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Risks Relating to Economic and Market Conditions
−Removed: Global economic conditions, particularly in the U.S., significantly affect our industry and businesses, and economic decline can materially impact our financial results.
+Added: Global economic conditions, particularly in the U.S., significantly affect our industry and business, and economic decline can materially impact our financial results.
In times of economic uncertainty or recession, consumers tend to have less discretionary income and to defer significant spending on non-essential items, which may adversely affect our financial performance.
−Removed: Although portions of the marine industry have experienced positive trends as a result of the unique consumer environment resulting from the COVID-19 pandemic, these trends may not continue, and the accompanying economic uncertainty caused by the pandemic may lead to unfavorable business outcomes.
+Added: Although portions of the marine industry have experienced positive trends as a result of the unique consumer environment resulting from the COVID-19 pandemic, these trends may not continue, and the economic uncertainty caused by (i) general economic conditions, (ii) the impact of inflation, (iii) labor shortages, (iv) supply chain disruptions, (v) the conflict between Russia and Ukraine, (vi) the ongoing COVID-19 pandemic and (vii) actions and stimulus measures adopted by local, state and federal governments may lead to unfavorable business outcomes.
We continue to develop our portfolio of brands, but our business remains cyclical and sensitive to consumer spending on new boats.
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We cannot predict the strength of global economies or the timing of economic recovery, either globally or in the specific markets in which we compete.
−Removed: Fiscal concerns and policy changes may negatively impact worldwide economic and credit conditions and adversely affect our industry, businesses, and financial condition.
−Removed: Fiscal policy could have a material adverse impact on worldwide economic conditions, the financial markets, and availability of credit and, consequently, may negatively affect our industry, businesses, and overall financial condition.
−Removed: Customers often finance purchases of our products, and as interest rates rise, the cost of financing the purchase also increases.
−Removed: While credit availability is adequate to support demand and interest rates remain relatively low, if credit conditions worsen and adversely affect the ability of customers to finance potential purchases at acceptable terms and interest rates, it could result in a decrease in sales or delay improvement in sales.
+Added: Inflation could adversely affect our financial results.
+Added: The market prices of certain materials and components used in manufacturing our products, especially resins that are made with hydrocarbon feedstocks, fiberglass, aluminum, lumber, and steel, can be volatile.
+Added: While, historically, inflation has not had a material effect on our results of operations, significant increases in inflation, particularly those related to wages and increases in the cost of raw materials, recently have, and may continue to have, an adverse impact on our business, financial condition, and results of operations.
+Added: In addition, new boat buyers often finance their purchases.
+Added: Inflation, along with rising interest rates, could translate into an increased cost of boat ownership.
+Added: Should inflation and increased interest rates continue to occur, prospective consumers may choose to forego or delay their purchases or buy a less expensive boat in the event credit is not available to finance their boat purchases.
+Added: Fiscal concerns and policy changes may negatively impact worldwide economic and credit conditions and adversely affect our industry, business, and financial condition.
+Added: Fiscal policy could have a material adverse impact on worldwide economic conditions, the financial markets, and availability of credit and, consequently, may negatively affect our industry, business, and overall financial condition.
+Added: Consumers often finance purchases of our products, and as interest rates rise, the cost of financing the purchase also increases.
+Added: While credit availability is adequate to support demand, interest rates began to rise significantly in the second half of fiscal 2022.
+Added: If credit conditions worsen and adversely affect the ability of consumers to finance potential purchases at acceptable terms and interest rates, it could result in a decrease in sales or delay improvement in sales.
Our variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase significantly.
Borrowings under our revolving credit facility and term loans are at variable rates of interest and expose us to interest rate risk.
−Removed: Reference rates used to determine the applicable interest rates for our debt are currently at relatively low levels.
−Removed: If interest rates increase, the debt service obligations on our indebtedness will increase even if the amount borrowed remains the same, and our net income and cash flows, including cash available for servicing our indebtedness, will correspondingly decrease.
+Added: Reference rates used to determine the applicable interest rates for our debt began to rise significantly in the second half of fiscal 2022.
