E-Z-GO 2007 Annual Report Download - page 30

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Textron Inc.
We have entered, and expect to continue to enter, into joint venture, teaming and other arrangements, and these activities
involve risks and uncertainties.
We have entered, and expect to continue to enter, into joint venture, teaming and other arrangements, and these activities involve risks and
uncertainties, including the risk of the joint venture or related business partner failing to satisfy its obligations, which may result in certain
liabilities to us for guarantees and other commitments, the challenges in achieving strategic objectives and expected benefi ts of the business
arrangement, the risk of confl icts arising between us and our partners and the diffi culty of managing and resolving such confl icts, and the
diffi culty of managing or otherwise monitoring such business arrangements.
We may make acquisitions and dispositions that increase the risks of our business.
We may enter into acquisitions or dispositions in the future in an effort to enhance shareholder value. Acquisitions or dispositions involve a
certain amount of risks and uncertainties that could result in our not achieving expected benefi ts. With respect to acquisitions, such risks include
diffi culties in integrating newly acquired businesses and operations in an effi cient and cost-effective manner; challenges in achieving expected
strategic objectives, cost savings and other benefi ts; the risk that the acquired businesses’ markets do not evolve as anticipated and that the
technologies acquired do not prove to be those needed to be successful in those markets; the risk that we pay a purchase price that exceeds what
the future results of operations would have merited; and the potential loss of key employees of the acquired businesses. With respect to
dispositions, the decision to dispose of a business or asset may result in a writedown of the related assets if the fair market value of the assets,
less costs of disposal, is less than the book value. In addition, we may encounter diffi culty in fi nding buyers or alternative exit strategies at
acceptable prices and terms and in a timely manner. We may also underestimate the costs of retained liabilities or indemnifi cation obligations. In
addition, unanticipated delays or diffi culties in effecting acquisitions or dispositions may divert the attention of our management and resources
from our existing operations.
Our operations could be adversely affected by interruptions of production that are beyond our control.
Our business and fi nancial results may be affected by certain events that we cannot anticipate or that are beyond our control, such as natural
disasters and national emergencies that could curtail production at our facilities and cause delayed deliveries and canceled orders. In addition, we
purchase components and raw materials and information technology and other services from numerous suppliers, and, even if our facilities are
not directly affected by such events, we could be affected by interruptions at such suppliers. Such suppliers may be less likely than our own
facilities to be able to quickly recover from such events and may be subject to additional risks such as fi nancial problems that limit their ability to
conduct their operations.
Our business could be adversely affected by strikes or work stoppages and other labor issues.
Approximately 14,000 of our employees, or 32% of our total employees, are unionized. As a result, we may experience work stoppages, which
could negatively impact our ability to manufacture our products on a timely basis, resulting in strain on our relationships with our customers and
a loss of revenues. In addition, the presence of unions may limit our fl exibility in responding to competitive pressures in the marketplace, which
could have an adverse effect on our fi nancial results of operations.
In addition to our workforce, the workforces of many of our customers and suppliers are represented by labor unions. Work stoppages or strikes
at the plants of our key customers could result in delayed or canceled orders for our products. Work stoppages and strikes at the plants of our key
suppliers could disrupt our manufacturing processes. Any of these results could adversely affect our fi nancial results of operations.
Our international business is subject to the risks of doing business in foreign countries.
Our international business exposes us to certain unique and potentially greater risks than our domestic business, and our exposure to such risks
may increase if our international business continues to grow. Our international business is subject to local government regulations and
procurement policies and practices, including regulations relating to import-export control, investments, exchange controls and repatriation of
earnings or cash settlement challenges, as well as to varying currency, geopolitical and economic risks. We also are exposed to risks associated
with using foreign representatives and consultants for international sales and operations and teaming with international subcontractors and
suppliers in connection with international programs.
Our Finance borrowing group’s business is dependent on its continuing access to the capital markets.
Our fi nancings are conducted through two borrowing groups: Finance and Manufacturing. Our Finance group consists of Textron Financial
Corporation and its subsidiaries, which are the entities through which we operate in the Finance segment. Our Finance group relies on its access
to the capital markets to fund asset growth, fund operations, and meet debt obligations and other commitments. This group raises funds through