., Oregon's largest privately held business, has just six weeks to fix its finances or face potential default on more than a half-billion dollars in loans, according to a New York firm that follows distressed companies.

Red flags went up Friday when Jeld-Wen, a Klamath Falls-based window and door maker, said it had

crucial to a rescue plan. On Tuesday, The Oregonian obtained a financial analysis that said Jeld-Wen had separately violated terms of its loans from a bank syndicate, which has given the company until Oct. 17 to fix the problem.

, a financial intelligence company that follows distressed-debt and leveraged-finance markets, produced the report Aug. 3 as Jeld-Wen prepared to market bonds necessary for Canada's

with an $864 million investment.

The report's author said Tuesday that Jeld-Wen had exceeded two debt ratios defined in its agreement with lenders.

"They tripped both," said

, a Debtwire high-yield bond reporter. "So it wasn't pretty."

Jeld-Wen's acknowledgment Friday that the company had failed to sell its junk bonds raised the possibility that the company, which employs 2,500 in Oregon,

. The report obtained Tuesday adds an element of urgency.

Jeld-Wen could get an extension from lenders -- including

, which gave the company until Oct. 17 to get two loans back into compliance.

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Or Jeld-Wen could quickly re-enter the difficult bond market, offering to pay double-digit interest on its $575 million offering instead of the 9.5 percent to 9.75 percent rate it tried offering, Xu said.

"They could go back to Wells Fargo and say, 'We tried to issue bonds, but the market just tanked, so why don't you give us three months?'" Xu said. "There are a lot of moving parts before bankruptcy, which is definitely not immediate."

Like mortgage holders, many corporate lenders would rather see a borrower restructure than fail. But it's difficult to know how much patience banks will have with an overextended player in the moribund housing market.

Though Wells Fargo gave Jeld-Wen the waiver, a spokesman said the bank is merely one member of a syndicate led by

, which serves as administrative agent for financing Jeld-Wen.

Jeld-Wen employs 20,000 in 22 countries. Credit ratings agencies say the company is laboring under a total of $1.2 billion in debt, with sales declining from $3.6 billion in 2008 to $3.1 billion last year. It's unclear exactly how Jeld-Wen amassed the debt or how it ended up violating some of the loan terms.

"The intuitive thought would be earnings going down," Xu said. "If they hold the same total debt and earnings go down, then their total leverage is going to go up."

Jeld-Wen representatives haven't returned phone calls from The Oregonian for weeks.

Xu said Jeld-Wen told investors after the quarter ended July 2 that the company had breached both its total leverage ratio and its minimum fixed charge ratio. "They didn't specify what happened and what the ratios are," Xu said. "They were just saying they breached them."

The debt consists of a $534 million term loan and a $50 million revolving loan, both due in September 2012, Xu said in her report.

Jeld-Wen had bad luck, Xu said, launching its junk-bond sale as high-yield markets tanked. If the market picks up, the company could conceivably go back to potential investors who have already received the pitch and do the deal in a matter of a couple of days, she said.

"The real issue is how fast the high-yield market is going to pick up in September like everyone is hoping for," Xu said. "There are so many uncertainties around the world."

Another issue, as

whether to go through with the Jeld-Wen deal, is what premium the Klamath Falls company would be willing to pay above the 9.5 percent to 9.75 percent interest originally planned for the bonds.

"The question is how much the company is willing to pay to get this deal done," Xu said. "It's definitely going to push up to double digits."

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