Nutrisystem 2007 Annual Report Download - page 15

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We use a variety of security techniques to protect our confidential customer data. When our customers place
an order or access their account information, we use a secure server (SSL) to transfer information. Our secure
server software encrypts all information entered before it is sent to our server. All customer data is protected
against unauthorized access. We use VeriSign and CyberSource software to secure our credit card transactions.
Intellectual Property
We own numerous domestic and international trademarks and other proprietary rights that are important to
our business. Depending upon the jurisdiction, trademarks are valid as long as they are used in the regular course
of trade and/or their registrations are properly maintained. We believe the protection of our trademarks,
copyrights, patents, domain names, trade dress, and trade secrets important to our success. We aggressively
protect our intellectual property rights by relying on a combination of trademark, copyright, patent, trade dress
and trade secret laws, and through the domain name dispute resolution system.
Employees
As of December 31, 2007, we had approximately 602 administrative, sales, counseling and customer service
personnel, 87 employees dedicated to fulfillment and 47 employees in marketing. None of our employees is
represented by a labor union, and we consider relations with our employees to be good.
Seasonality
Typically in the weight loss industry, revenue is strongest in the first quarter and lowest in the fourth
calendar quarter. We believe our business experiences seasonality, driven by the predisposition of dieters to
initiate a diet and the placement of our advertising based on the price and availability of certain media. This
seasonality can be seen in our results for 2007, however, in 2005, our revenue increased sequentially every
quarter due to our increased level of advertising spending and, in 2006, revenue in the third quarter was higher
than revenue in the first quarter due in part to favorable conditions in the market for certain media.
Available Information
All periodic and current reports, registration statements, code of conduct, code of ethics and other material
that the Company is required to file with the Securities and Exchange Commission (“SEC”), including the
Company’s annual report on Form 10-K, 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) of the Securities Exchange Act of 1934
(the “1934 Act Reports”), are available free of charge through the Company’s investor relations page at
www.nutrisystem.com. Such documents are available as soon as reasonably practicable after electronic filing of
the material with the SEC. The Company’s Internet website and the information contained therein or connected
thereto are not intended to be incorporated into this Annual Report on Form 10-K.
The public may also read and copy any materials filed by the Company with the SEC at the SEC’s Public
Reference Room at 100 F Street, NE, Washington, DC 20549. The public may obtain information on the
operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet
site, www.sec.gov, which contains reports, proxy and information statements, and other information regarding
issuers that file electronically with the SEC.
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