Dollar General 2012 Annual Report Download - page 96

10-K
Any failure to maintain the security of information relating to our customers, employees and vendors that
we may hold, whether as a result of cybersecurity attacks or otherwise, could expose us to litigation,
government enforcement actions and costly response measures, and could seriously disrupt our operations and
harm our reputation.
In connection with credit card sales, we transmit confidential credit and debit card information. We
also have access to, collect or maintain private or confidential information regarding our customers,
employees and vendors, as well as our business. We have procedures and technology in place to
safeguard such data and information. As a result of those procedures, to our knowledge computer
hackers have been unable to gain access to the information stored in our information systems.
However, cyberattacks are rapidly evolving and becoming increasingly sophisticated. It is possible that
computer hackers and others might compromise our security measures or those of our technology
vendors in the future and obtain the personal information of our customers, employees and vendors
that we hold or our business information. A security breach of any kind could expose us to risks of
data loss, litigation, government enforcement actions and costly response measures, and could seriously
disrupt our operations. Any resulting negative publicity could significantly harm our reputation which
could cause us to lose market share and have an adverse effect on our financial results.
We have substantial debt that must be repaid or refinanced at or prior to applicable maturity dates which
could adversely affect our ability to raise additional capital to fund our operations and limit our ability to
pursue our growth strategy or other opportunities or to react to changes in the economy or our industry.
At February 1, 2013, we had total outstanding debt (including the current portion of long-term
obligations) of $2.772 billion, including a $1.964 billion senior secured term loan facility, of which,
$1.084 billion matures on July 6, 2014 and $879.7 million matures on July 6, 2017, $500.0 million
aggregate principal amount of 4.125% senior notes due 2017, and borrowings of $286.5 million under
our senior secured asset-based revolving credit facility. We also had an additional $873.4 million
available for borrowing under the revolving credit facility which is scheduled to mature on July 6, 2014.
We do not believe that we will experience difficulty in refinancing this debt prior to applicable maturity
dates. However, if we were to experience difficulty repaying or refinancing this debt prior to maturity,
this, and the level of debt itself, could have important negative consequences to our business, including:
• increasing our vulnerability to general economic and industry conditions because our debt
payment obligations may limit our ability to use our cash to respond to or defend against
changes in the industry or the economy;
• requiring a substantial portion of our cash flow from operations to be dedicated to the payment
of principal and interest on our indebtedness, therefore reducing our ability to use our cash flow
to fund our operations, capital expenditures and future business opportunities or repurchase
shares of our common stock;
• limiting our ability to pursue our growth strategy;
• placing us at a disadvantage compared to our competitors who are less leveraged and may be
better able to use their cash flow to fund competitive responses to changing industry, market or
economic conditions;
• limiting our ability to obtain additional financing for working capital, capital expenditures, debt
service requirements, acquisitions and general corporate or other purposes; and
• increasing the difficulty of our ability to make payments on our outstanding debt.
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