Our future results may differ materially from past results and from those projected in the forward-looking statements contained in this Form 10-K due to various uncertainties and risks, including those risks set forth below, nonrecurring events and other important factors disclosed previously and from time to time in our other reports filed with the SEC.
−Removed: Uncertain government budgets and shifting government priorities could delay contract awards and funding and adversely affect our ability to continue work under our government contracts.
−Removed: Additionally, federal procurement directives could result in our loss of work on current programs to small business set-asides and large multiple award contracts.
−Removed: Our government business is subject to funding delays, terminations (including at the government's convenience), reductions, in-sourcing, extensions and moratoriums associated with the government’s budgeting and contracting process.
−Removed: The federal procurement environment is unpredictable and could adversely affect our ability to perform work under new and existing contracts.
−Removed: We have experienced delays in contract awards and funding on our contracts in recent years that have adversely affected our ability to continue existing work and to replace expiring work.
−Removed: Additionally, our government business is subject to the risk that one or more of our potential contracts or contract extensions may be diverted by the contracting agency to a small or disadvantaged or minority-owned business pursuant to set-aside programs administered by the U.S.
−Removed: Small Business Administration, or may be bundled into large multiple award contracts for very large businesses.
−Removed: These risks can potentially have an adverse effect on our revenue growth and profit margins.
−Removed: Intense competition from existing and new competitors may harm our business.
−Removed: The aviation and vehicle parts industries are highly fragmented, have several highly visible leading companies, and are characterized by intense competition.
−Removed: Some of our OEM competitors have greater name recognition than VSE or our subsidiaries, as well as complementary lines of business and financial, marketing and other resources that we do not have.
−Removed: In addition, OEMs, aircraft maintenance providers, leasing companies and FAA-certificated repair facilities may attempt to bundle their services and product offerings in the supply industry, thereby significantly increasing industry competition.
−Removed: Pressure on government budgets may adversely affect the flow of work to federal contractors, particularly new programs.
−Removed: Competitor contractors that experience a loss of government work have tended to redirect their marketing efforts toward the types of work that we perform.
−Removed: This increase in competition for our service offerings may adversely affect our ability to win new work or successor contracts to continue work that is currently performed by us under expiring contracts.
−Removed: Unsuccessful bidders frequently protest contract awards, which can delay or reverse the contract awards.
−Removed: Additionally, the government has frequently used contract award criteria that emphasizes lowest price, technically acceptable bids, which further intensifies competition in our government markets.
+Added: Operational Risks
+Added: The COVID-19 outbreak has adversely affected and could in the future continue to adversely affect our business.
+Added: The COVID-19 pandemic is adversely affecting, and is expected to continue to adversely affect, our operations, supply chains and distribution systems, and we have experienced and expect to continue to experience varying levels of reductions in demand for our products and services, particularly in the aviation aftermarket.
+Added: The global aviation market is experiencing a significant decline, specifically in global commercial air travel, which is having a significant impact on the parts distribution and maintenance, repair and overhaul services markets supporting general aviation and commercial aircraft.
+Added: Our Aviation segment experienced the most impactful reduction in demand for our products and services during fiscal 2020 compared to fiscal 2019, as a decline in commercial aircraft revenue passenger miles contributed to a reduction in demand for aftermarket parts and MRO services.
+Added: We expect this reduction in demand to continue throughout the first half of 2021.
+Added: This decrease in demand will adversely impact our operating results for 2021.
+Added: We cannot estimate with certainty the severity of this impact, but we expect it to be consistent with overall aviation industry trends.
+Added: We operate numerous “touch labor” warehouse and maintenance facilities supporting each of our three business segments both in our own facilities and customer facilities.
+Added: A local outbreak of the virus in any of these facilities could temporarily shut down operations at those facilities until they have been thoroughly cleaned.
+Added: Employees who become exposed to the virus would need to be quarantined and would be unable to work for 14 days or longer.
+Added: Similarly, customers who have warehouse or maintenance facilities could be impacted, slowing or reducing demand for our parts distribution services.
