Childrens Place, Inc. 10-K

ITEM 9A. CONTROLS AND PROCEDURES. Evaluation of Disclosure Controls and Procedures Disclosure controls and procedures are designed only to provide “reasonable assurance” that the controls and procedures will meet their objectives. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our Company have been detected. Management, including our President and Interim Chief Executive Officer, and Chief Accounting Officer and Interim Chief Financial Officer as of February 1, 2025, evaluated the effectiveness of our disclosure controls and procedures as defined in Rule 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of February 1, 2025. Based on that evaluation, our President and Interim Chief Executive Officer, and Chief Accounting Officer and Interim Chief Financial Officer as of February 1, 2025, concluded that our disclosure controls and procedures were effective at the reasonable assurance level, as of February 1, 2025, to ensure that all information required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms, and is accumulated and communicated to our management, including our principal executive, principal accounting, and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Management’s Report on Internal Control Over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Exchange Act Rule 13a-15(f). Internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of our financial reporting for external purposes in accordance with accounting principles generally accepted in the U.S. Because of its inherent limitations, internal control over financial reporting is not intended to provide absolute assurance that a misstatement of our financial statements would be prevented or detected. Under the supervision and with the participation of our management, including our President and Interim Chief Executive Officer, and Chief Accounting Officer and Interim Chief Financial Officer as of February 1, 2025, we conducted an evaluation of the design and effectiveness of our internal control over financial reporting based on the criteria set forth in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Based on our evaluation under the Internal Control-Integrated Framework, our management concluded that our internal control over financial reporting was effective as of February 1, 2025. Changes in Internal Control Over Financial Reporting There have been no changes in our internal control over financial reporting that occurred during our most recently completed fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ITEM 9B. OTHER INFORMATION. Not applicable . ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS. Not applicable. 49 Table of Contents PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE. The information required to be included by Item 10 of Form 10-K will be set forth in the Company’s proxy statement for its 2025 annual meeting of stockholders to be filed with the SEC within 120 days after February 1, 2025 (the “Proxy Statement”) and is incorporated by reference herein. We have adopted an insider trading policy governing the purchase and sale of our securities by our directors, executive officers, and employees, and by the Company. A copy of our insider trading policy is filed as Exhibit 19.1 to this Form 10-K. ITEM 11. EXECUTIVE COMPENSATION. The information required to be included by Item 11 of Form 10-K will be set forth in the Proxy Statement and is incorporated by reference herein. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS. The information required to be included by Item 12 of Form 10-K will be set forth in the Proxy Statement and is incorporated by reference herein. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE. The information required to be included by Item 13 of Form 10-K will be set forth in the Proxy Statement and is incorporated by reference herein. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES. The information required to be included by Item 14 of Form 10-K will be set forth in the Proxy Statement and is incorporated by reference herein. 50 Table of Contents PART IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES. (a)(1) Financial Statements The following documents are filed as part of this report: Report of Independent Registered Public Accounting Firm (PCAOB ID: 243 ) 52 Report of Independent Registered Public Accounting Firm (PCAOB ID: 42 ) 54 Consolidated Balance Sheets as of February 1 , 202 5 and February 3, 2024 55 Consolidated Statements of Operations for the fiscal years ended February 1 , 202 5 , February 3, 2024 , January 28, 2023 56 Consolidated Statements of Comprehensive Loss for the fiscal years ended February 1, 202 5 , February 3, 2024 , and January 28, 2023 57 Consolidated Statements of Changes in Stockholders’ Equity (Deficit) for the fiscal years ended February 1 , 202 5 , February 3, 2024 , and January 28, 2023 58 Consolidated Statements of Cash Flows for the fiscal years ended February 1 , 202 5 , February 3, 2024 , and January 28, 2023 59 Notes to Consolidated Financial Statements 60 51 Table of Contents Report of Independent Registered Public Accounting Firm Shareholders and Board of Directors The Children’s Place, Inc. Secaucus, New Jersey Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheet of The Children’s Place, Inc. (the “Company”) as of February 1, 2025, the related consolidated statements of operations, comprehensive loss, stockholders’ equity (deficit), and cash flows for the year then ended, and the related notes to the consolidated financial statements (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at February 1, 2025, and the results of its operations and its cash flows for the year ended February 1, 2025, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audit provides a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Valuation of Gymboree Tradename As described in Notes 1, 4, and 14 to the consolidated financial statements, the Company’s Gymboree Tradename had a carrying value of $13.0 million as of February 1, 2025. The indefinite-lived tradename is evaluated for impairment annually or more frequently if events or changes in circumstances indicate that a decline in value may have occurred. An impairment loss is recognized when the estimated fair value of tradename is less than the carrying value. The Company recorded an impairment charge related to the Gymboree tradename of $28.0 million in the second quarter of fiscal year 2024, which reduced its carrying value to $13.0 million. The determination of the fair value of the Gymboree Tradename requires management to make significant estimates and assumptions related to future cash flows, royalty rate and the discount rate used in the valuation model. We identified certain assumptions used in the determination of the fair value of the Gymboree tradename, specifically the revenue growth rate, royalty rate, and the discount rate as a critical audit matter. The principal consideration for our determination is the judgment used to evaluate the revenue growth rate, royalty rate, and the discount rate in the fair value determination of the Gymboree Tradename. Auditing these assumptions involved especially challenging and subjective auditor judgment due to the nature and extent of audit effort required to address these matters, including the extent of specialized skills and knowledge needed. 52 Table of Contents The primary procedures we performed to address this critical audit matter included: • Obtaining an understanding of management's process related to the Gymboree tradename impairment assessment and the determination of the estimated fair value of the tradename including the revenue growth rate, royalty rate, and the discount rate. • Performing a sensitivity analysis of the significant assumptions to evaluate the change in the estimated fair value that would result from changes in the significant assumptions. • Evaluating the revenue growth rate used in the determination of the estimated fair value related to the Gymboree tradename by comparing the revenue growth rate against historical financial results, guideline companies, and industry information. • Utilizing personnel with specialized knowledge and skills in valuation to evaluate the royalty rate and discount rate used in the determination of the estimated fair value related to the Gymboree tradename. • Evaluating on a sample basis, the completeness and accuracy of the underlying data used by the Company used to develop the revenue growth rate and royalty rate. /S/ BDO USA, P.C. We have served as the Company’s auditor since 2024. Woodbridge, New Jersey April 17, 2025 53 Table of Contents Report of Independent Registered Public Accounting Firm To the Stockholders and the Board of Directors of The Children’s Place, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheet of The Children’s Place, Inc. and subsidiaries (the Company) as of February 3, 2024, the related consolidated statements of operations, comprehensive loss, changes in stockholders’ equity (deficit) and cash flows for each of the two years in the period ended February 3, 2024, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at February 3, 2024 and the results of its operations and its cash flows for each of the two years in the period ended February 3, 2024, in conformity with U.S. generally accepted accounting principles. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. /S/ Ernst & Young, LLP We have served as the Company’s auditor from 2018 to 2024. Iselin, New Jersey May 3, 2024, except for Note 17 and the effects of the rights offering described in Note 13, as to which the date is April 17, 2025. 54 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS February 1, 2025 February 3, 2024 (in thousands, except par value) ASSETS Current assets: Cash and cash equivalents $ 5,347 $ 13,639 Accounts receivable 42,701 33,219 Inventories 399,602 362,099 Prepaid expenses and other current assets 20,354 43,169 Total current assets 468,004 452,126 Long-term assets: Property and equipment, net 97,487 124,750 Right-of-use assets 161,595 175,351 Tradenames, net 13,000 41,123 Other assets 7,466 6,958 Total assets $ 747,552 $ 800,308 LIABILITIES AND STOCKHOLDERS’ DEFICIT Current liabilities: Revolving loan $ 245,659 $ 226,715 Accounts payable 126,716 225,549 Current portion of operating lease liabilities 67,407 69,235 Income taxes payable 2,441 5,297 Accrued expenses and other current liabilities 75,895 89,608 Total current liabilities 518,118 616,404 Long-term liabilities: Long-term debt — 49,818 Related party long-term debt 165,974 — Long-term portion of operating lease liabilities 107,287 118,073 Income taxes payable — 9,486 Other tax liabilities 5,291 4,664 Other long-term liabilities 10,293 10,882 Total liabilities 806,963 809,327 Commitments and contingencies (see Note 10) Stockholders’ deficit: Preferred stock, $ 1.00 par value, 1,000 shares authorized, 0 shares issued and outstanding — — Common stock, $ 0.10 par value, 100,000 shares authorized; 12,785 and 12,585 issued; 12,782 and 12,529 outstanding 1,279 1,259 Additional paid-in capital 151,485 141,083 Treasury stock, at cost ( 3 and 56 shares) ( 90 ) ( 2,909 ) Deferred compensation 90 2,909 Accumulated other comprehensive loss ( 19,491 ) ( 16,496 ) Accumulated deficit ( 192,684 ) ( 134,865 ) Total stockholders’ deficit ( 59,411 ) ( 9,019 ) Total liabilities and stockholders’ deficit $ 747,552 $ 800,308 See accompanying notes to these consolidated financial statements. 55 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS Fiscal Years Ended February 1, 2025 February 3, 2024 January 28, 2023 (in thousands, except loss per common share) Net sales $ 1,386,269 $ 1,602,508 $ 1,708,482 Cost of sales (exclusive of depreciation and amortization) 926,808 1,157,234 1,194,320 Gross profit 459,461 445,274 514,162 Selling, general, and administrative expenses 405,550 447,343 460,972 Depreciation and amortization 39,612 47,186 51,464 Asset impairment charges 28,000 34,543 3,256 Operating loss ( 13,701 ) ( 83,798 ) ( 1,530 ) Related party interest expense ( 6,493 ) — — Other interest expense ( 29,301 ) ( 30,087 ) ( 13,324 ) Interest income 47 87 92 Loss before provision (benefit) for income taxes ( 49,448 ) ( 113,798 ) ( 14,762 ) Provision (benefit) for income taxes 8,371 40,743 ( 13,624 ) Net loss $ ( 57,819 ) $ ( 154,541 ) $ ( 1,138 ) Loss per common share Basic $ ( 4.53 ) $ ( 12.34 ) $ ( 0.09 ) Diluted $ ( 4.53 ) $ ( 12.34 ) $ ( 0.09 ) Weighted average common shares outstanding Basic 12,766 12,522 13,063 Diluted 12,766 12,522 13,063 See accompanying notes to these consolidated financial statements. 56 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS Fiscal Years Ended February 1, 2025 February 3, 2024 January 28, 2023 (in thousands) Net loss $ ( 57,819 ) $ ( 154,541 ) $ ( 1,138 ) Other comprehensive loss: Foreign currency translation adjustment ( 2,995 ) ( 249 ) ( 2,061 ) Total comprehensive loss $ ( 60,814 ) $ ( 154,790 ) $ ( 3,199 ) See accompanying notes to these consolidated financial statements. 