Enom 2010 Annual Report Download - page 46

Table of Contents
reporting, as well as a statement that our auditors have issued an attestation report on our management's assessment of our internal controls.
We are in the process of evaluating and testing our compliance with Section 404. We may not be able to complete our evaluation, testing and any
required remediation in a timely fashion. During the evaluation and testing process, if we identify one or more material weaknesses in our internal control
over financial reporting, we will be unable to assert that our internal control is effective. If we are unable to assert that our internal control over financial
reporting is effective, or if our auditors are unable to attest that our management's report is fairly stated or they are unable to express an opinion on the
effectiveness of our internal control, we could lose investor confidence in the accuracy and completeness of our financial reports, which would have a material
adverse effect on the price of our common stock. Failure to comply with the new rules might make it more difficult for us to obtain certain types of insurance,
including director and officer liability insurance, and we might be forced to accept reduced policy limits and coverage and/or incur substantially higher costs
to obtain the same or similar coverage. The impact of these events could also make it more difficult for us to attract and retain qualified persons to serve on
our board of directors, on committees of our board of directors, or as executive officers.
If securities or industry analysts publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.
The trading market for our common stock will depend in part on the research and reports that securities or industry analysts publish about us or our
business. If one or more of the analysts who cover us downgrade our stock or publish inaccurate or unfavorable research about our business, our stock price
would likely decline. If one or more of these analysts cease coverage of our company or fail to publish reports on us regularly, demand for our stock could
decrease, which might cause our stock price and trading volume to decline.
We do not anticipate paying cash dividends, and accordingly, stockholders must rely on stock appreciation for any return on their investment.
The terms of our credit agreement currently prohibit us from paying cash dividends on our common stock. In addition, we do not anticipate paying cash
dividends in the future. As a result, only appreciation of the price of our common stock, which may never occur, will provide a return to stockholders.
Investors seeking cash dividends should not invest in our common stock.
Our management has broad discretion over the use of the proceeds we received in our initial public offering and might not apply the proceeds in ways that
increase the value of our common stock.
Our management will continue to have broad discretion to use the net proceeds to us from our initial public offering. Our management might not apply
the net proceeds from our initial public offering in ways that increase the value of our common stock. We expect that we will use the net proceeds of our
initial public offering for investments in content, international expansion, working capital, product development, sales and marketing activities, general and
administrative matters and capital expenditures. We have not otherwise allocated the net proceeds from our initial public offering for any specific purposes. In
addition, as discussed under "—Risks Relating to our Company—We have made and may make additional acquisitions that could entail significant execution,
integration and operational risks," we may consider making acquisitions in the future to increase the scope of our business domestically and internationally.
Until we use the net proceeds to us from our initial public offering, we have invested them, principally in marketable securities with maturities of less than
one year, including but not limited to commercial paper, money market instruments, and Treasury bills, and these investments may not yield a favorable rate
of return. If we do not invest or apply the net
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