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We could incur substantial costs, including clean-up costs, fines and civil or criminal sanctions, as aresult of violations of or liabilities under environmental laws.Our operations inside and outside the United States are subject to laws and regulations relating tothe protection of the environment, including those governing the discharge of pollutants into the airand water, the management and disposal of hazardous substances and wastes and the clean-up ofcontaminated sites. Certain of our operations involve the use of substances regulated under variousfederal, state and international environmental laws. It is our policy to apply strict standards forenvironmental protection to sites inside and outside the United States, even if not subject toregulations imposed by local governments. We could also incur substantial costs, including clean-upcosts, fines and civil or criminal sanctions, third-party property damage or personal injury claims if wewere to violate or become liable under environmental laws or become non-compliant withenvironmental permits required at our facilities.The European Parliament has enacted the Restriction on Use of Hazardous Substances Directive,or RoHS Directive, which restricts the sale of new electrical and electronic equipment containingcertain hazardous substances, including lead, which is currently used in some of the products wemanufacture. We are working to modify our manufacturing processes to eliminate lead from productswe put on the market by July 1, 2006 as required by the RoHS Directive. This may require additionalcapital expenditures. In addition, the costs associated with compliance may negatively impact our resultsof operations and competitive position. We are also working with our suppliers to redesign orreformulate their components containing lead to reduce or eliminate lead in our products. Based uponcurrent information available to us, we believe that we will be able to comply with the RoHS Directivewithin the applicable time period. However, if we do not comply with this Directive, we may suffer aloss of revenue, be unable to sell in certain markets or countries and suffer competitive disadvantage.The European Parliament has also recently finalized the Waste Electrical and ElectronicEquipment Directive, or WEEE Directive, which makes producers of electrical and electronicequipment financially responsible for specified collection, recycling, treatment and disposal of past andfuture covered products. We may incur financial responsibility for the collection, recycling, treatment ordisposal of products covered under the WEEE Directive. Because the EU member states have not fullyimplemented the WEEE Directive, the nature and extent of the costs to comply and fees or penaltiesassociated with non-compliance are unknown at this time. Costs to comply with the WEEE Directiveand similar future legislation, if applicable, may also include legal and regulatory costs and insurancecosts. We may also be required to take reserves for costs associated with compliance with theseregulations.Customers and potential customers, particularly in Japan, are requiring compliance withenvironmental controls more stringent than those required by European legislation. These may benationally driven or company driven, as leading players in an industry take specific unilateral initiativesin pursuit of a corporate environmental strategy. For example, in Japan some of our potentialcustomers have developed their own environmental standards which include amongst other thingsrestrictions on the type of insulation surrounding copper wire and cables.We will endeavor to comply with these environmental controls but any failure to keep up mayharm our ability to work with certain customers or markets.We may identify weaknesses and/or deficiencies with our controls over financial reporting when evaluatingthese controls for compliance with section 404 of the Sarbanes-Oxley Act.We will be required to comply with section 404 of the US Sarbanes-Oxley Act of 2002 for ourAnnual Report on Form 20-F for the year ending November 30, 2006. Section 404 requires that weevaluate and report on our systems of internal control over financial reporting. In addition, ourIndependent Registered Public Accounting Firm will be required to report on management’s evaluation16