Avon 2015 Annual Report Download - page 31

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conduct of our business. We are currently vigorously contesting certain of these litigation claims. However, it is not possible to predict the
final resolution of the litigation to which we currently are or may in the future become party, or to predict the impact of certain of these
matters on our business, prospects, financial condition, liquidity, results of operations and cash flows.
Government reviews, inquiries, investigations, and actions could harm our business or
reputation. In addition, from time to time we may conduct other investigations and reviews,
the consequences of which could negatively impact our business or reputation.
As we operate in various locations around the world, our operations in certain countries are subject to significant governmental scrutiny and
may be harmed by the results of such scrutiny. The regulatory environment with regard to direct selling in emerging and developing markets
where we do business is evolving, and government officials in such locations often exercise broad discretion in deciding how to interpret and
apply applicable regulations. From time to time, we may receive formal and informal inquiries from various government regulatory
authorities about our business and compliance with local laws and regulations. In addition, from time to time, we may conduct
investigations and reviews. The consequences of such government reviews, inquiries, investigations, and actions or such investigations and
reviews may adversely impact our business, prospects, reputation, financial condition, liquidity, results of operations or cash flows.
Additionally, any determination that our operations or activities, or, where local law mandates, the activities of our Representatives,
including our licenses or permits, importing or exporting, or product testing or approvals are not, or were not, in compliance with existing
laws or regulations could result in the imposition of substantial fines, civil and criminal penalties, interruptions of business, loss of supplier,
vendor or other third party relationship, termination of necessary licenses and permits, modification of business practices and compliance
programs, equitable remedies, including disgorgement, injunctive relief and other sanctions that we may take against our personnel or that
may be taken against us or our personnel. Other legal or regulatory proceedings, as well as government investigations, which often involve
complex legal issues and are subject to uncertainties, may also follow as a consequence. Further, other countries in which we do business
may initiate their own investigations and impose similar sanctions. These proceedings or investigations could be costly and burdensome to
our management, and could adversely impact our business, prospects, reputation, financial condition, liquidity, results of operations or cash
flows. Even if an inquiry or investigation does not result in any adverse determinations, it potentially could create negative publicity and give
rise to third-party litigation or action.
The market price of our common stock could be subject to fluctuations as a result of many
factors.
Factors that could affect the trading price of our common stock include the following:
• variations in operating results;
• developments in connection with any investigations or litigations;
• a change in our credit ratings;
• economic conditions and volatility in the financial markets;
• announcements or significant developments in connection with our business and with respect to beauty and related products or the
beauty industry in general;
• actual or anticipated variations in our quarterly or annual financial results;
• unsolicited takeover proposals, proxy contests or other shareholder activism;
• governmental policies and regulations;
• estimates of our future performance or that of our competitors or our industries;
• general economic, political, and market conditions;
• market rumors; and
• factors relating to competitors.
The trading price of our common stock has been, and could in the future continue to be, subject to significant fluctuations.
A V O N 2015 19
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