we may not be able to obtain other credit facilities on favorable terms to fund our operations |
| If we were unable to arrange new warehousing or credit facilities or extend our existing warehouse or credit facilities when they come due, our results of operations, financial condition and cash flows could be materially and adversely affected |
| OUR RESULTS OF OPERATIONS WILL DEPEND ON OUR ABILITY TO SECURITIZE OUR PORTFOLIO OF MOTOR VEHICLE CONTRACTS We are dependent upon our ability to continue to finance pools of motor vehicle contracts in term securitizations in order to generate cash proceeds for new purchases of motor vehicle contracts |
| We have historically depended on securitizations of motor vehicle contracts to provide permanent financing of those contracts |
| By "e permanent financing "e we mean financing that extends to cover the full term of the contracts |
| By contrast, our warehouse credit facilities permit us to borrow against the value of such receivables only for limited times |
| There can be no assurance that any securitization transaction will be available on terms acceptable to us, or at all |
| The timing of any securitization transaction is affected by a number of factors beyond our control, any of which could cause substantial delays, including, without limitation, o market conditions; o the approval by all parties of the terms of the securitization; o the availability of credit enhancement on acceptable terms; and o our ability to acquire a sufficient number of motor vehicle contracts for securitization Adverse changes in the market for securitized contract pools may result in our inability to securitize contracts and may result in a substantial extension of the period during which our contracts are financed through our warehouse facilities, which would burden our financing capabilities, could require us to curtail our purchase of contracts, and could have a material adverse effect on us |
| OUR RESULTS OF OPERATIONS WILL DEPEND ON CASH FLOWS FROM OUR RESIDUAL INTERESTS IN OUR SECURITIZATION PROGRAM AND OUR WAREHOUSE CREDIT FACILITIES When we sell or pledge our motor vehicle contracts in securitizations and warehouse credit facilities, we receive cash and a residual interest in the securitized assets |
| This residual interest represents the right to receive the future cash flows to be generated by the motor vehicle contracts in excess of (i) the interest and principal paid to investors on the indebtedness issued in connection with the financing (ii) the costs of servicing the contracts and (iii) certain other costs incurred in connection with completing and maintaining the securitization or warehousing |
| We sometimes refer to these future cash flows as "e excess spread cash flows "e |
| Under the financial structures we have used to date in our securitizations and warehouse credit facilities, excess spread cash flows that would otherwise be paid to the holder of the residual interest are used to increase overcollateralization or are retained in a spread account within the securitization trusts or the warehouse facility to provide liquidity and credit enhancement for the related securities |
| 16 While the specific terms and mechanics of each spread account vary among transactions, our securitization and warehousing agreements generally provide that we will receive excess spread cash flows only if the amount of overcollateralization and spread account balances have reached specified levels and/or the delinquency, defaults or net losses related to the contracts in the motor vehicle contract pools are below certain predetermined levels |
| In the event delinquencies, defaults or net losses on contracts exceed these levels, the terms of the securitization or warehouse facility: o may require increased credit enhancement, including an increase in the amount required to be on deposit in the spread account, to be accumulated for the particular pool; o may restrict the distribution to us of excess spread cash flows associated with other securitized or warehoused pools; and o in certain circumstances, may permit affected parties to require the transfer of servicing on some or all of the securitized or warehoused contracts to another servicer |
| We typically retain or sell residual interests or use them as collateral to borrow cash |
| In any case, the future excess spread cash flow received in respect of the residual interests are integral to the financing of our operations |
| The amount of cash received from residual interests depends in large part on how well our portfolio of securitized and warehoused motor vehicle contracts performs |
| If our portfolio of warehoused and securitized motor vehicle contracts has higher delinquency and loss ratios than expected, then the amount of money realized from our retained residual interests, or the amount of money we could obtain from the sale or other financing of our residual interests, would be reduced, which could have an adverse effect on our operations, financial condition and cash flows |
| IF WE ARE UNABLE TO OBTAIN CREDIT ENHANCEMENT FOR OUR SECURITIZATION PROGRAM OR OUR WAREHOUSE CREDIT FACILITIES UPON FAVORABLE TERMS, OUR RESULTS OF OPERATIONS MAY BE IMPAIRED In our securitizations, we typically utilize credit enhancement in the form of one or more financial guaranty insurance policies issued by financial guaranty insurance companies |
| Each of these policies unconditionally and irrevocably guarantees certain interest and principal payments on the securities issued in our securitizations |
| These guarantees enable these securities to achieve the highest credit rating available |
| This form of credit enhancement reduces the costs of our securitizations relative to alternative forms of credit enhancements currently available to us |
