10 W e are subject to a number of risks listed below , which could have a material adverse ef fect on our financial condition, results of operations and the value of our securities. Certain statements in the 2012 Annual Report on Form 10-K including, without limitation, statements regarding future financial results and performance, plans and objectives, capital expenditures, understanding of competition, projected sources of cash flow , potential legal liability , proposed legislation and regulatory action, and our management's beliefs, expectations or opinions, are forward-looking statements, and as such, we desire to take advantage of the “safe harbor” which is af forded such statements under the Private Securities Litigation Reform Act of 1995. Our forward-looking statements should be read in conjunction with our comments in this report under the heading, “Disclosure Regarding Forward-Looking Statements.” Actual results may dif fer materially from those statements as a result of factors, risks and uncertainties over which we have no control. The risk factors discussed below are all of the known material risks and uncertainties that we know to exist. However , additional risks that are currently unknown to us may also impair our business or adversely af fect our financial condition or results of operations. • Our net sales, net income and growth depend largely on the economic strength of the geographic markets that we serve, and if these markets become weaker , we could experience decreased sales and net income. Many of our customers use our products as components in their own products or in projects undertaken for their customers. Our ability to sell our products is lar gely dependent on general economic conditions, including end user spending on power transmission and distribution infrastructures, industrial manufacturing assets, new construction and building, information technology and maintaining or reconfiguring their communications networks. In periods of negative or no economic growth, we would likely experience a decrease in sales and net income. • V olatility in the price of copper and aluminum and other raw materials, as well as fuel and energy , could adversely af fect our businesses. The costs of copper and aluminum, the most significant raw materials we use, have been subject to considerable volatility caused by supply conditions, weather , political and economic variables as well as other unknown and unpredictable variables. Other raw materials such as fuel and ener gy have additionally been subject to considerable volatility . The Company typically passes these changes in copper and aluminum prices along to its customers, although there are timing delays of varying lengths depending upon the volatility of metals prices, the type of product, competitive conditions, pricing mechanisms and particular customer arrangements. Although the general trends are detailed in Item 1 - Business – Raw Materials, there is no exact future measure of the ef fect of the change of raw material cost inputs due to the unique set of selling variables and the high volume of transactions in any given period, each of which involves numerous individual pricing decisions. T o help reduce this volatility , the Company implemented pricing mechanisms and hedges a portion of its metal purchases when there is a firm price commitment for a future delivery but does not engage in speculative metals trading. In addition, we may be required to recognize an expense to record our inventory at market value, which would negatively impact our financial results. Although we attempt to recover copper and aluminum and other raw material price changes either in the selling price of our products or through commodity hedging programs, there is no assurance that we can do so successfully or at all in the future. • The markets for our products are highly competitive, and if we fail to successfully invest in product development, productivity improvements and customer service and support, sales of our products could be adversely af fected. The markets for copper , aluminum and fiber optic wire and cable products are highly competitive and some of our competitors may have greater financial resources than we have. W e compete with at least one major competitor with respect to each of our business segments. Many of our products are made to common specifications and, therefore, may be interchangeable with competitors' products. Accordingly , we are subject to competition in many markets on the basis of price, quality , breadth of product line, inventory , delivery time, customer service, the environmental impact of the products, and the ability to meet the customer's needs. W e believe that competitors will continue to improve the design and performance of their products and to introduce new products with competitive price and performance characteristics. W e expect that we will be required to continue to invest in product development, productivity improvements and customer service and support in order to compete in our markets. Furthermore, an increase in imports of competing products could adversely af fect our sales on a region by region basis. • Our business is subject to the economic, political and other risks of maintaining facilities and selling products in foreign countries. During the year ended December 31, 2012 , approximately 61% of our sales and approximately 70% of our assets were in markets outside of North America. Our operations outside of North America generated approximately 52% of our cash flows from operations during this period. Some of our facilities, in particular , certain locations such as Algeria, Angola, Egypt, India, Pakistan, the Philippines, Thailand, and V enezuela, among others, are at higher risk of being tar gets of economic and political destabilization, international conflicts, restrictive actions by foreign governments, nationalizations or expropriations, changes in regulatory T able of Contents