+Added: If interest rates continue to increase, the debt service obligations on our indebtedness will continue to increase even if the amount borrowed remains the same, and our net income and cash flows, including cash available for servicing our indebtedness, will correspondingly decrease.
Please see Part II, Item 7A, “Quantitative and Qualitative Disclosures about Market Risk” for discussion of our market risk related to interest rates.
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Uncertainty as to the nature of alternative reference rates and as to potential changes or other reforms to LIBOR may adversely impact the availability and cost of borrowings.
−Removed: Inflation could adversely affect our financial results
−Removed: The market prices of certain materials and components used in manufacturing our products, especially resins that are made with hydrocarbon feedstocks, fiberglass, aluminum, lumber, and steel, can be volatile.
−Removed: While, historically, inflation has not had a material effect on our results of operations, significant increases in inflation, particularly those related to wages and increases in the cost of raw materials, recently have, and may continue to have, an adverse impact on our business, financial condition, and results of operations.
−Removed: In addition, n ew boat buyers often finance their purchases.
−Removed: Inflation typically results in higher interest rates that could translate into an increased cost of boat ownership.
−Removed: Should inflation and increased interest rates occur, prospective consumers may choose to forego or delay their purchases or buy a less expensive boat in the event credit is not available to finance their boat purchases.
+Added: An increase in energy costs, including as a result of the ongoing conflict between Russia and Ukraine, may materially adversely affect our business, financial condition, and results of operations.
+Added: Our results of operations can be directly affected, positively and negatively, by volatility in the cost and availability of energy, which is subject to global supply and demand and other factors beyond our control.
+Added: The ongoing conflict between Russia and Ukraine has impacted global energy markets, particularly in Europe, leading to high volatility and increasing prices for crude oil, natural gas and other energy supplies.
+Added: Higher energy costs result in increases in operating expenses at our manufacturing facilities, in the expense of shipping raw materials to our facilities, and in the expense of shipping products to our dealers.
+Added: In addition, increases in energy costs may adversely affect the pricing and availability of petroleum-based raw materials, such as resins and foams that are used in our products.
+Added: Higher fuel prices may also have an adverse effect on demand for our boats, as they increase the cost of boat ownership and possibly affect product use.
Fluctuations in foreign currency exchange rates could adversely affect our results.
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We will often attempt to offset these higher prices with increased discounts, which can lead to reduced net sales per unit.
−Removed: An increase in energy costs may materially adversely affect our business, financial condition, and results of operations.
−Removed: Higher energy costs result in increases in operating expenses at our manufacturing facilities and in the expense of shipping products to our dealers.
−Removed: In addition, increases in energy costs may adversely affect the pricing and availability of petroleum-based raw materials, such as resins and foams that are used in our products.
−Removed: Higher fuel prices may also have an adverse effect on demand for our boats, as they increase the cost of boat ownership and possibly affect product use.
Risks Relating to Our Business
−Removed: Actual or potential public health emergencies, epidemics, or pandemics, such as the current coronavirus (“COVID-19”) pandemic, could have a material adverse effect on our business, results of operations, or financial condition.
−Removed: The impact of actual or potential public health emergencies, epidemics, or pandemics on the Company, our suppliers, dealers, and customers, and the general economy could be wide-ranging and significant, depending on the nature of the issue, governmental actions taken in response, and the public reaction.
+Added: Actual or potential public health emergencies, epidemics, or pandemics, such as the COVID-19 pandemic, could have a material adverse effect on our business, results of operations, or financial condition.
+Added: The impact of actual or potential public health emergencies, epidemics, or pandemics on the Company, our suppliers, dealers, and consumers, and the general economy could be wide-ranging and significant, depending on the nature of the issue, governmental actions taken in response, and the public reaction.
The impact of the current COVID-19 pandemic includes illness, quarantines, cancellation of events and travel, business and school shutdowns, reduction in economic activity, widespread unemployment, and supply chain interruptions, which collectively have caused significant disruptions to global economies and financial markets.
−Removed: Despite the COVID-19 pandemic, demand for our products increased in fiscal 2021 versus fiscal 2020, but the pandemic could result in future significant volatility in demand, positively or negatively, for our products.
