What changed in this filing

/stocks — the workspaceLOADING

Item 1A. Risk Factors

2020-11-06 compared with 2020-05-08 · 92 added, 78 removed, 645 unchanged (21% of the section changed)

8 unchanged sentences

We do not employ a traditional direct sales force.

Sales to our distributors have accounted for nearly all of our revenues.

Sales to our distributors have accounted for the majority of our revenues.

Our distributors do not make long term purchase commitments to us, and do not typically provide us with information about market demand for our products.

4 unchanged sentences

The markets we serve can be especially volatile, and weakness in orders could harm our future results of operations.

Weakness in orders, directly or indirectly, from the markets we serve, including as a result of any slowdown in capital expenditures by the markets we service (which may be more prevalent during a global economic downturn, or periods of economic, political or regulatory uncertainty), could have a material adverse effect on our business, results of operations, and financial condition.

regulatory uncertainty), could have a material adverse effect on our business, results of operations, liquidity and financial condition.

Such slowdowns may continue or recur in future periods.

Orders from the markets we serve could decline for many reasons other than the competitiveness of our products and services within their respective markets.

These conditions have harmed our business and results of operations in the past, and some of these or other conditions in the markets we serve

could affect our business and results of operations in any future period of such slowdowns

These conditions have harmed our business and results of operations in the past, and some of these or other conditions in the markets we serve could affect our business and results of operations, liquidity or financial condition in any future period of such slowdowns.

We are subject to risks associated with our distributors’ inventory management practices.

11 unchanged sentences

The Company must order components for its products and build inventory, both of finished products and components, in advance of new product announcements and shipments.

With the use of third-party logistics and warehousing providers, we may also decide to increase or maintain higher levels of inventory of finished products or components.

Decisions to build inventory for new products or to increase or maintain higher inventory levels are typically based upon uncertain forecasts or other assumptions and may expose us to a greater risk of carrying excess or obsolete inventory.

9 unchanged sentences

The market for our wireless broadband networking equipment is emerging and is characterized by rapid technological change, evolving industry standards, frequent new product introductions and short product life cycles.

The markets for enterprise networking equipment and consumer products possess similar characteristics of rapid technological updates, evolving industry standards, frequent changes in consumer preferences, frequent new product introductions and short and unpredictable product life cycles.

The markets for enterprise networking equipment and consumer products possess similar characteristics of rapid technological updates, evolving industry standards, frequent

changes in consumer preferences, frequent new product introductions and short and unpredictable product life cycles.

Our ability to keep pace in these markets depends upon our ability to enhance our current products, and continue to develop and introduce new products rapidly and at competitive prices.

2 unchanged sentences

Given the complexity, we occasionally have experienced, and could experience in the future, lower than expected yields on new or enhanced products and delays in completing the development and introduction of new products and enhancements to existing products.

In addition, new products may have lower selling prices or higher costs than

existing products, which could negatively impact our results of operations.

In addition, new products may have lower selling prices or higher costs than existing products, which could negatively impact our results of operations.

Our ability to compete successfully will depend in large measure on our ability to maintain a technically skilled development and engineering staff, to successfully innovate, and to adapt to technological changes and advances in the industry.

12 unchanged sentences

• our ability to allow centralized management of the solutions;

• our ability to provide quality product support.

• our ability to provide product support.

New entrants seeking to gain market share by introducing new technology and new products may also make it more difficult for us to sell our products, and could create increased pricing pressure.

2 unchanged sentences

We expect competition to continuously intensify as other established and new companies introduce new products in the same markets that we serve or intend to enter, as these markets consolidate.

Our business, results of operations and financial condition will suffer if we do not maintain our competitiveness.

Our business, results of operations, liquidity and financial condition will suffer if we do not maintain our competitiveness.

A number of our current or potential competitors have longer operating histories, greater brand recognition, larger customer bases and significantly greater resources than we do.

14 unchanged sentences

The existence of defects or bugs in our products may damage our reputation and disrupt our sales.

If any of these problems are not found until after we have commenced commercial production and distribution of a new product, we may be required to incur additional

development costs, repair or replacement costs, and other costs relating to regulatory proceedings, product recalls and litigation, which could harm our reputation and results of operations.

