FTD.com 2011 Annual Report Download - page 30

Table of Contents
forecasted revenues or growth rates of certain reporting units or other factors are not achieved or are revised downward, we may be required to
record additional impairment charges in future periods. In addition, from time to time, we record tangible or intangible assets on our balance
sheet that, due to changes in value or in our strategy, may have to be expensed in future periods. Write-downs or impairments of assets, whether
tangible or intangible, could adversely and materially impact our financial condition and results of operations.
Our ability to operate our business could be seriously harmed if we lose members of our senior management team or other key employees.
Our business is largely dependent on the efforts and abilities of our senior management, particularly Mark R. Goldston, our chairman,
president and chief executive officer, and other key personnel. Any of our officers or employees can terminate his or her employment
relationship at any time. The loss of any of these key employees or our inability to attract or retain other qualified employees could seriously
harm our business and prospects. We do not carry key-person life insurance on any of our employees.
Foreign, state and local governments may attempt to impose additional income taxes, sales and use taxes, value added taxes or other taxes on
our business activities and Internet-based transactions, including our past sales, which could decrease our ability to compete, reduce our
sales, or have a material adverse effect on our business, financial condition, results of operations, and cash flows.
We are subject to income and various other taxes in the U.S. and numerous foreign jurisdictions. Significant judgment is required in
evaluating our consolidated provision for income taxes. During the ordinary course of business, there are many transactions for which the
ultimate tax determination is uncertain. In addition, our effective income tax rates could be adversely affected by earnings being less than
anticipated in countries where we have lower statutory rates and more (or determined to be more by a particular taxing jurisdiction) than
anticipated in countries where we have higher statutory rates, by changes in the valuation of our deferred tax assets and liabilities or by, among
other factors, changes in the relevant tax, accounting and other laws, regulations, principles, and interpretations. We are subject to audit in
various jurisdictions, and such jurisdictions may assess additional income and other taxes against us. Although we believe our tax estimates are
reasonable, the final determination of tax audits and any related litigation could be materially different from our historical income tax provisions,
and our historical recognition of other tax matters. The results of an audit or litigation could have a material adverse effect on our business,
financial condition, results of operations, and cash flows.
In connection with our Internet-based transactions, a number of states have been considering or adopting legislation or instituting policy
initiatives, including those that would facilitate a finding of nexus to exist between Internet companies with the states, aimed at expanding the
reach of sales and use taxes or imposing state income or other taxes on various innovative theories, including agency attribution from
independent third-party service providers. Such legislation or initiatives could result in the imposition of additional sales and use taxes, or the
payment of state income or other taxes, on certain transactions conducted over the Internet. In addition, advertisers and other third parties may
choose to not do business with us in order to avoid nexus with certain states. If such legislation is enacted, or such initiatives are instituted, and
upheld by the courts, the legislation or initiatives could subject us to substantially increased tax liabilities for past and future sales or state
income or other taxes, require us to collect additional sales and use taxes, cause our future sales to decrease, otherwise negatively impact our
businesses, and thus have a material adverse effect on us.
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