57 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS ’ EQUITY (DEFICIT) Accumulated Total Additional Other Stockholders' Common Stock Paid-In Deferred Accumulated Comprehensive Treasury Stock Equity (in thousands) Shares Amount Capital Compensation Deficit Loss Shares Amount (Deficit) Balance, January 29, 2022 13,964 $ 1,396 $ 160,348 $ 3,443 $ 77,914 $ ( 14,186 ) ( 61 ) $ ( 3,443 ) $ 225,472 Vesting of stock awards 281 28 ( 28 ) — — — — — — Stock-based compensation expense — — 29,150 — — — — — 29,150 Purchase and retirement of common stock ( 1,953 ) ( 195 ) ( 38,514 ) — ( 54,236 ) — — — ( 92,945 ) Other comprehensive loss — — — — — ( 2,061 ) — — ( 2,061 ) Deferral of common stock into deferred compensation plan — — — 293 — — ( 6 ) ( 293 ) — Net loss — — — — ( 1,138 ) — — — ( 1,138 ) Balance, January 28, 2023 12,292 $ 1,229 $ 150,956 $ 3,736 $ 22,540 $ ( 16,247 ) ( 67 ) $ ( 3,736 ) $ 158,478 Vesting of stock awards 503 51 ( 51 ) — — — — — — Stock-based compensation benefit — — ( 5,576 ) — — — — — ( 5,576 ) Purchase and retirement of common stock ( 210 ) ( 21 ) ( 4,246 ) — ( 2,864 ) — — — ( 7,131 ) Other comprehensive loss — — — — — ( 249 ) — — ( 249 ) Distribution of common stock into deferred compensation plan, net of deferrals — — — ( 827 ) — — 11 827 — Net loss — — — — ( 154,541 ) — — — ( 154,541 ) Balance, February 3, 2024 12,585 $ 1,259 $ 141,083 $ 2,909 $ ( 134,865 ) $ ( 16,496 ) ( 56 ) $ ( 2,909 ) $ ( 9,019 ) Vesting of stock awards 278 28 ( 28 ) — — — — — — Stock-based compensation expense — — 12,786 — — — — — 12,786 Purchase and retirement of common stock ( 78 ) ( 8 ) ( 666 ) — — — — — ( 674 ) Stock issuance costs — — ( 1,690 ) — — — — — ( 1,690 ) Other comprehensive loss — — — — — ( 2,995 ) — — ( 2,995 ) Distribution of common stock from deferred compensation plan, net of deferrals — — — ( 2,819 ) — — 53 2,819 — Net loss — — — — ( 57,819 ) — — — ( 57,819 ) Balance, February 1, 2025 12,785 $ 1,279 $ 151,485 $ 90 $ ( 192,684 ) $ ( 19,491 ) ( 3 ) $ ( 90 ) $ ( 59,411 ) See accompanying notes to these consolidated financial statements. 58 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS Fiscal Years Ended February 1, 2025 February 3, 2024 January 28, 2023 (in thousands) CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ ( 57,819 ) $ ( 154,541 ) $ ( 1,138 ) Reconciliation of net loss to net cash (used in) provided by operating activities: Non-cash portion of operating lease expense 76,963 83,591 88,936 Depreciation and amortization 39,612 47,186 51,464 Non-cash stock-based compensation expense (benefit), net 12,786 ( 5,576 ) 29,150 Asset impairment charges 28,000 34,543 3,256 Deferred income tax provision (benefit) — 36,975 ( 13,675 ) Other non-cash charges, net 2,782 729 601 Changes in operating assets and liabilities: Inventories ( 38,297 ) 85,307 ( 20,741 ) Accounts receivable and other assets ( 8,461 ) 21,305 ( 28,143 ) Prepaid expenses and other current assets 1,152 1,855 10,440 Income taxes payable, net of prepayments 9,933 ( 2,199 ) 14,690 Accounts payable and other current liabilities ( 107,861 ) 39,955 ( 41,734 ) Lease liabilities ( 75,791 ) ( 93,396 ) ( 102,522 ) Other long-term liabilities ( 593 ) ( 2,934 ) 1,198 Net cash (used in) provided by operating activities ( 117,594 ) 92,800 ( 8,218 ) CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures ( 15,830 ) ( 27,559 ) ( 45,577 ) Change in deferred compensation plan — ( 231 ) ( 371 ) Net cash used in investing activities ( 15,830 ) ( 27,790 ) ( 45,948 ) CASH FLOWS FROM FINANCING ACTIVITIES: Borrowings under revolving credit facility 1,249,913 579,655 713,718 Repayments under revolving credit facility ( 1,230,968 ) ( 639,931 ) ( 602,046 ) Proceeds from issuance of related party term loans 168,600 — — Repayment of term loan ( 50,000 ) — — Payment of debt issuance costs ( 6,784 ) ( 861 ) — Payment of stock issuance costs ( 1,690 ) — — Purchase and retirement of common stock, including shares surrendered for tax withholdings and transaction costs ( 673 ) ( 7,131 ) ( 94,616 ) Net cash provided by (used in) financing activities 128,398 ( 68,268 ) 17,056 Effect of exchange rate changes on cash and cash equivalents ( 3,266 ) 208 ( 988 ) Net decrease in cash and cash equivalents ( 8,292 ) ( 3,050 ) ( 38,098 ) Cash and cash equivalents, beginning of period 13,639 16,689 54,787 Cash and cash equivalents, end of period $ 5,347 $ 13,639 $ 16,689 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Net cash (received) paid for income taxes $ ( 1,726 ) $ 5,775 $ ( 14,969 ) Cash paid for interest 27,007 29,038 12,354 Purchases of property and equipment not yet paid 3,454 7,156 9,801 See accompanying notes to these consolidated financial statements. 59 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Business The Children’s Place, Inc. and its subsidiaries (collectively, the “Company”) is the largest pure-play children’s specialty retailer in North America with an omni-channel portfolio of brands. The Company designs, contracts to manufacture, and sells fashionable, high-quality apparel, accessories and footwear predominantly at value prices, primarily under the Company’s proprietary brands “The Children’s Place”, “Gymboree”, “Sugar & Jade”, and “PJ Place”. Its global retail and wholesale network includes two digital storefronts, 495 stores in North America, wholesale marketplaces, 190 international points of distribution in 13 countries through six international franchise partners and social media channels on Instagram, Facebook, X, formerly known as Twitter, YouTube and Pinterest. The Company’s digital storefronts are at www.childrensplace.com and www.gymboree.com , where its customers are able to shop online for the same merchandise available in its physical stores, but also certain exclusive merchandise only available at our e-commerce sites. The Company classifies its business into two segments: The Children’s Place U.S. and The Children’s Place International. Included in The Children’s Place U.S. segment are the Company’s U.S. and Puerto Rico-based stores and revenue from its U.S.-based wholesale business. Included in The Children’s Place International segment are its Canadian-based stores and revenue from international franchisees. Each segment includes an e-commerce business located at www.childrensplace.com and www.gymboree.com . Terms that are commonly used in the notes to the Company’s consolidated financial statements are defined as follows: • Fiscal 2025 - The fifty-two weeks ending January 31, 2026 • Fiscal 2024 - The fifty-two weeks ended February 1, 2025 • Fiscal 2023 - The fifty-three weeks ended February 3, 2024 • Fiscal 2022 - The fifty-two weeks ended January 28, 2023 • SEC - U.S. Securities and Exchange Commission • U.S. GAAP - Generally Accepted Accounting Principles in the United States • FASB - Financial Accounting Standards Board • FASB ASC - FASB Accounting Standards Codification, which serves as the source for authoritative U.S. GAAP, except that rules and interpretive releases by the SEC are also sources of authoritative U.S. GAAP for SEC registrants Fiscal Year The Company’s fiscal year is a 52-week or 53-week period ending on the Saturday on or nearest to January 31. Fiscal 2024 was a 52-week year, Fiscal 2023 was a 53-week year, and Fiscal 2022 was a 52-week year. Basis of Presentation The consolidated financial statements and accompanying notes to consolidated financial statements are prepared in accordance with U.S. GAAP and include the accounts of the Company and its wholly owned subsidiaries. Intercompany balances and transactions have been eliminated. As of February 1, 2025 and February 3, 2024, the Company did not have any investments in unconsolidated affiliates. FASB ASC 810— Consolidation is considered when determining whether an entity is subject to consolidation. Certain prior period financial statements disclosures have been conformed to the current period presentation. 60 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and amounts of revenues and expenses reported during the period. Actual results could differ from the assumptions used and estimates made by management, which could have a material impact on the Company’s financial position or results of operations. Critical accounting estimates inherent in the preparation of the consolidated financial statements include impairment of long-lived assets, impairment of indefinite-lived intangible assets, income taxes, stock-based compensation, and inventory valuation. Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. Accounts Receivable Accounts receivable consists of credit and debit card receivables, wholesale and franchisee receivables, and other miscellaneous items. Credit and debit card receivables represent credit and debit card sales, inclusive of private label credit card sales, for which the respective third-party service company has yet to remit the cash. The unremitted balance approximates the last few days of related credit and debit card sales for each reporting period. Wholesale and franchisee receivables represent product sales and sales royalties in which cash has not yet been remitted by our partners. Bad debt associated with all sales has not been material. Inventories Inventories, which consist primarily of finished goods, are stated at the lower of cost or net realizable value, with cost determined on an average cost basis. The Company capitalizes certain buying, design, and supply chain costs in inventory, and these costs are reflected within Cost of sales as the inventories are sold. The Company establishes reserves based on an analysis of historical sales trends of its individual product categories, the impact of market trends and economic conditions, and a forecast of future demand, as well as plans to sell through inventory. Inventory shrinkage is estimated based upon the historical results of physical inventory counts in the context of current year facts and circumstances. Deferred Financing Costs The Company capitalizes costs directly associated with acquiring third-party financing. Deferred financing costs for the asset-based revolving credit facility are included in Other assets and deferred financing costs for the term loans are recorded in Long-term debt as a reduction of the related term loan. These costs are amortized as Interest expense over the term of the related indebtedness. Property and Equipment, Net Property and equipment are stated at cost. Leasehold improvements are depreciated on a straight-line basis over the shorter of the life of the lease or the estimated useful life of the asset. All other property and equipment is depreciated on a straight-line basis based upon estimated useful lives, with furniture and fixtures and equipment generally ranging from 3 to 10 years and buildings and improvements generally ranging from 20 to 25 years. Repairs and maintenance are expensed as incurred. The Company accounts for internally developed software intended for internal use in accordance with provisions of FASB ASC 350— Intangibles-Goodwill and Other . The Company capitalizes development-stage costs such as direct external costs and direct payroll related costs. When development is substantially complete and the software is ready for its intended use, the Company amortizes the cost of the software on a straight-line basis over the expected life of the software, which is generally 3 to 10 years. Preliminary project costs and post-implementation costs such as training, maintenance, and support are expensed as incurred. 61 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Intangible Assets The Company’s intangible assets include both indefinite-lived and finite-lived assets. Intangible assets with an indefinite life consists of the acquired Gymboree tradename, and is tested for impairment using a qualitative assessment to determine whether its fair value is below its carrying value. If there are indicators of impairment, the Company performs a quantitative assessment to estimate the fair value of this intangible asset based on an income approach using the relief-from-royalty method. The Company’s finite-lived intangible assets consist primarily of customer lists and other acquisition-related assets. Finite-lived intangible assets are amortized over their estimated useful economic lives and are reviewed for impairment when factors indicate that an impairment may have occurred. The Company recognizes an impairment charge when the estimated fair value of the intangible asset is less than the carrying value. Impairment of Long-Lived Assets The Company periodically reviews its long-lived assets for impairment when events indicate that their carrying value may not be recoverable. Such events include historical trends or projected trends of cash flow losses or a future expectation that the Company will sell or dispose of an asset significantly before the end of its previously estimated useful life. In reviewing for impairment, the Company groups its long-lived assets at the lowest possible level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The Company reviews all stores that have reached comparable sales status for impairment on at least an annual basis, or sooner if circumstances so dictate. The Company believes waiting this period of time allows a store to reach a maturity level where a more comprehensive analysis of financial performance can be performed. For each store that shows indications of impairment, the Company performs a recoverability test comparing estimated undiscounted future cash flows to the carrying value of the related long-lived assets. If the undiscounted cash flows are less than the related net book value of the long-lived assets, they are written down to their fair market value. The Company primarily uses discounted future cash flows directly associated with those assets, which consist principally of property and equipment and right-of-use (“ROU”) assets, to determine their fair market values. In evaluating future cash flows, the Company considers external and internal factors. External factors comprise the local environment in which the store resides, including mall traffic, competition, and their effect on sales trends, as well as macroeconomic factors, such as inflationary pressures impacting our customer, and changes in product input costs, transporting costs, distribution costs and wage rates. Internal factors include the Company’s ability to gauge the fashion taste of its customers, control variable costs such as cost of sales and payroll, and