+Added: Despite the COVID-19 pandemic, demand for our products increased versus prior periods, but the pandemic could result in future significant volatility in demand, positively or negatively, for our products.
Demand volatility may be caused by, among other things:
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Our manufacturing strategy is designed to improve product quality and increase productivity, while reducing costs and increasing flexibility to respond to ongoing changes in the marketplace.
−Removed: To implement this strategy, we must be successful in our continuous
−Removed: improvement efforts, which depend on the involvement of management, production employees, and suppliers.
+Added: To implement this strategy, we must be successful in our continuous improvement efforts, which depend on the involvement of management, production employees, and suppliers.
Any inability to achieve these objectives could adversely impact the profitability of our products and our ability to deliver desirable products to our consumers.
−Removed: In addition, we have made strategic capital investments in capacity expansion activities to successfully capture growth opportunities and enhance product offerings, including relocating production of our Aviara brand to Merritt Island, Florida.
−Removed: This allows for a dedicated manufacturing facility of our Aviara brand and increased capacity for our MasterCraft brand at the Vonore, Tennessee facility.
−Removed: We must carefully manage capital expansions to ensure they meet cost targets, comply with applicable environmental, safety, and other regulations, and uphold high-quality workmanship.
+Added: In addition, we have made strategic capital investments in capacity expansion activities to successfully capture growth opportunities and enhance product offerings, including brand relocation and plant expansions.
Moving production to a different plant and expanding capacity at an existing facility involves risks, including difficulties initiating production within the cost and timeframe estimated, supplying product to customers when expected, integrating new products, and attracting sufficient skilled labor to handle additional production demands.
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Our ability to remain competitive depends on successfully introducing new products and services that meet consumer expectations.
−Removed: We believe that our customers look for and expect quality, innovation, and advanced features when evaluating and making purchasing decisions about products and services in the marketplace.
+Added: We believe that our consumers look for and expect quality, innovation, and advanced features when evaluating and making purchasing decisions about products and services in the marketplace.
Our ability to remain competitive and meet our growth objectives may be adversely affected by difficulties or delays in product development, such as an inability to develop viable new products, gain market acceptance of new products, generate sufficient capital to fund new product development, or obtain adequate intellectual property protection for new products.
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As a result, we may not be able to introduce new products that are necessary to remain competitive in all markets that we serve.
−Removed: Furthermore, we must continue to meet or exceed customers' expectations regarding product quality and after-sales service or our operating results could suffer.
+Added: Furthermore, we must continue to meet or exceed consumers' expectations regarding product quality and after-sales service or our operating results could suffer.
Our ability to meet demand in a rapidly changing environment may adversely affect our results of operations.
The seasonality of retail demand for our products, together with our goal of balancing production throughout the year, requires us to manage our manufacturing and allocate our products to our dealer network to address anticipated retail demand.
−Removed: Production and sales levels throughout fiscal 2021 and 2020 fluctuated due in large part to the COVID-19 pandemic.
+Added: Production and sales levels throughout fiscal 2022, 2021, and 2020 fluctuated due to general economic conditions and the ongoing COVID-19 pandemic.
In addition, our dealers must manage seasonal changes in consumer demand and inventory.
−Removed: Although we have remained focused on applying and enhancing our COVID-19
−Removed: health and safety protocols while continuing to ramp-up production, our businesses may experience difficulty in adapting to the rapidly changing production and sales volumes.
+Added: Our business may experience difficulty in
+Added: adapting to the rapidly changing production and sales volumes.
We may not be able to recruit or maintain sufficient skilled labor or our suppliers may not be able to deliver sufficient quantities of parts and components for us to match production with rapid changes in forecasted demand.
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A failure to adjust dealer pipeline inventory levels to meet demand could adversely impact our results of operations.
−Removed: Our financial results may be adversely affected by our third-party suppliers' increased costs or inability to meet required production levels due to increased demand or disruption of supply of raw materials, parts, and product components.
−Removed: We rely on third parties to supply raw materials used in the manufacturing process, including resins, fiberglass, aluminum, lumber and steel, as well as product parts and components.
