American Home Shield 2010 Annual Report Download - page 17

Table of Contents
expenditures could be required to comply with environmental laws and regulations, including requirements that may be adopted or imposed in the future.
Local, state, federal and foreign agencies that regulate environmental matters may change environmental laws, regulations or standards, including
imposing new regulations with respect to climate change matters. Changes in any of these or other laws, regulations or standards could materially adversely
impact our business, financial position, results of operations and cash flows.
If we fail to protect the security of personal information about our customers, we could be subject to interruption of our business operations, private
litigation, reputational damage and costly penalties.
We rely, among other things, on commercially available systems, software, tools and monitoring to provide security for processing, transmission and
storage of confidential customer information, such as payment card and personal information. The systems currently used for transmission and approval of
payment card transactions, and the technology utilized in payment cards themselves, all of which can put payment card data at risk, are central to meeting
standards set by the payment card industry. The Company is evaluating and updating its systems and protocols to establish compliance with these industry
standards as they currently exist, and going forward will continue to evaluate its systems and protocols in a continued effort to comply with industry
standards, as such standards may change from time to time in the future. Activities by third parties, advances in computer and software capabilities and
encryption technology, new tools and discoveries and other events or developments may facilitate or result in a compromise or breach of our systems. Any
compromises, breaches or errors in application related to our systems or failures to comply with standards set by the payment card industry could cause
interruptions in our operations, damage to our reputation and our customers' ability to pay for our services and products by credit card or their willingness to
purchase our services and products, result in a violation of applicable laws, regulations, orders, industry standards or agreements and subject us to costs,
penalties and liabilities which could have a material adverse impact on our business, financial position, results of operations and cash flows.
Our business process outsourcing initiatives have increased our reliance on third-party contractors and may expose our business to harm upon the
termination or disruption of our third party contractor relationships.
Our strategy to increase profitability, in part, by reducing our costs of operations includes the implementation of business process outsourcing initiatives.
As a result, our future operations will increasingly rely on third party vendors to provide services that we previously performed internally. Any disruption,
termination or substandard performance of these outsourced services, including possible breaches by third party vendors of their agreements with us, could
adversely affect our brands, customer relationships, financial position, results of operations and cash flows. Also, if a third party outsourcing provider
relationship is terminated, there is a risk that we may not be able to enter into a similar agreement with an alternate provider in a timely manner or on terms
that we consider favorable, and even if we find an alternate provider, there are risks associated with any transitioning activities. In addition, in the event a
third party outsourcing relationship is terminated and we are unable to replace it, there is a risk that we may no longer have the capabilities to perform these
services internally, resulting in a disruption to our business, which could adversely impact our reputation, business, financial position, results of operations
and cash flows.
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