First Data 2007 Annual Report Download - page 25

The ability to recruit, retain and develop qualified personnel is critical to the Company's success and growth.
All of the Company's businesses function at the intersection of rapidly changing technological, social, economic and regulatory developments that requires a
wide ranging set of expertise and intellectual capital. For the Company to successfully compete and grow, it must retain, recruit and develop the necessary
personnel who can provide the needed expertise across the entire spectrum of its intellectual capital needs. In addition, the Company must develop its
personnel to provide succession plans capable of maintaining continuity in the midst of the inevitable unpredictability of human capital. However, the market
for qualified personnel is competitive and the Company may not succeed in recruiting additional personnel or may fail to effectively replace current personnel
who depart with qualified or effective successors. The Company's effort to retain and develop personnel may also result in significant additional expenses,
which could adversely affect the Company's profitability. The Company also manages its business with a number of key personnel that do not have
employment agreements with the Company. In connection with the recent appointment of a new chief executive officer concurrent with the closing of the
merger, changes have been and may continue to be made to the Company's senior management. The Company cannot assure that key personnel, including
executive officers, will continue to be employed or that it will be able to attract and retain qualified personnel in the future. Failure to retain or attract key
personnel could have a material adverse effect on the Company.
Failure to comply with state and federal antitrust requirements could adversely affect the Company's business.
Through the Company's merchant alliances, it holds an ownership interest in several competing merchant acquiring businesses while serving as the electronic
processor for those businesses. In order to satisfy state and federal antitrust requirements, the Company actively maintains an antitrust compliance program.
Notwithstanding the Company's compliance program, it is possible that perceived or actual violation of state or federal antitrust requirements could give rise
to regulatory enforcement investigations or actions. Regulatory scrutiny of, or regulatory enforcement action in connection with, compliance with state and
federal antitrust requirements could have a material adverse effect on the Company's reputation and business.
Global economics, political and other conditions may adversely affect trends in consumer spending, which may adversely impact the Company's revenue
and profitability.
The global electronic payments industry depends heavily upon the overall level of consumer, business and government spending. A sustained deterioration in
the general economic conditions, particularly in the United States or Europe, or increases in interest rates in key countries in which the Company operates
may adversely affect the Company's financial performance by reducing the number of average purchase amount of transactions involving payment cards. A
reduction in the amount of consumer spending could result in a decrease of the Company's revenue and profits.
The market for the Company's electronic commerce services is evolving and may not continue to develop or grow rapidly enough for the Company to
maintain and increase its profitability.
If the number of electronic commerce transactions does not continue to grow or if consumers or businesses do not continue to adopt the Company's services, it
could have a material adverse effect on the profitability of the Company's business, financial condition and results of operations. The Company believes future
growth in the electronic commerce market will be driven by the cost, ease-of-use, and quality of products and services offered to consumers and businesses. In
order to consistently increase and maintain the Company's profitability, consumers and businesses must continue to adopt the Company's services.
The Company may experience breakdowns in its processing systems that could damage customer relations and expose it to liability.
The Company depends heavily on the reliability of its processing systems in the Company's core business. A system outage or data loss could have a material
adverse effect on the Company's business, financial condition and results of operations. Not only would the Company suffer damage to its reputation in the
event of a system outage or data loss, but the Company may also be liable to third parties. Many of the Company's contractual agreements with financial
institutions require the payment of penalties if the Company's systems do not meet certain operating standards. To successfully operate the Company's
business, the Company must be able to protect its processing and other systems from interruption, including from events that may be beyond the Company's
control. Events that could cause system interruptions include but are not limited to:
• fire;
• natural disaster;
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