in certain cases, its ability to renegotiate lease costs. In addition, the Company utilizes market-corroborated inputs, including sales per square foot and cost of occupancy rates, in its calculation of the fair value of its ROU assets and any necessary discounting required for rent rates based on macroeconomic conditions or local mall conditions. Insurance and Self-Insurance Reserves The Company self-insures and purchases insurance policies to provide for workers’ compensation, general liability and property losses, cyber-security coverage, as well as director and officers’ liability, vehicle liability, and employee medical benefits. The Company estimates risks and records a liability based on historical claim experience, insurance deductibles, severity factors, and other actuarial assumptions. The Company records the current portions of employee medical benefits, workers compensation, and general liability reserves within Accrued expenses and other current liabilities. Leases The Company has operating leases for retail stores, corporate offices, distribution facilities, and certain equipment. The Company’s leases have remaining lease terms ranging from less than one year up to 12 years, some of which include options to extend the leases for up to five years , and some of which include options to terminate the lease early. The lease liability is initially and subsequently measured at the present value of the unpaid lease payments at the lease commencement date. For operating leases, the ROU asset is initially and subsequently measured throughout the lease term at the carrying amount of the lease liability, plus initial direct costs, less any accrued lease payments and unamortized lease incentives. For finance leases, the ROU asset is initially measured at cost and subsequently amortized using the straight-line method, generally from the lease commencement date to the earlier of the end of its useful life or the end of the lease term. 62 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The discount rate is the rate implicit in the lease, unless that rate cannot be readily determined. In that case, the Company is required to use its incremental borrowing rate. The discount rate for a lease is determined based on the information available at lease commencement. The Company accounts for the underlying leased asset and applies a discount rate at the lease level. However, there are certain non-real estate leases for which the Company utilizes the portfolio method by aggregating similar leased assets based on the underlying lease term. The Company has made an accounting policy election by class of underlying asset to not apply the recognition requirements of FASB ASC 842— Leases (“Topic 842”) to leases with an initial term of 12 months or less. Leases with an initial lease term of 12 months or less are not recorded on the balance sheet. The Company recognizes lease expense for these leases on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components. The Company has elected a policy to account for lease and non-lease components as a single component for all asset classes. In certain leases, the Company has the right to exercise lease renewal options. Renewal option periods are included in the measurement of lease liability and related ROU asset where the exercise is reasonably certain to occur. As of the periods presented, the Company’s finance leases were not material to the Consolidated Balance Sheets, Consolidated Statements of Operations, or Consolidated Statements of Cash Flows. The Company has certain lease agreements structured with both fixed base rent and contingent rent based on a percentage of sales over contractual levels, others with only contingent rent based on a percentage of sales, and some with a fixed base rent adjusted periodically for inflation or changes in fair market value of the underlying real estate. Contingent rent is recognized as sales occur. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The Company records all occupancy costs in Cost of sales, except costs for administrative office buildings, which are recorded in Selling, general, and administrative expenses. Accumulated Other Comprehensive Loss Accumulated other comprehensive loss primarily consists of cumulative translation adjustments. Treasury Stock Treasury stock is recorded at acquisition cost. Gains and losses on disposition are recorded as increases or decreases to Additional paid-in capital with losses in excess of previously recorded gains charged directly to Accumulated deficit. When treasury shares are retired and returned to authorized but unissued status, the carrying value in excess of par is allocated to Additional paid-in capital and Accumulated deficit on a pro rata basis. Income Taxes The Company utilizes the asset and liability method of accounting for income taxes as set forth in FASB ASC 740— Income Taxes . Under the asset and liability method, deferred taxes are determined based on the temporary differences between the financial statement and tax basis of assets and liabilities, as well as for net operating losses and tax credit carryforwards. Deferred tax assets and liabilities are measured using currently enacted tax rates applied to taxable income in effect for the years in which the basis differences and tax assets are expected to be realized. A valuation allowance is recorded when it is more likely than not that some of the deferred tax assets will not be realized. In determining the need for valuation allowances, the Company considers projected future taxable income, the availability of tax planning strategies, taxable income in prior carryback years, and future reversals of existing taxable temporary differences. The assumptions utilized in determining future taxable income require significant judgment. Actual operating results in future years could differ from current assumptions, judgments and estimates. If the Company determines that it would not be able to realize its recorded deferred tax assets, an increase in the valuation allowance would decrease earnings in the period in which such determination is made. 63 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The Company assesses income tax positions and records tax benefits for all years subject to examination based upon the Company’s evaluation of the facts, circumstances, and information available at the reporting date. For those tax positions where it is more likely than not that a tax benefit will be sustained, the Company has recorded the largest amount of tax benefit with a greater than 50% likelihood of being realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. For those income tax positions where it is not more likely than not that a tax benefit will be sustained, no tax benefit has been recognized in the consolidated financial statements. The Company recognizes accrued interest and penalties for its unrecognized tax benefits as a component of tax expense. The Company accounts for the tax effects of the tax on global intangible low-taxed income (“GILTI”) of certain foreign subsidiaries in the income tax provision in the period the tax arises. Deferred Compensation Plan The Company has a deferred compensation plan (the “Deferred Compensation Plan”), which is a nonqualified, unfunded plan, for eligible senior level employees. Under the Deferred Compensation Plan, a participant may elect to defer up to 80 % of his or her base salary and/or up to 100 % of his or her bonus to be earned for the year following the year in which the deferral election is made. The Deferred Compensation Plan also permits members of the Board of Directors to elect to defer payment of all or a portion of their retainer and other fees to be earned for the year following the year in which a deferral election is made, and they may elect to defer payment of any shares of Company stock that are earned with respect to deferred stock awards. Directors may elect to have all or a portion of their fees earned for their service on the Board invested in shares of the Company’s common stock. The Deferred Compensation Plan does not allow for the deferral of the Company’s common stock by employee participants. The Company is not required to contribute to the Deferred Compensation Plan, but at its sole discretion, can make additional contributions on behalf of the participants. Deferred amounts are not subject to forfeiture and are deemed invested among investment funds offered under the Deferred Compensation Plan, as directed by each participant. Payments of deferred amounts (as adjusted for earnings and losses) are payable following separation from service or at a date or dates elected by the participant at the time the deferral is elected. Payments of deferred amounts are generally made in either a lump sum or in annual installments over a period not exceeding 15 years. All deferred amounts are payable in the form in which they were made, except for Board of Directors fees invested in shares of the Company’s common stock, which are settled in shares of Company common stock. Earlier distributions are not permitted, except in the case of an unforeseen hardship. The Company has established a rabbi trust that serves as an investment to shadow the Deferred Compensation Plan liability. The assets of the rabbi trust are general assets of the Company and, as such, would be subject to the claims of creditors in the event of bankruptcy or insolvency. Investments of the rabbi trust consist of mutual funds and Company common stock. The Deferred Compensation Plan liability, excluding Company common stock, is included within Other long-term liabilities, and changes in the balance, except those relating to payments, are recognized as compensation expense within Selling, general, and administrative expenses. The value of the mutual funds in the rabbi trust is included in Other assets and related earnings and losses are recognized as investment income or loss, within Selling, general, and administrative expenses. Company stock deferrals are included within the equity section of the Company’s Consolidated Balance Sheets as Treasury stock and as Deferred compensation. Deferred stock is recorded at fair market value at the time of deferral, and any subsequent changes in fair market value are not recognized. Legal Contingencies The Company reserves for the outcome of litigation and contingencies when it determines an adverse outcome is probable and can estimate losses. Estimates are adjusted as facts and circumstances require. The Company expenses the costs to resolve litigation as incurred, net of amounts, if any, recovered through insurance coverage. Foreign Currency Translation and Transactions The Company has determined that the local currencies of its Canadian and Asian subsidiaries are their functional currencies. In accordance with FASB ASC 830— Foreign Currency Matters , the assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the current rates of exchange existing at period-end, and revenues and expenses are translated at average monthly exchange rates. Related translation adjustments are reported as a separate component of stockholders’ equity (deficit). The Company also transacts certain business in foreign denominated currencies primarily with its Canadian subsidiary purchasing inventory in U.S. dollars, and there are intercompany charges between various subsidiaries. 64 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Revenues Revenues are recognized when control of the promised goods or services is transferred to the Company’s customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The Company recognizes revenue, including shipping and handling fees billed to customers as applicable, upon purchase at the Company’s retail stores or when received by the customer if the product was purchased via e-commerce, net of coupon redemptions and anticipated sales returns. The Company deferred sales of $ 3.2 million and $ 3.1 million within Accrued expenses and other current liabilities as of February 1, 2025 and February 3, 2024, respectively, based upon estimated time of delivery, at which point control passes to the customer. Sales tax collected from customers is excluded from revenue. For its wholesale business, the Company recognizes revenue, when title of the goods passes to the customer, net of commissions, discounts, operational chargebacks, and cooperative advertising. The allowance for wholesale revenue included within Accounts receivable was $ 8.7 million and $ 9.0 million as of February 1, 2025 and February 3, 2024, respectively. For the sale of goods to retail customers with a right of return, the Company recognizes revenue for the consideration it expects to be entitled to and calculates an allowance for estimated sales returns based upon the Company’s sales return experience. Adjustments to the allowance for estimated sales returns in subsequent periods have not been material based on historical data, thereby reducing the uncertainty inherent in such estimates. The allowance for estimated sales returns, which is recorded in Accrued expenses and other current liabilities, was $ 1.0 million and $ 1.7 million as of February 1, 2025 and February 3, 2024, respectively. The Company’s private label credit card is issued to customers for use exclusively at The Children’s Place and Gymboree stores and online at www.childrensplace.com and www.gymboree.com, and credit is extended to such customers by a third-party financial institution on a non-recourse basis to the Company. The private label credit card includes multiple performance obligations for the Company, including marketing and promoting the program on behalf of the bank and the operation of the loyalty rewards program. Included in the agreement with the