If any of these problems are not found until after we have commenced commercial production and distribution of a new product, we may be required to incur additional development costs, repair or replacement costs, and other costs relating to regulatory proceedings, product recalls and litigation, which could harm our reputation and results of operations.

Undetected defects or bugs may lead to negative online Internet reviews of our products, which are increasingly becoming a significant factor in the success of our new product launches, especially for our consumer products.

23 unchanged sentences

No additional recoveries were made since fiscal year ended 2016.

The Company is continuing to pursue the recovery of the remaining $30.0 million and is cooperating with U.S.

federal and numerous overseas law enforcement authorities who are actively pursuing a multi-agency criminal investigation.

The Company is continuing to pursue the recovery of the remaining $30.0 million and is cooperating with numerous overseas law enforcement authorities who are actively pursuing a multi-agency criminal investigation.

However, any additional recoveries are likely remote and therefore cannot be assured.

13 unchanged sentences

Supply chain issues or a shortage of adequate component supply or manufacturing capacity could increase our costs or delay our ability to fulfill future orders and could have a material adverse impact on our business and results of operations.

We retain contract manufacturers, located primarily in China, V ietnam and Taiwan , to manufacture our products.

We retain contract manufacturers, located primarily in China and V ietnam , to manufacture our products.

Any significant change in our relationship with these manufacturers could have a material adverse effect on our business, results of operations and financial condition.

10 unchanged sentences

In the event that we receive shipments of products that fail to comply with our technical specifications or that fail to conform to our quality control standards, and we are not able to obtain replacement products in a timely manner, we risk revenue losses from the inability to sell those products, increased administrative and shipping costs, and lower profitability.

Additionally, if defects are not discovered until after distributors and/or end users purchase our products, they could lose confidence in the technical attributes of our products and our business and results of operations could be harmed.

Additionally, if defects are not

discovered until after distributors and/or end users purchase our products, they could lose confidence in the technical attributes of our products and our business and results of operations could be harmed.

We do not control our contract manufacturers or suppliers, including their labor, environmental or other practices.

5 unchanged sentences

• labor strikes or shortages;

including shortages in labor as a result of, or to mitigate, the spread of COVID-19

• financial problems of either contract manufacturers or component suppliers;

4 unchanged sentences

We purchase components, directly or through our contract manufacturers, from third parties that are necessary for the manufacture of our products.

Shortages in the supply of components or other supply disruptions may not be predicted in time to design-in different components or qualify other suppliers.

Shortages or supply disruptions may also increase the prices of

components due to market conditions.

Shortages in the supply of components or other supply disruptions, including, without limitations, due to reductions in supply as a result of COVID-19, may not be predicted in time to design-in different components or qualify other suppliers.

Shortages or supply disruptions may also increase the prices of components due to market conditions.

While many components are generally available from a variety of sources, we and our contract manufacturers currently depend on a single or limited number of suppliers for several components for our products.

For example, we currently rely upon some chipset suppliers, such as Qualcomm Atheros, as single-source suppliers of certain components for some of our products, and a disruption in the supply of those components would significantly disrupt our business.

For example, we currently rely upon some chipset suppliers, such as Qualcomm Atheros and Broadcom, as single-source suppliers of certain components for some of our products, and a disruption in the supply of those components would significantly disrupt our business.

We and our contract manufacturers generally rely on short-term purchase orders rather than long-term contracts with the suppliers of components for our products.

11 unchanged sentences

Any disruption resulting from these events could cause significant delays in product development or shipments of our products until we are able to shift our development, manufacturing or logistics centers from the affected contractor to another vendor, or shift the affected administrative or research and development activities to another location.

Our business may be materially adversely affected by public health problems, particularly in China.

Our business may be materially adversely affected by public health problems, particularly

For example, in the last decade, China has suffered health crises related to the outbreak of avian influenza, severe acute respiratory syndrome and COVID-19.

Public health problems may result in quarantines, business closures, unavailability of key personnel, domestic and international transportation restrictions, import and export complications, and otherwise cause shortages in the supply of components or cause other disruptions within our supply chain.

The COVID-19 pandemic and resulting global disruptions have caused significant volatility in financial markets and the domestic and global economy.