+Added: Our financial results may be adversely affected by our third-party suppliers' increased costs or inability to meet required production levels due to increased demand or global supply chain disruptions.
+Added: We rely on a complex global supply chain of third parties to supply raw materials used in the manufacturing process, including resins, fiberglass, aluminum, lumber and steel, as well as product parts and components.
The prices for these raw materials, parts, and components fluctuate depending on market conditions and, in some instances, commodity prices or trade policies, including tariffs.
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In addition, an uncorrected defect or supplier's variation in a raw material, part, or component, either unknown to us or incompatible with our manufacturing process, could jeopardize our ability to manufacture products.
−Removed: Some additional supply risks that could disrupt our operations, impair our ability to deliver products to customers, and negatively affect our financial results include:
+Added: Some additional supply chain disruptions that could impact our operations, impair our ability to deliver products to customers, and negatively affect our financial results include:
an outbreak of disease or facility closures due to the COVID-19 pandemic, or similar public health threat;
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events such as natural disasters, power outages, or labor strikes;
+Added: financial or political instability, such as the ongoing conflict between Russia and Ukraine, in any of the countries in which our suppliers operate;
financial pressures on our suppliers due to a weakening economy or unfavorable conditions in other end markets;
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Cost increases, defects, or sustained interruptions in the supply of raw materials, parts, or components due to delayed start-up periods our suppliers experience as they increase production efforts create risks to our operations and financial results.
−Removed: The Company experienced periodic supply shortages and increases in costs to certain materials in fiscal 2021.
+Added: The Company has experienced periodic supply shortages and increases in costs to certain materials.
We continue to address these issues by identifying alternative suppliers for key materials and components, working to secure adequate inventories of critical supplies, and continually monitoring the capabilities of our supplier base.
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The talents and efforts of our employees, particularly key managers, are vital to our success.
+Added: We have observed an overall tightening and increasingly competitive labor market, which could inhibit our ability to recruit, train and retain employees we require at efficient costs and could lead to increased costs, such as increased overtime to meet demand and increased wage rates to attract and retain employees.
Our management team has significant industry experience and would be difficult to replace.
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Failure to hire, develop, and retain highly qualified and diverse employee talent and to develop and implement an adequate succession plan for the management team could disrupt our operations and adversely affect our business and our future success.
−Removed: We perform an annual review of management succession plans with our b oard of d irectors, including reviewing executive officer and other important positions to substantially mitigate the risk associated with key contributor transitions, but we cannot ensure that all transitions will be implemented successfully.
+Added: We perform an annual review of management succession plans with our board of directors, including reviewing executive officer and other important positions to substantially mitigate the risk associated with key contributor transitions, but we cannot ensure that all transitions will be implemented successfully.
Our ability to continue to execute our growth strategy could potentially be adversely affected by the effectiveness of organizational changes.
Any disruption or uncertainty resulting from such changes could have a material adverse impact on our business, results of operations, and financial condition.
−Removed: Much of our future success depends on, among other factors, our ability to attract and retain skilled labor.
−Removed: In 2021, all our facilities sought to increase production and to hire and retain sufficient skilled hourly labor to meet increased demand for our products.
+Added: Much of our future success depends on, among other factors, our ability to attract and retain skilled labor, which is critical to our operations.
+Added: We may experience difficulty maintaining desired staffing levels due to increased competition for employees, higher employee turnover rates and low unemployment rates in many of the geographic areas in which we manufacture or distribute goods.
+Added: In fiscal 2022, all our facilities increased hiring of skilled hourly labor, and may need to continue to increase hiring of skilled hourly labor to meet increased demand for our products.
In the future, if we are not successful in these efforts, we may be unable to meet our operating goals and plans, which may impact our financial results.
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In order to manage this risk, we regularly monitor and make improvements to wages and benefit programs, as well as develop and improve recruiting, training, and safety programs to attract and retain an experienced and skilled workforce.
−Removed: An inability to identify and complete targeted acquisitions could negatively impact financial results.
−Removed: We may in the future explore acquisitions and strategic alliances that will enable us to acquire complementary skills and capabilities, offer new products, expand our consumer base, enter new product categories or geographic markets, and obtain other competitive advantages.
