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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
[ X ] Annual report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 [Fee Required]
For the fiscal year ended January 29, 1994 or
[ ] Transition report pursuant to Section 13 or
15(d) of the Securities Exchange Act of 1934 [Fee Required]
For the transition period from ______________ to ______________
Commission File Number 1-7562
THE GAP, INC.
(Exact name of registrant as specified in its charter)
Delaware 94-1697231
(State of Incorporation) (I.R.S. Employer
Identification No.)
One Harrison
San Francisco, California 94105
(Address of principal executive offices)
Registrant's telephone number, including area code: (415)952-4400
Securities registered pursuant to Section 12(b) of the Act:
Common Stock, $0.05 par value New York Stock Exchange, Inc.
(Title of class) Pacific Stock Exchange, Inc.
(Name of each exchange where registered)
Securities registered pursuant to Section 12(g) of the Act: None
_______________________
Indicate by check mark whether Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports) and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
The aggregate market value of the voting stock held by non-
affiliates of the Registrant as of March 28, 1994 was
approximately $4,350,722,367, based upon the last price reported
for such date in the NYSE-Composite transactions.
The number of shares of the Registrant's Common Stock
outstanding as of March 28, 1994 was 145,572,634.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Registrant's Proxy Statement for the Annual
Meeting of Stockholders to be held on May 24, 1994 (hereinafter
referred to as the "1994 Proxy Statement") are incorporated into
Parts I and III.
Portions of the Registrant's Annual Report to Stockholders for
the fiscal year ended January 29, 1994 (hereinafter referred to
as the "1993 Annual Report to Stockholders") are incorporated
into Parts II and IV.
PART I
Item 1 - BUSINESS
General
The Gap, Inc. (hereinafter referred to as the "Company") is a
specialty retailer which operates stores selling casual apparel,
shoes and other accessories for men, women and children under six
trade names: Gap, GapKids, babyGap, GapShoes, Banana Republic and
Old Navy Clothing Co. The Company was incorporated in the State
of California in July 1969 and was reincorporated under the laws
of the State of Delaware in May 1988. On March 28, 1994, the
Company operated 1,383 stores, including 841 Gap, 316 GapKids,
179 Banana Republic and 47 Old Navy Clothing Co. stores (40 of
the Gap and GapKids stores are located in the United Kingdom, 64
are located in Canada and 1 is located in France).
All of the Company's merchandise is private label. The Gap
stores offer casual clothing for men and women. GapKids was
introduced in 1986 to provide well-designed, comfortable clothing
for boys and girls ages 2-12. The babyGap line, offering mostly
natural fiber clothing for infants and toddlers, was added in
1990 and is sold in most GapKids stores. Banana Republic, Inc., a
wholly-owned subsidiary acquired by the Company in 1983, offers
classic, casual fashions for men and women. Old Navy Clothing Co.
was introduced in 1993 under the name Gap Warehouse and offers
basic and fashion casual clothing for men, women and children at
lower price points.
Merchandise Inventory, Replenishment and Distribution
The retail apparel specialty business fluctuates according
to changes in customer preferences dictated by fashion and
season. These fluctuations especially affect the inventory owned
by apparel retailers, since merchandise usually must be ordered
well in advance of the season and sometimes before fashion trends
are evidenced by customer purchases. The Company is vulnerable to
changing fashion trends. In addition, the cyclical nature of the
retail business requires the Company to carry a significant
amount of inventory, especially prior to peak selling seasons
when the Company and other retailers generally build up their
inventory levels. The Company must enter into contracts for the
purchase and manufacture of private label apparel well in advance
of the applicable selling season. As a result, the Company is
vulnerable to demand and pricing shifts and to errors in
selection and timing of merchandise purchases.
The Company reviews its inventory levels in order to
identify slow-moving merchandise and broken assortments (items no
longer in stock in a sufficient range of sizes) and may use
markdowns to clear merchandise. Markdowns may be used if
inventory exceeds customer demand for reasons of style, seasonal
adaptation, changes in customer preference or if it is determined
that the inventory in stock will not sell at its currently marked
price. Such markdowns may have an adverse impact on earnings,
depending on their extent and the amount of inventory affected.
Because the Company does not carry much replenishment
inventory in its stores, replenishment inventory is maintained in
the Company's distribution centers in California, Kentucky,
Maryland and Canada and in a distribution center owned and
operated by a third party in the United Kingdom, and then shipped
to the stores.
Store Operations and Expansion
The Company's stores offer a shopper-friendly environment
with a select assortment of casual clothing and accessories which
emphasize style, quality and good value. The range of apparel
displayed in each store varies significantly depending on the
selling season and the size of the store.
The Company's stores generally are open seven days per week
(where permitted by law), three to six nights per week and most
holidays. All sales are made for cash, personal checks or on
credit cards issued by others.
The Company opened 108 new stores and expanded 130 stores
during the 1993 fiscal year; the Company anticipates that it will
open approximately 185 to 200 new stores and expand approximately
90 stores during the 1994 fiscal year. Over the past four years,
the Company has increased the average size of its new stores and
expanded the size of existing stores. For fiscal 1993, the
average size of new and expanded stores was about 8,000 square
feet for The Gap, 4,400 square feet for GapKids, and 7,000 square
feet for Banana Republic. Expanded stores are excluded from
comparable store calculations until they have been open over one
year in their new size.
