Rayovac 2015 Annual Report Download - page 46

If we are unable to protect the confidentiality of our proprietary information and know-how, the value of
our technology, products and services could be harmed significantly.
We rely on trade secrets, know-how and other proprietary information in operating our business. If this
information is not adequately protected, then it may be disclosed or used in an unauthorized manner. To the
extent that consultants, key employees or other third parties apply technological information independently
developed by them or by others to our proposed products, disputes may arise as to the proprietary rights to such
information, which may not be resolved in our favor. The risk that other parties may breach confidentiality
agreements or that our trade secrets become known or independently discovered by competitors, could harm us
by enabling our competitors, who may have greater experience and financial resources, to copy or use our trade
secrets and other proprietary information in the advancement of their products, methods or technologies. The
disclosure of our trade secrets would impair our competitive position, thereby weakening demand for our
products or services and harming our ability to maintain or increase our customer base.
Disruption or failures of our information technology systems could have a material adverse effect on our
business.
Our information technology systems are susceptible to security breaches, operational data loss, general
disruptions in functionality, and may not be compatible with new technology. We depend on our information
technology systems for the effectiveness of our operations and to interface with our customers, as well as to
maintain financial records and accuracy. Disruption or failures of our information technology systems could
impair our ability to effectively and timely provide our services and products and maintain our financial records,
which could damage our reputation and have a material adverse effect on our business.
Our acquisition and expansion strategy may not be successful.
Our growth strategy is based in part on growth through acquisitions, which poses a number of risks. We
may not be successful in identifying appropriate acquisition candidates, consummating acquisitions on
satisfactory terms or integrating any newly acquired or expanded business with our current operations. We may
issue additional equity, incur long-term or short-term indebtedness, spend cash or use a combination of these for
all or part of the consideration paid in future acquisitions or expansion of our operations. The execution of our
acquisition and expansion strategy could entail repositioning or similar actions that in turn require us to record
impairments, restructuring and other charges. Any such charges would reduce our earnings. We cannot guarantee
that any future business acquisitions will be pursued or that any acquisitions that are pursued will be
consummated.
Significant costs have been incurred and are expected to be incurred in connection with the consummation
of recent and future business acquisitions and the integration of such acquired businesses with Spectrum
into a combined company, including legal, accounting, financial advisory and other costs.
We expect to incur one-time costs in connection with integrating our operations, products and personnel and
those of businesses we acquire into a combined company, in addition to costs related directly to completing such
acquisitions. We would expect similar costs to be incurred with any future acquisition. These costs may include
expenditures for:
• employee redeployment, relocation or severance;
• integration of operations and information systems;
• combination of research and development teams and processes; and
• reorganization or closures of facilities.
In addition, we expect to incur a number of non-recurring costs associated with combining our operations
with those of acquired businesses. Additional unanticipated costs may yet be incurred as we integrate our
32