Pitney Bowes 2011 Annual Report Download - page 24

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We have a commercial paper program that is an important source of liquidity for us. While we continue to have unencumbered access
to the commercial paper markets, there can be no assurance that such markets will continue to be a reliable source of short-term
financing for us. If market conditions deteriorate, there can be no assurance that other funding sources would be available or
sufficient, and those funding sources that may be available could result in a significantly higher cost of borrowing and adversely
impact our results of operations.
Failure to comply with privacy laws and other related regulations could subject us to significant liability and damage our reputation.
Several of our services and financing businesses use, process and store customer information that could include confidential, personal
or financial information. We also provide third-party benefits administrators with access to our employees’ personal information.
Privacy laws and similar regulations in many jurisdictions where we do business, as well as contractual provisions, require that we and
our benefits administrators take significant steps to safeguard this information. These laws are continuing to evolve. We, and our
third-party benefits administrators, have security systems and procedures in place that are designed to protect against unauthorized
access to such information; however, there is no guarantee that experienced computer programmers or hackers will not be able to gain
access to ours, our third-party benefits administrators, security systems and misappropriate confidential information. Any significant
violations of data privacy or failure to comply with any of these laws, regulations or contract provisions could damage our reputation
and business and subject us to significant remediation costs and/or liability.
A disruption of our information technology systems could adversely impact our operating results.
Our portfolio of product, service and financing solutions is dependent on reliable information technology systems. We maintain
secure systems to collect revenue for certain postal services, which is critical to enable both our systems and the postal systems to run
reliably. The continuous and uninterrupted performance of our systems is critical to our ability to support and service our customers
and to support postal services. We have disaster recovery plans in place to protect our business operations in the case of adverse acts
of nature, security breaches, power or communications failures, computer viruses, vandalism and other unexpected events. Despite
our preparations, our disaster recovery plans may not be completely successful and we could be prevented from fulfilling orders and
servicing customers and postal services, which could have an adverse effect on our reputation and business.
Our inability to obtain and protect our intellectual property and defend against claims of infringement by others may negatively
impact our operating results.
We do not believe our businesses are materially dependent on any one patent or license or group of patents or licenses. However, we
rely on copyright, trade secret, patent and other intellectual property laws in the United States and similar laws in other countries to
establish and protect proprietary rights that are important to our business. If we fail to enforce our intellectual property rights, our
businesses may suffer. We, or our suppliers, may be subject to third-party claims of infringement on intellectual property rights.
These claims, if successful, may require us to redesign affected products, enter into costly settlement or license agreements, pay
damage awards, or face a temporary or permanent injunction prohibiting us from marketing or selling certain of our products.
If we fail to comply with government contracting regulations, our operating results, brand name and reputation could suffer.
Many of our contracts are with governmental entities. Government contracts are subject to extensive and complex government
procurement laws and regulations, along with regular audits of contract pricing and our business practices by government agencies. If
we are found to have violated some provisions of the government contracts, we could be required to provide a refund, pay significant
damages, or be subject to contract cancellation, civil or criminal penalties, fines, or debarment from doing business with the
government. Any of these events could not only affect us financially but also adversely affect our brand and reputation.
ITEM 1B. – UNRESOLVED STAFF COMMENTS
None.
ITEM 2. – PROPERTIES
Our world headquarters is located in Stamford, Connecticut. We have facilities worldwide that are either leased or owned. Our
primary manufacturing and assembly operations are located in Danbury, Connecticut and our principal research and development
facilities are located in Danbury, Connecticut and Noida, India. We believe that our manufacturing and assembly, administrative and
sales office locations are adequate for the needs of all of our operations.