Memorex 2014 Annual Report Download - page 20

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15
• changes in financial estimates by securities analysts relating specifically to us or the industries in
which we participate in general; and
• macroeconomic conditions that affect the market generally.
In addition, general economic conditions may cause the stock market to experience extreme price and
volume fluctuations from time to time that particularly affect the stock prices of many high technology companies.
These fluctuations often appear to be unrelated to the operating performance of the companies.
Item 1B. Unresolved Staff Comments.
None.
Item 2. Properties
Our worldwide headquarters is located in Oakdale, Minnesota, in the United States of America. Our principal
facilities, and the functions at such facilities, are listed below for each reporting segment. Our facilities are in good
operating condition suitable for their respective uses and are adequate for our current needs.
Facility Function Segment(s)
Using Space
Oakdale, Minnesota (owned) (1) Sales/Administrative/Laboratory facility/Corporate
headquarters Both
Thousand Oaks, California (leased) Sales/Assembly TSS
Campbell, California (leased) Sales/Distribution center TSS
Hoofddorp, Netherlands (leased) Sales/Administrative/European regional headquarters Both
Tokyo, Japan (leased) Sales/Administrative/ Japan headquarters Both
Kings Park, Australia (leased) Sales/Administrative/Distribution center/Asia Pacific
regional headquarters Both
Montreal, Canada (leased) Sales/Research & development TSS
Panama City, Panama (leased) Sales/Administrative/Latin America regional headquarters Both
Derby, United Kingdom (leased) Sales/Assembly TSS
(1) Subject to a mortgage to secure the obligations under our Credit Facility. See Note 11 - Debt in our Notes to
Consolidated Financial Statements for further information on our Credit Facility.
Item 3. Legal Proceedings.
In the normal course of business, we periodically enter into agreements that incorporate general indemnification
language. Performance under these indemnities would generally be triggered by a breach of terms of the contract
or by a supportable third-party claim. There have historically been no material losses related to such
indemnifications. In accordance with accounting principles generally accepted in the United States of America, we
record a liability in our Consolidated Financial Statements for these actions when a loss is known or considered
probable and the amount can be reasonably estimated.
We are the subject of various pending or threatened legal actions in the ordinary course of our business. All
such matters are subject to many uncertainties and outcomes that are not predictable with assurance. Additionally,
our businesses are subject to allegations of patent infringement by our competitors as well as by non-practicing
entities (NPEs), sometimes referred to as “patent trolls,” who may seek monetary settlements from us, our
competitors, suppliers and resellers including the One-Blue litigation described below. Consequently, as of
December 31, 2014, we are unable to reasonably estimate the ultimate aggregate amount of any monetary liability
or financial impact that we may incur with respect to these matters. It is reasonably possible that the ultimate
resolution of these matters could materially affect our financial condition, results of operations and cash flows.
On May 22, 2013, Imation was sued in U.S. District Court for the District of Delaware by five entities: One-Blue,
LLC (One-Blue), which is an entity with licensing authority for a pool of patents relating to Blu-ray discs, and four
members of One-Blue, Koninklijke Philips N.V., Panasonic Corporation, Pioneer Corporation and Sony
Corporation. The plaintiffs allege that Imation's sales of certain Blu-ray discs infringe six patents and seek
unspecified damages, treble damages, and attorney's fees. On June 13, 2013, Imation filed an Answer, Affirmative
Defenses, and Counterclaims, naming various defenses including that plaintiffs are barred, in whole or in part, from