In its most recent annual report filing with the Securities and Exchange Commission (SEC), Blockbuster Inc. spells out a potentially dire forecast for its future should the company fail to meet loan obligations, including bankruptcy, which could possibly affect its ticketing deal with partner Live Nation.

The concern is due to Live Nation’s three-year deal with Blockbuster for the giant movie rental chain to be the bricks-and-mortar storefront for Live Nation’s ticket-selling operation. The two companies formed the partnership just prior to Live Nation launching its new ticketing operation in January, and the terms call for Live Nation to exclusively sell tickets at-retail through 500 strategically situated Blockbuster outlets across the country.

While there is no official indication that Blockbuster will indeed file for bankruptcy, the company states in its 10-K document filed with the SEC Monday, April 6, that the situation is serious.

What a potential bankruptcy filing could mean to the Live Nation deal is anyone’s guess. What would happen to tickets issued at Blockbuster outlets if the company filed for bankruptcy? Would bankruptcy necessarily mean all outlets would close down? Would concert ticket sales be adversely affected? Is this situation placing added pressure on Live Nation to get its merger with Ticketmaster approved by federal regulators?

TicketNews posed these questions to a Live Nation spokesperson, but did not receive any responses.

“Our future viability is dependent on our ability to execute these plans successfully or otherwise address our liquidity shortfall. If we fail to do so for any reason, we would not have adequate liquidity to fund our operations, would not be able to continue as a going concern and could potentially be forced to seek relief through a filing under the U.S. Bankruptcy Code,” Blockbuster stated in the document.

The company is in the midst of restructuring certain debt obligations with lenders, and it hopes to be pointed in a more positive direction next month. As of early January, Blockbuster was carrying more than $780 million in debt, but stands to have that amount significantly reduced under the restructuring plans.

“While we believe that all such conditions will be met and that we will be in a position to close on the amended credit facility on or about May 11, 2009, there can be no assurance regarding these matters,” Blockbuster said in the document. “The risk that we may not successfully complete this refinancing and obtain the related amendment of certain financial covenants included therein, and/or the risk that we may not have adequate liquidity to fund our operations as a result of not meeting our projected financial results, even if the refinancing is completed within the time and upon the terms contemplated, raise substantial doubt about our ability to continue as a going concern.”