+Added: Due to the impact of COVID-19 and decisions by our customers to delay the use of, or permanently retire, certain aircraft, demand levels for aviation disruption inventory could decrease in the near term or midterm, which could result in a write-down of existing inventory to adjust to current market trends and adversely affect our results of operations.
+Added: Furthermore, as a result of COVID-19, some of our commercial customers in the Aviation segment have been and could continue to be negatively impacted as a result of disruption in demand, which has led to delays and could lead to defaults on collections of receivables from them.
+Added: Such continued delays could further negatively impact our business, results of operations and financial condition.
+Added: The impact of the COVID-19 pandemic continues to evolve, and while we expect it to continue to have an adverse effect on our business, financial condition, liquidity, cash flow and results of operations, we are unable to predict the extent, nature or duration of these impacts at this time, although we expect such negative impacts to continue in the first half of 2021.
Certain programs comprise a material portion of our revenue.
8 unchanged sentences
The timing of both the roll out of a new fleet and the retirement of the current vehicles and their decision on how many of such vehicles will remain in the fleet could potentially have a significant impact on our future revenues and profits.
−Removed: Changes to DoD business practices could have a material effect on DoD's procurement process and adversely impact our current programs and potential new awards.
−Removed: The defense industry has experienced, and we expect will continue to experience, significant changes to business practices resulting from greater DoD focus on affordability, efficiencies, business systems, recovery of costs, and a reprioritization of
−Removed: available defense funds to key areas for future defense spending.
−Removed: The DoD continues to adjust its procurement practices, requirements criteria, and source selection methodology in an ongoing effort to reduce costs, gain efficiencies, and enhance program management and control.
−Removed: We expect the DoD's focus on business practices to impact the contracting environment in which we operate as we and others in the industry adjust our practices to address the DoD's initiatives and the reduced level of spending by the DoD.
−Removed: Depending on how these initiatives are implemented, they could have an impact on our current programs, as well as new business opportunities with the DoD.
−Removed: As a result of certain of these initiatives, we experienced, and may continue to experience, a higher number of audits and/or lengthened periods of time required to close open audits.
−Removed: Such additional or lengthier audits could have a material adverse effect on our business, financial condition and results of operations.
−Removed: Our success is highly dependent on the performance of the aviation aftermarket, which could be impacted by lower demand for business aviation and commercial air travel or airline fleet changes causing lower demand for our goods and services.
−Removed: General global industry and economic conditions that affect the aviation industry may also affect our business.
−Removed: We are subject to macroeconomic cycles, and when recessions occur, we may experience reduced orders, payment delays, supply chain disruptions or other factors as a result of the economic challenges faced by our customers, prospective customers and suppliers.
−Removed: Further, the aviation industry has historically, from time to time, been subject to downward cycles which reduce the overall demand for jet engine and aircraft component replacement parts and repair and overhaul services, and such downward cycles result in lower sales and greater credit risk.
−Removed: Demand for commercial air travel can be influenced by airline industry profitability, world trade policies, government-to-government relations, terrorism, disease outbreaks, environmental constraints imposed upon aircraft operations, technological changes, price and other competitive factors.
−Removed: For example, the recent outbreak of COVID-19 coronavirus in Wuhan, China and other parts of the world, has resulted in travel disruption which could have an impact on airline spending and demand, if conditions worsen or extend for a prolonged period of time.
−Removed: China has also limited the shipment of products through its borders which could negatively impact our ability to receive certain products flowing through that region.
−Removed: At this point, the extent to which the coronavirus may impact our results is uncertain.
−Removed: These global industry and economic conditions may have a material adverse effect on our business, financial condition and results of operations.
Acquisitions, which have been a part of our business strategy in recent years, present certain risks.
17 unchanged sentences
Any such impairments that result in us recording additional goodwill or intangible asset impairment charges could have a material adverse effect on our financial position or results of operations.
+Added: Intense competition from existing and new competitors may harm our business.
+Added: The aviation and vehicle parts industries are highly fragmented, have several highly visible leading companies, and are characterized by intense competition.