This disruption can contribute to potential payment delays or defaults in our accounts receivable, affect asset valuations resulting in impairment charges, and affect the availability of financing credit as well as other segments of the credit markets.

Public health problems may also result in quarantines, business closures, unavailability of key personnel, domestic and international transportation restrictions, import and export complications, and otherwise cause shortages in the supply of components or cause other disruptions within our supply chain.

Public health problems currently cause and may continue to cause disruptions, delays, shortages, and increased costs within our supply chain, and distribution channels.

In addition, public health problems may require us to take precautionary measures to minimize the risk to our employees, including requiring our employees to work remotely and suspending non-essential travel, which could negatively affect our business.

Additionally, we have experienced a disruption in our supply chain as a result of the COVID-19 related restrictions that have impacted our suppliers' ability to manufacture or provide key components or services, and we have incurred, and continue to incur, additional cost to expedite deliveries of components and services.

The disruptions in our supply chain have not been fully remediated as of the date of this report.

As a result of the transition to a remote working environment, we may experience disruptions or inefficiencies in our ability to operate our business.

6 unchanged sentences

and the global economy.

An outbreak of public health problems, or the perception that such an outbreak could occur, and the measures taken by the government of countries affected, could adversely affect our business, results of operations and financial condition.

A general global economic downturn may negatively affect our customers and their ability to purchase our products.

1 unchanged sentence

The global macroeconomic environment has been challenging and inconsistent caused by instability in the global credit markets, the impact of uncertainty regarding global central bank monetary policy, the instability in the geopolitical environment in many parts of the world, including the June 2016 referendum by the United Kingdom in which voters approved an exit from the European Union, commonly referred to as “Brexit”.

As a result of the referendum, the British government formally initiated

the process for withdrawal in March 2017, and, following agreed extensions between the European Council and the United Kingdom on March 22, 2019, April 11, 2019 and October 28, 2019, “Brexit” became effective on January 31, 2020 under the terms of a Withdrawal Agreement that was ratified by the U.K.

As a result of the referendum, the British government formally initiated the process for withdrawal in March 2017, and, following agreed extensions between the European Council and the United Kingdom on March 22, 2019, April 11, 2019 and October 28, 2019, “Brexit” became effective on January 31, 2020 under the terms of a Withdrawal Agreement that was ratified by the U.K.

Parliament, and the European Parliament in Brussels, in late January 2020.

10 unchanged sentences

An economic downturn or economic uncertainty in our key U.S.

and international markets, as well as fluctuations in currency exchange rates, may adversely affect consumer discretionary spending and demand for our consumer products.

and international markets, as well as fluctuations in currency

exchange rates, may adversely affect consumer discretionary spending and demand for our consumer products.

Factors affecting the level of consumer spending include general market conditions, macroeconomic conditions, fluctuations in foreign exchange rates and interest rates, and other factors such as consumer confidence, the availability and cost of consumer credit, levels of unemployment and tax rates.

11 unchanged sentences

Therefore, we may not correctly determine in advance the ultimate effect of new product introductions and transitions.

Additionally, if the assumptions on which we based our forecasts and management of product demand, purchase commitments or inventory levels turn out to be incorrect, our financial performance could suffer and we could be required to write-off the value of excess products or components inventory or not fully utilize firm purchase commitments.

excess products or components inventory or not fully utilize firm purchase commitments.

In addition, the introduction or announcement of new products or product enhancements may shorten the life cycle of our existing products or reduce demand for our current products, thereby offsetting any benefits of successful product introductions and potentially lead to challenges in managing inventory of existing products.

Failure to complete product transitions effectively or in a timely manner could harm our brand and lead to, among other things, lower revenue, excess prior generation product inventory, or a deficit of new product inventory and reduced profitability.

In connection with introduction of new products, and our consumer products, in particular, we may spend significant amount on advertising and other marketing campaigns, such as television, print advertising, social media and others, as well as increased

promotional activities, to build brand awareness and acquire new users.

While we seek to structure our advertising campaigns in the manner that we believe is most likely to encourage people to use our products and services, we may fail to identify advertising opportunities that satisfy our anticipated return on advertising spend, accurately predict customer acquisition, or fully understand or estimate the conditions and behaviors that drive customer behavior.