−Removed: We cannot provide assurance, however, that we will identify acquisition candidates or strategic partners that are suitable to our business, obtain financing on satisfactory terms, or complete acquisitions or strategic alliances.
−Removed: In managing our acquisition strategy, we conduct rigorous due diligence, involve various functions, and continually review target acquisitions, all of which we believe mitigates some of our acquisition risks.
−Removed: However, we cannot assure that suitable acquisitions will be identified or consummated or that, if consummated, they will be successful.
−Removed: Acquisitions include a number of risks, including our ability to project and evaluate market demand, realize potential synergies and cost savings, and make accurate accounting estimates, as well as diversion of management attention.
−Removed: Uncertainties exist in assessing the value, risks, profitability, and liabilities associated with certain companies or assets, negotiating acceptable terms, obtaining financing on acceptable terms, and receiving any necessary regulatory approvals.
−Removed: As we continue to grow, in part, through acquisitions, our success depends on our ability to anticipate and effectively manage these risks.
−Removed: Our failure to successfully do so could have a material adverse effect on our financial condition and results of operations.
−Removed: The inability to successfully integrate acquisitions could negatively impact financial results.
−Removed: Our strategic acquisitions pose risks, such as our ability to project and evaluate market demand;
−Removed: maximize potential synergies and cost savings;
−Removed: make accurate accounting estimates;
−Removed: and achieve anticipated business objectives.
−Removed: Acquisitions we may complete in the future, present these and other integration risks, including:
−Removed: the possibility that the expected synergies and value creation will not be realized or will not be realized within the expected time period;
−Removed: the risk that unexpected costs and liabilities will be incurred;
−Removed: diversion of management attention;
−Removed: difficulties retaining employees.
−Removed: If we fail to timely and successfully integrate new businesses into existing operations, we may see higher costs, lost sales, or otherwise diminished earnings and financial results.
We depend on our network of independent dealers which creates additional risks.
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We face competition from other manufacturers in attracting and retaining independent boat dealers.
−Removed: Although our management believes that the quality of our products in the premium performance sport, outboard boat, and sterndrive boat industries should permit us to maintain our relationships with our dealers and our market share position, there can be no
−Removed: assurance that we will be able to maintain or improve our relationships with our dealers or our market share position.
+Added: Although our management believes that the quality of our products in the premium performance sport, outboard boat, and sterndrive boat industries should permit us to maintain our relationships with our dealers and our market share position, there can be no assurance that we will be able to maintain or improve our relationships with our dealers or our market share position.
In addition, independent dealers in the powerboat industry have experienced significant consolidation in recent years, which could result in the loss of one or more of our dealers in the future if the surviving entity in any such consolidation purchases similar products from a competitor.
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During the economic downturn that commenced in 2008, we observed a shift in consumer demand toward purchasing more used boats, primarily because prices for used boats are typically lower than retail prices for new boats.
−Removed: If this were to occur again (including as a result of the COVID-19 Pandemic), it could have the effect of reducing demand among retail purchasers for our new boats.
+Added: If this were to occur again, it could have the effect of reducing demand among retail purchasers for our new boats.
Also, while we have taken steps designed to balance production volumes for our boats with demand, our competitors could choose to reduce the price of their products, which could have the effect of reducing demand for our new boats.
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In addition, product recalls could harm our reputation and cause us to lose consumers, particularly if recalls cause consumers to question the safety or reliability of our products.
+Added: An inability to identify and complete targeted acquisitions could negatively impact financial results.
+Added: We may in the future explore acquisitions and strategic alliances that will enable us to acquire complementary skills and capabilities, offer new products, expand our consumer base, enter new product categories or geographic markets, and obtain other competitive advantages.
+Added: We cannot provide assurance, however, that we will identify acquisition candidates or strategic partners that are suitable to our business, obtain financing on satisfactory terms, or complete acquisitions or strategic alliances.
+Added: In managing our acquisition strategy, we conduct rigorous due diligence, involve various functions, and continually review target acquisitions, all of which we believe mitigates some of our acquisition risks.
+Added: However, we cannot assure that suitable acquisitions will be identified or consummated or that, if consummated, they will be successful.
