Enom 2012 Annual Report Download - page 40

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acquiror from conducting a solicitation of proxies to elect the acquiror's own slate of directors or otherwise attempting
to obtain control of us.
We are also subject to certain anti-takeover provisions under Delaware law. Under Delaware law, a corporation may not, in
general, engage in a business combination with any holder of 15% or more of its capital stock unless the holder has held the
stock for three years or, among other things, our board of directors has approved the transaction.
Risks Relating to the Proposed Business Separation
The proposed separation of our business into two distinct publicly traded companies may not be completed on the terms or
timeline currently contemplated, if at all.
In February 2013, we announced our intention to pursue the separation of our business into two distinct publicly traded
companies (the “Proposed Business Separation”). The Proposed Business Separation could be delayed or negatively impacted
by unanticipated developments, including, without limitation, the incurrence of additional expenses related to completing the
Proposed Business Separation, delays in filing and effectiveness of appropriate filings with the SEC, obtaining favorable tax
rulings and/or opinions regarding the tax-free nature of the transaction, receipt of regulatory approvals, and completing further
due diligence as appropriate, and changes in market conditions. In addition, consummation of the Proposed Business Separation
will require final approval from our board of directors. Therefore, we cannot assure that we will be able to complete the
Proposed Business Separation on the terms or on the timeline that we announced, if at all.
The Proposed Business Separation may require significant time and attention of our management, may not achieve the
intended results, and may present difficulties that could have an adverse effect on us.
In order to position ourselves for the Proposed Business Separation, we are actively considering and pursuing strategic,
structural and process actions and initiatives for both businesses. These actions could lead to disruption of our ongoing
operations, loss of, or our inability to recruit, key personnel needed to operate and grow our businesses and complete the
Proposed Business Separation, weakening of our internal standards, controls or procedures, and impairment of our relationship
with key customers and suppliers, among other things. Execution of the Proposed Business Separation will require significant
time and attention from management, which may distract management from the operation of our business and the execution of
our other initiatives. Our employees may also be distracted due to uncertainty about their future roles with us pending the
completion of the Proposed Business Separation. Although the Proposed Business Separation is intended to be a tax-free pro
rata distribution to our stockholders, these types of transactions are complex and there are no assurances that there will not be
adverse tax liabilities in connection therewith. Further, if the Proposed Business Separation is completed, the transaction may
not achieve the intended results. Any such difficulties could have a material adverse effect on our business, financial condition
and results of operations.
If completed, the Proposed Business Separation will leave two smaller, less diversified companies. Once separated, these
distinct companies may be more vulnerable to changing market conditions, which could materially and adversely affect their
respective business, financial condition and results of operations. In addition, the diversification of revenues, costs, and cash
flows will diminish. As a result, it is possible that our results of operations, cash flows, working capital and financing
requirements may be subject to increased volatility.
The value of our common stock following completion of the Proposed Business Separation may not equal or exceed the
value of our common stock prior to the completion of the Proposed Business Separation.
There can be no assurance that the aggregate trading price of the common stock of the two public companies that would
result from the Proposed Business Separation, as may be adjusted for any changes in our capitalization structure, will be equal
to or greater than the trading price of our common stock prior to the Proposed Business Separation. Until the market has fully
evaluated the two companies separately, the price at which the common stock of the two companies trades may fluctuate
significantly. Further, shares of our common stock today will represent an investment in two smaller separate public companies
once the Proposed Business Separation is completed. These changes may not meet some stockholders' investment strategies,
which could cause investors to sell their shares of our common stock. Excessive selling could cause the relative market price of
our common stock to decrease in advance of or following completion of the Proposed Business Separation.