Energizer 2014 Annual Report Download - page 20

Energizer's business involves the potential for product liability and other claims against us, which could affect our results of
operations and financial condition and result in product recalls or withdrawals.
We face exposure to claims arising out of alleged defects in our products, including for property damage, bodily injury or
other adverse effects. We maintain product liability insurance, but this insurance does not cover all types of claims, particularly
claims that do not involve personal injury or property damage or claims that exceed the amount of insurance coverage. Further,
we may not maintain such insurance on acceptable terms, or at all. In addition to the risk of monetary judgments not covered by
insurance, product liability claims could result in negative publicity that could harm our products' reputation and in certain
cases require a product recall. Product recalls or product liability claims, and any subsequent remedial actions, could have a
material adverse effect on our business, reputation, brand value, results of operations and financial condition.
We may not be able to attract, retain and develop key personnel.
Our future performance depends in significant part upon the continued service of our executive officers and other key
personnel. The loss of the services of one or more of our executive officers or other key employees could have a material
adverse effect on our business, prospects, financial condition and results of operations. Our success also depends on our
continuing ability to attract, retain and develop highly qualified personnel. Competition for such personnel is intense, and there
can be no assurance that we can retain and motivate our key employees or attract and retain other highly qualified personnel in
the future. The proposed spin-off transaction may heighten this risk. Additionally, the escalating costs of offering and
administering health care, retirement and other benefits for employees could result in reduced profitability.
We may experience losses or be subject to increased funding and expenses related to our pension plans.
The funding obligations for Energizer's pension plans, including those assumed in the ASR acquisition, are impacted by
the performance of the financial markets, interest rates and governmental regulations. While in November 2012, we approved
and communicated changes to our U.S. pension plan so that, effective January 1, 2014, the pension benefit earned to date by
active participants under the legacy Energizer U.S. pension plan was frozen and future retirement service benefits no longer
accrued under this retirement program, our pension obligations are expected to remain significant. If the investment of plan
assets does not provide the expected long-term returns, interest rates change, or if governmental regulations change the timing
or amounts of required contributions to the plans, we could be required to make significant additional pension contributions
which may have an adverse impact on our liquidity, our ability to comply with debt covenants and may require recognition of
increased expense within our financial statements. If the proposed spin-off transaction is completed, we may need to restore
some of our pension plans. As a result, additional contributions may be required.
We may not be able to continue to identify and complete strategic acquisitions and effectively integrate acquired companies
to achieve desired financial benefits.
We have completed a number of significant acquisitions since becoming an independent company in 2000, including, most
recently, the acquisition of the Stayfree, Carefree and o.b. brands in the U.S., Canada and the Caribbean in October 2013. We
expect to continue making acquisitions if appropriate opportunities arise. However, we may not be able to identify and
successfully negotiate suitable strategic acquisitions at attractive valuations, obtain financing for future acquisitions on
satisfactory terms or otherwise complete future acquisitions. Following the proposed spin-off transaction, our reduced size may
make completing desirable acquisitions more challenging.
Even if we can complete future acquisitions, we face significant challenges in consolidating functions and effectively
integrating procedures, personnel, product lines, and operations in a timely and efficient manner. The integration process can be
complex and time consuming, may be disruptive to our existing and acquired business, and may cause an interruption of, or a
loss of momentum in, the business. Even if we can successfully complete the integration of acquired businesses into our
operations, there is no assurance that anticipated cost savings, synergies, or revenue enhancements will be realized within the
expected time frame, or at all.
Additional descriptions of risks impacting Energizer appearing under “ENERGIZER HOLDINGS, INC. -
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL
CONDITION” are included in Exhibit 13 attached hereto, which will also appear in the Energizer Holdings, Inc. 2014
Annual Report to Shareholders.
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