third-party financial institution was an upfront bonus paid to the Company and an additional bonus to extend the term of the agreement. These bonuses are recognized as revenue and allocated between brand and reward obligations. As the license of the Company’s brand is the predominant item in the performance obligation, the amount allocated to the brand obligation is recognized on a straight-line basis over the term of the agreement. The amount allocated to the reward obligation is recognized on a point-in-time basis as redemptions under the loyalty program occur. In measuring revenue and determining the consideration the Company is entitled to as part of a contract with a customer, the Company takes into account the related elements of variable consideration, such as additional bonuses, including profit-sharing, over the life of the private label credit card program. Similar to the upfront bonus, the usage-based royalties and bonuses are recognized as revenue and allocated between the brand and reward obligations. The amount allocated to the brand obligation is recognized on a straight-line basis over the initial term. The amount allocated to the reward obligation is recognized on a point-in-time basis as redemptions under the loyalty program occur. In addition, the annual profit-sharing amount is recognized quarterly within an annual period when it can be estimated reliably. The additional bonuses are amortized over the contract term based on anticipated progress against future targets and level of risk associated with achieving the targets. The Company has a points-based customer loyalty program in which customers earn points based on purchases and other promotional activities. These points can be redeemed for coupons to discount future purchases. The redemption cycle for coupons is 45 days. A contract liability is estimated based on the standalone selling price of benefits earned by customers through the program and the related redemption experience under the program. The value of each point earned is recorded as deferred revenue and is included within Accrued expenses and other current liabilities. The total contract liabilities related to this program were $ 3.7 million, $ 1.7 million and $ 2.6 million and as of February 1, 2025, February 3, 2024, and January 28, 2023, respectively. During Fiscal 2024 and Fiscal 2023, the Company recognized Net sales of $ 1.7 million and $ 2.6 million related to the points-based customer loyalty program liability balance that existed at February 3, 2024 and January 28, 2023, respectively. 65 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The Company’s policy with respect to gift cards is to record revenue as and when the gift cards are redeemed for merchandise. The Company recognizes gift card breakage income in proportion to the pattern of rights exercised by the customer when the Company expects to be entitled to breakage and the Company determines that it does not have a legal obligation to remit the value of the unredeemed gift card to the relevant jurisdiction as unclaimed or abandoned property. Gift card breakage is recorded within Net sales. Prior to their redemption, gift cards are recorded as a liability within Accrued expenses and other current liabilities. The liability is estimated based on expected breakage that considers historical patterns of redemption. The gift card liability balance was $ 4.8 million, $ 6.8 million, and $ 11.1 million as of February 1, 2025, February 3, 2024, and January 28, 2023, respectively. During Fiscal 2024 and Fiscal 2023, the Company recognized Net sales of $ 5.4 million and $ 9.3 million related to the gift card liability balance that existed at February 3, 2024 and January 28, 2023, respectively. The Company has an international program of territorial agreements with franchisees. The Company generates revenues from the franchisees from the sale of product and, in certain cases, sales royalties. The Company recognizes revenue on the sale of product to franchisees when the franchisee takes ownership of the product. The Company records net sales for royalties when the applicable franchisee sells the product to its customers. Under certain agreements, the Company receives a fee from each franchisee for exclusive territorial rights and based on the opening of new stores. The Company records these territorial fees as deferred revenue and amortizes the fee into Net sales over the life of the territorial agreement. Cost of Sales (exclusive of depreciation and amortization) In addition to the cost of inventory sold, the Company includes certain buying, design, and distribution expenses, and shipping and handling costs on merchandise sold directly to customers. The Company records all occupancy costs in Cost of sales, except for administrative office buildings, which are recorded in Selling, general, and administrative expenses. All depreciation and amortization is reported on a separate line in the Company’s Consolidated Statements of Operations. Stock-Based Compensation The Company’s stock-based compensation plans are administered by the Human Capital & Compensation Committee of the Board of Directors. The Human Capital & Compensation Committee is comprised of independent members of the Board of Directors. Effective May 20, 2011, the stockholders approved the 2011 Equity Incentive Plan (the “Equity Plan”). The Equity Plan allows the Human Capital & Compensation Committee to grant multiple forms of stock-based compensation, such as stock options, stock appreciation rights, restricted stock awards, deferred stock awards, and performance stock awards. The Company accounts for stock-based compensation in accordance with the provisions of FASB ASC 718— Compensation—Stock Compensation . These provisions require, among other things: (i) the fair value at grant date of all stock awards be expensed over their respective vesting periods; (ii) the amount of cumulative compensation cost recognized at any date must at least be equal to the portion of the grant-date value of the award that is vested at that date; and (iii) that compensation expense include a forfeiture estimate for those shares not expected to vest. The fair value of all stock awards is based on the closing price of the Company’s common stock on the grant date. We grant time-vesting and performance-based stock awards to employees at senior management levels. We also grant time-vesting stock awards to our non-employee independent directors. Time-vesting awards are granted in the form of restricted stock units that require each recipient to complete a service period (“Deferred Awards”). Typically, Performance-based stock awards are granted in the form of restricted stock units, which have performance criteria that must be achieved for the awards to be earned, in addition to a service period requirement (“Performance Awards”), and each Performance Award has a defined number of shares that an employee can earn (the “Target Shares”). In Fiscal 2024, there was a change of control of the Company, which triggered a conversion of all then-outstanding Performance Awards into service-based Performance Awards in accordance with their terms. As a result, the Fiscal 2023, Fiscal 2022 and fiscal year 2021 Performance Awards will all vest or have vested, as applicable, at their Target Shares on their respective vesting dates without regard to the achievement of any of the performance metrics associated with those awards, provided that the recipient be employed at the Company on each such vesting date. In Fiscal 2024, the stock awards granted to employees at senior management levels were a combination of both Deferred Awards and Performance Awards. The Deferred Award portion has a one-year vesting schedule, while the Performance Award portion is subject to graded vesting over the subsequent two years of the stock award, whereby employees may earn from 0 % to 200 % of their Target Shares in each of those years, based on the terms of the award and our achievement of certain performance goals established for such Performance Awards. The expense recognized for Performance Awards throughout the service period and the number of shares that are projected to ultimately vest, are based on the estimated degree to which the related performance metrics are expected to be achieved. 66 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Advertising and Marketing Costs The Company defers costs associated with the production of advertising until the first time the advertising takes place. Costs associated with communicating advertising that has been produced are expensed when the advertising event takes place. Advertising and other marketing costs are recorded in Selling, general, and administrative expenses and amounted to $ 68.9 million, $ 99.9 million, and $ 55.5 million in Fiscal 2024, Fiscal 2023, and Fiscal 2022, respectively. Earnings (Loss) per Common Share The Company reports its earnings (loss) per share in accordance with FASB ASC 260— Earnings Per Share , which requires the presentation of both basic and diluted earnings per share on the Consolidated Statements of Operations. The diluted weighted average common shares include adjustments for the potential effects of outstanding Deferred Awards and Performance Awards (as both terms are used in “Note 12. Stock-Based Compensation” of the Consolidated Financial Statements, “Item 8. Financial Statements and Supplementary Data” of this Form 10-K), but only in the periods in which such effect is dilutive under the treasury stock method. Included in basic and diluted weighted average common shares are those shares, due to participants in the Deferred Compensation Plan, which are held in treasury stock. Anti-dilutive stock awards are comprised of unvested deferred, restricted, and performance shares which would have been anti-dilutive in the application of the treasury stock method in accordance with FASB ASC 260— Earnings Per Share . Recent Accounting Standards Updates Accounting Pronouncement Recently Adopted In November 2023, the FASB issued Accounting Standards Update No. 2023-07 “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures,” (“ASU 2023-07”). The amendments in ASU 2023-07 are designed to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses during interim and annuals periods. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The Company adopted ASU 2023-07 on a retrospective basis, which expanded our disclosures but did not have a material impact on our consolidated financial statements. Accounting Pronouncements Not Yet Adopted In December 2023, the FASB issued Accounting Standards Update No. 2023-09 “Income Taxes (Topic 740): Improvements to Income Tax Disclosures,” (“ASU 2023-09”). The amendments in ASU 2023-09 are designed to enhance the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the rate reconciliation, and income taxes paid disaggregated by jurisdiction. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The adoption of ASU 2023-09 will expand our disclosures, but we do not expect it to have a material impact on our consolidated financial statements. In November 2024, the FASB issued Accounting Standards Update No. 2024-03 “Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures (Subtopic 220-40),” (“ASU 2024-03”). The amendments in ASU 2024-03 are designed to improve financial reporting by requiring that public business entities disclose additional information about specific expense categories in the notes to financial statements at interim and annual reporting periods. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods with fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of this update on its consolidated financial statements. 67 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 2. REVENUES The following table presents the Company’s net sales disaggregated by geography: Fiscal Years Ended February 1, 2025 February 3, 2024 January 28, 2023 (in thousands) South $ 502,042 $ 586,370 $ 633,430 Northeast 254,521 304,554 339,072 West 166,234 208,249 231,135 Midwest 147,308 185,126 196,075 International and other (1) 316,164 318,209 308,770 Total net sales $ 1,386,269 $ 1,602,508 $ 1,708,482 ____________________________________________ (1) Includes retail and e-commerce sales in Canada and Puerto Rico, wholesale and franchisee sales, and certain amounts earned under the Company’s private label credit card program. 3. RESTRUCTURING As a result of the strategic actions associated with the voluntary early termination and subsequent renewal of the Company’s corporate office lease, the move of its distribution center operations from Toronto, Canada (“TODC”) to Alabama in the United States, and workforce reductions, the Company incurred $ 2.5 million and $ 11.8 million in restructuring costs during Fiscal 2024 and Fiscal 2023, respectively, on a pretax basis, summarized in the following table: Fiscal Years Ended February 1, 2025 February 3, 2024 (in thousands) Employee-related costs $ — $ 7,382 Lease termination costs (1) 701 4,158 TODC costs (2) 1,848 — Professional fees — 268 Total restructuring costs (3) $ 2,549 $ 11,808 ___________________________________________ (1) Includes non-cash charges related to accelerated depreciation on certain assets in the corporate office over the reduced term, amounting to $ 0.7 million and $ 1.8 million during Fiscal 2024 and Fiscal 2023, respectively. (2) Includes non-cash charges related to accelerated depreciation on TODC assets, amounting to $ 1.1 million during Fiscal 2024. (3) Restructuring costs are recorded within Selling, general and administrative expenses, except accelerated depreciation charges noted above, which are recorded within Depreciation and amortization . TODC costs are recorded within The Children’s Place International segment. The remaining restructuring costs are primarily recorded within The Children’s Place U.S. segment. 