6 unchanged sentences

It is also possible that competitors could introduce new products and services that negatively impact consumer preference in the type of consumer products that we supply, which could result in decreased sales of our product and a loss in market share.

We may not be able to achieve an acceptable return, if any, on our research and development efforts, and our business may be adversely affected.

We may not be able to achieve an acceptable return, if any, on our research and development efforts, and our business, results of operations, liquidity and financial condition may be adversely affected.

As we continually seek to enhance our consumer products, we will incur additional costs to incorporate new or revised features.

12 unchanged sentences

We have limited number of distributors in certain regions, and if we were to lose the services of a distributor, we might need to find another distributor in that area and there can be no assurance of our ability to do so in a timely manner or on favorable terms.

Additionally, as a result of the COVID-19 pandemic, certain of our distributors have been forced to temporarily suspend or otherwise reduce operations, which may adversely impact sales of our products.

Further, our distributors build inventory in anticipation of future sales, and if such sales do not occur as rapidly as they anticipate, our distributors will decrease the size of their future product orders.

44 unchanged sentences

• our limited experience in operating manufacturing facilities.

Since these activities would be conducted in China and other foreign countries, some of these risks may be more significant due to the less predictable legal and political environment.

Since these activities are currently conducted in China and could be expanded to other foreign countries, some of these risks may be more significant due to the less predictable legal and political environment.

Our business may be negatively affected by political events and foreign policy responses.

1 unchanged sentence

Changes in commodity prices may also cause political uncertainty and increase currency volatility that can affect economic activity.

Policies and statements by the current White House administration have created

uncertainty with how trade might be affected between the U.S.

Policies and statements by the current White House administration have created uncertainty with how trade might be affected between the U.S.

and the rest of the world, and China, in particular.

69 unchanged sentences

These factors may make it more challenging for us to enforce our intellectual property rights against infringement.

The infringement of our intellectual property rights, particularly in these jurisdictions, may materially harm our business in these markets and elsewhere by reducing our sales, and adversely affecting our results of operations, and diluting our brand or reputation.

The infringement of our intellectual property rights, particularly in these jurisdictions, may materially harm our

business in these markets and elsewhere by reducing our sales, and adversely affecting our results of operations, and diluting our brand or reputation.

Our contract manufacturers may not respect our intellectual property, and may produce products that compete with ours.

9 unchanged sentences

Even extensive searches for patents that may be relevant to our products may not uncover all relevant patents and patent applications.

Because of the existence of a large number of patents in the networking field, the secrecy of some pending patents, and the rapid rate of issuance of new patents, it is not economically

practical or even possible to determine in advance whether a product or any of its components infringes or will infringe on the patent rights of others.

Because of the existence of a large number of patents in the networking field, the secrecy of some pending patents, and the rapid rate of issuance of new patents, it is not economically practical or even possible to determine in advance whether a product or any of its components infringes or will infringe on the patent rights of others.

The asserted claims and/or initiated litigation can include claims against us or our manufacturers, suppliers, or customers, alleging infringement of their proprietary rights with respect to our existing or future products or components of those products.

19 unchanged sentences

Some of our competitors may have substantially greater resources than we do and may be able to sustain the costs of complex intellectual property litigation to a greater degree and for longer periods of time than we could.

In addition, patent holding companies and other third-party non-practicing entities that focus on extracting royalties and settlements by enforcing patent rights may target our component suppliers, manufacturers, us, our distributors, members of our sales channels, our network operators and service providers, or other purchasers of our products.

In addition, patent holding companies and other third-party non-practicing entities that focus on extracting royalties and settlements by enforcing patent rights may target our

component suppliers, manufacturers, us, our distributors, members of our sales channels, our network operators and service providers, or other purchasers of our products.

These companies typically have little or no product revenues and therefore our patents may provide little or no deterrence against such companies filing patent infringement lawsuits against our component suppliers, manufacturers, us, our distributors, members of our sales channels, network operators and service providers, or other purchasers of our products.

9 unchanged sentences

We use open source software in certain of our products, and may use more open source software in the future.

There have been claims challenging the ownership of software against companies that use open source software in the development of their products.

We could become subject to claims regarding the ownership of what we believe to be our proprietary software.

