associated with repositioning actions designed to improve profit- ability beginning in 2013, primarily in the European portion of the Fluid Handling segment. However, our failure to respond to poten- tial declines in global demand for our products and services and properly align our cost base would have an adverse effect on our financial condition, results of operations and cash flow. 

We may be unable to successfully develop and introduce new products, which would limit our ability to grow and maintain our competitive position and adversely affect our financial condition, results of operations and cash flow. 

Our growth depends, in part, on continued sales of existing prod- ucts, as well as the successful development and introduction of new products, which face the uncertainty of customer acceptance and reaction from competitors. Any delay in the development or launch of a new product could result in our not being the first to market, which could compromise our competitive position. Further, the development and introduction of new products may require us to make investments in specialized personnel and capital equipment, increase marketing efforts and reallocate resources away from other uses. We also may need to modify our systems and strategy in light of new products that we develop. If we are unable to develop and introduce new products in a cost-effective manner or other- wise manage effectively the operations related to new products, our results of operations and financial condition could be adversely impacted. 

Pension expense and pension contributions associated with the Company’s retirement benefit plans may fluctuate significantly depending upon changes in actuarial assumptions and future market performance of plan assets. 

A significant portion of our current and retired employee pop- ulation is covered by pension and post-retirement benefit plans, the costs of which are dependent upon various assumptions, including estimates of rates of return on benefit related assets, discount rates for future payment obligations, rates of future cost growth and trends for future costs. In addition, funding require- ments for benefit obligations of our pension and post-retirement benefit plans are subject to legislative and other government regu- latory actions. Variances from these estimates could have a sig- nificant impact on our consolidated financial position, results of operations and cash flow. 

We may be unable to identify or to complete acquisitions, or to successfully integrate the businesses we acquire. We have evaluated, and expect to continue to evaluate, a wide array of potential acquisition transactions. Our acquisition program attempts to address the potential risks inherent in assessing the value, strengths, weaknesses, contingent or other liabilities, sys- tems of internal control and potential profitability of acquisition candidates, as well as other challenges such as retaining the employees and integrating the operations of the businesses we acquire. Integrating acquired operations, such as the recent acquisitions of WTA and Money Controls or the pending acquisition of MEI involves significant risks and uncertainties, including: 

• Maintenance of uniform standards, controls, policies and procedures; 

• Distraction of management’s attention from normal business operations during the integration process; 

• Unplanned expenses associated with the integration efforts; and 

• Unidentified issues not discovered in the due diligence process, including legal contingencies. 

There can be no assurance that suitable acquisition opportunities will be available in the future, that we will continue to acquire businesses or that any business acquired will be integrated successfully or prove profitable, which could adversely impact our growth rate. Our ability to achieve our growth goals depends in part upon our ability to identify and successfully acquire and integrate companies and businesses at appropriate prices and realize antici- pated cost savings. 

We face significant competition which may adversely impact our results of operations and financial position in the future. While we are a principal competitor in most of our markets, all of our markets are highly competitive. The competitors in many of our business segments can be expected in the future to improve tech- nologies, reduce costs and develop and introduce new products, and the ability of our business segments to achieve similar advances will be important to our competitive positions. Competitive pres- sures, including those discussed above, could cause one or more of our business segments to lose market share or could result in sig- nificant price erosion, either of which could have an adverse effect on our results of operations. 

We conduct a substantial portion of our business outside the United States and face risks inherent in non-domestic operations. Net sales and assets related to our operations outside the United States were 41% and 34% in 2012, respectively, of our consolidated amounts. These operations and transactions are subject to the risks associated with conducting business internationally, including the risks of currency fluctuations, slower payment of invoices, adverse trade regulations and possible social, economic and political instability in the countries and regions in which we operate. In addition, we expect that non-U.S. sales will continue to account for a significant portion of our revenues for the foreseeable future. Accordingly, declines in foreign currency exchange rates, primarily the Euro, the British Pound or the Canadian Dollar, could adversely affect our reported results, primarily in our Fluid Handling and Merchandising Systems segments, as amounts earned in other countries are translated into U.S. Dollars for reporting purposes. 

We are dependent on key personnel, and we may not be able to retain our key personnel or hire and retain additional personnel needed for us to sustain and grow our business as planned. Certain of our business segments and corporate offices are depend- ent upon highly qualified personnel, and we generally are depend- ent upon the continued efforts of key management employees. We may have difficulty retaining such personnel or locating and hiring additional qualified personnel. The loss of the services of any of our key personnel or our failure to attract and retain other qualified and experienced personnel on acceptable terms could impair our ability to successfully sustain and grow our business, which could impact our results of operations in a materially adverse manner. 