| None of such financial guaranty insurance companies is required to insure future securitizations |
| As we pursue future securitizations, we may not be able to obtain: o credit enhancement in any form from financial guaranty insurance companies or any other provider of credit enhancement on acceptable terms; or o similar ratings for future securitizations |
| IF OUR PORTFOLIO OF MOTOR VEHICLE CONTRACTS EXPERIENCES HIGHER LEVELS OF DEFAULTS, DELINQUENCIES OR LOSSES THAN WE ANTICIPATE, OUR RESULTS OF OPERATIONS MAY BE IMPAIRED We specialize in the purchase, sale and servicing of contracts to finance automobile purchases by customers with impaired or limited credit histories or "e sub-prime "e customers, which entail a higher risk of non-performance, higher delinquencies and higher losses than contracts with more creditworthy customers |
| While we believe that the underwriting criteria and collection methods we employ enable us to control the higher risks inherent in contracts with sub-prime customers, no assurance can be given that such criteria and methods will afford adequate protection against such risks |
| We have in the past experienced fluctuations in the delinquency and charge-off performance of our contracts |
| In the event that portfolios of contracts securitized and serviced by us experience greater defaults, higher delinquencies or higher net losses than anticipated, our income could be negatively affected |
| A larger number of defaults than anticipated could also result in adverse changes in the structure of future securitization transactions, such as a requirement of increased cash collateral or other credit enhancement in such transactions |
| 17 IF THE ECONOMY OF ALL OR CERTAIN REGIONS OF THE UNITED STATES SLOWS OR ENTERS INTO A RECESSION, OUR RESULTS OF OPERATIONS MAY BE IMPAIRED Our business is directly related to sales of new and used automobiles, which are sensitive to employment rates, prevailing interest rates and other domestic economic conditions |
| Delinquencies, repossessions and losses generally increase during economic slowdowns or recessions |
| Because of our focus on "e sub-prime "e customers, the actual rates of delinquencies, repossessions and losses on our motor vehicle contracts could be higher under adverse economic conditions than those experienced in the automobile finance industry in general, particularly in the states of Texas, California, Ohio, Florida and Pennsylvania, states in which our motor vehicle contracts are geographically concentrated |
| Any sustained period of economic slowdown or recession could adversely affect our ability to sell or securitize pools of contracts |
| The timing of any economic changes is uncertain, and weakness in the economy could have an adverse effect on our business and that of the dealers from which we purchase contracts and result in reductions in our revenues or the cash flows available to us |
| IF AN INCREASE IN INTEREST RATES RESULTS IN A DECREASE IN OUR CASH FLOW FROM EXCESS SPREAD, OUR RESULTS OF OPERATIONS MAY BE IMPAIRED Our profitability is largely determined by the difference, or "e spread, "e between the effective interest rate received by us on the motor vehicle contracts that we acquire and the interest rates payable under our warehouse credit facilities during the warehousing period and on the securities issued in our securitizations |
| Several factors affect our ability to manage interest rate risk |
| Specifically, we are subject to interest rate risk during the period between when motor vehicle contracts are purchased from dealers and when such contracts are sold and financed in a securitization |
| Interest rates on our warehouse credit facilities are adjustable while the interest rates on the contracts are fixed |
| Therefore, if interest rates increase, the interest we must pay to the lenders under our warehouse credit facilities is likely to increase while the interest realized by us under those warehoused contracts remains the same, and thus, during the warehousing period, the excess spread cash flow received by us would likely decrease |
| Additionally, contracts warehoused and then securitized during a rising interest rate environment may result in less excess spread cash flow realized by us under those securitizations as, historically, our securitization facilities pay interest to securityholders on a fixed rate basis set at prevailing interest rates at the time of the closing of the securitization, which may be several months after the contracts securitized were originated and entered the warehouse, while our customers pay fixed rates of interest on the contracts |
| A decrease in excess spread cash flow could adversely affect our earnings and cash flow |
| To mitigate, but not eliminate, the short-term risk relating to interest rates payable by us under the warehouse facilities, we generally hold motor vehicle contracts in the warehouse facilities for less than four months |
| To mitigate, but not eliminate, the long-term risk relating to interest rates payable by us in securitizations, we have in the past, and intend to continue to, structure some of our securitization transactions to include pre-funding structures, whereby the amount of securities issued exceeds the amount of contracts initially sold into the securitization |
| In pre-funding, the proceeds from the pre-funded portion are held in an escrow account until we sell the additional contracts into the securitization in amounts up to the balance of the pre-funded escrow account |
| In pre-funded securitizations, we effectively lock in our borrowing costs with respect to the contracts we subsequently sell into the securitization |