+Added: Some of our OEM competitors have greater name recognition than VSE or our subsidiaries, as well as complementary lines of business and financial, marketing and other resources that we do not have.
+Added: In addition, OEMs, aircraft maintenance providers, leasing companies and U.S.
+Added: Federal Aviation Administration ("FAA") certificated repair facilities may attempt to bundle their services and product offerings in the supply industry, thereby significantly increasing industry competition.
+Added: Pressure on government budgets may adversely affect the flow of work to federal contractors, particularly new programs.
+Added: Competitor contractors that experience a loss of government work have tended to redirect their marketing efforts toward the types of work that we perform.
+Added: This increase in competition for our service offerings may adversely affect our ability to win new work or successor contracts to continue work that is currently performed by us under expiring contracts.
+Added: Unsuccessful bidders frequently protest contract awards, which can delay or reverse the contract awards.
+Added: Additionally, the government has frequently used contract award criteria that emphasizes lowest price, technically acceptable bids, which further intensifies competition in our government markets.
+Added: Our success is highly dependent on the performance of the aviation aftermarket, which could be impacted by lower demand for business aviation and commercial air travel or airline fleet changes causing lower demand for our goods and services.
+Added: General global industry and economic conditions that affect the aviation industry may also affect our business.
+Added: We are subject to macroeconomic cycles, and when recessions occur, we may experience reduced orders, payment delays, supply chain disruptions or other factors as a result of the economic challenges faced by our customers, prospective customers and suppliers.
+Added: Further, the aviation industry has historically, from time to time, been subject to downward cycles which reduce the overall demand for jet engine and aircraft component replacement parts and repair and overhaul services, and such downward cycles result in lower sales and greater credit risk.
+Added: Demand for commercial air travel can be influenced by airline industry profitability, world trade policies, government-to-government relations, terrorism, disease outbreaks, environmental constraints imposed upon aircraft operations, technological changes, price and other competitive factors.
+Added: These global industry and economic conditions may have a material adverse effect on our business, financial condition and results of operations.
+Added: The COVID-19 pandemic has resulted in travel disruption has had an adverse impact on airline spending and demand that has caused a reduction in demand for our aviation products and services for most of 2020.
+Added: At this point, the extent or duration of the impact that the COVID-19 pandemic may have on our future results remains uncertain.
+Added: Global economic conditions and political factors could adversely affect our revenues.
+Added: Revenues for work performed in or products delivered to foreign countries are subject to economic conditions in these countries and to political risks posed by ongoing foreign conflicts and potential terrorist activity.
+Added: Significant domestic and political unrest in client countries can constrain our ability to maintain consistent staffing levels, resulting in a fluctuating level of services performed by our employees.
+Added: We cannot predict when these conditions will occur or the effect it will have on our revenues.
+Added: Regime changes in these countries can result in government restrictions upon the continuation of ongoing work.
+Added: Economic conditions in both the United States and foreign countries, and global prices and availability of oil and other commodities could potentially have an adverse effect on the demand for some of our services, including our aviation services.
+Added: The nature of our operations and work performed by our employees present certain challenges related to work force management.
+Added: Our financial performance is heavily dependent on the abilities of our operating and administrative staff with respect to technical skills, operating performance, pricing, cost management, safety, and administrative and compliance efforts.
+Added: A wide diversity of contract types, nature of work, work locations, and legal and regulatory complexities challenges our administrative staff and skill sets.
+Added: We also face challenges associated with our quality of workforce, quality of work, safety, and labor relations compliance.
+Added: Our current and projected work in foreign countries exposes us to challenges associated with export and ethics compliance, local laws and customs, workforce issues, extended supply chain, political unrest and war zone threats.
+Added: Failure to attract or retain an adequately skilled workforce, lack of knowledge or training in critical functions, or inadequate staffing levels can result in lost work, reduced profit margins, losses from cost overruns, performance deficiencies, workplace accidents, and regulatory noncompliance.
+Added: Our business could be adversely affected by incidents that could cause an interruption in our operations or impose a significant financial liability on us.