68 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The following tables summarize the restructuring costs that have been settled with cash payments. There was no remaining liability as of February 1, 2025. Employee-Related Costs Lease Termination Costs TODC Costs Professional Fees Total (in thousands) Balance at January 28, 2023 $ — $ — $ — $ — $ — Provision 7,382 4,040 — 268 11,690 Cash Payments ( 5,716 ) ( 4,040 ) — ( 268 ) ( 10,024 ) Balance at February 3, 2024 1,666 — — — 1,666 Provision ( 248 ) — 432 — 184 Cash Payments ( 1,418 ) — ( 432 ) — ( 1,850 ) Balance at February 1, 2025 $ — $ — $ — $ — $ — 4. INTANGIBLE ASSETS On April 4, 2019, the Company acquired certain intellectual property and related assets of Gymboree Group, Inc. and related entities, which included the worldwide rights to the names “Gymboree” and “Crazy 8” and other intellectual property, including trademarks, domain names, copyrights, and customer databases. These intangible assets, inclusive of acquisition costs, are recorded in the long-term assets section of the Consolidated Balance Sheets. The Company identified an indicator of impairment in its qualitative assessment performed during Fiscal 2024 and Fiscal 2023, primarily due to reductions in Gymboree sales forecasts and performed a quantitative impairment assessment of the Gymboree tradename. Some of the key assumptions used in the Fiscal 2024 quantitative impairment assessment included a long-term revenue growth rate of 2.5 % and a discount rate of 14.5 %. Based on its quantitative assessment performed, the Company recorded an impairment charge of $ 28.0 million in Fiscal 2024, which reduced the carrying value to its fair value of $ 13.0 million. The Company recorded a $ 29.0 million impairment charge in Fiscal 2023 and there was no impairment charge in Fiscal 2022. The Company’s intangible assets were as follows: February 1, 2025 Useful Life Gross Amount Accumulated Amortization Net Amount (in thousands) Gymboree tradename Indefinite $ 13,000 $ — $ 13,000 Crazy 8 tradename 5 years 4,000 ( 4,000 ) — Total intangible assets $ 13,000 $ — $ 13,000 February 3, 2024 Useful Life Gross Amount Accumulated Amortization Net Amount (in thousands) Gymboree tradename Indefinite $ 41,000 $ — $ 41,000 Crazy 8 tradename 5 years 4,000 ( 3,877 ) 123 Total intangible assets $ 45,000 $ ( 3,877 ) $ 41,123 69 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 5. PROPERTY AND EQUIPMENT, NET Property and equipment consisted of the following: February 1, 2025 February 3, 2024 (in thousands) Land and land improvements $ 3,403 $ 3,403 Building and improvements 36,527 36,187 Material handling equipment 88,092 90,637 Leasehold improvements 159,992 162,898 Store fixtures and equipment 151,810 173,667 Capitalized software 228,227 333,953 Construction in progress 1,647 3,386 669,698 804,131 Less accumulated depreciation and amortization ( 572,211 ) ( 679,381 ) Total property and equipment, net $ 97,487 $ 124,750 The Company reviewed its store related long-lived assets for indicators of impairment, and performed a recoverability test if indicators were identified. Based on the results of the analyses performed, the Company did no t record impairment charges on its store related long-lived assets during Fiscal 2024. The Company recorded asset impairment charges during Fiscal 2023 and Fiscal 2022 of $ 5.6 million, and $ 3.3 million, respectively, inclusive of ROU assets. 6. PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consisted of the following: February 1, 2025 February 3, 2024 (in thousands) Prepaid income taxes $ 4,834 $ 26,493 Prepaid cloud computing 4,385 8,329 Prepaid maintenance contracts 3,215 1,843 Prepaid insurance 5,097 2,679 Other 2,823 3,825 Total prepaid expenses and other current assets $ 20,354 $ 43,169 70 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 7. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accrued expenses and other current liabilities consisted of the following: February 1, 2025 February 3, 2024 (in thousands) Accrued salaries and benefits $ 19,760 $ 19,140 Related party accrued interest 6,493 — Accrued marketing 5,754 3,177 Customer liabilities 4,784 6,817 Accrued real estate expenses 4,780 6,366 Deferred revenue 4,183 4,832 Accrued legal costs 4,100 6,771 Sales taxes and other taxes payable 4,074 7,212 Loyalty points 3,692 1,686 Accrued outside services 2,460 4,044 Accrued store expenses 2,369 2,319 Accrued insurance 2,287 3,786 Accrued freight 2,124 10,324 Accrued professional fees 1,620 2,301 Accrued IT costs 1,225 2,995 Other 6,190 7,838 Total accrued expenses and other current liabilities $ 75,895 $ 89,608 71 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 8. LEASES The following components of lease expense were recognized in the Company’s Consolidated Statements of Operations: Fiscal Years Ended February 1, 2025 February 3, 2024 January 28, 2023 (in thousands) Fixed operating lease cost $ 90,129 $ 91,066 $ 99,988 Variable operating lease cost 24,425 44,195 51,905 Total operating lease cost $ 114,554 $ 135,261 $ 151,893 The following table provides the weighted-average remaining lease term of the Company’s operating leases, the weighted-average discount rate used to calculate the Company’s operating liabilities, cash paid for amounts included in the measurement of the Company’s operating lease liabilities, and ROU assets obtained in exchange for the Company’s new operating lease liabilities: Fiscal Years Ended February 1, 2025 February 3, 2024 Weighted-average remaining lease term (years) 4.3 4.2 Weighted average discount rate (%) 8.1 7.1 Cash paid for amounts included in the measurement of operating lease liabilities ($, in millions) 79.1 93.4 ROU assets obtained in exchange for new operating lease liabilities ($, in millions) 71.8 120.5 As of February 1, 2025, the maturities of operating lease liabilities were as follows: February 1, 2025 (in thousands) 2025 $ 78,499 2026 49,253 2027 23,993 2028 16,325 2029 10,715 Thereafter 34,642 Total operating lease payments 213,427 Less: imputed interest ( 38,733 ) Present value of operating lease liabilities $ 174,694 72 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 9. DEBT ABL Credit Facility and 2021 Term Loan The Company and certain of its subsidiaries maintain a $ 433.0 million asset-based revolving credit facility (the “ABL Credit Facility”) and, before it was fully repaid, maintained a $ 50.0 million term loan (the “2021 Term Loan”) under its Credit Agreement with Wells Fargo Bank, National Association (“Wells Fargo”), Truist Bank, Bank of America, N.A., HSBC Business Credit (USA) Inc., JPMorgan Chase Bank, N.A., and PNC Bank, National Association, as the lenders party thereto (collectively, the “Credit Agreement Lenders”) and Wells Fargo, as Administrative Agent, Collateral Agent, Swing Line Lender and, before the 2021 Term Loan was fully repaid, Term Agent. The ABL Credit Facility will mature and, before it was fully repaid, the 2021 Term Loan would have matured, in November 2026. As of April 18, 2024, which is the effective date of the seventh amendment to the Credit Agreement (the “Seventh Amendment”), the ABL Credit Facility includes a $ 25.0 million Canadian sublimit and a $ 25.0 million sublimit for standby and documentary letters of credit. Under the ABL Credit Facility, borrowings outstanding bear interest, at the Company’s option, at: (i) the prime rate per annum, plus a margin of 2.000 %; or (ii) the Secured Overnight Financing Rate (“SOFR”) per annum, plus 0.100 %, plus a margin of 3.000 %. Prior to April 18, 2024, the Company was charged a fee of 0.200 % on the unused portion of the commitments. As of April 18, 2024, based on the size of the unused portion of the commitments, the Company is charged a fee ranging from 0.250 % to 0.375 %. Letter of credit fees are at 1.125 % for commercial letters of credit and 1.750 % for standby letters of credit. The amount available for loans and letters of credit under the ABL Credit Facility is determined by a borrowing base consisting of certain credit card receivables, certain trade receivables, certain inventory, and the fair market value of certain real estate, subject to certain reserves and an availability block. From and after February 4, 2025 and on the first day of each fiscal quarter thereafter, based on the amount of the Company’s average daily excess availability under the facility, borrowings outstanding under the ABL Credit Facility will bear interest, at the Company’s option, at: (i) the prime rate per annum, plus a margin of 1.750 % or 2.000 %; or (ii) the SOFR per annum, plus 0.100 %, plus a margin of 2.750 % or 3.000 %. Letter of credit fees will range from 1.000 % to 1.125 % for commercial letters of credit and will range from 1.500 % to 1.750 % for standby letters of credit. Letter of credit fees will be determined based on the amount of the Company’s average daily excess availability under the facility. For Fiscal 2024, Fiscal 2023, and Fiscal 2022, the Company recognized $ 25.0 million, $ 24.2 million, and $ 10.2 million, respectively, in interest expense related to the ABL Credit Facility. Prior to April 18, 2024, when the 2021 Term Loan was fully repaid, credit extended under the ABL Credit Facility was secured by a first priority security interest in substantially all of the Company’s U.S. and Canadian assets other than intellectual property, certain furniture, fixtures, equipment, and pledges of subsidiary capital stock, and a second priority security interest in the Company’s intellectual property, certain furniture, fixtures, equipment, and pledges of subsidiary capital stock. As of April 18, 2024, the ABL Credit Facility is secured on a first priority basis by all of the foregoing collateral. The outstanding obligations under the ABL Credit Facility may be accelerated upon the occurrence of certain customary events of default, as described below. The Company is not subject to any early termination fees. The ABL Credit Facility contains covenants, which include conditions on stock buybacks and the payment of cash dividends or similar payments. These covenants also limit the ability of the Company and its subsidiaries to incur certain liens, to incur certain indebtedness, to make certain investments, acquisitions, or dispositions or to change the nature of its business. Pursuant to the Seventh Amendment, the requisite payment condition thresholds for some of these covenants have been heightened, resulting in certain actions such as the repurchase of shares and payment of cash dividends becoming more difficult to perform. Additionally, if the Company is unable to maintain a certain amount of excess availability for borrowings (the “excess availability threshold”), the Company may be subject to cash dominion. 73 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The ABL Credit Facility contains customary events of default, which include (subject in certain cases to customary grace and cure periods) nonpayment of principal or interest, breach of covenants, failure to pay certain other indebtedness, and certain events of bankruptcy, insolvency or reorganization, such as a change of control. The tables below present the components of the Company’s ABL Credit Facility as of the end of Fiscal 2024 and Fiscal 2023: February 1, 2025 February 3, 2024 (in millions) Total borrowing base availability (1) $ 301.9 $ 258.4 Credit facility availability (1) 433.0 400.5 Maximum borrowing availability (2) 301.9 258.4 Outstanding borrowings 245.7 226.7 Letters of credit outstanding—standby 16.0 7.4 Utilization of credit facility at end of period 261.7 234.1 Availability (3) $ 40.2 $ 24.3 Interest rate at end of period 7.6 % 8.1 % Average end-of-day loan balance during the period $ 284.5 $ 315.5 Highest end-of-day loan balance during the period $ 366.9 $ 379.4 Average interest rate 8.7 % 7.5 % ____________________________________________ (1) In Fiscal 2023, the total borrowing base availability and credit facility availability were both calculated net of the excess availability threshold under the Credit Agreement, as prior to the Seventh Amendment, crossing that threshold would have resulted in cash dominion, which would have triggered a fixed charge coverage ratio covenant test and would likely have led to a default under the Credit Agreement. As of the Seventh Amendment, the fixed charge coverage ratio covenant has been removed from the Credit Agreement, and entering into cash dominion by crossing the excess availability threshold no longer poses the same risk of default under the Credit Agreement. (2) The lower of the credit facility availability and the total borrowing base availability. (3) The sub-limit availability for letters of credit was $ 9.0 million at February 1, 2025 and $ 42.6 million at February 3, 2024 . The 2021 Term Loan bore interest, payable monthly, at (i) the SOFR per annum plus 2.750 % for any portion that was a SOFR loan, or (ii) the base rate per annum plus 2.000 % for any portion that was a base rate loan. The 2021 Term Loan was pre-payable at any time without penalty, and did not require amortization. For Fiscal 2024, Fiscal 2023, and Fiscal 2022, the Company recognized $ 1.1 million, $ 4.0 million, and $ 2.3 million respectively, in interest expense related to the 2021 Term Loan. As of April 18, 2024, the 2021 Term Loan was fully repaid. As of February 1, 2025 and February 3, 2024, unamortized deferred financing costs amounted to $ 3.8 million and $ 2.2 million, respectively, related to the Company's ABL Credit Facility. Mithaq Term Loans Mithaq Capital SPC, a Cayman segregated portfolio company (“Mithaq”), is a controlling stockholder of the Company. The Company and certain of its subsidiaries maintain an interest-free, unsecured and subordinated promissory note with Mithaq for a $ 78.6 million term loan (the “Initial Mithaq Term Loan”), consisting of (i) a first tranche in an aggregate principal amount of $ 30.0 million (the “First Tranche”) and (ii) a second tranche in an aggregate principal amount of $ 48.6 million (the “Second Tranche”). The Company received the First Tranche on February 29, 2024 and the Second Tranche on March 8, 2024. The Initial Mithaq Term Loan matures on February 15, 2027. The Initial Mithaq Term Loan is guaranteed by each of the Company’s subsidiaries that guarantee the Company’s ABL Credit Facility. 