EFTA Document EFTA01382613

S-I/A Table of Content Our debt agreements contain restrictions that limit our flexibility in operating our business. The agreements governing our indebtedness contain various covenants that limit our ability to engage in specified types of transactions. These covenants limit our and certain of our subsidiaries' ability to, among other things: • incur additional indebtedness or issue certain preferred shares; • pay dividends on, repurchase, or make distributions in respect of, our capital stock or make other restricted payments; • make certain investments; sell certain assets; • create liens; • consolidate, merge, sell, or otherwise dispose of all or substantially all of our assets; and • enter into certain transactions with our affiliates. A breach of any of these covenants could result in a default under one or more of these agreements. including as a result of cross-default provisions and, in the case of our senior secured revolving credit facility, pennit the lenders to cease making loans to us. Upon the occurrence of an event of default under these agreements. the holders of our debt could elect to declare all amounts outstanding thereunder to be immediately due and payable and, in the cast of our senior secured revolving credit facility, terminate all commitments to extend further credit. Such actions by these holders could cause cross-defaults under our other indebtedness. If we were unable to repay those amounts, the lenders under our senior secured credit facilities or holders of our senior secured notes could proceed against the collateral securing such debt. We have pledged a significant portion of our awls as collateral under our senior secured credit facilities and our senior secured notes. If the holders of our debt accelerate the repayment of borrowings, we may not have sufficient assets to repay our senior secured credit facilities or any other debt that may become due as a result of that acceleration and we could experience a material adverse effect on our financial condition and results of operations. Our consolidated balance sheet includes significant amounts of goodwill and intangible assets. The impairment of a significant portion of these assets would negatively affect our financial condition and results of operations. Our consolidated balance sheet includes goodwill and intangible assets that represent approximately 60% of our total assets at June 30. 2015. These assets consist primarily of goodwill and client relationship intangible assets associated with our acquisitions. We also expect to engage in additional acquisitions. which may result in our recognition of additional goodwill and intangible assets. Under current accounting standards. we are required to amortize certain intangible assets over the useful life of the asset, while goodwill and certain other intangible assets are not amortized. On a regular basis we assess whether there have been impairments in the carrying value of goodwill and certain intangible assets. If the canying value of the asset is determined to be impaired. then it is written down to fair value by a charge to operating earnings. An impairment of a significant portion of goodwill or intangible assets could have a material adverse effect on our financial condition and results of operations. Our results of operations may be adversely affected by changes in foreign currency exchange rates. We are subject to risks related to the changes in currency rates as a result of our investments in non-U.S. operations and from revenues generated in currencies other than the U.S. dollar. Revenue and profit generated by such non-U.S. operations will increase or decrease compared to prior periods as a result of changes in foreign currency exchange rates. From time to time, we utilize foreign currency forward contracts or other derivative instruments to mitigate the cash flow or market value risks associated with foreign currency-denominated transactions. These hedge contracts may not, however. eliminate all of the risks related to foreign 27 httplAvvmsee.gov/Arehi vecledgaildatat883980/000119312515334479/d31022dsla.htm[10/14/20I 5 9:06:38 AM] CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) CONFIDENTIAL DB-SDNY-0082043 SONY GM_00228227 EFTA01382613