+Added: Disruption of our operations due to internal or external system or service failures, accidents or incidents involving employees or third parties working in high-risk locations, or natural disasters, health crisis, epidemics or pandemics, including the COVID-19 pandemic, or other crises could adversely affect our financial performance and condition.
+Added: The COVID-19 pandemic could potentially impact our global supply chain network for any of our segments.
+Added: A fire, flood, earthquake, or other natural disaster, health crises, epidemic, pandemic or other crisis at or affecting physical facilities that support key revenue generating operations, or a procurement system or contractual delay could potentially interrupt the revenues from our operations.
+Added: Investments in inventory and facilities could cause losses if certain work is disrupted or discontinued.
+Added: We have made investments in inventory, facilities and lease commitments to support specific business programs, work requirements, and service offerings.
+Added: A slowing or disruption of these business programs, work requirements, or service offerings that results in operating below intended levels could cause us to suffer financial losses.
+Added: We are dependent on access to and the performance of third‑party package delivery companies.
+Added: Our ability to provide efficient distribution of the products we sell to our customers is an integral component of our overall business strategy, both domestic and international.
+Added: We do not maintain our own delivery networks, and instead rely on third‑party package delivery companies.
+Added: We cannot assure that we will always be able to ensure access to preferred shipping and delivery companies or that these companies will continue to meet our needs or provide reasonable pricing terms.
+Added: In addition, if the package delivery companies on which we rely on experience delays resulting from inclement weather or other disruptions, we may be unable to maintain products in inventory and deliver products to our customers on a timely basis, which may adversely affect our results of operations and financial condition.
+Added: Uncertain government budgets and shifting government priorities could delay contract awards and funding and adversely affect our ability to continue work under our government contracts.
+Added: Additionally, federal procurement directives could result in our loss of work on current programs to small business set-asides and large multiple award contracts.
+Added: Our government business is subject to funding delays, terminations (including at the government's convenience), reductions, in-sourcing, extensions and moratoriums associated with the government’s budgeting and contracting process.
+Added: The federal procurement environment is unpredictable and could adversely affect our ability to perform work under new and existing contracts.
+Added: We have experienced delays in contract awards and funding on our contracts in recent years that have adversely affected our ability to continue existing work and to replace expiring work.
+Added: Additionally, our government business is subject to the risk that one or more of our potential contracts or contract extensions may be diverted by the contracting agency to a small or disadvantaged or minority-owned business pursuant to set-aside programs administered by the U.S.
+Added: Small Business Administration, or may be bundled into large multiple award contracts for very large businesses.
+Added: These risks can potentially have an adverse effect on our revenue growth and profit margins.
+Added: Changes to DoD business practices could have a material effect on DoD's procurement process and adversely impact our current programs and potential new awards.
+Added: The defense industry has experienced, and we expect will continue to experience, significant changes to business practices resulting from greater DoD focus on affordability, efficiencies, business systems, recovery of costs, and a re-prioritization of available defense funds to key areas for future defense spending.
+Added: The DoD continues to adjust its procurement practices, requirements criteria, and source selection methodology in an ongoing effort to reduce costs, gain efficiencies, and enhance program management and control.
+Added: We expect the DoD's focus on business practices to impact the contracting environment in which we operate as we and others in the industry adjust our practices to address the DoD's initiatives and the reduced level of spending by the DoD.
+Added: Depending on how these initiatives are implemented, they could have an impact on our current programs, as well as new business opportunities with the DoD.
+Added: As a result of certain of these initiatives, we experienced, and may continue to experience, a higher number of audits and/or lengthened periods of time required to close open audits.
+Added: Such additional or lengthier audits could have a material adverse effect on our business, financial condition and results of operations.
+Added: Legal and Regulatory Risks
Our business could be adversely affected by government audits or investigations.
7 unchanged sentences
If an audit or investigation uncovers improper or illegal activities, we may be subject to civil and criminal penalties and administrative sanctions, including termination of contracts, forfeiture of profits, suspension of payments, fines and suspension or debarment from doing business with the government.
