Oracle 2008 Annual Report Download - page 22

Table of Contents
• we may not realize the anticipated increase in our revenues from an acquisition if a larger than
predicted number of customers decline to renew software license updates and product support
contracts, if we are unable to sell the acquired products to our customer base or if contract models of an
acquired company do not allow us to recognize revenues on a timely basis;
• we may be unable to obtain timely approvals from, or may otherwise have certain limitations,
restrictions, penalties or other sanctions imposed on us by, worker councils or similar bodies under
applicable employment laws as a result of an acquisition, which could adversely affect our integration
plans in certain jurisdictions;
• we may have difficulty incorporating acquired technologies or products with our existing product lines
and maintaining uniform standards, architecture, controls, procedures and policies;
• we may have multiple and overlapping product lines as a result of our acquisitions that are offered,
priced and supported differently, which could cause customer confusion and delays;
• we may have higher than anticipated costs in continuing support and development of acquired
products;
• we may be unable to obtain required approvals from governmental authorities under competition and
antitrust laws on a timely basis, if it all, which could, among other things, delay or prevent us from
completing a transaction, otherwise restrict our ability to realize the expected financial or strategic
goals of an acquisition or have other adverse effects on our current business and operations;
• our use of cash to pay for acquisitions may limit other potential uses of our cash, including stock
repurchases, dividend payments and retirement of outstanding indebtedness;
• we may significantly increase our interest expense, leverage and debt service requirements if we incur
additional debt to pay for an acquisition and we may have to delay or not proceed with a substantial
acquisition if we cannot obtain the necessary funding to complete the acquisition in a timely manner or
on favorable terms;
• we may experience additional and/or unexpected changes in how we are required to account for our
acquisitions pursuant to U.S. generally accepted accounting principles (GAAP), including our adoption
of FASB Statement No. 141 (revised 2007), Business Combinations, in fiscal 2010, which could
materially affect our consolidated financial statements; and
• to the extent that we issue a significant amount of equity securities in connection with future
acquisitions, existing stockholders may be diluted and earnings per share may decrease.
The occurrence of any of these risks could have a material adverse effect on our business, results of
operations, financial condition or cash flows, particularly in the case of a larger acquisition or several
concurrent acquisitions.
Our international sales and operations subject us to additional risks that can adversely affect our operating
results. We derive a substantial portion of our revenues from, and have significant operations, outside of the
United States. Our international operations include software development, sales, customer support,
consulting, On Demand and shared administrative service centers.
Compliance with international and U.S. laws and regulations that apply to our international operations
increases our cost of doing business in foreign jurisdictions. These laws and regulations include U.S. laws
such as the Foreign Corrupt Practices Act, and local laws which also prohibit corrupt payments to
governmental officials, data privacy requirements, labor relations laws, tax laws, anti-competition regulations,
import and trade restrictions, and export requirements. Violations of these laws and regulations could result in
fines, criminal sanctions against us, our officers or our employees, and prohibitions on the conduct of our
business. Any such violations could result in prohibitions on our ability to offer our products and services in
one or more countries, could delay or prevent potential acquisitions, and could also materially damage our
reputation, our brand, our international expansion efforts, our ability to attract and retain employees, our
business and our operating results. Our success depends, in part, on our ability to anticipate these risks and
manage these difficulties. We monitor our international operations and investigate allegations of improprieties
relating to transactions and the way in which such transactions are
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Source: ORACLE CORP, 10-K, June 29, 2009 Powered by Morningstar® Document Research℠