+Added: Acquisitions include a number of risks, including our ability to project and evaluate market demand, realize potential synergies and cost savings, and make accurate accounting estimates, as well as diversion of management attention.
+Added: Uncertainties exist in assessing the value, risks, profitability, and liabilities associated with certain companies or assets, negotiating acceptable terms, obtaining financing on acceptable terms, and receiving any necessary regulatory approvals.
+Added: As we continue to grow, in part, through acquisitions, our success depends on our ability to anticipate and effectively manage these risks.
+Added: Our failure to successfully do so could have a material adverse effect on our financial condition and results of operations.
+Added: The inability to successfully integrate acquisitions could negatively impact financial results.
+Added: Our strategic acquisitions pose risks, such as our ability to project and evaluate market demand;
+Added: maximize potential synergies and cost savings;
+Added: make accurate accounting estimates;
+Added: and achieve anticipated business objectives.
+Added: Acquisitions we may complete in the future, present these and other integration risks, including:
+Added: the possibility that the expected synergies and value creation will not be realized or will not be realized within the expected time period;
+Added: the risk that unexpected costs and liabilities will be incurred;
+Added: diversion of management attention;
+Added: difficulties retaining employees.
+Added: If we fail to timely and successfully integrate new businesses into existing operations, we may see higher costs, lost sales, or otherwise diminished earnings and financial results.
Our business operations could be negatively impacted by an outage or breach of our information technology systems, network disruptions, or a cybersecurity event.
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We have established security policies, processes, and defenses, including employee awareness training regarding phishing, malware, and other cyber risks, designed to help identify and protect against intentional and unintentional misappropriation or corruption of our information technology systems and information and disruption of our operations.
+Added: Additionally, we maintain quarterly discussions with our board of directors to address cyber risks and system and process enhancements.
Despite these efforts, our information technology systems may be damaged, disrupted, or shut down due to attacks by unauthorized access, malicious software, computer viruses, undetected intrusion, hardware failures, or other events, and in these circumstances our disaster recovery plans may be ineffective or inadequate.
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Violation of those covenants, whether as a result of operating losses or otherwise, could result in our lenders restricting or terminating our borrowing ability under our credit facilities.
−Removed: If our lenders reduce or terminate our access to amounts under our credit facilities, we may not have sufficient capital to fund our working capital and other needs, and we may need to secure additional capital or financing to fund our operations or to repay outstanding debt under our credit facilities.
+Added: If our lenders reduce or terminate our access to amounts under our credit
+Added: facilities, we may not have sufficient capital to fund our working capital and other needs, and we may need to secure additional capital or financing to fund our operations or to repay outstanding debt under our credit facilities.
We cannot provide assurance that we will be successful in ensuring the availability of amounts under our credit facilities or in raising additional capital, or that any amount, if raised, will be sufficient to meet our cash needs or will be on terms as favorable as those which have been available to us historically.
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Any royalty or licensing agreements, if required, may not be available to us on acceptable terms or at all.
−Removed: A successful claim of infringement against us could result in our being required to pay significant damages, enter into costly license or royalty agreements, or stop the sale of certain products, any of which could have a negative impact on our business, financial condition, and results of operations.
+Added: A successful claim of infringement against us could result in our being required to pay significant
+Added: damages, enter into costly license or royalty agreements, or stop the sale of certain products, any of which could have a negative impact on our business, financial condition, and results of operations.
While we are not currently involved in any outstanding intellectual property litigation that we believe, individually or in the aggregate, will have a material adverse effect on our business, financial condition, or results of operations, we cannot predict the outcome of any pending litigation and an unfavorable outcome could have an adverse impact on our business, financial condition, or results of operations.
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While we believe that we are in compliance with applicable federal, state, local, and foreign regulatory requirements, and hold all licenses and permits required thereunder, we cannot provide assurance that we will, at all times, be able to continue to comply with applicable regulatory requirements.
−Removed: Compliance with increasingly stringent regulatory and permit requirements may, in the future, cause us to incur substantial capital costs and increase our cost of operations, or may limit our operations, all of which could have a material adverse effect on our business or financial condition.
