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Network failures, disruptions or capacity constraints in our third party data center facilities or in our servers could affect the
performance of the products and services of our wireless applications and 9-1-1 business and harm our reputation and our
revenue.
The products and services of our wireless applications business are provided through a combination of our servers, which we
house at third party data centers, and the networks of our wireless carrier partners. The operations of our wireless applications business
rely to a significant degree on the efficient and uninterrupted operation of the third party data centers we use. Our hosted data centers
are currently located in third party facilities located in the Irvine and San Francisco, California areas, and we may use others as
required. We also use third party data center facilities in the Phoenix, Arizona area to provide for disaster recovery.
Poor performance in or disruptions of the services of our wireless applications business could harm our reputation, delay market
acceptance of our services and subject us to liabilities. Our wireless carrier agreements require us to meet operational uptime
requirements, excluding scheduled maintenance periods, or be subjected to penalties. If we are unable to meet these requirements, our
wireless carrier partners could terminate our agreements or we may be required to refund a portion of monthly subscriptions fees they
have paid us.
Our operating results could be adversely affected by interruption of our data delivery services, system failure or production
interruptions.
Our 9-1-1, hosted location-based services and satellite teleport services operations depend on our ability to maintain our
computer and telecommunications equipment and systems in effective working order, and to protect our systems against damage from
fire, natural disaster, power loss, telecommunications failure, sabotage, unauthorized access to our system or similar events. Although
all of our mission-critical systems and equipment are designed with built-in redundancy and security, any unanticipated interruption or
delay in our operations or breach of security could have a material adverse effect on our business, financial condition and results of
operations. Our property and business interruption insurance may not be adequate to compensate us for any losses that may occur in
the event of a system failure or a breach of security. Insurance may not be available to us at all or, if available, may not be available to
us on commercially reasonable terms.
Our past and future acquisitions of companies or technologies could prove difficult to integrate, disrupt our business, dilute
shareholder value or adversely affect operating results or the market price of our Class A common stock.
We have made several acquisitions and intend to continue to selectively consider acquisitions of companies and technologies in
order to increase the scale and scope of our operations, market presence, products, services and customer base. Any acquisitions,
strategic alliances or investments we may pursue in the future will have a continuing, significant impact on our business, financial
condition and operating results. The value of the companies or assets that we acquire or invest in may be less than the amount we paid
if there is a decline of their position in the respective markets they serve or a decline in general of the markets they serve. If we fail to
properly evaluate and execute acquisitions and investments, our business and prospects may be seriously harmed. Acquisitions involve
risks including:
x
properly evaluating the technology;
x
accurately forecasting the financial impact of the transaction, including accounting charges and transaction expenses;
x
integrating and retaining personnel;
x
retaining and cross-selling to acquired customers;
x
combining potentially different corporate cultures;
x
the potential of significant goodwill and intangibles write-offs in the future in the event that an acquisition or investment
does not meet expectations; and
x
effectively integrating products and services, and research and development, sales and marketing and support operations.
If we fail to do any of these, we may suffer losses or incur impairment charges, our management may be distracted from day-to-
day operations and the market price of our Class A common stock may be materially adversely affected. In addition, if we
consummate future acquisitions using our equity securities or convertible notes, existing shareholders may be diluted which could
have a material adverse effect on the market price of our Class A common stock. The companies and business units we have acquired
or invested in or may acquire or invest in are subject to each of the business risks we describe in this section, and if they incur any of
these risks the businesses may not be as valuable as the amount we paid. Further, we cannot guarantee that we will realize the benefits
or strategic objectives we are seeking to obtain by acquiring or investing in these companies.