Usage of open source software can also lead to greater risks than the use of third-party commercial software, since open source licensors generally do not provide warranties or controls on origin of the software.

There have been claims challenging the ownership of software and claims of copyright infringement against companies that use open source software in the development of their products.

We could become subject to claims regarding the ownership of what we believe to be our proprietary software and claims of copyright infringement.

Usage of open source software can also lead to greater risks than the use of third-party commercial software, because open source licensors generally do not provide warranties or controls on origin of the software.

Some open source licenses contain requirements that users make available and license the source code for the modifications or derivative works that they create based upon the open source software.

20 unchanged sentences

We receive a substantial majority of our revenues from the sale of outdoor wireless networking equipment and enterprise WLAN.

As we expand into other products and services, such as video surveillance equipment, wireless backhaul, consumer electronics, and machine-to-machine communications, we may not be able to compete effectively with existing market participants and may not be able to realize a positive return on the investment we have made in these products or services.

As we expand into other products and services, such as video surveillance equipment, voice communication equipment, security access equipment, wireless backhaul, consumer electronics, and machine-to-machine communications, we may not be able to compete effectively with existing market participants and may not be able to realize a positive return on the investment we have made in these products or services.

Entering these markets may result in increased product development costs, and our new products may have extended time to market relative to our current products.

3 unchanged sentences

Our operating expenses are increasing as we make expenditures to enhance and expand our operations.

Over the past several years, we have increased our expenditure on infrastructure to support our anticipated growth and as a result of our being a public company.

Over the past several years, we have increased our expenditure on infrastructure to support our anticipated growth.

We are continuing to make significant investments in information systems, hiring more administrative personnel, using more professional services and expanding our operations outside the United States.

4 unchanged sentences

Compliance with conflict mineral disclosure requirements will create additional compliance cost and may create reputational challenges.

Pursuant to Section 1502 of the Dodd-Frank Act, United States publicly-traded companies are required to disclose use or

potential use of certain minerals and their derivatives, including tantalum, tin, gold and tungsten, that are mined from the Democratic Republic of Congo and adjoining countries and deemed conflict minerals.

Pursuant to Section 1502 of the Dodd-Frank Act, United States publicly-traded companies are required to disclose use or potential use of certain minerals and their derivatives, including tantalum, tin, gold and tungsten, that are mined from the Democratic Republic of Congo and adjoining countries and deemed conflict minerals.

These requirements necessitate due diligence efforts to assess whether such minerals are used in our products in order to make the relevant required annual disclosures.

9 unchanged sentences

We rely on third party service providers, such as G-Suite, Google Cloud and Amazon Web Services, to provide distributed computing infrastructure platforms for business operations, or what is commonly referred to as a “cloud” computing service.

Any transition of the cloud services currently provided by these service providers to another cloud provider would be difficult to implement and will cause us to incur significant time and expense.

Any transition of the

cloud services currently provided by these service providers to another cloud provider would be difficult to implement and will cause us to incur significant time and expense.

If our existing cloud service providers experience interruptions in service regularly or for a prolonged basis, or other similar issues, our business would be seriously harmed.

3 unchanged sentences

Our debt levels could adversely affect our ability to raise additional capital to pay dividends, repurchase our shares of common stock and fund our operations or limit our ability to react to changes in our industry or the economy.

As of March 31, 2020, our balance outstanding under the Credit Agreement for our Term Facility and Revolving Facility, was $481.3 million and $205.0 million, respectively.

As of September 30, 2020, our balance outstanding under the Credit Agreement for our Term Facility and Revolving Facility, was $468.8 million and $170.0 million, respectively.

In the future we may need to raise additional capital to finance our payment of dividends or repurchase shares of our common stock and fund our growth and operational goals.

10 unchanged sentences

These transactions involve numerous risks, including:

• difficulties in integrating and managing the operations, technologies and products of the companies we acquire,

particularly in light of our lean organizational structure;

• difficulties in integrating and managing the operations, technologies and products of the companies we acquire, particularly in light of our lean organizational structure;

• diversion of our management’s attention from normal daily operation of our business;

8 unchanged sentences

Completing acquisitions could consume significant amounts of cash.

