Rosetta Stone 2014 Annual Report Download - page 9

Table of Contents
We have nine U.S. patents, twenty foreign patents and several U.S. and foreign patent applications pending that cover various aspects of our language
teaching methods and literacy assessment methodologies.
We have registered a variety of trademarks, including our primary or house marks, , The Blue Stone Logoand
These trademarks are the subject of either registrations or pending applications in the U.S., as well as numerous countries worldwide where we do
business. We have been issued trademark registrations for our yellow color from the U.S. Patent and Trademark Office. We intend to continue to strategically
register, both domestically and internationally, trademarks we use today and those we develop in the future. We believe that the distinctive marks that we use
in connection with our solutions are important in building our brand image and distinguishing our offerings from those of our competitors. These marks are
among our most valuable assets.
In addition to our distinctive marks, we own numerous registered and unregistered copyrights, and trade dress rights, to our products and packaging. We
intend to continue to strategically register copyrights in our various products. We also place significant value on our trade dress, which is the overall image
and appearance of our products, as we believe that our trade dress helps to distinguish our products in the marketplace from our competitors.
Since 2006, we have held a perpetual, irrevocable and worldwide license from the University of Colorado allowing us to use speech recognition
technology for language-learning solutions. Since 2014, we have also held a commercial license from the Florida State University Research Foundation
allowing us to use certain computer software and technology in our literacy offerings. These types of arrangements are often subject to royalty or license fees.
We diligently protect our intellectual property through the use of patents, trademarks and copyrights and through enforcement efforts in litigation. We
routinely monitor for potential infringement in the countries where we do business. In addition, our employees, contractors and other parties with access to
our confidential information are required to sign agreements that prohibit the unauthorized disclosure of our proprietary rights, information and technology.
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As of December 31, 2014, we had 1,292 total employees, consisting of 957 full-time and 335 part-time employees. We have employees in France, Spain
and Italy who are represented by a collective bargaining agreement. We believe that we have good relations with our employees. On March 11, 2015, we
announced that we will be implementing a program to reduce costs as part of an alignment of resources around our Global Enterprise & Education segment,
including reducing global non-Enterprise & Education headcount approximately 15%. See Note 21 of Item 8, 
contained in this Annual Report on Form 10-K for more information.
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For a discussion of financial information by segment and geographic area, see Note 17 of Item 8, 
contained in this Annual Report on Form 10-K.
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This Annual Report on Form 10-K, along with our Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed
or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (the "Exchange Act"), are available free of charge through our website
as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission ("SEC"). Our
website address is www.rosettastone.com. The SEC maintains a website that contains reports, proxy statements and other information regarding issuers that
file electronically with the SEC. These materials may be obtained electronically by accessing the SEC's website at www.sec.gov.
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In addition to the other information set forth in this annual report on Form 10-K, you should carefully consider the risk factors discussed below and in
other documents we file with the Securities and Exchange Commission that could materially affect our business, financial condition, cash flows or future
results. The risks described below are not the only ones facing us. Our business is also subject to the risks that affect many other companies, such as general
economic conditions and geopolitical events. Further, additional risks not currently known to us or that we currently believe are immaterial could have a
material adverse effect on our business, financial condition, cash flows and results of operations.
We might not be successful in executing our strategy of focusing on the Global Enterprise & Education segment and on more serious learners, and our
company reorganization and realignment might not produce the desired results.
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