−Removed: In addition, we could suffer serious harm to our reputation if allegations of impropriety were made.
+Added: In addition, we could suffer serious harm to our reputation if
+Added: allegations of impropriety were made.
Performance of international work can expose us to risks associated with the Foreign Corrupt Practices Act and Export Control Act compliance.
9 unchanged sentences
If any of our subcontractors fail to timely meet their contractual obligations or have regulatory compliance or other problems, our ability to fulfill our obligations as a prime contractor may be jeopardized.
−Removed: The aviation industry is highly regulated by the U.S.
−Removed: Federal Aviation Administration ("FAA") and similar regulatory agencies in other countries.
+Added: The aviation industry is highly regulated by the FAA and similar regulatory agencies in other countries.
Aviation engines, engine accessories and components that we sell must meet certain airworthiness standards established by the FAA or the equivalent agencies in certain other countries.
2 unchanged sentences
Lastly, border tariffs and new trade deals could have significant effects on our customers and, in turn, on our suppliers, which may impact our business.
−Removed: Global economic conditions and political factors could adversely affect our revenues.
−Removed: Revenues for which work is performed in or products are delivered to foreign countries are subject to economic conditions in these countries and to political risks posed by ongoing foreign conflicts and potential terrorist activity.
−Removed: Significant domestic and
−Removed: political unrest in client countries can constrain our ability to maintain consistent staffing levels, resulting in a fluctuating level of services performed by our employees.
−Removed: We cannot predict when these conditions will occur or the effect it will have on our revenues.
−Removed: Regime changes in these countries can result in government restrictions upon the continuation of ongoing work.
−Removed: Economic conditions in both the United States and foreign countries, and global prices and availability of oil and other commodities could potentially have an adverse effect on the demand for some of our services, including our aviation services.
Due to the nature of our work, we could potentially be exposed to legal actions arising from our operations.
3 unchanged sentences
Such events could cause us to suffer financial losses and adversely affect our financial condition.
−Removed: "Legal Proceedings” below.
+Added: See Item 3, "Legal Proceedings” below.
+Added: Environmental and pollution risks could potentially impact our financial results.
+Added: Our operations are subject to and affected by a variety of existing federal, state, and local environmental protection laws and regulations.
+Added: In addition, we could be affected by future laws or regulations, including those imposed in response to concerns over climate change, other aspects of the environment, or natural resources.
+Added: We expect to incur future capital and operating costs to comply with current and future environmental laws and regulations, and such costs could be substantial, depending on the future proliferation of environmental rules and regulations and the extent to which we discover currently unknown environmental conditions.
+Added: Some of our contract work includes the use of chemical solvents and the handling of hazardous materials to maintain, repair, and refurbish vehicles, aircraft engines, and equipment.
+Added: This exposes us to certain environmental and pollution risks.
+Added: Various federal, state, and local environmental laws and regulations impose restrictions on the discharge of pollutants into the environment and establish standards for the transportation, storage, and disposal of toxic and hazardous wastes.
+Added: Substantial fines, penalties, and criminal sanctions may be imposed for noncompliance, and certain environmental laws impose joint and several "strict liability" for remediation of spills and releases of oil and hazardous substances.
+Added: Such laws and regulations impose liability upon a party for environmental cleanup and remediation costs and damage without regard to negligence or fault on the part of such party and could expose us to liability for the conduct of or conditions caused by third parties.
+Added: Costs associated with compliance with Federal, State and local provisions regulating the discharge of materials or that otherwise relate to the protection of the environment have not had a material adverse effect on our capital expenditures, earnings, or competitive position.
+Added: However, we cannot predict the likelihood of such a material adverse effect should we experience the occurrence of a future environmental or pollution event.
+Added: The adoption of new environmental laws and regulations, stricter enforcement of existing laws and regulations, imposition of new cleanup requirements, discovery of previously unknown or more extensive contamination, litigation involving environmental impacts, our inability to recover related costs under our government contracts, or the financial insolvency of other responsible parties could cause us to incur costs that could have a material adverse effect on our financial position, results of operations, or cash flows.
