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Risks

• VF’s revenues and profits depend on the level of consumer spending for apparel and footwear, which is sensitive to global economic conditions and other factors. A decline in consumer spending could have a material adverse effect on VF.
• Widespread outbreak of an illness or any other public health crisis, including the recent coronavirus (COVID-19) global pandemic, could materially and adversely affect, and has materially and adversely affected, our business, financial condition and results of operations.
• The apparel and footwear industries are highly competitive, and VF’s success depends on its ability to gauge consumer preferences and product trends, and to respond to constantly changing markets.
• VF’s business and the success of its products could be harmed if VF is unable to maintain the images of its brands.
• VF’s revenues and cash requirements are affected by the seasonal nature of its business.
• VF’s profitability may decline as a result of increasing pressure on margins.
• VF may not succeed in its business strategy.
• VF relies significantly on information technology. Any inadequacy, interruption, integration failure or security failure of this technology could harm VF’s ability to effectively operate its business.
• VF is subject to data security and privacy risks that could negatively affect its business operations, results of operations or reputation.
• VF’s business is exposed to the risks of foreign currency exchange rate fluctuations. VF’s hedging strategies may not be effective in mitigating those risks.
• There are risks associated with VF’s acquisitions.
• VF’s operations and earnings may be affected by legal, regulatory, political and economic risks.
• Changes to U.S. or international trade policy, tariff and import/export regulations or our failure to comply with such regulations may have a material adverse effect on our reputation, business, financial condition and results of operations.
• Changes in tax laws could increase our worldwide tax rate and tax liabilities and materially affect our financial position and results of operations.
• VF’s balance sheet includes a significant amount of intangible assets and goodwill. A decline in the fair value of an intangible asset or of a business unit could result in an asset impairment charge, which would be recorded as an operating expense in VF’s Consolidated Statement of Income and could be material.
• VF uses third-party suppliers and manufacturing facilities worldwide for a substantial portion of its raw materials and finished products, which poses risks to VF’s business operations.
• Our business is subject to national, state and local laws and regulations for environmental, consumer protection, corporate governance, competition, employment, privacy, safety and other matters. The costs of compliance with, or the violation of, such laws and regulations by VF or by independent suppliers who manufacture products for VF could have an adverse effect on our operations and cash flows, as well as on our reputation.
• Fluctuations in wage rates and the price, availability and quality of raw materials and finished goods could increase costs.
• We may be adversely affected by weather conditions.
• Climate change and increased focus by governmental and non-governmental organizations, customers, consumers and investors on sustainability issues, including those related to climate change, may adversely affect our business and financial results and damage our reputation.
• A substantial portion of VF’s revenues and gross profit is derived from a small number of large customers. The loss of any of these customers or the inability of any of these customers to pay VF could substantially reduce VF’s revenues and profits.
• The retail industry has experienced financial difficulty that could adversely affect VF's business.
• Our ability to obtain short-term or long-term financing on favorable terms, if needed, could be adversely affected by geopolitical risk and volatility in the capital markets.
• VF has a global revolving credit facility. One or more of the participating banks may not be able to honor their commitments, which could have an adverse effect on VF’s business.
• VF’s indebtedness could have a material adverse effect on its business, financial condition and results of operations and prevent VF from fulfilling its financial obligations, and VF may not be able to maintain its current credit ratings, may not continue to pay dividends or repurchase its common stock and may not remain in compliance with existing debt covenants.
• The loss of members of VF’s executive management and other key employees could have a material adverse effect on its business.
• VF’s direct-to-consumer business includes risks that could have an adverse effect on its results of operations.
• VF’s net sales depend on the volume of traffic to its stores and the availability of suitable lease space.
• VF may be unable to protect its trademarks and other intellectual property rights.
• VF is subject to the risk that its licensees may not generate expected sales or maintain the value of VF’s brands.
• If VF encounters problems with its distribution system, VF’s ability to deliver its products to the market could be adversely affected.
• Volatility in securities markets, interest rates and other economic factors could substantially increase VF’s defined benefit pension costs.
• We may be unable to achieve some or all of the benefits we expect to achieve from the spin-off.
• The Kontoor Brands spin-off could result in substantial tax liability to us and our stockholders.
• Certain directors who serve on our Board of Directors also serve as directors of Kontoor Brands, and ownership of shares of common stock of Kontoor Brands following the spin-off by our directors and executive officers, may create, or appear to create, conflicts of interest.