Citrix 2014 Annual Report Download - page 24

18
A breach of our security measures as a result of third-party action, malware, employee error, malfeasance or otherwise
could result in (among other consequences):
• harm to our reputation or brand, which could lead some customers to seek to cancel subscriptions, stop using certain
of our products or services, reduce or delay future purchases of our products or services, or use competing products
or services;
• individual and/or class action lawsuits, which could result in financial judgments against us or the payment of
settlement amounts, which would cause us to incur legal fees and costs;
• state or federal enforcement action, which could result in fines and/or penalties or other sanctions and which would
cause us to incur legal fees and costs; and/or
• in the event that we or one of our customers were the victim of a cyberattack or other security breach, additional
costs associated with responding to such breach, such as investigative and remediation costs, and the costs of
providing data owners or others with notice of the breach, legal fees, the costs of any additional fraud detection
activities required by such customers' credit card issuers, and costs incurred by credit card issuers associated with
the compromise and additional monitoring of systems for further fraudulent activity.
Any of these actions could materially adversely impact our business and results of operations.
We recently implemented a restructuring program, which could have a material negative impact on our business.
To increase strategic focus and operational efficiency, at the end of January 2015, we implemented a restructuring
program that will affect approximately 700 full-time and 200 contractor positions. We anticipate completing the majority of the
activities related to our restructuring program by the end of 2015. We may incur additional restructuring costs or not realize the
expected benefits of these new initiatives. Further, we could experience delays, business disruptions, decreased productivity,
unanticipated employee turnover and increased litigation related costs in connection with the restructuring and other efficiency
improvement activities, and there can be no assurance that our estimates of the savings achievable by the restructuring will be
realized. As a result, our restructuring and our related cost reduction activities could have an adverse impact on our financial
condition or results of operations.
Regulation of the Web and telecommunications, privacy and data security may adversely affect sales of our products and
result in increased compliance costs.
As Web commerce continues to evolve, increasing regulation by federal, state or foreign agencies and industry groups
becomes more likely. For example, we believe increased regulation is likely with respect to the solicitation, collection,
processing or use of personal, financial and consumer information as regulatory authorities around the world are considering a
number of legislative and regulatory proposals concerning data protection, privacy and data security. In addition, the
interpretation and application of consumer and data protection laws and industry standards in the United States, Europe and
elsewhere are often uncertain and in flux. The application of existing laws to cloud-based solutions is particularly uncertain and
cloud-based solutions may be subject to further regulation, the impact of which cannot be fully understood at this time.
Moreover, it is possible that these laws may be interpreted and applied in a manner that is inconsistent with our data and
privacy practices. If so, in addition to the possibility of fines, this could result in an order requiring that we change our data and
privacy practices, which could have an adverse effect on our business and results of operations. Complying with these various
laws could cause us to incur substantial costs or require us to change our business practices in a manner adverse to our
business. Also, any new regulation, or interpretation of existing regulation, imposing greater fees or taxes on Web-based
services, such as collaboration and data sharing services and audio services, or restricting information exchange over the Web,
could result in a decline in the use and adversely affect sales of our products and our results of operations.
Our Mobility Apps products may involve the storage and transmission of protected health information, or PHI, that is
subject to the Health Insurance Portability and Accountability Act, or HIPAA. HIPAA, amended by the Health Information
Technology for Economic and Clinical Health Act, or the HITECH ACT, has significantly increased the civil money penalties
for violations of patient privacy rights protected under HIPAA. As a result of the HITECH ACT, business associates who have
access to PHI provided by hospitals, healthcare providers, health insurance companies and other covered entities are now
directly subject to HIPAA, including the new enforcement scheme and inspection requirements. To the extent we are required
to comply with HIPAA's data security provisions, we may be liable for sanctions and penalties for any failure to so comply.
Furthermore, we may be required to incur additional expenses in order to comply with the HITECH Act and any further
amendments to and/or modifications of these requirements.