74 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The Company and certain of its subsidiaries also maintain an unsecured and subordinated $ 90.0 million term loan with Mithaq (the “New Mithaq Term Loan”; and together with the Initial Mithaq Term Loan, collectively, the “Mithaq Term Loans”). The New Mithaq Term Loan matures on April 16, 2027, and requires monthly payments equivalent to interest charged at the SOFR plus 4.000 % per annum, with such monthly payments to Mithaq deferred until April 30, 2025. The New Mithaq Term Loan is guaranteed by each of the Company’s subsidiaries that guarantee the Company’s ABL Credit Facility. For Fiscal 2024, the Company recognized $ 6.5 million in deferred interest-equivalent expense related to the New Mithaq Term Loan. The Mithaq Term Loans are subject to an amended and restated subordination agreement (as amended from time to time, the “Subordination Agreement”), dated as of April 16, 2024, by and among the Company and certain of its subsidiaries, Wells Fargo and Mithaq, pursuant to which the Mithaq Term Loans are subordinated in payment priority to the obligations of the Company and its subsidiaries under the Credit Agreement. Subject to such subordination terms, the Mithaq Term Loans are prepayable at any time and from time to time without penalty and do not require any mandatory prepayments. The Mithaq Term Loans contain customary affirmative and negative covenants substantially similar to a subset of the covenants set forth in the Credit Agreement, including limits on the ability of the Company and its subsidiaries to incur certain liens, to incur certain indebtedness, to make certain investments, acquisitions, dispositions or restricted payments, or to change the nature of its business. The Mithaq Term Loans, however, do not provide for any closing, prepayment or exit fees, or other fees typical for transactions of this nature, do not impose additional reserves on borrowings under the Credit Agreement, and do not contain certain other restrictive covenants. The Mithaq Term Loans contain certain customary events of default, which include (subject in certain cases to customary grace periods), nonpayment of principal, breach of other covenants of the Mithaq Term Loans, inaccuracy in representations or warranties, acceleration of certain other indebtedness (including under the Credit Agreement), certain events of bankruptcy, insolvency or reorganization, such as a change of control, and invalidity of any part of the Mithaq Term Loans. As of February 1, 2025, unamortized deferred financing costs amounted to $ 2.6 million related to the Mithaq Term Loans. Maturities of the Company’s principal debt payments on the Mithaq Term Loans as of February 1, 2025 are as follows: February 1, 2025 (in thousands) 2025 $ — 2026 — 2027 168,600 Thereafter — Total related party debt $ 168,600 As of February 6, 2025, $ 60.2 million under the Initial Mithaq Term Loan was repaid pursuant to the completion of the Rights Offering, leaving an aggregate of $ 108.4 million outstanding under the Mithaq Term Loans, payable in fiscal year 2027. Refer to “Note 18. Subsequent Events” for additional detail. Mithaq Commitment Letter On May 2, 2024, the Company entered into a commitment letter (the “Commitment Letter”) with Mithaq for a $ 40.0 million credit facility (the “Mithaq Credit Facility”). Under the Mithaq Credit Facility, the Company had the ability to request for advances at any time prior to July 1, 2025. On September 10, 2024, the Company and Mithaq entered into an Amendment No. 1 to the Commitment Letter, that extended the deadline for requesting advances until July 1, 2026. If any debt is incurred under the Mithaq Credit Facility, it shall require monthly payments equivalent to interest charged at the SOFR plus 5.000 % per annum. Such debt shall be unsecured and shall be guaranteed by each of the Company’s subsidiaries that guarantee the Company’s ABL Credit Facility. Similar to the Mithaq Term Loans, such debt shall also be subject to the Subordination Agreement, contain customary affirmative and negative covenants substantially similar to a subset of the covenants set forth in the Credit Agreement, and contain certain customary events of default. Additionally, such debt shall require no mandatory prepayments and shall mature no earlier than July 1, 2026. As of February 1, 2025, no debt had been incurred under the Mithaq Credit Facility. 75 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 10. COMMITMENTS AND CONTINGENCIES Commitments As of February 1, 2025, the Company entered into various purchase commitments for the next 12 months for merchandise for re-sale of approximately $ 96.9 million and approximately $ 56.4 million for equipment, construction, and other non-merchandise commitments. The Company also has operating lease and standby letters of credit commitments of $ 213.4 million and $ 16.0 million, respectively. Legal and Regulatory Matters The Company is a defendant in Rael v. The Children’s Place, Inc. , a purported class action, pending in the U.S. District Court, Southern District of California. In the initial complaint filed in February 2016, the plaintiff alleged that the Company falsely advertised discount prices in violation of California’s Unfair Competition Law, False Advertising Law, and Consumer Legal Remedies Act. The plaintiff filed an amended complaint in April 2016, adding allegations of violations of other state consumer protection laws. In August 2016, the plaintiff filed a second amended complaint, adding an additional plaintiff and removing the other state law claims. The plaintiffs’ second amended complaint sought to represent a class of California purchasers and sought, among other items, injunctive relief, damages, and attorneys’ fees and costs. The Company engaged in mediation proceedings with the plaintiffs in December 2016 and April 2017. The parties reached an agreement in principle in April 2017, and signed a definitive settlement agreement in November 2017, to settle the matter on a class basis with all individuals in the U.S. who made a qualifying purchase at The Children’s Place from February 11, 2012 through January 28, 2020, the date of preliminary approval by the court of the settlement. The Company submitted its memorandum in support of final approval of the class settlement on March 2, 2021. On March 29, 2021, the court granted final approval of the class settlement and denied plaintiff’s motion for attorney’s fees, with the amount of attorney’s fees to be decided after the class recovery amount has been determined. The settlement provides merchandise vouchers for qualified class members who submit valid claims, as well as payment of legal fees and expenses and claims administration expenses. Vouchers were distributed to class members on November 15, 2021 and they were eligible for redemption in multiple rounds through November 2023. On February 23, 2024, a hearing on motion for preliminary injunction and permanent injunction and to enforce judgement and settlement agreement was held. Pending receipt of the court’s ruling, upon the court’s order, the plaintiff filed a renewed motion for attorneys’ fees, costs and incentive awards on March 4, 2024, to which the Company filed a statement of non-opposition on April 1, 2024. Because the plaintiff was seeking less than the maximum amount agreed to in the settlement, the Company requested that such difference in amount be distributed as vouchers to authorized class members, pursuant to the settlement agreement. The hearing for the motion for attorneys’ fees, costs, and incentive awards resulted in the court granting the plaintiff’s counsel approximately $ 0.3 million in fees, costs and incentive awards. The balance of funds initially reserved for the plaintiff counsel’s fees and costs have now been issued as a single, final round of merchandise vouchers for qualified class members, which expired in March 2025. In connection with the settlement, the Company recorded a reserve for $ 5.0 million in its consolidated financial statements in the first quarter of 2017. Following the court’s recent decision(s), the Company released $ 2.3 million from its previously established reserve during Fiscal 2024, which is recorded within Selling, general and administrative expenses. 76 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Similar to the Rael case above, the Company is also a defendant in Gabriela Gonzalez v. The Children’s Place, Inc. , a purported class action, pending in the U.S. District Court, Central District of California. The plaintiff alleged that the Company had falsely advertised discounts that do not exist, in violation of California’s Unfair Competition Laws, False Advertising Law and the California Consumer Legal Remedies Act. The Company filed a motion to compel arbitration, which the plaintiff did not oppose, and the court granted the motion on August 17, 2022—staying the case pending the outcome of the arbitration. The demand for arbitration was filed on October 4, 2022, in connection with the individual claim of the plaintiff. A mass arbitration firm associated with plaintiff’s counsel then conducted an advertising campaign for claimants to conduct a mass arbitration. In part, to avoid the mass arbitration, the parties stipulated to return the original plaintiff’s claim to court to proceed as a class action. Accordingly, the arbitration would not be proceeding and the Company’s response to the original plaintiff’s complaint in court was filed on July 20, 2023. On August 16, 2023, however, the Company began to receive notices regarding an initial tranche of approximately 1,300 individual demands that were filed with Judicial Arbitration and Mediation Services, Inc. (“JAMS”) as part of a related mass arbitration claim. The parties participated in mediation proceedings on November 15, 2023 and February 9, 2024. The parties agreed to further discuss settlement options in May 2024, which occurred without resolution. In late May, due to the judge’s retirement, the Gonzalez action was transferred and reassigned to a different judge. Deadlines were therefore reset, including the Company’s motion to dismiss. On June 10, 2024, JAMS advised that it would be pausing its administration of the claims until the parties resolve their dispute over which set of arbitration terms apply to the case. The Company’s motion to dismiss was denied in November 2024. Any liability arising out of these proceedings is not expected to have a material adverse effect on the Company's financial position, results of operations, or cash flows. The Company is also involved in various legal proceedings arising in the normal course of business. In the opinion of management, any ultimate liability arising out of these proceedings is not expected to have a material adverse effect on the Company’s financial position, results of operations, or cash flows. 11. STOCKHOLDERS’ DEFICIT Share Repurchase Program In November 2021, the Board of Directors authorized a $ 250.0 million share repurchase program (the “Share Repurchase Program”). Under this program, the Company may repurchase shares on the open market at current market prices at the time of purchase or in privately negotiated transactions. The timing and actual number of shares repurchased under the program will depend on a variety of factors, including price, corporate and regulatory requirements, and other market and business conditions. The Company may suspend or discontinue the program at any time and may thereafter reinstitute purchases, all without prior announcement. Currently, pursuant to the terms of the Company’s Credit Agreement as amended by its Seventh Amendment described above, the repurchase of any shares would require fulfilling the heightened payment conditions under the Credit Agreement, except that repurchases of shares as described below, pursuant to the Company’s practice as a result of its insider trading policy, are expressly permitted. As of February 1, 2025, there was $ 156.5 million remaining availability under the Share Repurchase Program. Pursuant to the Company’s practice, including due to restrictions imposed by the Company’s insider trading policy during black-out periods, the Company withholds and repurchases shares of vesting stock awards and makes payments to taxing authorities as required by law to satisfy the withholding tax requirements of all equity award recipients. The Company’s payment of the withholding taxes in exchange for the surrendered shares constitutes a repurchase of its common stock. The Company also acquires shares of its common stock in conjunction with liabilities owed under the Company’s deferred compensation plan, which are held in treasury. The following table summarizes the Company’s share repurchases: Fiscal Years Ended February 1, 2025 February 3, 2024 January 28, 2023 Shares Amount Shares Amount Shares Amount (in thousands) Share repurchases related to: Share repurchase program 71 $ 674 210 $ 7,131 1,953 $ 92,945 Shares acquired and held in treasury 5 $ 66 8 $ 245 6 $ 293 77 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) In accordance with the FASB ASC 505— Equity , the par value of the shares retired is charged against Common stock and the remaining purchase price is allocated between Additional paid-in capital and Accumulated deficit. The portion charged against Additional paid-in capital is determined using a pro-rata allocation based on total shares outstanding. Dividends Future declarations of quarterly dividends and the establishment of future record and payment dates are subject to approval by the Board of Directors based on a number of factors, including business and market conditions, the Company’s financial performance, and other investment priorities. Currently, pursuant to the terms of the Company’s Credit Agreement as amended by its Seventh Amendment described above, the Company has no current plans to pay regular cash dividends in Fiscal 2025. 