First Data 2008 Annual Report Download - page 29

been made, are currently pending, and other claims may be made in the future, with regards to the Company's technology infringing on a patent or other
intellectual property rights. Unfavorable resolution of these claims could either result in the Company being restricted from delivering the related service or
result in a settlement that could be material to the Company.
The Company is the subject of various legal proceedings which could have a material adverse effect on the Company's revenue and profitability.
The Company is involved in various litigation matters. The Company is also involved in or is the subject of governmental or regulatory agency
inquiries or investigations from time to time. If the Company is unsuccessful in its defense in the litigation matters, or any other legal proceeding, it may be
forced to pay damages or fines and/or change its business practices, any of which could have a material adverse effect on the Company's revenue and
profitability. For more information about the Company's legal proceedings, see "Item 3: Legal Proceedings" herein.
The ability to recruit, retain and develop qualified personnel is critical to the Company's success and growth.
All of the Company's businesses function at the intersection of rapidly changing technological, social, economic and regulatory developments that
requires a wide ranging set of expertise and intellectual capital. For the Company to successfully compete and grow, it must retain, recruit and develop the
necessary personnel who can provide the needed expertise across the entire spectrum of its intellectual capital needs. In addition, the Company must develop
its personnel to provide succession plans capable of maintaining continuity in the midst of the inevitable unpredictability of human capital. However, the
market for qualified personnel is competitive and the Company may not succeed in recruiting additional personnel or may fail to effectively replace current
personnel who depart with qualified or effective successors. The Company's effort to retain and develop personnel may also result in significant additional
expenses, which could adversely affect the Company's profitability. The Company also manages its business with a number of key personnel that do not have
employment agreements with the Company. In connection with the appointment of a new Chief Executive Officer concurrent with the closing of the merger,
changes have been and may continue to be made to the Company's senior management. The Company cannot assure that key personnel, including executive
officers, will continue to be employed or that it will be able to attract and retain qualified personnel in the future. Failure to retain or attract key personnel
could have a material adverse effect on the Company.
Failure to comply with state and federal antitrust requirements could adversely affect the Company's business.
Through the Company's merchant alliances, it holds an ownership interest in several competing merchant acquiring businesses while serving as the
electronic processor for those businesses. In order to satisfy state and federal antitrust requirements, the Company actively maintains an antitrust compliance
program. Notwithstanding the Company's compliance program, it is possible that perceived or actual violation of state or federal antitrust requirements could
give rise to regulatory enforcement investigations or actions. Regulatory scrutiny of, or regulatory enforcement action in connection with, compliance with
state and federal antitrust requirements could have a material adverse effect on the Company's reputation and business.
The market for the Company's electronic commerce services is evolving and may not continue to develop or grow rapidly enough for the Company to
maintain and increase its profitability.
If the number of electronic commerce transactions does not continue to grow or if consumers or businesses do not continue to adopt the Company's
services, it could have a material adverse effect on the profitability of the Company's business, financial condition and results of operations. The Company
believes future growth in the electronic commerce market will be driven by the cost, ease-of-use, and quality of products and services offered to consumers
and businesses. In order to consistently increase and maintain the Company's profitability, consumers and businesses must continue to adopt the Company's
services.
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