If we finance acquisitions by issuing equity or convertible debt securities, our existing stockholders will likely experience dilution, and if we finance future acquisitions with debt funding, we will incur interest expense and may have to comply with covenants and secure that debt obligation with our assets.

incur interest expense and may have to comply with covenants and secure that debt obligation with our assets.

Our investments in new businesses, products, services, technologies, joint ventures and other strategic transactions are inherently risky, and could disrupt our current operations.

2 unchanged sentences

Because these investments are inherently risky, no assurance can be given that such investments will be successful and will not adversely affect our reputation, business prospects, results of operation and financial condition.

We may be adversely affected by changes in LIBOR reporting practices or the method in which LIBOR is calculated.

On July 27, 2017, the United Kingdom’s Financial Conduct Authority, which regulates LIBOR, announced that it intends to phase out LIBOR by the end of 2021.

It is unclear whether new methods of calculating LIBOR will be established such that it continues to exist after 2021.

Federal Reserve, in conjunction with the Alternative Reference Rates Committee, a steering committee comprised of large U.S.

financial institutions, is considering replacing U.S.

dollar LIBOR with a newly created index, calculated by reference to short-term repurchase agreements backed by U.S.

Treasury securities, called the Secured Overnight Financing Rate (“SOFR”).

The first publication of SOFR was released by the Federal Reserve Bank of New York in April 2018.

Whether SOFR will become a widely accepted benchmark in place of LIBOR, however, remains in question.

As such, the future of LIBOR and potential alternatives thereto are uncertain at this time.

If LIBOR is discontinued, the terms of our Credit Agreement provide for the use of an alternative rate.

Such an event would not affect our ability to borrow or maintain already outstanding borrowings, but the alternative rate could be higher and more volatile than LIBOR prior to its discontinuance.

Accordingly, the potential effects of the foregoing on our cost of capital cannot yet be determined.

Risks Related to Our Common Stock

11 unchanged sentences

Pera is entitled to vote his shares in his own interests, which may not always be in the interests of our stockholders generally.

As of May 8, 2020, Mr.

As of November 6, 2020, Mr.

Pera beneficially owned 56,278,181 shares of our common stock.

8 unchanged sentences

Pera to reduce his loan balance or the lenders upon foreclosure are likely to adversely affect our stock price.

Pera has also indicated to us that he may in the future from time to time pledge additional shares of common stock as collateral for margin or other loans, enter into derivative transactions based on the value of our common stock, dispose of shares of common stock, otherwise monetize shares of his common stock and/or engage in other

transactions relating to shares of our common stock and/or other securities of the company.

Any of these activities by Mr.

Pera may adversely affect the price of our common stock.

Pera has also indicated that he intends to continue to own at least a majority of our outstanding shares of common stock.

has also indicated that he intends to continue to own at least a majority of our outstanding shares of common stock.

Not paying cash dividends to our stockholders, or repurchasing shares of our common stock pursuant to our previously announced stock repurchase program, could cause the market price for our common stock to decline.

34 unchanged sentences

Department of the Treasury’s Office of Foreign Asset Control (“OFAC”) regarding these compliance issues.

We resolved the matters described in our self-disclosures with the BIS and OFAC, and have taken significant steps towards ensuring our compliance with export control regulations and embargoes.

We resolved the matters described in our self-disclosures with the BIS and OFAC, and have taken significant steps towards ensuring

our compliance with export control regulations and embargoes.

It is, however, possible that violations may occur in the future.

20 unchanged sentences

Our inability to alter our products to address these requirements and any regulatory changes may have a material adverse effect on our financial condition, results of operations, and our brand.

Further, the enforcement of laws and regulations may force us to withdrawal one or more of our products from sale in certain jurisdictions or to recall one or more of our products in certain jurisdictions.

Further, the enforcement of laws and regulations may force us to withdraw one or more of our products from sale in certain jurisdictions or to recall one or more of our products in certain jurisdictions.

We may incur costs and expenses relating to a withdrawal from a particular market or a recall of one or more of our products.

9 unchanged sentences

In particular, there are numerous U.S.

federal, state, and local laws and regulations and foreign laws and regulations regarding privacy and the collection, sharing, use, processing, disclosure, and protection of personal information and other user data.

federal, state, and local laws and regulations and foreign laws and regulations regarding privacy

and the collection, sharing, use, processing, disclosure, and protection of personal information and other user data.