12. STOCK-BASED COMPENSATION The Company generally grants time vesting stock awards (“Deferred Awards”) and performance-based stock awards (“Performance Awards”) to employees at senior management levels. The Company also grants Deferred Awards to its non-employee independent directors. Deferred Awards are granted in the form of restricted stock units that require each recipient to complete a service period. Performance Awards are granted in the form of restricted stock units which have performance criteria that must be achieved for the awards to vest in addition to a service period requirement, and each Performance Award has a defined number of shares that an employee can earn (the “Target Shares”). With the approval of the Human Capital & Compensation Committee, the Company may settle vested Deferred Awards and Performance Awards in shares, in a cash amount equal to the market value of such shares at the time all requirements for delivery of the award have been met, or in part shares and cash. In Fiscal 2024, there was a change of control of the Company, which triggered a conversion of all then-outstanding Performance Awards into service-based Performance Awards in accordance with their terms. As a result, the Fiscal 2023, Fiscal 2022, and fiscal year 2021 Performance Awards will all vest or have vested, as applicable, at their Target Shares on their respective vesting dates without regard to the achievement of any of the performance metrics associated with those awards, provided that the recipient be employed at the Company on each such vesting date. In Fiscal 2024, the stock awards granted to employees at senior management levels were a combination of both Deferred Awards and Performance Awards. The Deferred Award portion has a one-year vesting schedule, while the Performance Award portion is subject to graded vesting over the subsequent two years of the stock award, whereby employees may earn from 0 % to 200 % of their Target Shares in each of those years, based on the terms of the award and the Company’s achievement of certain performance goals established for such Performance Awards. 78 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The following table summarizes the Company’s stock-based compensation expense (benefit): Fiscal Years Ended February 1, 2025 February 3, 2024 January 28, 2023 (in thousands) Deferred Awards $ 2,956 $ 6,619 $ 9,937 Performance Awards (1) 9,830 ( 12,195 ) 19,213 Total stock-based compensation expense (benefit) (2) $ 12,786 $ ( 5,576 ) $ 29,150 ____________________________________________ (1) Included within the Performance Awards expense for Fiscal 2024 was a combination of ongoing expense associated with existing grants and $ 9.9 million associated with increasing the attainment level of certain Performance Awards due to the change of control of the Company, partially offset by the reversal of unvested expense related to forfeited awards for employees no longer at the Company. Included within the Performance Awards benefit for Fiscal 2023 was a combination of ongoing expense associated with existing grants and $ 13.5 million of credits resulting from (i) a change in estimate based on revised expectations of the attainment levels for performance metrics of certain awards, and (ii) the reversal of unvested expense related to forfeited awards for employees no longer with the Company. (2) Stock-based compensation expense (benefit) recorded within Cost of sales (exclusive of depreciation and amortization) amounted to $ 1.1 million, $ 0.4 million, and $ 2.2 million in Fiscal 2024, Fiscal 2023, and Fiscal 2022, respectively. All other stock-based compensation expense is included in Selling, general, and administrative expenses. The Company recognized a tax benefit related to stock-based compensation expense (benefit) before consideration of the valuation allowance of $ 1.6 million, $ 0.3 million, and $ 2.5 million in Fiscal 2024, Fiscal 2023, and Fiscal 2022, respectively. At February 1, 2025, the Company had 278,400 shares available for grant under the Equity Plan. Changes in the Company’s Unvested Stock Awards Deferred Awards Fiscal Years Ended February 1, 2025 February 3, 2024 January 28, 2023 Number of Shares Weighted Average Grant Date Fair Value Number of Shares Weighted Average Grant Date Fair Value Number of Shares Weighted Average Grant Date Fair Value (in thousands) (in thousands) (in thousands) Unvested Deferred Awards at beginning of year 238 $ 31.99 282 $ 49.78 467 $ 57.60 Granted 183 16.27 170 25.35 159 46.56 Vested ( 158 ) 28.86 ( 203 ) 50.08 ( 222 ) 62.13 Forfeited ( 110 ) 33.78 ( 11 ) 52.27 ( 122 ) 53.09 Unvested Deferred Awards at end of year 153 $ 15.23 238 $ 31.99 282 $ 49.78 Total unrecognized stock-based compensation expense related to unvested Deferred Awards was $ 1.7 million as of February 1, 2025, which will be recognized over a weighted average period of approximately 2.3 years. The fair value of Deferred Awards that vested during Fiscal 2024, Fiscal 2023, and Fiscal 2022 was $ 4.6 million, $ 4.7 million, and $ 11.4 million, respectively. 79 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Performance Awards Fiscal Years Ended February 1, 2025 February 3, 2024 January 28, 2023 Number of Shares (1) Weighted Average Grant Date Fair Value Number of Shares (1) Weighted Average Grant Date Fair Value Number of Shares (1) Weighted Average Grant Date Fair Value (in thousands) (in thousands) (in thousands) Unvested Performance Awards at beginning of year 296 $ 51.98 483 $ 55.85 366 $ 70.01 Granted 182 14.17 131 21.55 90 48.84 Shares earned in excess of (below) Target Shares — — — — 192 48.17 Vested shares, including shares earned in excess of Target Shares ( 114 ) 75.97 ( 300 ) 44.71 ( 58 ) 101.62 Forfeited ( 112 ) 27.18 ( 18 ) 55.01 ( 107 ) 59.86 Unvested Performance Awards at end of year 252 $ 24.92 296 $ 51.98 483 $ 55.85 ____________________________________________ (1) For awards for which the performance period is complete, the number of unvested shares is based on actual shares that will vest upon completion of the service period. For awards for which the performance period is not yet complete, the number of unvested shares is based on the participants earning their Target Shares at 100 %. The cumulative expense (benefit) recognized for Performance Awards are based on the changes in the estimated degree to which the related performance metrics are expected to be achieved. Based on the current number of Performance Awards expected to be earned, total u nrecognized stock-based compensation expense related to unvested Performance Awards was $ 2.2 million as of February 1, 2025, which will be recognized over a weighted average period of approximately 2.4 years . The fair value of Performance Awards that vested during Fiscal 2024, Fiscal 2023 and Fiscal 2022 was $ 8.6 million, $ 11.8 million, and $ 3.0 million, respectively. 13. LOSS PER COMMON SHARE On February 6, 2025, the Company completed a rights offering (“Rights Offering”) pursuant to which it distributed to the holders of record of the Company’s Common stock non-transferable subscription rights to purchase, in the aggregate, up to 9.2 million shares of Common stock. As the exercise price of the subscription right was less than the fair value of the Common stock, the subscription right contained a bonus element. In connection with this transaction, and in accordance with FASB ASC 260— Earnings Per Share , the Company’s weighted average common shares outstanding and basic and diluted loss per share were retroactively adjusted for all periods presented by a factor of 1.002 . Refer to “Note 18. Subsequent Events” for more information. The following table reconciles net loss and share amounts utilized to calculate basic and diluted loss per common share: Fiscal Years Ended February 1, 2025 February 3, 2024 January 28, 2023 (in thousands) Net loss $ ( 57,819 ) $ ( 154,541 ) $ ( 1,138 ) Basic weighted average common shares outstanding 12,766 12,522 13,063 Dilutive effect of stock awards — — — Diluted weighted average common shares outstanding 12,766 12,522 13,063 Anti-dilutive shares excluded from diluted loss per common share calculation 53 114 184 80 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 14. FAIR VALUE MEASUREMENT FASB ASC 820— Fair Value Measurement provides a single definition of fair value, together with a framework for measuring it, and requires additional disclosure about the use of fair value to measure assets and liabilities. This topic defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and establishes a three-level hierarchy, which encourages an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of the hierarchy are defined as follows: • Level 1 - inputs to the valuation techniques that are quoted prices in active markets for identical assets or liabilities • Level 2 - inputs to the valuation techniques that are other than quoted prices, but are observable for the assets or liabilities, either directly or indirectly • Level 3 - inputs to the valuation techniques that are unobservable for the assets or liabilities The Company’s cash and cash equivalents and investments in the rabbi trust are short-term in nature. As such, their carrying amounts approximate fair value. These assets and liabilities fall within Level 1 of the fair value hierarchy. The Company stock included in the Deferred Compensation Plan is not subject to fair value measurement. The fair value of the Initial Mithaq Term Loan with a carrying value (gross of debt issuance costs) of $ 78.6 million at February 1, 2025, was approximately $ 60.2 million. The fair value of the New Mithaq Term Loan with a carrying value (gross of debt issuance costs) of $ 90.0 million at February 1, 2025, was approximately $ 80.8 million. The fair value of debt was estimated using a market approach, which considers the Company’s credit risk and market related conditions, and is therefore within Level 2 of the fair value hierarchy. The Company’s non-financial assets measured at fair value on a nonrecurring basis include long-lived assets, such as intangible assets, fixed assets, and ROU assets. The Company reviews the carrying amounts of such assets when events indicate that their carrying amounts may not be recoverable. Any resulting asset impairment would require that the asset be recorded at its fair value. The resulting fair value measurements of the assets are considered to fall within Level 3 of the fair value hierarchy. Impairment of Long-Lived Assets The fair value of the Company’s long-lived assets is primarily calculated using a discounted cash-flow model directly associated with those assets, which consist principally of property and equipment and ROU assets. These assets are tested for impairment when events indicate that their carrying value may not be recoverable. The Company performed periodic quantitative impairment assessments of its long-lived assets and did not record an impairment charge in Fiscal 2024. The Company recorded impairment charges of $ 5.6 million and $ 3.3 million during Fiscal 2023 and Fiscal 2022, respectively, inclusive of ROU assets. Impairment of Indefinite-Lived Intangible Assets The Company estimates the fair value of its indefinite-lived Gymboree tradename based on an income approach using the relief-from-royalty method. Estimating fair value using this method requires management to estimate future revenues, royalty rates, discount rates, long-term growth rates, and other factors in order to project future cash flows. The Company identified an indicator of impairment in its qualitative assessment performed during Fiscal 2024, primarily due to reductions in Gymboree sales forecasts. Based on its quantitative assessment performed, the Company recorded an impairment charge of $ 28.0 million in Fiscal 2024, which reduced the carrying value to its fair value of $ 13.0 million. The Company recorded a $ 29.0 million impairment charge recorded in Fiscal 2023 and there was no impairment charge in Fiscal 2022. The impairment charge was recorded in The Children’s Place U.S. segment. 