| However, we incur an expense in pre-funded securitizations equal to the difference between the money market yields earned on the proceeds held in escrow prior to subsequent delivery of contracts and the interest rate paid on the securities outstanding, the amount as to which there can be no assurance |
| Despite these mitigation strategies, an increase in prevailing interest rates would cause us to receive less excess spread cash flows on motor vehicle contracts, and thus could adversely affect our earnings and cash flows |
| 18 IF WE ARE UNABLE TO SUCCESSFULLY COMPETE WITH OUR COMPETITORS, OUR RESULTS OF OPERATIONS MAY BE IMPAIRED The automobile financing business is highly competitive |
| We compete with a number of national, local and regional finance companies |
| In addition, competitors or potential competitors include other types of financial services companies, such as commercial banks, savings and loan associations, leasing companies, credit unions providing retail loan financing and lease financing for new and used vehicles and captive finance companies affiliated with major automobile manufacturers such as General Motors Acceptance Corporation and Ford Motor Credit Corporation |
| Many of our competitors and potential competitors possess substantially greater financial, marketing, technical, personnel and other resources than we do, including greater access to capital markets for unsecured commercial paper and investment grade rated debt instruments, and to other funding sources which may be unavailable to us |
| Moreover, our future profitability will be directly related to the availability and cost of our capital relative to that of our competitors |
| Many of these companies also have long-standing relationships with automobile dealers and may provide other financing to dealers, including floor plan financing for the dealers &apos purchases of automobiles from manufacturers, which we do not offer |
| There can be no assurance that we will be able to continue to compete successfully and, as a result, we may not be able to purchase contracts from dealers at a price acceptable to us, which could result in reductions in our revenues or the cash flows available to us |
| IF OUR DEALERS DO NOT SUBMIT A SUFFICIENT NUMBER OF SUITABLE MOTOR VEHICLE CONTRACTS TO US FOR PURCHASE, OUR RESULTS OF OPERATIONS MAY BE IMPAIRED We are dependent upon establishing and maintaining relationships with a large number of unaffiliated automobile dealers to supply us with motor vehicle contracts |
| During the year ended December 31, 2005, no dealer accounted for more than 1dtta0prca of the contracts we purchased |
| The agreements we have with dealers to purchase contracts do not require dealers to submit a minimum number of contracts for purchase |
| The failure of dealers to submit contracts that meet our underwriting criteria could result in reductions in our revenues or the cash flows available to us, and, therefore, could have an adverse effect on our results of operations |
| IF A SIGNIFICANT NUMBER OF OUR MOTOR VEHICLE CONTRACTS PREPAY OR EXPERIENCE DEFAULTS, OUR RESULTS OF OPERATIONS MAY BE IMPAIRED If motor vehicle contracts that we purchase or service are prepaid or experience defaults, this could materially and adversely affect our results of operations, financial condition and cash flows |
| Our results of operations, financial condition, cash flows and liquidity, depend, to a material extent, on the performance of motor vehicle contracts that we purchase, warehouse and securitize |
| A portion of the motor vehicle contracts acquired by us will default or prepay |
| In the event of payment default, the collateral value of the motor vehicle securing a motor vehicle contract will most likely not cover the outstanding principal balance on that contract and the related costs of recovery |
| We maintain an allowance for credit losses on motor vehicle contracts held on our balance sheet, which reflects our estimates of probable credit losses which can be reasonably estimated for on-balance sheet securitizations and warehoused contracts |
| If the allowance is inadequate, then we would recognize the losses in excess of the allowance as an expense and our results of operations could be adversely affected |
| In addition, under the terms of our warehouse facilities, we are not able to borrow against defaulted motor vehicle contracts |
| Our servicing income can also be adversely affected by prepayment of, or defaults under, motor vehicle contracts in our servicing portfolio |
| Our contractual servicing revenue is based on a percentage of the outstanding principal balance of the motor vehicle contracts in our servicing portfolio |
| If motor vehicle contracts are prepaid or charged off, then our servicing revenue will decline while our servicing costs may not decline proportionately |
| The value of our residual interest in the securitized assets in each off-balance sheet securitization reflects our estimate of expected future credit losses and prepayments for the motor vehicle contracts included in that securitization |
| If actual rates of credit loss or prepayments, or both, on such motor vehicle contracts exceed our estimates, the value of our residual interest 19 and the related cash flow would be impaired |
| We periodically review our credit loss and prepayment assumptions relative to the performance of the securitized motor vehicle contracts and to market conditions |
| Our results of operations and liquidity could be adversely affected if actual credit loss or prepayment levels on securitized motor vehicle contracts substantially exceed anticipated levels |
| Under certain circumstances, we could be required to record an impairment charge through a reduction to interest income |