+Added: Technology Risks
Technology security and cyber-attack risks could potentially impact our financial results.
9 unchanged sentences
However, the occurrence of a future security breach event could potentially have such an adverse effect.
−Removed: The nature of our operations and work performed by our employees present certain challenges related to work force management.
−Removed: Our financial performance is heavily dependent on the abilities of our operating and administrative staff with respect to technical skills, operating performance, pricing, cost management, safety, and administrative and compliance efforts.
−Removed: A wide diversity of contract types, nature of work, work locations, and legal and regulatory complexities challenges our administrative staff and skill sets.
−Removed: We also face challenges associated with our quality of workforce, quality of work, safety, and labor relations compliance.
−Removed: Our current and projected work in foreign countries exposes us to challenges associated with export and ethics compliance, local laws and customs, workforce issues, extended supply chain, political unrest and war zone threats.
−Removed: Failure to attract or retain an adequately skilled workforce, lack of knowledge or training in critical functions, or inadequate staffing levels can result in lost work, reduced profit margins, losses from cost overruns, performance deficiencies, workplace accidents, and regulatory noncompliance.
−Removed: Our business could be adversely affected by incidents that could cause an interruption in our operations or impose a significant financial liability on us.
−Removed: Disruption of our operations due to internal or external system or service failures, accidents or incidents involving employees or third parties working in high-risk locations, or natural disasters, health crisis, epidemics or pandemics, including the recent outbreak of the COVID-19 coronavirus, or other crises could adversely affect our financial performance and condition.
−Removed: The recent outbreak of the coronavirus could impact our global supply chain network for any of our segments.
−Removed: A fire, flood, earthquake, or other natural disaster, health crises, epidemic, pandemic or other crisis at or affecting physical facilities that support key revenue generating operations, or a procurement system or contractual delay could potentially interrupt the revenues from our operations.
−Removed: Investments in inventory and facilities could cause losses if certain work is disrupted or discontinued.
−Removed: We have made investments in inventory, facilities and lease commitments to support specific business programs, work requirements, and service offerings.
−Removed: A slowing or disruption of these business programs, work requirements, or service offerings that results in operating below intended levels could cause us to suffer financial losses.
−Removed: We are dependent on access to and the performance of third‑party package delivery companies.
−Removed: Our ability to provide efficient distribution of the products we sell to our customers is an integral component of our overall business strategy, both domestic and international.
−Removed: We do not maintain our own delivery networks, and instead rely on third‑party package delivery companies.
−Removed: We cannot assure that we will always be able to ensure access to preferred shipping and delivery companies or that these companies will continue to meet our needs or provide reasonable pricing terms.
−Removed: In addition, if the package delivery companies on which we rely on experience delays resulting from inclement weather or other disruptions, we may be unable to maintain products in inventory and deliver products to our customers on a timely basis, which may adversely affect our results of operations and financial condition.
−Removed: There can be no assurance we will continue to increase our dividends at current levels or in the future.
−Removed: The payment of cash dividends and repurchases of our common stock are subject to limitations under applicable law and the discretion of our board of directors, considered in the context of then current conditions, including our earnings, other operating results, and capital requirements.
+Added: Financial Risks
+Added: There can be no assurance we will continue to pay dividends at current levels or in the future.
+Added: The payment of cash dividends and repurchases of our common stock are subject to limitations under applicable law and our bank loan agreement, and to the discretion of our board of directors, considered in the context of then current conditions, including our earnings, other operating results, and capital requirements.
Declines in asset values or increases in liabilities, including liabilities associated with benefit plans and assets and liabilities associated with taxes, can reduce stockholders’ equity.
14 unchanged sentences
This announcement indicates that the continuation of LIBOR on the current basis cannot and will not be guaranteed after 2021, and it appears likely that LIBOR will be discontinued or modified by 2021.
−Removed: The consequences of the discontinuance of the LIBOR benchmark cannot be entirely predicted but could include an increase in the cost of our variable rate indebtedness.
+Added: The consequences of the discontinuance of the LIBOR benchmark cannot be entirely predicted but could result in an increase in the cost of our variable rate indebtedness.
