Sunbeam 2007 Annual Report Download - page 35

Our results could be adversely affected if the cost of compliance with environmental, health and safety
laws and regulations becomes too burdensome.
Our operations are subject to federal, state and local environmental and health and safety laws and
regulations including those that impose workplace standards and regulate the discharge of pollutants into the
environment and establish standards for the handling, generation, emission, release, discharge, treatment, storage
and disposal of materials and substances including solid and hazardous wastes. We believe that we are in
material compliance with such laws and regulations and that the cost of maintaining compliance will not have a
material adverse effect on our business, results of operations or financial condition. However, due to the nature of
our operations and the frequently changing nature of environmental compliance standards and technology, we
cannot assure you that future material capital expenditures will not be required in order to comply with
applicable environmental laws and regulations.
In January 2003, the European Union (“EU”) issued two directives relating to chemical substances in
electronic products. The Waste Electrical and Electronic Equipment Directive requires producers of electrical
goods to pay for specified collection, recycling, treatment and disposal of past and future covered products. EU
governments were required to enact and implement legislation that complies with this directive by August 13,
2004 (such legislation, together with the directive, the “WEEE Legislation”), and certain producers are to be
financially responsible under the WEEE Legislation beginning in August 2005. The EU has issued another
directive that requires electrical and electronic equipment placed on the EU market after July 1, 2006 to be free
of lead, mercury, cadmium, hexavalent chromium (above a threshold limit) and brominated flame retardants. EU
governments were required to enact and implement legislation that complies with this directive by August 13,
2004 (such legislation, together with this directive, the “RoHS Legislation”). If we do not comply with these
directives, we may suffer a loss of revenue, be unable to sell in certain markets and/or countries, be subject to
penalties and enforced fees and/or suffer a competitive disadvantage. Similar legislation could be enacted in
other jurisdictions, including in the United States. Costs to comply with the WEEE Legislation, RoHS
Legislation and/or similar future legislation, if applicable, could include costs associated with modifying our
products, recycling and other waste processing costs, legal and regulatory costs and insurance costs. We may also
be required to take reserves for costs associated with compliance with these regulations. We cannot assure you
that the costs to comply with these new laws, or with current and future environmental and worker health and
safety laws, will not have a material adverse effect on our business, results of operations and financial condition.
We may incur significant costs in order to comply with environmental remediation obligations.
In addition to operational standards, environmental laws also impose obligations on various entities to clean
up contaminated properties or to pay for the cost of such remediation, often upon parties that did not actually
cause the contamination. Accordingly, we may be liable, either contractually or by operation of law, for
remediation costs even if the contaminated property is not presently owned or operated by us, is a landfill or
other location where we have disposed wastes, or if the contamination was caused by third parties during or prior
to our ownership or operation of the property. Given the nature of the past industrial operations conducted by us
and others at these properties, there can be no assurance that all potential instances of soil or groundwater
contamination have been identified, even for those properties where an environmental site assessment has been
conducted. We do not believe that any of our existing remediation obligations, including at third-party sites
where we have been named a potentially responsible party, will have a material adverse effect upon our business,
results of operations or financial condition. However, future events, such as changes in existing laws or policies
or their enforcement, or the discovery of currently unknown contamination, may give rise to additional
remediation liabilities that may be material. See “Environmental Matters” under note 11 (Commitments and
Contingencies) of the notes to our consolidated financial statements contained in our Annual Report on
Form 10-K (which is incorporated by reference herein) for a discussion of these and other environmental-related
matters.
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