+Added: Compliance with increasingly stringent regulatory and permit requirements may, in the future,
+Added: cause us to incur substantial capital costs and increase our cost of operations, or may limit our operations, all of which could have a material adverse effect on our business or financial condition.
Our manufacturing processes involve the use, handling, storage, and contracting for recycling or disposal of hazardous substances and wastes.
The failure to manage or dispose of such hazardous substances and wastes properly could expose us to material liability or fines, including liability for personal injury or property damage due to exposure to hazardous substances, damages to natural resources, or for the investigation and remediation of environmental conditions.
−Removed: Under environmental laws, we may be liable for
−Removed: remediation of contamination at sites where our hazardous wastes have been disposed or at our current or former facilities, regardless of whether such facilities are owned or leased or regardless of whether we were at fault.
+Added: Under environmental laws, we may be liable for remediation of contamination at sites where our hazardous wastes have been disposed or at our current or former facilities, regardless of whether such facilities are owned or leased or regardless of whether we were at fault.
While we do not believe that we are presently subject to any such liabilities, we cannot assure you that environmental conditions relating to our prior, existing, or future sites or operations or those of predecessor companies will not have a material adverse effect on our business or financial condition.
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Any common stock that we issue, including under our 2015 Incentive Award Plan or other equity incentive plans that we may adopt in the future, would dilute the percentage ownership of holders of our common stock.
−Removed: We do not intend to pay dividends on our common stock for the foreseeable future.
−Removed: While we have paid dividends in the past, we presently have no intention to pay dividends on our common stock at any time in the foreseeable future.
+Added: We currently do not intend to pay dividends on our common stock.
+Added: While we have paid dividends in the past, we currently have no intention to pay dividends on our common stock.
Any decision to declare and pay dividends in the future will be made at the discretion of our board of directors and will depend on, among other things, our results of operations, financial condition, cash requirements, contractual restrictions, and other factors that our board of directors may deem relevant.
Furthermore, our ability to declare and pay dividends may be limited by instruments governing future outstanding indebtedness we may incur.
−Removed: Delaware law and certain provisions in our amended and restated certificate of incorporation may prevent efforts by our stockholders to change the direction or management of our Company.
−Removed: We are a Delaware corporation, and the anti-takeover provisions of Delaware law impose various impediments to the ability of a third party to acquire control of us, even if a change of control would be beneficial to our existing stockholders.
−Removed: In addition, our amended and restated certificate of incorporation and our amended and restated by-laws currently contain provisions that may make the acquisition of our company more difficult without the approval of our board of directors, including, but not limited to, the following:
−Removed: our board of directors will be classified into three classes until our 2022 annual meeting of stockholders;
−Removed: only our board of directors may call special meetings of our stockholders;
−Removed: we require advance notice and duration of ownership requirements for stockholder proposals.
−Removed: These provisions could discourage, delay, or prevent a transaction involving a change in control of our company.
−Removed: These provisions could also discourage proxy contests and make it more difficult for stockholders to elect directors of their choosing and cause us to take other corporate actions they desire.
−Removed: In addition, because our board of directors is responsible for appointing the members of our management team, these provisions could in turn affect any attempt by our stockholders to replace current members of our management team.
+Added: Certain activist shareholder actions could cause us to incur expense and hinder execution of our strategy.
+Added: We actively engage in discussions with our shareholders regarding further strengthening our Company and creating long-term shareholder value.
+Added: This ongoing dialogue can include certain divisive activist tactics, which can take many forms.
+Added: Some shareholder activism, including potential proxy contests, could result in substantial costs, such as legal fees and expenses, and divert management’s and our board of director’s attention and resources from our businesses and strategic plans.
+Added: Additionally, public shareholder activism could give rise to perceived uncertainties as to our future, adversely affect our relationships with dealers, distributors, or consumers, make it more difficult to attract and retain qualified personnel, and cause our stock price to fluctuate based on temporary or speculative market perceptions or other factors that do not necessarily reflect the underlying fundamentals and prospects of our business.
+Added: These risks could adversely affect our business and operating results.
UNRESOLVED STAFF COMMENTS.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.