The Company's continued success depends, in part, upon its
ability both to increase sales at existing store locations and to
open and operate stores on a profitable basis. There can be no
assurance that this expansion will result in enhanced
profitability or that it will continue at the same rate in future
years. In addition, the Company's strategy of expanding
domestically through new concepts (such as Old Navy Clothing
Co.), and internationally in countries in which the Company has
no, or limited, operating history could result in reduced
profitability if such expansion is not successful.
The Company is monitoring proposed federal health care
legislation and anticipates an increase in its operating costs if
such legislation is passed because the Company is a multi-state,
labor-intensive employer. The Company believes that it is too
early to quantify the economic impact of such legislation on the
Company due to uncertainty as to what legislation may ultimately
be adopted.
Suppliers
The Company purchases merchandise from over 700 suppliers
located domestically and overseas. No supplier accounted for more
than 5% of the Company's fiscal 1993 purchases. All suppliers
manufacture the Company's private-label merchandise according to
the Company's specifications. During fiscal 1993, approximately
40% of all the Company's merchandise was produced domestically
while the remaining 60% was imported from overseas vendors.
Approximately 23% of foreign dollar purchases were from Hong
Kong, or about 15% of the Company's total merchandise, with the
remainder coming from 42 other countries. Any event causing a
sudden disruption of imports from Hong Kong, including the
imposition of additional import restrictions, could have a
materially adverse effect on the Company's operations.
Substantially all of the Company's foreign purchases are
negotiated and paid for in U.S. dollars.
The Company cannot predict whether any of the foreign
countries in which its products are currently manufactured or any
of the countries in which the Company may manufacture its
products in the future will be subject to future import
restrictions by the U.S. government, including the likelihood,
type or effect of any trade retaliation. For example, currently
the United States government is considering imposing various
restrictions on the importation of goods from China, including
denial of most favored nation (MFN) status. Trade restrictions,
including increased tariffs or quotas, or both, against apparel
items could affect the importation of apparel generally, and, in
that event, could increase the cost or reduce the supply of
apparel available to the Company and adversely affect the
Company's business, financial condition and results of
operations. In addition, the Company's import operations may be
adversely affected by political instability resulting in the
disruption of trade from exporting countries, significant
fluctuation in the value of the U.S. dollar against foreign
currencies and restrictions on the transfer of funds.
Seasonal Business
The Company's business follows a seasonal pattern, peaking
over a total of about 10 weeks during the late summer (August
through early September) and holiday (Thanksgiving through
Christmas) periods. During fiscal year 1993, these periods
accounted for approximately 30% of the Company's annual sales.
Competition
The Company's business is highly competitive. The Company's
stores compete with national and local department, specialty and
discount store chains and independent retail stores which handle
similar lines of merchandise. Some competitors have larger sales
and assets than the Company.
Depth of selection in sizes, colors and styles of
merchandise, merchandise procurement and pricing, ability to
anticipate fashion trends and customer preferences, inventory
control, reputation, quality of merchandise, store design and
location, advertising and customer service are all important
factors in competing successfully in the retail industry. Given
the large number of companies in the retail industry, the Company
cannot estimate the number of its competitors or its relative
competitive position.
The performance of the Company in recent years has increased
imitation by other retailers. Such imitation has made and will
continue to make the retail environment more competitive. In
addition, the success of the Company's operations depends upon a
number of factors relating to consumer spending, including
future economic conditions affecting disposable consumer income
such as employment, business conditions, interest rates and
taxation. A decline in consumer spending could adversely affect
the Company's net sales and profitability.
Advertising
The Company's marketing strategy primarily involves
advertising in major metropolitan newspapers and their Sunday
magazines and in The New Yorker, with smaller amounts of print
advertising in lifestyle and fashion magazines, such as Vanity
Fair and Glamour. Other advertising media include various outdoor
venues, such as bus shelters, mass transit posters, billboards,
telephone kiosks and exterior bus panels,including double-decker
London buses. In addition, the Gap Division introduced in 1993 a
new print campaign for its khaki pants featuring celebrities in
the fields of the arts and motion pictures wearing khakis.
Employees
On January 29, 1994, the Company had a work force of
approximately 44,000 employees. Additionally, the Company hires
temporary employees during the peak late summer and holiday
seasons. The Company considers its employee relations to be good.
Trademarks and Service Marks
The trademarks and service marks for Gap, GapKids, babyGap,
GapShoes, Banana Republic and Old Navy Clothing Co., and other
trademarks either have been registered, or have trademark
applications pending, with the United States Patent and Trademark
Office and with the registries of many foreign countries.
Executive Officers of the Registrant
The Chairman and Chief Executive Officer of the Company is
Donald G. Fisher. Millard S. Drexler is the President and Chief
Operating Officer of the Company and Chief Executive Officer of
the operating divisions. Robert J. Fisher is Executive Vice
President and Chief Financial Officer of the Company. Each of
Messrs. Donald G. Fisher, Robert J. Fisher and Drexler is a
director of the Company and the required information with respect
to each of them is set forth in the table located in the Section
entitled "Nominees for Election as Directors" of the 1994 Proxy
Statement and is incorporated by reference herein. The following
are also executive officers of the Company:
Name Age Position
Patricia DeRosa 41 President, GapKids Division
William S. Fisher 37 President, International Division
Magdalene Gross 45 Executive Vice President - Advertising, Gap Division
Warren R. Hashagen 43 Senior Vice President - Finance
Richard M. Lyons 37 President, Gap Division
Ms. DeRosa joined the Company in 1975 and has served as
President, GapKids Division since July 1993. From August 1992 to
July 1993 she was Executive Vice President, Gap Division and from
March 1991 to August 1992 she served as Executive Vice President -
Merchandising, Gap Division. From April 1989 to March 1991 she
was Senior Vice President, General Merchandise Manager, Men's,
Gap Division, and from 1988 to March 1989 she was Vice President,
General Merchandise Manager, Men's. From 1986 to 1988 she was
Merchandise Manager, Men's.
Mr. William S. Fisher joined the Company in 1984 and has
served as President, International Division since July 1993. From
August 1992 to July 1993 he was Executive Vice President,
International Division and from April to August 1992 he served as
Senior Vice President - International, Gap Division in charge of
United Kingdom and Canada operations. He served as Senior Vice
President - International from April 1991 to April 1992 and as
Vice President - International, Canada Operations from December
1989 to April 1991. From 1988 to 1989 he was Regional Manager,
Gap Division and from 1987 to 1988 he was Vice President of
Stores and Operations, Banana Republic, Inc.
Ms. Gross joined the Company in 1984 and has served as
Executive Vice President - Advertising, Gap Division since April
1992. From 1989 to 1992, she was Senior Vice President -
Advertising. She served as Senior Vice President - Advertising of
the Gap Division from 1986 to 1989.
Mr. Hashagen joined the Company in 1982 and has served as
Senior Vice President - Finance since April 1992. From February
1991 to April 1992, he was Senior Vice President - Finance and
Treasurer. He served as Vice President, Treasurer from 1988 to
1991 and as Corporate Treasurer from 1987 to 1988.
Mr. Lyons joined the Company in 1984 and has served as
President, Gap Division since July 1993. From August 1992 to July
1993 he was Executive Vice President, GapKids Division and from
November 1989 to August 1992 he was Senior Vice President -
General Merchandise Manager, GapKids Division. He served as
General Merchandise Manager, GapKids from 1988 to 1989, at which
time he was promoted to Vice President - General Merchandise
Manager, GapKids. From 1986 to 1988 he was Buyer for GapKids.
Item 2 - PROPERTIES
During fiscal year 1993, the Company opened 108 stores and
closed 45. The newly-opened stores include 45 Gap stores
(including 1 store in the United Kingdom, 5 stores in Canada and
1 store in France), 44 GapKids stores (including 2 stores in the
United Kingdom and 6 stores in Canada) and 19 Banana Republic
stores. In addition, during fiscal year 1993, the Company
expanded 130 stores. The expanded stores include 81 Gap stores
(including 2 stores in the United Kingdom and 6 stores in
Canada), 34 GapKids stores, 14 Banana Republic stores and 1 Old
Navy Clothing Co. store. The 1,370 stores operating on January
29, 1994 aggregated approximately 7.5 million square feet. The
Company leases virtually all of its store premises for terms
generally ranging from 12 to 15 years. Most leases provide for
additional rent based on a percentage of store sales in addition
to or in lieu of minimum rentals, as well as for the payment of
certain other expenses. Some leases contain cancellation clauses
in favor of the Company if specified sales levels are not
achieved. In the United States, the Company's stores are located
in all of the 50 largest metropolitan statistical areas.
During fiscal year 1994, the Company plans to increase store
space by 15% to 20%, after taking into account store closings.
This increase is expected to include the opening of approximately
185 to 200 stores worldwide and the expansion of approximately 90
of the Company's existing stores.
The Company leases its headquarters and regional office
buildings, as well as its Eastern (EDC) and Canadian (CDC)
Distribution Centers. The EDC in Erlanger, Kentucky consists of
approximately 1,042,000 square feet. It distributes Gap, GapKids
and Banana Republic merchandise and its lease term runs through
February 28, 2003, with options to extend the lease for an
additional 30 years. The Company leases approximately 112,000
square feet in Brampton, Ontario to serve as its Canadian
distribution facility. The CDC distributes Gap and GapKids
merchandise and its lease term runs through August 23, 2000, with
options to extend the lease for an additional ten years.
The Company owns its Western Distribution Center (WDC)
located in Ventura, California. This facility, which is
approximately 334,000 square feet, distributes Gap and GapKids
merchandise. The Company also owns an adjacent five acre parcel
for possible future expansion. The Atlantic Distribution Center
(ADC), a facility owned by the Company in Edgewood, Maryland,
covers approximately 745,000 square feet and distributes Gap
merchandise. The Company also owns 156 additional acres, portions
of which could be used for potential expansion of the ADC.
The Company also owns and operates a data center located on
seven acres of land in Rocklin, California; it covers
approximately 40,000 square feet and serves as a corporate
computer processing center.
The Company continues to explore alternatives for expanding
its headquarters facilities in San Francisco and San Bruno,
California.
Item 3 - LEGAL PROCEEDINGS
The Company is a party to routine litigation incident to its
business. Some of the lawsuits to which the Company is a party
are covered by insurance and are being defended by the Company's
insurance carriers. The Company has established reserves which
management believes are adequate to cover any litigation losses
which may occur.
Item 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
PART II
Item 5 - MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
The information required by this item is incorporated herein
by reference to page 23 of the paper version of the 1993 Annual
Report to Stockholders and as electronically filed under the heading
"Management's Discussion and Analysis of results of Operations
and Financial Condition" of Exhibit 13 to this Annual Report on
Form 10-K.
Item 6 - SELECTED FINANCIAL DATA
The information required by this item is incorporated herein
by reference to pages 20 and 21 of the paper version of the 1993
Annual Report to Stockholders and as electronically filed under
the heading "Five Year Selected Financial Data" of Exhibit 13 to
this Annual Report on Form 10-K.
Item 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The information required by this item is incorporated herein
by reference to pages 22 and 23 of the paper version of the 1993
Annual Report to Stockholders and as electronically filed under the
heading "Management's Discussion and Analysis of results of
Operations and Financial Condition" of Exhibit 13 to this Annual
Report on Form 10-K.
Item 8 - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
($000) January 29, 1994 January 30, 1993
Short-term Deferred Tax Asset $25,119 $36,755
Accrued Payroll 27,238 24,628
The information required by this item is incorporated herein
by reference to pages 24-33 of the paper version of the 1993
Annual Report to Stockholders and as electronically filed under the
headings "Management's Report on Financial Condition, Independent
Auditor's Report, Consolidated Statements of Earnings,
Consolidated Balance Sheets, Consolidated Statements of Cash
Flows, Consolidated Statements of Stockholders' Equity and Notes
to Consolidated Financial Statements" of Exhibit 13 to this
Annual Report on Form 10-K.
Item 9 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
Not applicable.
PART III
Item 10 - DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information required by this item is incorporated herein
by reference to the Section entitled "Nominees for Election as
Directors" and "Compliance with Section 16(a) of the Securities
Exchange Act of 1934" in the 1994 Proxy Statement. See also Item
1 above.
Item 11 - EXECUTIVE COMPENSATION
The information required by this item is incorporated herein
by reference to the Sections entitled "Compensation of
Directors," "Executive Compensation" and "Employment Contracts
and Termination of Employment Arrangements" in the 1994 Proxy
Statement.
Item 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The information required by this item is incorporated herein
by reference to the Section entitled "Beneficial Ownership of
Shares" in the 1994 Proxy Statement.
Item 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information required by this item is incorporated herein
by reference to the Sections entitled "Other Reportable
Transactions" and "Indebtedness of Management" in the 1994 Proxy
Statement.
PART IV
Item 14 - EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES, AND REPORTS
ON FORM 8-K
1. The following consolidated financial statements,
schedules and exhibits are filed as part of this report or are
incorporated herein as indicated.
A. Financial Statements
(i) Independent Auditors' Report. Incorporated by reference
to Page 24 of the paper version of the 1993 Annual
Report to Stockholders and as electronically filed
under the heading "Independent Auditors' Report: of
Exhibit 13 to this Annual Report on Form 10-K.
(ii) The consolidated balance sheets as of January 29, 1994
and January 30, 1993 and the related consolidated
statements of earnings, cash flows, and stockholders'
equity for each of the three fiscal years in the period
ended January 29, 1994 are incorporated by reference to
pages 25-33 of the paper version of the 1993 Annual
Report to Stockholders and as filed electronically
under the headings "Consolidated Statements of
Earnings, Consolidated Balance Sheets, Consolidated
Statements of Cash Flows, Consolidated Statements of
Stockholders' Equity" of Exhibit 13 to this Annual
Report on Form 10-K.
B. Financial Statement Schedules
Schedules and Independent Auditors' Report thereon for the three
years ended January 29, 1994, filed as part of this Annual Report on Form
10-K.
Independent Auditors' Report on Schedules
II - Amounts Receivable From Related Parties and Underwriters,
Promoters and Employees Other Than Related Parties
V - Property, Plant and Equipment
VI - Accumulated Depreciation and Amortization of Property,
Plant and Equipment
IX - Short-Term Borrowings
X - Supplementary Statements of Earnings Information
Schedules other than those referred to above have been omitted
because they are not required or are not applicable or because the
information required to be set forth therein either is not material or
is included in the financial statements or notes thereto.
Individual financial statements of the Company have been omitted
since the Company is primarily an operating Company and the indebtedness
of the wholly owned subsidiaries to any person other than the Company does
not exceed five percent of the total assets.
C. Exhibits
Incorporated herein by reference is a list of the Exhibits
contained in the Exhibit Index which begins on sequentially numbered
page 21 of the paper version of this Report.
D. Reports on Form 8-K
No reports on Form 8-K were filed or required to be filed for
the last quarter of the fiscal year.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
THE GAP, INC.
Date: April 15, 1994 By /s/ Donald G. Fisher
Donald G. Fisher, Chairman and Chief
Executive Officer (Principal Executive Officer)
Date: April 15, 1994 By /s/ Robert J. Fisher
Robert J. Fisher, Executive Vice
President and Chief Financial Officer
(Principal Financial and Accounting Officer)
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
Date: April 15, 1994 By /s/ John G. Bowes
John G. Bowes, Director
Date: April 15, 1994 By /s/ Millard S. Drexler
Millard S. Drexler, Director
Date: April 15, 1994 By /s/ Donald G. Fisher
Donald G. Fisher, Director
Date: April 15, 1994 By /s/ Doris F. Fisher
Doris F. Fisher, Director
Date: April 15, 1994 By /s/ Robert J. Fisher
Robert J. Fisher, Director
Date: April 15, 1994 By /s/ William A. Hasler
William A. Hasler, Director
Date: April 15, 1994 By /s/ John M. Lillie
John M. Lillie, Director
Date: April 15, 1994 By /s/ Charles R. Schwab
Charles R. Schwab, Director
Date: April 15, 1994 By /s/ Brooks Walker, Jr.
Brooks Walker, Jr., Director
INDEX TO FINANCIAL STATEMENT SCHEDULES (page references are to the
paper version of the Annual Report on Form 10-K)
Independent Auditors' Report on Schedules F-1
II -Amounts Receivable From Related Parties
and Underwriters, Promoters and Employees
Other Than Related Parties F-2
V -Property, Plant and Equipment F-4
VI -Accumulated Depreciation and Amortization of
Property, Plant and Equipment F-5
IX -Short-Term Borrowings F-6
X -Supplementary Statements of Earnings Information F-7
Deloitte & Touche
50 Fremont Street Telephone:(415)247-4000
San Francisco, California 94105-2230 Facsimile:(415)247-4329
INDEPENDENT AUDITORS' REPORT ON SCHEDULES
To the Stockholders and Board of Directors of The Gap, Inc.
We have audited the consolidated financial statements of The Gap, Inc. and
subsidiaries as of January 29, 1994 and January 30, 1993, and for each of
the three fiscal years in the period ended January 29, 1994 and have issued
our report thereon dated March 3, 1994: such financial statements and
report are included in your 1993 Annual Report to Stockholders and are
incorporated herein by reference. Our audits also included the
consolidated financial statement schedules of The Gap, Inc. and
subsidiaries, listed in Item 14. These consolidated financial statement
schedules are the responsibility of the Company's management. Our
responsibility is to express an opinion based on our audits. In our
opinion,such consolidated financial statement schedules, when considered
in relation to the basic consolidated financial statements taken as a
whole, present fairly in all material respects the information set forth
therein.
/S/ Deloitte & Touche
March 3, 1994
THE GAP, INC. AND SUBSIDIARIES
SCHEDULE II - AMOUNTS RECEIVABLE FROM RELATED PARTIES AND UNDERWRITERS,
PROMOTERS, AND EMPLOYEES OTHER THAN RELATED PARTIES
Balance at Deductions Balance at
beginning Amounts Amounts end of period
Name of debtor of period Additions collected written off Current Non-Current
Year Ended January 29, 1994:
Christopher Fiore $150,000 $ - ($150,000) $ - $ - $ -
Ronald G. Franks 130,000 - - - - 130,000
Kevin M. Lonergan 130,000 - (15,000) - 115,000 -
George P. Blankenship 100,000 - - - 100,000 -
David M. DeMattei 100,000 - - (50,000) 50,000 -
Stanley L. Moore 100,000 - (50,000) - - 50,000
T. Robert Bell IV 100,000 - (100,000) - - -
Laura J. Loda - 134,179 (91,679) - - 42,500
Joann C. Kuss - 103,414 - - 103,414 -
Year Ended January 30, 1993:
Millard S. Drexler $500,000 $ - ($500,000) $ - $ - $ -
J. Patrick Spainhour 179,000 210,000 (375,000) (14,000) - -
Ronald G. Franks 170,000 - (40,000) - - 130,000
Stanley L. Moore 159,508 - (59,508) - - 100,000
Kevin M. Lonergan 145,000 - - (15,000) 15,000 115,000
T. Robert Bell IV 100,000 - - - - 100,000
George P. Blankenship 100,000 - - - - 100,000
David M. DeMattei 100,000 - - - 50,000 50,000
Gail Pfeifer 16,456 - (2,689) - 2,855 10,912
Christopher Fiore - 164,375 (14,375) - - 150,000
Brian W. Falk - 177,986 (132,986) - - 45,000
Walter N. Moll - 183,049 (120,549) - - 62,500
Year Ended February 1, 1992:
Millard S. Drexler $500,000 $ - $ - $ - $ - $500,000
J. Patrick Spainhour 186,000 - - (7,000) 7,000 172,000
Ronald G. Franks 40,000 130,000 - - 130,000 40,000
Stanley L. Moore - 159,508 - - 59,508 100,000
Kevin M. Lonergan 160,000 - - (15,000) 15,000 130,000
T. Robert Bell IV 467,037 - (367,037) - - 100,000
George P. Blankenship 100,000 - - - - 100,000
David M. DeMattei 15,181 100,000 (15,181) - - 100,000
James A. Gargiulo 390,000 - (390,000) - - -
Raymond C. Attanasio 192,072 176,364 (368,436) - - -
Robert T. Amato - 138,645 (138,645) - - -
Daniel E. Walker - 125,000 (125,000) - - -
Gail Pfeifer 132,762 - (116,306) - 2,689 13,767
Steven S. Krajenka - 114,178 (114,178) - - -
Carole J. Whitacre 100,000 - (100,000) - - -
_________________________________________
Loan is (was) secured by a deed of trust on debtor's principal residence
and, in some cases, by the debtor's restricted stock or stock options.
Interest at a rate of 4% to 9% is (was) paid monthly with outstanding
principal and any unpaid interest due in full at dates ranging from
September 1993 to August, 1998.
The loan was securted by a first deed of trust on real property owned
by the debtor. The loan and all related interest was paid in full on
April 8, 1992.
Loan is (was) a non-interest bearing bridge loan due upon the sale of
the debtor's principal residence.
A portion of loan was a non-interest bearing personal loan.
Loan was secured by a deed of trust on debtor's principal residence and
was due upon the exercise of the debtor's stock options. Loan was non-
interest bearing until April 1, 1992, at which time interest at a rate
of 8% became payable monthly.
THE GAP, INC. AND SUBSIDIARIES
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT
($000)
Reclassification
Balance at of costs from Balance at
beginning Additions construction- end of
Classification of period at cost Retirements in-progress period
Year Ended January 29, 1994:
Leasehold Improvements $490,791 $ 7,713 ($21,118) $ 79,174 $ 556,560
Furniture and Equipment 388,219 80,472 (7,117) 43,378 504,952
Construction-in-progress 16,623 134,897 - (122,552) 28,968
Total $895,633 $223,082 ($28,235) - $1,090,480
Year Ended January 30, 1993:
Leasehold Improvements $394,835 $ 1,198 ($25,757) $ 120,515 $ 490,791
Furniture and Equipment 255,665 72,232 (26,847) 87,169 388,219
Construction-in-progress 86,967 137,340 - (207,684) 16,623
Total $737,467 $210,770 ($52,604) - $ 895,633
Year Ended February 1, 1992:
Leasehold Improvements $289,266 $ 522 ($21,101) $ 126,148 $ 394,835
Furniture and Equipment 178,109 54,768 (14,914) 37,702 255,665
Construction-in-progress 60,992 189,825 - (163,850) 86,967
Total $528,367 $245,115 ($36,015) - $ 737,467
Note: Refer to Note A of the Consolidated Financial Statements for
description of depreciation methods.
THE GAP, INC. AND SUBSIDIARIES
SCHEDULE VI - ACCUMULATED DEPRECIATION AND AMORTIZATION OF
PROPERTY, PLANT AND EQUIPMENT
($000)
Additions
Balance at charged to Balance at
beginning costs and end of
Description of period expenses Retirements period
Year Ended January 29, 1994:
Leasehold Improvements $121,235 $41,883 ($12,035) $151,083
Furniture and Equipment 124,030 79,647 (4,702) 198,975
Total $245,265 $121,530 ($16,737) $350,058
Year Ended January 30, 1993:
Leasehold Improvements $100,878 $35,067 ($14,710) $121,235
Furniture and Equipment 88,849 59,117 (23,936) 124,030
Total $189,727 $94,184 ($38,646) $245,265
Year Ended February 1, 1992:
Leasehold Improvements $86,259 $27,846 ($13,227) $100,878
Furniture and Equipment 58,560 42,274 (11,985) 88,849
Total $144,819 $70,120 ($25,212) $189,727
Note: Refer to Note A of the Consolidated Financial Statements for
description of depreciation methods.
THE GAP, INC. AND SUBSIDIARIES
SCHEDULE IX - SHORT-TERM BORROWINGS
($000)
Maximum Average Weighted
Weighted amount amount average
Balance average outstanding outstanding interest
Category of aggregate at end interest during during rate during
short-term borrowings of period rate the period the period the period
Year ended January 29, 1994:
Notes Payable to Banks $7,603 5.42% $18,950 $ 5,993 5.65%
Commercial Paper - - - - -
Year ended January 30, 1993:
Notes Payable to Banks $ - - $27,900 $ 3,383 3.28%
Commercial Paper - - 22,500 3,616 3.27%
Year ended February 1, 1992:
Notes Payable to Banks $ - - $52,700 $12,321 5.82%
Commercial Paper - - 30,100 2,983 6.18%
_________________________________________
The average amount outstanding during the period is computed
by dividing the total of daily outstanding balances by the number
of days in the year.
The weighted average interest rate during the period is computed by
dividing the actual short-term interest expense by the average short-term
debt outstanding.
Note: Refer to Note B of the Consolidated Financial Statements for
general terms of short-term borrowings. Short-term borrowings
have original maturities of three months or less.
THE GAP, INC. AND SUBSIDIARIES
SCHEDULE X - SUPPLEMENTARY STATEMENTS OF EARNINGS INFORMATION
($000)
Item Charged to Costs and Expenses
Fiscal Years
1993 1992 1991
Advertising Costs $37,510 $46,249 $34,674
Note: Costs and expenses which are not stated above have been omitted
because the information required to be set forth therein either
is not material or is included in the financial statements or
notes thereto.
EXHIBIT INDEX
3.1 Registrant's Amended and Restated Certificate of
Incorporation, filed as Exhibit 3.1 to
Registrant's Annual Report on Form 10-K for the
year ended January 30, 1993, Commission File No.
1-7562.
3.2 Registrant's By-Laws, filed as Exhibit C to
Registrant's definitive proxy statement for its
annual meeting of stockholders held on May 24,
1988, Commission File No. 1-7562.
10.1 Credit Agreement, dated as of March 2, 1990,
among Registrant and Citibank, N.A.; Bank of
America National Trust & Savings Association;
Continental Bank N.A.; National Westminster Bank
PLC; Security Pacific National Bank; Deutsche
Bank, AG New York Branch and Cayman Islands
Branch; Harris Trust and Savings Bank; NCNB
National Bank of North Carolina; The Royal Bank
of Canada; Algemene Bank Nederland N.V., Cayman
Islands Branch; The Sumitomo Bank Limited; and
Swiss Bank Corporation, filed as Exhibit 10.6 to
Registrant's Annual Report on Form 10-K for the
year ended February 3, 1990, Commission File No.
1-7562.
10.2 Amendment to Credit Agreement, dated as of March
4, 1991, filed as Exhibit 10.7 to Registrant's
Annual Report on Form 10-K for the year ended
February 2, 1991, Commission File No. 1-7562.
10.3 Second Amendment to Credit Agreement, dated as
of September 16, 1992, filed as Exhibit 10.3 to
Registrant's Annual Report on Form 10-K for the
year ended January 30, 1993, Commission File No.
1-7562.
10.4 Third Amendment to Credit Agreement, dated as of
January 22, 1993, filed as Exhibit 10.4 to
Registrant's Annual Report on Form 10-K for the
year ended January 30, 1993, Commission File No.
1-7562.
10.5 Note Agreement, dated as of February 22, 1991,
among Registrant and The Prudential Insurance
Company of America; Prudential Property and
Casualty Insurance Company; Nationwide Life
Insurance Company; West Coast Life Insurance
Company; Financial Horizons Life Insurance
Company; Farmland Life Insurance Company;
Wisconsin Health Care Liability Insurance Plan;
and Allstate Life Insurance Company filed as
Exhibit 10.8 to Registrant's Annual Report on
Form 10-K for the year ended February 2, 1991,
Commission File No. 1-7562.
10.6 Lease Agreement (Canadian Distribution Center),
dated as of 4/5/90, between Registrant and
Bramalea Limited filed as Exhibit 10.9 to
Registrant's Annual Report on Form 10-K for the
year ended February 2, 1991, Commission File No.
1-7562.
10.7 First Amendment to Lease Agreement (Canadian
Distribution Center), dated as of July 5, 1990,
filed as Exhibit 10.7 to Registrant's Annual
Report on Form 10-K for the year ended January
30, 1993, Commission File No. 1-7562.
10.8 Lease Agreement (Eastern Distribution Center),
dated as of July 6, 1979, between Registrant and
Corporate Property Associates, filed as Exhibit
10.8 to Registrant's Annual Report on Form 10-K
for the year ended February 3, 1980, Commission
File No. 1-7562.
10.9 Amendment to Lease Agreement (Eastern
Distribution Center), dated as of October 10,
1986, filed as Exhibit 10.10 to Registrant's
Annual Report on Form 10-K for the year ended
January 30, 1988, Commission File No. 1-7562.
10.10 Second Amendment to Lease Agreement (Eastern
Distribution Center), dated as of February 16,
1988, filed as Exhibit 10.11 to Registrant's
Annual Report on Form 10-K for the year ended
January 30, 1988, Commission File No. 1-7562.
10.11 Lease Agreement (Kentucky Distribution Center),
dated as of February 16, 1988, between
Registrant and Corporate Property Associates 7,
filed as Exhibit 10.12 to Registrant's Annual
Report on Form 10-K for the year ended January
30, 1988, Commission File No. 1-7562.
10.12 Lease Agreement (One Harrison, San Francisco),
dated as of September 1, 1987, between
Registrant's wholly-owned subsidiary, Banana
Republic, Inc. ("Banana Republic"), and JMC
Associates Limited Partnership, filed as Exhibit
10.13 to Registrant's Annual Report on Form 10-K
for the year ended January 30, 1988, Commission
File No. 1-7562.
10.13 First Amendment to Lease Agreement (One
Harrison, San Francisco), dated as of December
21, 1987, filed as Exhibit 10.14 to Registrant's
Annual report on Form 10-K for the year ended
February 1, 1992, Commission File No. 1-7562.
10.14 Second Amendment to Lease Agreement (One
Harrison, San Francisco), dated as of October
16, 1991, filed as Exhibit 10.15 to Registrant's
Annual report on Form 10-K for the year ended
February 1, 1992, Commission File No. 1-7562.
10.15 Sublease Agreement (One Harrison, San
Francisco), dated as of December 21, 1987,
between Registrant's wholly-owned subsidiary,
Banana Republic, Inc. and Hillman Properties
West, Inc., filed as Exhibit 10.14 to
Registrant's Annual Report on Form 10-K for the
year ended January 30, 1988, Commission File No.
1-7562.
10.16 First Amendment to Sublease Agreement (One
Harrison, San Francisco), dated as of December
17, 1990, filed as Exhibit 10.17 to Registrant's
Annual report on Form 10-K for the year ended
February 1, 1992, Commission File No. 1-7562.
10.17 Second Amendment to Sublease Agreement (One
Harrison, San Francisco), dated as of September
30, 1991, filed as Exhibit 10.18 to Registrant's
Annual report on Form 10-K for the year ended
February 1, 1992, Commission File No. 1-7562.
10.18 Third Amendment to Sublease Agreement (One
Harrison, San Francisco), dated as of October
16, 1991, filed as Exhibit 10.19 to Registrant's
Annual report on Form 10-K for the year ended
February 1, 1992, Commission File No. 1-7562.
10.19 Lease Agreement (Two Harrison, San Francisco),
dated as of May 31, 1991, between Registrant and
Harrison Plaza, Ltd., a California limited
partnership, filed as Exhibit 10.20 to
Registrant's Annual report on Form 10-K for the
year ended February 1, 1992, Commission File No.
1-7562.
10.20 Purchase Agreement (Atlantic Distribution
Center), dated as of April 9, 1990, between
Registrant and Greater Harford Industrial Park
Partnership, filed as Exhibit 10.13 to
Registrant's Annual Report on Form 10-K for the
year ended February 3, 1990, Commission File No.
1-7562.
10.21 Purchase and Installation Agreement (Materials
Handling Equipment for Atlantic Distribution
Center), dated as of December 18, 1990, between
Registrant and Computer Aided Systems, Inc.
filed as Exhibit 10.17 to Registrant's Annual
Report on Form 10-K for the year ended February
2, 1991, Commission File No. 1-7562.
10.22 Construction Agreement (Atlantic Distribution
Center), dated as of July 31, 1990, between
Registrant and Robert A. Kinsley, Inc., filed as
Exhibit 10.18 to Registrant's Annual Report on
Form 10-K for the year ended February 2, 1991,
Commission File No. 1-7562.