| THE EFFECTS OF TERRORISM AND MILITARY ACTION MAY IMPAIR OUR RESULTS OF OPERATIONS The long-term economic impact of the events of September 11, 2001, possible future attacks or other incidents and related military action, or current or future military action by United States forces in Iraq and other regions, could have a material adverse effect on general economic conditions, consumer confidence, and market liquidity |
| No assurance can be given as to the effect of these events on the performance of the motor vehicle contracts |
| Any adverse impact resulting from these events could materially affect our results of operations, financial condition and cash flows |
| In addition, activation of a substantial number of US military reservists or members of the National Guard may significantly increase the proportion of contracts whose interest rates are reduced by the application of the Servicemembers &apos Civil Relief Act, which provides, generally, that an obligor who is covered by the relief act may not be charged interest on the related contract in excess of 6prca annually during the period of the obligorapstas active duty |
| IF WE LOSE SERVICING RIGHTS ON OUR PORTFOLIO OF MOTOR VEHICLE CONTRACTS, OUR RESULTS OF OPERATIONS WILL BE IMPAIRED The loss of our servicing rights could materially and adversely affect our results of operations, financial condition and cash flows |
| Our results of operations, financial condition and cash flows, would be materially and adversely affected if any of the following were to occur: o the loss of our servicing rights under the sale and servicing agreements for our warehouse facilities; o the loss of our servicing rights under the applicable sale and servicing agreement relating to motor vehicle contracts which we have sold in our securitizations or service on behalf of third parties, including servicing rights acquired from Seawest; or o the occurrence of certain trigger events under our insurance agreements with financial guaranty insurance companies or with any other credit enhancer in each of our securitizations that would block the release of excess spread cash flows or cash releases from the spread accounts in those securitizations |
| We are entitled to receive servicing fees only while we act as servicer under the applicable sale and servicing agreement for motor vehicle contracts entered into in connection with our warehouse facilities and securitizations and the agreements under which we service motor vehicle contracts in connection with the Seawest securitizations |
| Under our warehouse facilities and securitizations and the Seawest securitizations, we may be terminated as servicer upon the occurrence of certain events, including: o our failure generally to observe and perform covenants and agreements applicable to us; o certain bankruptcy events involving us; or o the occurrence of certain events of default under the documents governing the facilities |
| IF WE LOSE KEY PERSONNEL, OUR RESULTS OF OPERATIONS MAY BE IMPAIRED Our future operating results depend in significant part upon the continued service of our key senior management personnel, none of whom is bound by an employment agreement |
| Our future operating results also depend in part upon our ability to attract and retain qualified management, technical, sales and support personnel for our operations |
| Competition for such personnel is 20 intense |
| We cannot assure you that we will be successful in attracting or retaining such personnel |
| The loss of any key employee, the failure of any key employee to perform in his or her current position or our inability to attract and retain skilled employees, as needed, could materially and adversely affect our results of operations, financial condition and cash flows |
| IF WE FAIL TO COMPLY WITH REGULATIONS, OUR RESULTS OF OPERATIONS MAY BE IMPAIRED Failure to materially comply with all laws and regulations applicable to us could materially and adversely affect our ability to operate our business |
| Our business is subject to numerous federal and state consumer protection laws and regulations, which, among other things: o require us to obtain and maintain certain licenses and qualifications; o limit the interest rates, fees and other charges we are allowed to charge; o limit or prescribe certain other terms of our motor vehicle contracts; o require specific disclosures; o define our rights to repossess and sell collateral; and o maintain safeguards designed to protect the security and confidentiality of customer information |
| We believe that we are in compliance in all material respects with all such laws and regulations, and that such laws and regulations have had no material adverse effect on our ability to operate our business |
| However, we may be materially and adversely affected if we fail to comply with: o applicable laws and regulations; o changes in existing laws or regulations; o changes in the interpretation of existing laws or regulations; or o any additional laws or regulations that may be enacted in the future |
| IF WE EXPERIENCE UNFAVORABLE LITIGATION RESULTS, OUR RESULTS OF OPERATIONS MAY BE IMPAIRED Unfavorable outcomes in any of our current or future litigation proceedings could materially and adversely affect our results of operations, financial conditions and cash flows |
| As a consumer finance company, we are subject to various consumer claims and litigation seeking damages and statutory penalties based upon, among other things, disclosure inaccuracies and wrongful repossession, which could take the form of a plaintiffapstas class action complaint |