Market volatility and adverse capital market conditions may affect our ability to access cost-effective sources of funding and may expose us to risks associated with the financial viability of suppliers and subcontractors.
3 unchanged sentences
A number of factors could cause us to incur higher borrowing costs and experience greater difficulty accessing public and private markets for debt.
−Removed: These factors include disruptions or declines in the global capital markets and/or a decline in our financial performance,
−Removed: outlook, or credit ratings.
+Added: These factors include disruptions or declines in the global capital markets and/or a decline in our financial performance, outlook, or credit ratings.
The occurrence of any or all of these events may adversely affect our ability to fund our operations, meet contractual commitments, make future investments or desirable acquisitions, or respond to competitive challenges.
−Removed: Environmental and pollution risks could potentially impact our financial results.
−Removed: Our operations are subject to and affected by a variety of existing federal, state, and local environmental protection laws and regulations.
−Removed: In addition, we could be affected by future laws or regulations, including those imposed in response to concerns over climate change, other aspects of the environment, or natural resources.
−Removed: We expect to incur future capital and operating costs to comply with current and future environmental laws and regulations, and such costs could be substantial, depending on the future proliferation of environmental rules and regulations and the extent to which we discover currently unknown environmental conditions.
−Removed: Some of our contract work includes the use of chemical solvents and the handling of hazardous materials to maintain, repair, and refurbish vehicles, aircraft engines, and equipment.
−Removed: This exposes us to certain environmental and pollution risks.
−Removed: Various federal, state, and local environmental laws and regulations impose restrictions on the discharge of pollutants into the environment and establish standards for the transportation, storage, and disposal of toxic and hazardous wastes.
−Removed: Substantial fines, penalties, and criminal sanctions may be imposed for noncompliance, and certain environmental laws impose joint and several "strict liability" for remediation of spills and releases of oil and hazardous substances.
−Removed: Such laws and regulations impose liability upon a party for environmental cleanup and remediation costs and damage without regard to negligence or fault on the part of such party and could expose us to liability for the conduct of or conditions caused by third parties.
−Removed: Costs associated with compliance with Federal, State and local provisions regulating the discharge of materials or that otherwise relate to the protection of the environment have not had a material adverse effect on our capital expenditures, earnings, or competitive position.
−Removed: However, we cannot predict the likelihood of such a material adverse effect should we experience the occurrence of a future environmental or pollution event.
−Removed: The adoption of new environmental laws and regulations, stricter enforcement of existing laws and regulations, imposition of new cleanup requirements, discovery of previously unknown or more extensive contamination, litigation involving environmental impacts, our inability to recover related costs under our government contracts, or the financial insolvency of other responsible parties could cause us to incur costs that could have a material adverse effect on our financial position, results of operations, or cash flows.
+Added: If the disruptions caused by the COVID-19 global pandemic continue to adversely impact our operations and financial performance, we may face further challenges regarding compliance with the financial covenants in our debt facility.
+Added: We have a loan agreement with a bank group comprised of ten banks.
+Added: Under the terms of our debt facility, we are required to maintain certain financial covenants.
+Added: As a result of the COVID-19 global pandemic, our business operations have been and could be further disrupted, which could adversely affect our ability to satisfy our financial covenant requirements.
+Added: In June 2020, we amended our loan agreement to provide increased financial covenant flexibility.
+Added: We believe the amendment will provide sufficient covenant relief for future near term compliance, however, there can be no assurance that any further future disruption will not adversely impact our business and result in an inability to comply with the financial covenants in our loan agreement.
+Added: There can be no assurance that we would be able to obtain future changes in a timely manner, on acceptable terms, or at all.
+Added: If we were not able to satisfactorily obtain further changes to the debt facility, we could be in default, which could trigger an acceleration of repayment provisions that we would be unable to meet and would impair our ability to operate our businesses.
+Added: If we make changes, it may lead to fees, increased costs, increased interest rates, additional restrictive covenants and other available lender protections that would be applicable to us under the debt facility.
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.