GPS Gap Dashboard

Risks

• The novel coronavirus disease (or COVID-19) pandemic is expected to continue to have a material adverse effect on our business and results of operations.
• We have suspended rent payments for our stores that have been closed because of the COVID-19 pandemic, which could cause the counterparties under those leases to attempt to hold us in breach of our lease obligations and terminate our leases and accelerate our future rents due thereunder if we cannot reach acceptable settlements or otherwise prevail in litigation.
• Global economic conditions and any related impact on consumer spending patterns could adversely impact our results of operations.
• We must successfully gauge apparel trends and changing consumer preferences to succeed.
• We must maintain our reputation and brand image.
• Our business is highly competitive.
• We may engage in or seek to engage in strategic transactions, such as acquisitions and dispositions, that are subject to various risks and uncertainties, which could disrupt or adversely affect our businesses.
• Our investments in customer, digital, and omni-channel shopping initiatives may not deliver the results we anticipate.
• Our failure to manage key executive succession and retention and to continue to attract qualified personnel could have an adverse impact on our results of operations.
• If we are unable to manage our inventory effectively, our gross margins could be adversely affected.
• Our business is subject to risks associated with global sourcing and manufacturing.
• Risks associated with importing merchandise from foreign countries, including failure of our vendors to adhere to our Code of Vendor Conduct, could harm our business.
• We are subject to data and security risks, which could have an adverse effect on our results of operations and consumer confidence in our security measures.
• Failures of, or updates or changes to, our IT systems may disrupt operations.
• Our efforts to expand internationally may not be successful.
• The market for real estate is competitive.
• Our franchise business is subject to certain risks not directly within our control that could impair the value of our brands.
• Trade matters may disrupt our supply chain.
• Our business is exposed to the risks of foreign currency exchange rate fluctuations and our hedging strategies may not be effective in mitigating those risks.
• We experience fluctuations in our comparable sales and margins.
• Our results could be adversely affected by natural disasters, public health crises, political crises, negative global climate patterns, or other catastrophic events.
• We are subject to various proceedings, lawsuits, disputes, and claims from time to time, which could adversely affect our business, financial condition, and results of operations.
• Changes in the regulatory or administrative landscape could adversely affect our financial condition and results of operations.
• Reductions in income and cash flow from our credit card arrangement related to our private label and co-branded credit cards could adversely affect our operating results and cash flows.
• Changes in our credit profile or deterioration in market conditions may limit our access to the capital markets and adversely impact our financial position or our business initiatives.
• Our level of indebtedness may adversely affect our ability to operate our business, remain in compliance with debt covenants, react to changes in our business or the industry in which we operate, or prevent us from making payments on our indebtedness, including the notes.
• Despite our level of indebtedness, we may incur additional indebtedness, which could further increase the risks associated with our leverage.
• We may not be able to generate sufficient cash to service all of our indebtedness, including the notes, and fund our working capital and capital expenditures, and may be forced to take other actions to satisfy our obligations under our indebtedness, which may not be successful.
• Covenants in our debt agreements restrict our business and could limit our ability to implement our business plan.
• We may not be able to repurchase the notes upon a change of control.