The Gap 2009 Annual Report Download - page 18

Special Note on Forward-looking Statements
This Annual Report on Form 10-K contains forward-looking statements within the “safe harbor” provisions of the
Private Securities Litigation Reform Act of 1995. All statements other than those that are purely historical are forward-
looking statements. Words such as “expect,” “anticipate,” “believe,” “estimate,” “intend,” “plan,” “project,” and similar
expressions also identify forward-looking statements. Forward-looking statements include, but are not limited to,
statements regarding: (i) our plans to expand internationally through a number of channels and brands, including
additional Gap stores in Europe and our first Gap stores in China, additional Banana Republic stores in Europe,
additional outlet stores in Canada, Europe, and Asia, online sales internationally, and additional franchising and
similar arrangements; (ii) our plans to downsize, consolidate, reposition, or close some of our stores; (iii) cash and cash
flows being sufficient for the foreseeable future; (iv) the outcome of proceedings, lawsuits, disputes, and claims;
(v) improving our sales trend while delivering healthy margins; (vi) maintaining a focus on cost management
and return on invested capital; (vii) generating strong free cash flow; (viii) investing in the future while delivering
earnings growth; (ix) current cash balances and cash flows being adequate to support our business operations,
capital expenditures, and the payment of dividends and share repurchases; (x) being able to supplement near-term
liquidity with our existing credit facility; (xi) capital expenditures in fiscal 2010; (xii) the number of new store openings
and store closings in fiscal 2010; (xiii) net square footage change in fiscal 2010; (xiv) our plan to increase our dividend
in fiscal 2010; (xv) future share repurchases; (xvi) the expected payments and the expected benefits, including cost
savings, resulting from our services agreement with IBM; (xvii) the maximum potential amount of future lease
payments; (xviii) the impact of losses due to indemnification obligations; (xix) the maximum exposure and cash
collateralized balance for the reinsurance pool in future periods; (xx) the estimates and assumptions we use in our
accounting policies, including those used to calculate our lower of cost or market and inventory shortage reserves,
our impairment of long-lived assets, goodwill, and intangible assets, our insurance liabilities, our future sales returns,
our breakage income, and our settlement of foreign and domestic tax audits; (xxi) future lease payments related to
the closure of Forth & Towne; (xxii) the assumptions used to value share-based compensation expense; (xxiii) future
lease payments and related net cash outlay; (xxiv) our intent to use earnings in foreign operations for an indefinite
period or repatriate them only when tax-effective to do so; (xxv) total gross unrecognized tax benefits; and (xxvi) the
impact of recent tax return and refund claim audits.
Because these forward-looking statements involve risks and uncertainties, there are important factors that could
cause our actual results to differ materially from those in the forward-looking statements. These factors include,
without limitation, the following: the risk that the adoption of new accounting pronouncements will impact future
results; the risk that we will be unsuccessful in gauging fashion trends and changing consumer preferences; the
risk that changes in general economic conditions or consumer spending patterns will have a negative impact on
our financial performance or strategies; the highly competitive nature of our business in the United States and
internationally and our dependence on consumer spending patterns, which are influenced by numerous other
factors; the risk that we will be unsuccessful in identifying and negotiating new store locations and renewing or
modifying leases for existing store locations effectively; the risk that comparable store sales and margins will
experience fluctuations; the risk that we will be unsuccessful in implementing our strategic, operating and people
initiatives; the risk that adverse changes in our credit ratings may have a negative impact on our financing costs,
structure and access to capital in future periods; the risk that changes to our information technology (“IT”) systems
may disrupt our operations; the risk that trade matters, events causing disruptions in product shipments from
China and other foreign countries, or an inability to secure sufficient manufacturing capacity may disrupt our
supply chain or operations; the risk that our efforts to expand internationally may not be successful and could
impair the value of our brands; the risk that acts or omissions by our third party vendors, including a failure to
comply with our code of vendor conduct, could have a negative impact on our reputation or operations; the risk
that changes in the regulatory or administrative landscape could adversely affect our financial condition and
results of operations; the risk that we do not repurchase some or all of the shares we anticipate purchasing
pursuant to our repurchase program; and the risk that we will not be successful in defending various proceedings,
lawsuits, disputes, claims, and audits; any of which could impact net sales, expenses, and/or planned strategies.
Additional information regarding factors that could cause results to differ can be found in this Annual Report on
Form 10-K and our other filings with the U.S. Securities and Exchange Commission.
Future economic and industry trends that could potentially impact net sales and profitability are difficult to
predict. These forward-looking statements are based on information as of March 26, 2010 and we assume no
obligation to publicly update or revise our forward-looking statements even if experience or future changes make
it clear that any projected results expressed or implied therein will not be realized.
2Gap Inc. Form 10-K