Such laws and regulations often have changes in scope, may be subject to differing interpretations, and may be inconsistent among different jurisdictions.

1 unchanged sentence

Parliament approved a new data protection regulation, known as the General Data Protection Regulation (“GDPR”), which came into force on May 25, 2018.

The GDPR includes operational requirements for companies that receive or process personal data of residents of the European Union that are different than

those previously in place in the European Union, and that include significant penalties for non-compliance.

The GDPR includes operational requirements for companies that receive or process personal data of residents of the European Union that are different than those previously in place in the European Union, and that include significant penalties for non-compliance.

Another example, in November 2016, the Standing Committee of China’s National People’s Congress passed China’s first Cybersecurity Law (“CSL”), which took effect in June 2017.

The CSL is the first Chinese law that systematically lays out the regulatory requirements on cybersecurity and data protection, subjecting many previously under-regulated or unregulated activities in cyberspace to government scrutiny.

More recently, California enacted the California Consumer Privacy Act (the “CCPA”) that will, among other things, require covered companies to provide new disclosures to California consumers, and afford such consumers new abilities to opt-out of certain sales of personal information, when it goes into effect on January 1, 2020.

California legislators have announced the intent to modify the CCPA, and, as a result, we cannot yet predict the impact of the CCPA on our business or operations.

The CCPA took effect on January 1, 2020 with the privacy provisions enforceable by the California Attorney General as of July 1, 2020 , and the regulations becoming enforceable as of August 1, 2020.

Given the recent implementation of the regulations , we cannot yet predict the impact of the CCPA on our business or operations.

The costs of compliance with, and other burdens imposed by, the GDPR, CSL and CCPA may limit the use and adoption of our products and services and could have an adverse impact on our business, results of operations and financial condition.

20 unchanged sentences

The operation of our products by network operators or service providers in the United States or elsewhere in a manner not in compliance with local law could result in fines, operational disruption, or harm to our reputation.

In addition, if new spectrums, either licensed or unlicensed, are made available by government regulatory agencies for broadband wireless communication that may disrupt the competitive landscape of our industry and impact our business.

We could be adversely affected by unfavorable results in litigation.

We may be involved, from time to time, in a variety of claims, lawsuits, investigations, and proceedings relating to contractual disputes, intellectual property rights, employment matters, regulatory compliance matters, consumer or securities class-actions and other litigation matters relating to various claims that arise in the normal course of business and otherwise.

It can be difficult or impossible to predict the outcome of legal proceedings with any degree of certainty, particularly given that laws may be ambiguous and factual findings can often be the result of incomplete evidence, opinions, varying standards or proof, and

extraneous factors.

Any such proceedings or matters may adversely affect how we operate the business, divert the attention of management from the operation of the business, have an adverse effect on our reputation, result in additional costs and adversely affect our results of operations.

14 unchanged sentences

Any failure to implement required new or improved controls, or difficulties encountered in their implementation, could cause us to fail to meet our reporting obligations, and prevent us from producing accurate and timely financial statements to manage our business.

If we fail to do so, our business could be negatively affected and our independent registered public accounting firm may be unable to attest to the fair presentation of our Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the effectiveness of our internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act.

If we fail to do so, our business could be negatively affected and our independent registered public accounting firm may be unable to attest to the fair presentation of our Consolidated Financial Statements included in our Annual Report on Form 10-K in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the effectiveness of our internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act.

If we cannot provide reliable financial reports and effectively prevent fraud, our reputation and results of operations could be harmed.

Even effective internal controls have inherent limitations, including the possibility of human error, the circumvention or overriding of controls, or fraud.

Therefore, even effective internal controls can provide only reasonable assurance with respect to the preparation and fair presentation of financial statements.

Therefore, even effective internal controls can provide only reasonable assurance with respect to the preparation and fair presentation of finan cial statements.

The preparation of Consolidated Financial Statements also requires us to make estimates and assumptions.

We base our estimates on historical experience and other assumptions that we believe are reasonable under the circumstances.

To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operations and cash flows will be affected.

Additionally, as the COVID-19 pandemic continues to develop, many of our estimates could require increased judgement and carry a higher degree of variability and volatility.

