TripAdvisor 2015 Annual Report Download - page 23

eventscouldcausesysteminterruption,delaysandlossofcriticaldata,andcouldpreventusfromprovidingcontentandservicestousers,travelersand/orthird
partiesforasignificantperiodoftime.Ifweexperiencefrequentorpersistentsystemfailures,ourreputationandbrandcouldbepermanentlyandsignificantly
harmed.Inaddition,remediationmaybecostlyandwemaynothaveadequateinsurancetocoversuchcosts.Moreover,thecostsofenhancinginfrastructureto
attainimprovedstabilityandredundancymaybetimeconsumingandexpensiveandmayrequireresourcesandexpertisethataredifficulttoobtain.
Our processing, storage and use personal information and other data exposes us to risks of external and internal security breaches and could give rise to
liabilities.
Therearenumerouslawsregardingprivacyandthestoring,sharing,use,processing,disclosureandprotectionofpersonalinformationandotherconsumer
data,thescopeofwhicharechanging,subjecttodifferinginterpretations,andmaybeinconsistentbetweencountriesorconflictwithotherrules.Inaddition,the
securityofdatawhenengaginginelectroniccommerceisessentialtomaintainingconsumerandtravelserviceproviderconfidencesinourservices.Westriveto
complywithallapplicablelaws,policies,legalobligationsandindustrycodesofconductrelatingtoprivacyanddataprotection.Anyfailureorperceivedfailureby
ustocomplywithourprivacypolicies,privacy-relatedobligationstousersorotherthirdparties,orprivacy-relatedlegalobligations,oranycompromiseofsecurity
thatresultsintheunauthorizedreleaseortransferofpersonallyidentifiableinformationorotheruserdata,mayresultingovernmentalenforcementactions,
litigationorpublicstatementsthatcouldharmourreputationandcauseourcustomersandmemberstolosetrustinus,whichcouldhaveanadverseeffectonour
business,brand,marketshareandresultsofoperations.
Theregulatoryframeworkforprivacyissuesworldwideiscurrentlyinfluxandislikelytoremainsofortheforeseeablefuture.Practicesregardingthe
collection,use,storage,transmissionandsecurityofpersonalinformationbycompaniesoperatingovertheInternethaverecentlycomeunderincreasedpublic
scrutiny.TheU.S.Congressandfederalagencies,includingtheFederalTradeCommissionandtheDepartmentofCommerce,arereviewingtheneedforgreater
regulationforthecollectionanduseofinformationconcerningconsumerbehaviorontheInternet.VariousU.S.courtsarealsoconsideringtheapplicabilityof
existingfederalandstatestatutes,includingcomputertrespassandwiretappinglaws,tothecollectionandexchangeofinformationonline.Inaddition,the
EuropeanUnionisintheprocessofproposingreformstoitsexistingdataprotectionlegalframework,whichmayresultinagreatercomplianceburdenfor
companies,includingus,withusersinEuropeandincreasedcostsofcompliance.
Potentialsecuritybreachestooursystems,whetherresultingfrominternalorexternalsources,couldsignificantlyharmourbusiness.Aparty,whether
internalorexternal,thatisabletocircumventoursecuritysystemscouldmisappropriateuserinformationorproprietaryinformationorcausesignificant
interruptionsinouroperations.Inthepast,wehaveexperienced“denial-of-service”typeattacksonoursystemsthathavemadeportionsofourwebsites
unavailableforshortperiodsoftimeaswellasunauthorizedaccessofoursystemsanddata.Wehaveacquiredanumberofcompaniesovertheyearsandmay
continuetodosointhefuture.Whilewemakesignificanteffortstoaddressanyinformationtechnologysecurityissueswithrespecttoouracquisitions,wemay
stillinheritsuchriskswhenweintegratetheacquiredbusinesses.Wemayneedtoexpendsignificantresourcestoprotectagainstsecuritybreachesorto
investigateandaddressproblemscausedbybreaches,andreductionsinwebsiteavailabilitycouldcausealossofsubstantialbusinessvolumeduringtheoccurrence
ofanysuchincident.Becausethetechniquesusedtosabotagesecuritychangefrequently,oftenarenotrecognizeduntillaunchedagainstatargetandmayoriginate
fromlessregulatedandremoteareasaroundtheworld,wemaybeunabletoproactivelyaddressthesetechniquesortoimplementadequatepreventivemeasures.
Securitybreachescouldresultinnegativepublicity,damagetoreputation,exposuretoriskoflossorlitigationandpossibleliabilityduetoregulatorypenaltiesand
sanctions.Securitybreachescouldalsocausetravelersandpotentialuserstoloseconfidenceinoursecurity,whichwouldhaveanegativeeffectonthevalueofour
brand.Failuretoadequatelyprotectagainstattacksorintrusions,whetherforourownsystemsorsystemsofvendors,couldexposeustosecuritybreachesthat
couldhaveanadverseimpactonfinancialperformance.
WealsofacerisksassociatedwithsecuritybreachesaffectingthirdpartiesconductingbusinessovertheInternet.Muchofourbusinessisconductedwith
thirdpartymarketingaffiliatesor,morerecently,thoughbusinesspartnerspoweringourinstantbookingfeature.Inaddition,wefrequentlyusethirdpartiesto
processcreditcardpayments.Asecuritybreachatsuchthirdpartycouldbeperceivedbyconsumersasasecuritybreachofoursystemsandcouldresultin
negativepublicity,damageourreputation,exposeustoriskoflossorlitigationandpossibleliabilityandsubjectustoregulatorypenaltiesandsanctions.In
addition,suchthirdpartiesmaynotcomplywithapplicabledisclosurerequirements,whichcouldexposeustoliability.
We face increased risks as the level of our debt increases.
OnJune26,2015,weenteredintoanewcreditagreementwithrespecttoa$1billionfive-yearrevolvingcreditfacility.Thesearrangementsinclude
restrictivecovenantsthatmayimpactthewaywemanageourbusinessandmaylimitourabilitytosecuresignificantadditionalfinancinginthefutureonfavorable
terms.Ourabilitytosecureadditionalfinancingandsatisfyourfinancialobligationsunderindebtednessoutstandingfromtimetotimewilldependuponourfuture
operatingperformance,whichissubjecttothenprevailinggeneraleconomicandcreditmarketconditions,includinginterestratelevelsandtheavailabilityofcredit
generally,andfinancial,businessandotherfactors,manyofwhicharebeyondourcontrol.Inlightofperiodicuncertaintyinthecapitaland
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