Google 2015 Annual Report Download - page 20

Table of Contents Alphabet Inc. and Google Inc.
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• Announcements by us or our competitors of acquisitions, new products, significant contracts, commercial
relationships, or capital commitments.
• Recommendations by securities analysts or changes in earnings estimates.
• Announcements about our earnings that are not in line with analyst expectations, the risk of which is enhanced
because it is our policy not to give guidance on earnings.
• Announcements by our competitors of their earnings that are not in line with analyst expectations.
• Commentary by industry and market professionals about our products, strategies, and other matters affecting
our business and results, regardless of its accuracy.
• The volume of shares of Class A common stock and Class C capital stock available for public sale.
• Sales of Class A common stock and Class C capital stock by us or by our stockholders (including sales by our
directors, executive officers, and other employees).
• Short sales, hedging, and other derivative transactions on shares of our Class A common stock and Class C
capital stock.
• The perceived values of Class A common stock and Class C capital stock relative to one another.
• Our stock repurchase program.
In addition, the stock market in general, and the market for technology companies in particular, have experienced
extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance
of those companies. These broad market and industry factors may harm the market price of our Class A common stock
and our Class C capital stock regardless of our actual operating performance.
We cannot guarantee that our recently announced stock repurchase program will be fully consummated
or that our stock repurchase program will enhance long-term stockholder value, and stock repurchases could
increase the volatility of the price of our stock and could diminish our cash reserves.
In October 2015, our board of directors authorized our company to repurchase up to $5,099,019,513.59 of our
Class C capital stock and in January 2016, our board of directors authorized our Company to repurchase an additional
amount of approximately 514 thousand shares. The repurchase program does not have an expiration date. Although
our board of directors has authorized a stock repurchase program, the share repurchase program does not obligate
Alphabet to repurchase any specific dollar amount or to acquire any specific number of shares. The stock repurchase
program could affect the price of our stock and increase volatility and may be suspended or terminated at any time,
which may result in a decrease in the trading price of our stock.
The concentration of our stock ownership limits our stockholders’ ability to influence corporate matters.
Our Class B common stock has 10 votes per share, our Class A common stock has one vote per share, and our
Class C capital stock has no voting rights. As of December 31, 2015, Larry, Sergey, and Eric beneficially owned
approximately 92.5% of our outstanding Class B common stock, which represented approximately 58.5% of the voting
power of our outstanding capital stock. Larry, Sergey, and Eric therefore have significant influence over management
and affairs and over all matters requiring stockholder approval, including the election of directors and significant
corporate transactions, such as a merger or other sale of our company or our assets, for the foreseeable future. In
addition, because our Class C capital stock carries no voting rights (except as required by applicable law), the issuance
of the Class C capital stock, including in future stock-based acquisition transactions and to fund employee equity
incentive programs, could prolong the duration of Larry and Sergey’s current relative ownership of our voting power
and their ability to elect all of our directors and to determine the outcome of most matters submitted to a vote of our
stockholders. Together with Eric, they would also continue to be able to control any required stockholder vote with
respect to certain change in control transactions involving Alphabet (including an acquisition of Alphabet by another
company).
This concentrated control limits or severely restricts our stockholders’ ability to influence corporate matters and,
as a result, we may take actions that our stockholders do not view as beneficial. As a result, the market price of our
Class A common stock and our Class C capital stock could be adversely affected.
Provisions in our charter documents and under Delaware law could discourage a takeover that
stockholders may consider favorable.
Provisions in Alphabet’s certificate of incorporation and bylaws may have the effect of delaying or preventing a
change of control or changes in our management. These provisions include the following: