This excerpt taken from the GPS 10-K filed Mar 28, 2008.
Changes in our credit ratings may limit our access to the capital market.
As a result of changes to our long-term credit ratings, we do not have meaningful access to the commercial paper market. Although we believe that our existing cash, cash equivalents and short-term investments combined with future cash flow from our operations will be adequate to satisfy our capital needs for the foreseeable future, we may require additional cash for unexpected contingencies.
Gap Inc. Form 10-K 9
The interest on our $500 million notes payable due December 2008, of which only $138 million remains outstanding, is subject to increase or decrease by 0.25 percent for each rating downgrade or upgrade, respectively, of our long-term senior unsecured debt ratings by rating agencies. The interest rate on the notes was 10.05 percent per annum as of February 2, 2008.
Any future reduction in our long-term senior unsecured credit rating could result in reduced access to the capital markets and higher interest costs on future financings.
For further information on our debt and credit facilities see the sections entitled Debt and Credit Facilities in our Managements Discussion and Analysis of Financial Condition and Results of Operations included as Part II, Item 7 of this Form 10-K.