As events continue to evolve our estimates may change materially in future periods.

In addition, projections of any evaluation of effectiveness of internal control over financial reporting in future periods are subject to the risk that the control may become inadequate because of changes in conditions or a deterioration in the degree of compliance with the policies or procedures.

2 unchanged sentences

As described in more detail in our Annual Report on Form 10-K for year ended June 30, 2017, under Item 9A.

“Controls and Procedures”, the Company has completed the remediation efforts of such material weakness, completed testing of the controls to address such material weaknesses and concluded that the previously reported material weaknesses in internal controls over financial reporting have been satisfactorily remediated as of June 30, 2017.

“Controls and

Procedures”, the Company completed the remediation efforts of such material weakness, completed testing of the controls to address such material weaknesses and concluded that the previously reported material weaknesses in internal controls over financial reporting have been satisfactorily remediated as of June 30, 2017.

Any such failure (including any failure to implement new or improved controls, difficulties in the execution of such implementation or deterioration of our current control practices) may result in an inability to prevent fraud, or cause us to fail to meet our reporting obligations.

5 unchanged sentences

Although we have implemented a company policy requiring our employees and consultants to comply with the FCPA and similar laws, there can be no assurance that all of our employees, and agents, as well as those companies to which we outsource certain of our business operations, will not take actions in violation of our policies, for which we may be ultimately held responsible.

Any violation of FCPA or similar laws could result in severe criminal or civil

sanctions and suspension or debarment from U.S.

Any violation of FCPA or similar laws could result in severe criminal or civil sanctions and suspension or debarment from U.S.

government contracting, which could have a material and adverse effect on our reputation, business, results of operations and financial condition.

23 unchanged sentences

• changes in tax law and/or generally accepted accounting principles;

From time to time the United States, foreign and state governments make substantive changes to tax rules and the application of rules to companies which may impact our taxes on international earnings.

From time to time the United States, foreign and state governments make substantive changes to tax rules and the application of rules

to companies which may impact our taxes on international earnings.

We regularly assess the likelihood of favorable or unfavorable outcomes resulting from examinations to determine the adequacy of our provision for income taxes.

3 unchanged sentences

government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “2017 Tax Act”).

The 2017 Tax Act significantly changes the taxation of U.S.-based multinational corporations, by, among other things, reducing the U.S.

corporate income tax rate, changing rules regarding the use and carrying of net operating losses, adopting elements of a territorial tax system, assessing a one-time transition tax under revised Section 965 of the Internal Revenue Code on earnings of certain foreign subsidiaries that were previously tax deferred (the "Transition Tax"), imposing a new minimum tax if deductible payments to foreign affiliates exceed a certain threshold, and creating new taxes on certain foreign-sourced earnings.

The changes included in the 2017 Tax Act are broad and complex.

The 2017 Tax Act is also unclear in some respects and has required and will continue to require interpretations and implementing regulations from the U.S.

Treasury and Internal Revenue Service, as well as state tax authorities, and the legislation could be subject to potential amendments and technical corrections, any of which could lessen or increase certain adverse impacts of the legislation.

The final transition impacts of the 2017 Tax Act may differ from the estimates provided elsewhere in this report, possibly materially, due to, among other things, changes in interpretations of the Tax Act, any legislative action to address questions that

arise because of the Tax Act, any changes related interpretations in response to the 2017 Tax Act, or any updates or changes to estimates we have utilized to calculate the transition impacts.

A significant portion of our earnings are earned by our subsidiaries outside the U.S.

1 unchanged sentence

Furthermore, changes to the taxation of undistributed foreign earnings could change our future intentions regarding reinvestment of such earnings.

Although the accounting for the impact of the 2017 Tax Act was completed as of December 22, 2018, we are continuing to evaluate the overall impact of the 2017 Tax Act on our operations and U.S.

federal income tax position.

Although the accounting for the impact of the 2017 Tax Act was completed as of December 22, 2018, we are continuing to monitor ongoing changes and ruling updates to the 2017 Tax Act.

There can be no assurance that further changes in the 2017 Tax Act will not materially and adversely affect our effective tax rate, tax payments, financial condition and results of operations.

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.

What changed 10-Q

Item 1A. Risk Factors