10.23 Purchase Agreement (Rocklin Data Center), dated
as of November 20, 1990, between Registrant and
Stanford Ranch, Inc., filed as Exhibit 10.19 to
Registrant's Annual Report on Form 10-K for the
year ended February 2, 1991, Commission File No.
1-7562.
10.24 Construction Agreement (Rocklin Data Center),
dated as of January 11, 1991, between Registrant
and The Austin Company, filed as Exhibit 10.20
to Registrant's Annual Report on Form 10-K for
the year ended February 2, 1991, Commission File
No. 1-7562.
10.25 Purchase Agreement (Canadair Corporate Jet),
dated as of July 11, 1991, between Registrant
and Canadair Challenger, Inc., a Delaware
corporation, filed as Exhibit 10.26 to
Registrant's Annual report on Form 10-K for the
year ended February 1, 1992,
10.26 Construction Agreement, dated as of January 1,
1992, between Registrant and Fisher Development,
Inc., filed as Exhibit 10.26 to Registrant's
Annual Report on Form 10-K for the year ended
January 30, 1993, Commission File No. 1-7562.
10.27 Letter Agreement, dated as of December 17, 1992,
amending the Restated Construction Agreement
between Registrant and Fisher Development, Inc.,
filed as Exhibit 10.27 to Registrant's Annual
Report on Form 10-K for the year ended January
30, 1993, Commission File No. 1-7562.
EXECUTIVE COMPENSATION PLANS AND ARRANGEMENTS
10.28 1981 Stock Option Plan, filed as Exhibit 4.1 to
Registrant's Registration Statement on Form S-8,
Commission File No. 33-54690.
10.29 Form of Nonqualified Stock Option Agreement
under Registrant's 1981 Stock Option Plan, filed
as Exhibit 4.2 to Registrant's Registration
Statement on Form S-8, Commission File No. 33-
54690.
10.30 Management Incentive Restricted Stock Plan II,
filed as Exhibit 4.1 to Registrant's
Registration Statement on Form S-8, Commission
File No. 33-54686.
10.31 Form of Restricted Stock Agreement under
Registrant's Management Incentive Restricted
Stock Plan II, filed as Exhibit 4.2 to
Registrant's Registration Statement on Form S-8,
Commission File No. 33-54686.
10.32 GapShare, filed as Exhibit 4.1 to Registrant's
Registration Statement on Form S-8, Commission
File No. 33-40505.
10.33 Nonqualified Supplemental Executive Retirement
Plan, effective January 1, 1988, filed as
Exhibit 10.29 to Registrant's Annual Report on
Form 10-K for the year ended February 3, 1990,
Commission File No. 1-7562.
10.34 Description of Management Incentive Cash Award Plan.
10.35 Executive Management Incentive Cash Award Plan,
filed as Exhibit A to the Registrant's
definitive proxy statement for its annual
meeting of stockholders held on May 24, 1994,
Commission File No. 1-7562 Proxy.
10.36 Deferred Compensation Plan.
10.37 Relocation Loan Plan, filed as Exhibit A to
Registrant's definitive proxy statement for its
annual meeting of stockholders held on October
25, 1977, Commission File No. 1-7562.
10.38 Certificate of Corporate Resolution amending the
Relocation Loan Plan, adopted by the Board of
Directors on November 27, 1990, filed as Exhibit
10.34 to Registrant's Annual Report on Form 10-K
for the year ended February 2, 1991, Commission
File No. 1-7562.
10.39 Agreement, dated as of October 22, 1985, between
Registrant and Millard S. Drexler, together with
an amendment thereto dated as of November 21,
1985, filed as Exhibits 19.1 and 19.2,
respectively, to Registrant's quarterly Report
on Form 10-Q for the quarter ended November 2,
1985, Commission File No. 1-7562.
10.40 Amendment to the Agreement between Registrant,
Millard Drexler and Donald Fisher, dated October
23, 1992, filed as Exhibit 10.38 to Registrant's
Annual Report on Form 10-K for the year ended
January 30, 1993, Commission File No. 1-7562.
10.41 Amended and Restated Restricted Stock Agreement,
dated January 30, 1992, between Registrant and
Millard Drexler, filed as Exhibit 10.39 to
Registrant's Annual Report on Form 10-K for the
year ended January 30, 1993, Commission File No.
1-7562.
10.42 First Amendment to the Amended and Restated
Restricted Stock Agreement, dated October 23,
1992, between Registrant and Millard Drexler,
filed as Exhibit 10.40 to Registrant's Annual
Report on Form 10-K for the year ended January
30, 1993, Commission File No. 1-7562.
10.43 Restricted Stock Award Agreement, dated April
13, 1992, between Registrant and Millard
Drexler, filed as Exhibit 10.41 to Registrant's
Annual Report on Form 10-K for the year ended
January 30, 1993, Commission File No. 1-7562.
10.44 First Amendment to Restricted Stock Award
Agreement, dated October 23, 1992, between
Registrant and Millard Drexler, filed as Exhibit
10.42 to Registrant's Annual Report on Form 10-K
for the year ended January 30, 1993, Commission
File No. 1-7562.
10.45 Non-Employee Director Retirement Plan, dated
October 27, 1992, filed as Exhibit 10.43 to
Registrant's Annual Report on Form 10-K for the
year ended January 30, 1993, Commission File No.
1-7562.
11 Computation of Earnings per Share.
13 Registrant's annual report to security holders
for the fiscal year ended January 29, 1994.
21 Subsidiaries of Registrant.
23 Consent of Deloitte & Touche.
Incorporated by reference as indicated