| We, as the assignee of finance contracts originated by dealers, may also be named as a co-defendant in lawsuits filed by consumers principally against dealers |
| We are also subject to other litigation common to the motor vehicle industry and businesses in general |
| The relief requested by the plaintiffs varies but includes requests for compensatory, statutory and punitive damages |
| While we intend to vigorously defend ourselves against such proceedings, there is a chance that our results of operations, financial condition and cash flows could be materially and adversely affected by unfavorable outcomes |
| IF WE EXPERIENCE PROBLEMS WITH OUR ACCOUNTING AND COLLECTION SYSTEMS, OUR RESULTS OF OPERATIONS MAY BE IMPAIRED Problems with our in-house receivables accounting and collection systems could materially and adversely affect our collections and cash flows |
| Any significant failures or defects with our accounting and collection systems could adversely affect our results of operations, financial conditions and cash flows |
| 21 WE HAVE SUBSTANTIAL INDEBTEDNESS We have and will continue to have a substantial amount of indebtedness |
| At December 31, 2005, we had approximately dlra1dtta06 billion of debt outstanding |
| Our substantial indebtedness could adversely affect our financial condition by, among other things: o increasing our vulnerability to general adverse economic and industry conditions; o requiring us to dedicate a substantial portion of our cash flow from operations payments on our indebtedness, thereby reducing amounts available for working capital, capital expenditures and other general corporate purposes; o limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate; o placing us at a competitive disadvantage compared to our competitors that have less debt; and o limiting our ability to borrow additional funds |
| Although we believe we will generate sufficient free cash flow to service such debt, there is no assurance that we will be able to do so |
| If we do not generate sufficient operating profits, our ability to make required payments on our debt may be impaired |
| BECAUSE WE ARE SUBJECT TO MANY RESTRICTIONS IN OUR EXISTING CREDIT FACILITIES, OUR ABILITY TO PAY DIVIDENDS MAY BE IMPAIRED The terms of our existing credit facilities and our outstanding debt impose significant operating and financial restrictions on us and our subsidiaries and require us to meet certain financial tests |
| These restrictions may have an adverse impact on our business activities, results of operations and financial condition |
| These restrictions may also significantly limit or prohibit us from engaging in certain transactions, including the following: o incurring or guaranteeing additional indebtedness; o making capital expenditures in excess of agreed upon amounts; o paying dividends or other distributions to our stockholders or redeeming, repurchasing or retiring our capital stock or subordinated obligations; o making investments; o creating or permitting liens on our assets or the assets of our subsidiaries; o issuing or selling capital stock of our subsidiaries; o transferring or selling our assets; o engaging in mergers or consolidations; o permitting a change of control of our company; o liquidating, winding up or dissolving our company; o changing our name or the nature of our business, or the names or nature of the business of our subsidiaries; and o engaging in transactions with our affiliates outside the normal course of business |
| These restrictions may limit our ability to obtain additional sources of capital, which may limit our ability to generate earnings |
| In addition, the failure to comply with any of the covenants of our existing credit facilities or to maintain certain indebtedness ratios would cause a default under one or more of our credit facilities or our other debt agreements that may be outstanding from time to time |
| A default, if not waived, could result in acceleration of the related indebtedness, in which case such debt would become immediately due and payable |
| A continuing default or acceleration of one or more of our credit facilities or any other debt agreement, will likely cause a default and other debt agreements that otherwise would not be in default, in which case all such related indebtedness could be accelerated |
| If this occurs, we may not be able to repay our debt or borrow sufficient funds to refinance our indebtedness |
| Even if any new financing is available, it may not be on terms that are acceptable to us or it may not be sufficient to refinance all of our indebtedness as it becomes due |
| 22 FORWARD-LOOKING STATEMENTS This report contains certain statements of a forward-looking nature relating to future events or our future performance |
| These forward-looking statements are based on our current expectations, assumptions, estimates and projections about us and our industry |
| When used in this prospectus, the words "e expects, "e "e believes, "e "e anticipates, "e "e estimates, "e "e intends "e and similar expressions are intended to identify forward-looking statements |
| These forward-looking statements are only predictions and are subject to risks and uncertainties that could cause actual events or results to differ materially from those projected |
| The cautionary statements made in this report should be read as being applicable to all related forward-looking statements wherever they appear in this report |
| We assume no obligation to update these forward-looking statements publicly for any reason |
| Actual results could differ materially from those anticipated in these forward-looking statements |
| The risk factors discussed above could cause our actual results to differ materially from those expressed in any forward-looking statements |