Juno 2012 Annual Report Download - page 32

Table of Contents
employees could seriously harm our business and prospects. We do not carry key-person life insurance on any of our employees.

The payment of future dividends is discretionary and is subject to determination by our Board of Directors each quarter following its review of our
financial condition, results of operations and cash flows and such other factors as are deemed relevant by our Board of Directors. Our cash flows have
been declining, and we expect our cash flows to continue to decline. Declines in our cash flows, the effects of the FTD Spin-Off Transaction, any other
Strategic Transactions or other transactions on our businesses, changes in our business needs, including working capital and funding for business
initiatives or acquisitions, changes in tax laws relating to dividends, or changes in corporate strategy, among other factors, could cause our Board of
Directors to decide to reduce or cease the payment of dividends in the future. We cannot assure you that we will not decrease or discontinue quarterly
cash dividends, and if we do, our stock price could be negatively impacted.


We have capitalized goodwill and identifiable intangible assets in connection with our acquisitions and certain business initiatives such as the
content archives on the Classmates website. We perform an impairment test of our goodwill and indefinite-lived intangible assets annually during the
fourth quarter of our fiscal year or when events occur or circumstances change that would more likely than not indicate that goodwill or any such assets
might be permanently impaired. If our acquisitions or business initiatives are not commercially successful or, if due to economic or other conditions, our
assumptions regarding the performance of our businesses or business initiatives are not achieved, we would likely be required to record impairment
charges which would negatively impact our financial condition and results of operations. We have experienced impairment charges in the past, including
a $26.9 million goodwill and intangible asset impairment charge in the quarter ended December 31, 2012 with respect to our MyPoints reporting unit.
Given the current economic environment and the uncertainties regarding the impact on our businesses, there can be no assurance that our estimates and
assumptions regarding the duration of the challenging economic conditions, or the period or strength of recovery, made for purposes of our goodwill
and identifiable intangible assets impairment testing will prove to be accurate predictions of the future. If our assumptions regarding forecasted revenues
or growth rates of certain reporting units or other factors are not achieved or are revised downward, we may be required to record additional impairment
charges in future periods. In addition, from time to time, we record tangible or intangible assets on our balance sheet that, due to changes in value or in
our strategy, may have to be expensed in future periods. Write-downs or impairments of assets, whether tangible or intangible, could adversely and
materially impact our financial condition and results of operations.


 
We are subject to income and various other taxes in the U.S. and numerous foreign jurisdictions. Significant judgment is required in evaluating our
consolidated provision for income taxes. During the ordinary course of business, there are many transactions for which the ultimate tax determination is
uncertain. In addition, our effective income tax rates could be adversely affected by earnings being less than anticipated in countries where we have
lower statutory rates and more (or determined to be more by a particular taxing jurisdiction) than anticipated in countries where we have higher statutory
rates, by changes in the valuation of our deferred tax assets and liabilities or by, among other factors, changes
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