Lexmark 2015 Annual Report Download - page 25

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21
Business disruptions could seriously harm future revenue and financial condition and increase costs and expenses.
Lexmark’s worldwide operations and those of the Company’s manufacturing partners, suppliers, and freight transporters,
among others, are subject to natural and manmade disasters that could cause business interruptions such as earthquakes,
tsunamis, floods, hurricanes, typhoons, fires, extreme weather conditions, environmental hazards, power shortages, water
shortages and telecommunications failures. The occurrence of any of these business disruptions could result in significant
losses to the Company, seriously harm the Company’s revenue, profitability and financial condition and increase the
Company’s costs and expenses. The consolidation of certain functions into shared service centers and movement of certain
functions to lower cost countries by the Company in recent years increases the probability and impact of business disruptions
over time.
Increased competition in the Company’s aftermarket supplies business may negatively impact the Company’s revenue and gross
margins.
Refill, remanufactured, clones, counterfeits and other compatible alternatives for some of the Company’s cartridges are
available and compete with the Company’s supplies business. The Company expects competitive supplies activity to
increase. Various legal challenges and governmental activities may intensify competition for the Company’s aftermarket
supplies business.
The Company’s inability to obtain and protect its intellectual property and defend against claims of infringement by others may
negatively impact the Company’s operating results.
The Company’s success depends in part on its ability to develop technology and obtain patents, copyrights and trademarks,
and maintain trade secret protection, to protect its intellectual property against theft, infringement or other misuse by others.
The Company must also conduct its operations without infringing the proprietary rights of others. Current or future claims of
intellectual property infringement could prevent the Company from obtaining technology of others and could otherwise
materially and adversely affect its operating results or business, as could expenses incurred by the Company in obtaining
intellectual property rights, enforcing its intellectual property rights against others or defending against claims that the
Company’s products infringe the intellectual property rights of others, that the Company engages in false or deceptive
practices or that its conduct is anti-competitive.
Terrorist acts, acts of war or other political conflicts may negatively impact the Company’s ability to manufacture and sell its
products.
Terrorist attacks and the potential for future terrorist attacks have created many political and economic uncertainties, some of
which may affect the Company’s future operating results. Future terrorist attacks, the national and international responses to
such attacks, and other acts of war or hostility may affect the Company’s facilities, employees, suppliers, customers,
transportation networks and supply chains, or may affect the Company in ways that are not capable of being predicted
presently.
Any variety of factors unrelated to the Company’s operating performance may negatively impact the Company’s operating results or
the Company’s stock price.
Factors unrelated to the Company’s operating performance, including the financial failure or loss of significant customers,
resellers, manufacturing partners or suppliers; the outcome of pending and future litigation or governmental proceedings; and
the ability to retain and attract key personnel, could also adversely affect the Company’s operating results. In addition, the
Company’s stock price, like that of other technology companies, can be volatile. Trading activity in the Company’s common
stock, particularly the trading of large blocks and intraday trading in the Company’s common stock, may affect the
Company’s common stock price.
Item 1B. UNRESOLVED STAFF COMMENTS
Not applicable.