81 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 15. INCOME TAXES The components of Loss before provision (benefit) for income taxes were as follows: Fiscal Years Ended February 1, 2025 February 3, 2024 January 28, 2023 (in thousands) Domestic $ ( 58,830 ) $ ( 156,703 ) $ ( 61,065 ) Foreign 9,382 42,905 46,303 Total loss before provision (benefit) for income taxes $ ( 49,448 ) $ ( 113,798 ) $ ( 14,762 ) The components of the Company’s Provision (benefit) for income taxes consisted of the following: Fiscal Years Ended February 1, 2025 February 3, 2024 January 28, 2023 (in thousands) Current: Federal $ 4,812 $ ( 1,239 ) $ 4,172 State and local 1,120 249 ( 1,193 ) Foreign 2,439 4,758 ( 2,842 ) 8,371 3,768 137 Deferred: Federal — 21,125 ( 12,030 ) State and local — 13,019 ( 2,712 ) Foreign — 2,831 981 — 36,975 ( 13,761 ) Total provision (benefit) for income taxes $ 8,371 $ 40,743 $ ( 13,624 ) Effective tax rate ( 16.9 ) % ( 35.8 ) % 92.3 % On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was enacted in response to the COVID-19 pandemic. The CARES Act allows net operating losses (“NOLs”) incurred in taxable years 2018, 2019, and 2020 to be carried back to each of the five preceding taxable years to offset 100 % of taxable income and to generate a refund of previously paid income taxes. Pursuant to the CARES Act, the Company carried back the taxable year 2020 tax loss of $ 150.0 million to prior years. As of February 1, 2025, the remaining income tax receivable of $ 19.1 million is included within Prepaid expenses and other current assets on the Consolidated Balance Sheets. 82 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) A reconciliation between the calculated tax provision (benefit) based on the U.S. federal statutory rate of 21.0% and the effective tax rate for Fiscal 2024, Fiscal 2023, and Fiscal 2022 follows: Fiscal Years Ended February 1, 2025 February 3, 2024 January 28, 2023 (in thousands) Calculated income tax benefit at U.S. federal statutory rate $ ( 10,384 ) $ ( 23,898 ) $ ( 3,100 ) State and local income taxes, net of federal benefit ( 2,145 ) ( 6,901 ) ( 3,812 ) Foreign tax rate differential (1) ( 3,082 ) ( 4,937 ) ( 5,498 ) Non-deductible expenses 2,654 ( 1,488 ) 3,696 Excess tax detriment related to stock compensation 889 558 816 Unrecognized tax benefits 104 3,127 ( 5,324 ) Change in valuation allowance 18,251 68,625 163 Global intangible low-taxed income 251 9,505 1,760 Federal tax credits ( 291 ) ( 3,242 ) ( 2,934 ) Other 2,124 ( 606 ) 609 Total provision (benefit) for income taxes $ 8,371 $ 40,743 $ ( 13,624 ) ____________________________________________ (1) The Company has substantial operations in Hong Kong, which has a lower statutory income tax rate as compared to the U.S. The Company’s foreign effective tax rate for Fiscal 2024, Fiscal 2023, and Fiscal 2022 was 17.5 %, 11.6 %, and 9.8 %, respectively. This rate will fluctuate from year to year in response to changes in the mix of income by country, as well as changes in tax laws in foreign jurisdictions. The assessment of the amount of value assigned to the Company’s deferred tax assets under the applicable accounting rules is judgmental. The Company is required to consider all available positive and negative evidence in evaluating the likelihood that it will be able to realize the benefit of the Company’s deferred tax assets in the future. Such evidence includes scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies, and the results of recent operations. Since this evaluation requires consideration of events that may occur some years into the future, there is an element of judgment involved. Realization of the Company’s deferred tax assets is dependent on generating sufficient taxable income in future periods. The Company believes that it is not more likely than not that future taxable income will be sufficient to allow it to recover substantially all of the value assigned to the Company’s deferred tax assets. Thus, in Fiscal 2024, the Company increased its valuation allowance accordingly. 83 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The tax effects of temporary differences which give rise to deferred tax assets and liabilities were as follows: February 1, 2025 February 3, 2024 (in thousands) Deferred tax assets: Operating lease liabilities $ 45,209 $ 48,122 Capitalized research and development, net 22,193 23,653 Net operating loss carryforward 13,578 13,704 Reserves 10,295 10,167 Interest expense carryforward 16,853 9,980 Tax credits 5,616 6,630 Inventory 10,299 3,333 Tradenames and customer databases, net 9,407 3,304 Charitable contributions 815 1,084 Stock-based compensation 843 924 Subtotal 135,108 120,901 Less: valuation allowance ( 88,148 ) ( 69,898 ) Total deferred tax assets 46,960 51,003 Deferred tax liabilities: Right-of-use assets ( 41,460 ) ( 44,844 ) Property and equipment, net ( 3,530 ) ( 3,149 ) Prepaid expenses ( 998 ) ( 2,038 ) Foreign and state tax on unremitted earnings ( 1,554 ) ( 1,554 ) Total deferred tax liabilities ( 47,542 ) ( 51,585 ) Total deferred tax liabilities, net $ ( 582 ) $ ( 582 ) The Company has gross federal NOL carryforwards of approximately $ 19.3 million which do not expire, state NOL carryforwards of approximately $ 126.7 million which either expire between one and nineteen years , or carryforward indefinitely, and foreign NOL carryforwards of approximately $ 9.3 million which expire between five and twenty years . The Company also has an Alternative Minimum Tax credit (“AMT”) in Puerto Rico of approximately $ 0.6 million. The Company has concluded that it is not more likely than not that its deferred tax assets, including NOLs, can be utilized in the foreseeable future. Thus, the Company’s valuation allowance continues to be maintained against its net deferred tax assets and increased $ 18.3 million to $ 88.1 million in Fiscal 2024. However, to the extent that tax benefits related to these deferred tax assets are realized in the future, the reduction of the valuation allowance will reduce income tax expense accordingly. During Fiscal 2024, there was a change of control of the Company. This change of control constituted an “ownership change” under Internal Revenue Code Section 382, subjecting the Company to an annual limitation on its ability to utilize its existing NOLs and tax credits as of the ownership change date to offset future taxable income. The application of such limitation may cause U.S. federal income taxes to be paid by the Company earlier than they otherwise would be paid if such limitation was not in effect, which would adversely affect the Company’s operating results and cash flows if it has taxable income in the future. In addition to the aforementioned federal income tax implications pursuant to Section 382 of the Code, most U.S. states follow the general provision of Section 382 of the Code, either explicitly or implicitly resulting in separate state NOL limitations. This may cause state income taxes to be paid earlier than otherwise would be paid if such limitation was not in effect and could cause such NOLs to expire unused. 84 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) On December 22, 2017, the U.S. government passed the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act is a comprehensive tax legislation that implemented complex changes to the U.S. tax code including, but not limited to, the reduction of the corporate tax rate from 35% to 21% and a move from a global tax regime to a modified territorial regime which required U.S. companies to pay a mandatory one-time transition tax on historical offshore earnings that have not been repatriated to the U.S. The remaining unpaid transition tax of $ 9.5 million is shown net in Prepaid expenses and other current assets on the Consolidated Balance Sheet as of February 1, 2025. While the Company is no longer permanently reinvested to the extent earnings were subject to the transition tax under the Tax Act, no additional income taxes have been provided on any earnings subsequent to the transition tax or for any additional outside basis differences inherent in the Company’s foreign subsidiaries, as these amounts continue to be permanently reinvested in foreign operations. Determining the amount of the unrecognized deferred tax liability related to any additional outside basis differences in the Company’s foreign subsidiaries (i.e., basis differences in excess of that subject to the one-time transition tax) is not practicable. The unremitted foreign earnings earned subsequent to the transition tax, which are permanently reinvested, were $ 262.4 million at February 1, 2025. Unrecognized Tax Benefits Tax positions are evaluated in a two-step process. First, the Company determines whether it is more-likely-than-not that a tax position will be sustained upon examination. Second, if a tax position meets the more-likely-than-not recognition threshold, it is measured to determine the amount of benefit to recognize in the financial statements. The tax position is measured as the largest amount of benefit that is greater than 50% likely to be realized upon ultimate settlement. A reconciliation of the gross amounts of unrecognized tax benefits, excluding accrued interest and penalties, is as follows: Fiscal Years Ended February 1, 2025 February 3, 2024 (in thousands) Beginning Balance $ 6,990 $ 3,626 Additions for current year tax positions 636 1,756 Additions for prior year tax positions 35 1,608 Reductions for prior year tax positions ( 661 ) — Reductions related to settlements with taxing authorities ( 70 ) — Reductions due to a lapse of the applicable statute of limitations ( 56 ) — Ending Balance $ 6,874 $ 6,990 Unrecognized tax benefits of $ 6.5 million, excluding accrued interest and penalties, at February 1, 2025 would affect the Company’s effective tax rate in future periods, if recognized. The Company believes that it is reasonably possible that the total amount of unrecognized tax benefits as of February 1, 2025 could decrease by up to $ 1.8 million in the next 12 months as a result of settlements with taxing authorities or the expiration of statutes of limitations. The Company accrues interest and penalties related to unrecognized tax benefits as part of the provision for income taxes. At February 1, 2025 and February 3, 2024, accrued interest and penalties of $ 0.8 million and $ 0.6 million, respectively, were included in unrecognized tax benefits. Interest, penalties, and reversals thereof, net of taxes, amounted to an expense of $ 0.2 million and $ 0.3 million in Fiscal 2024 and Fiscal 2023, respectively. The Company is subject to tax in the U.S. and foreign jurisdictions, including Canada and Hong Kong. The Company files a consolidated U.S. income tax return for federal income tax purposes. The Company is no longer subject to income tax examinations by U.S. federal, state and local or foreign tax authorities for tax years 2015 and prior. The Internal Revenue Service is currently conducting an examination of the Company’s tax return for fiscal year 2020 in conjunction with its review of the CARES Act NOL carryback to earlier fiscal years. The Company believes that its reserves for uncertain tax positions are adequate to cover existing risks or exposures. Management believes that an adequate provision has been made for any adjustments that may result from tax examinations. However, the outcome of tax audits cannot be predicted with certainty. If any issues arise as a result of a tax audit, and are resolved in a manner not consistent with management’s expectations, the Company could be required to adjust its provision for income taxes in the period such resolution occurs. 85 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 16. RETIREMENT AND SAVINGS PLANS 401(k) Plan The Company has adopted The Children’s Place 401(k) Savings Plan (the “401(k) Plan”), which qualifies under Section 401(k) of the Internal Revenue Code of 1986, as amended (the “Code”). The 401(k) Plan is a defined contribution plan established to provide retirement benefits for employees. The 401(k) Plan is employee funded up to an elective annual deferral amount and also provides for Company matching contributions up to a certain percentage of the employee’s salary. The 401(k) Plan is available for all U.S. employees of the Company. The Company matches the first 3 % of the participant’s contributions and 50 % of the next 2 % of the participant’s contributions, and the Company’s matching contribution vests immediately. The Company’s matching contributions were $ 3.4 million in Fiscal 2024, $ 4.0 million in Fiscal 2023, and $ 4.5 million in Fiscal 2022. Deferred Compensation Plan The Deferred Compensation Plan liability, excluding Company stock, was $ 1.1 million and $ 1.2 million at February 1, 2025 and February 3, 2024, respectively. The value of the assets held in the rabbi trust was $ 1.1 million and $ 1.2 million at February 1, 2025 and February 3, 2024, respectively. The cost of the Company’s stock repurchased was $ 0.1 million and $ 2.9 million at February 1, 2025 and February 3, 2024, respectively. Other Plans Under statutory requirements, the Company contributes to retirement plans for its operations in Canada, Puerto Rico, and Asia. Contributions under these plans were $ 0.5 million, $ 0.6 million, and $ 0.6 million in Fiscal 2024, Fiscal 2023, and Fiscal 2022, respectively. 17. SEGMENT INFORMATION The Company’s reportable segments are based on the financial information the chief operating decision maker (“CODM”) uses to allocate resources and assess performance of its business. The Company’s President and Interim Chief Executive Officer is the CODM. The Company’s CODM evaluates the performance of each segment and measures its segment profitability based on operating income (loss), defined as income (loss) before interest and taxes. Operating income (loss) is used as a key metric during the annual budget process, and on a quarterly basis to monitor actual performance against the annual budget and forecasts. The Company reports segment data based on geography: The Children’s Place U.S. and The Children’s Place International. Each segment includes an e-commerce business located at www.childrensplace.com and www.gymboree.com . Included in The Children’s Place U.S. segment are the Company’s U.S. and Puerto Rico-based stores and revenue from the Company’s U.S.-based wholesale business. Included in The Children’s Place International segment are the Company’s Canadian-based stores and revenue from international franchisees. Net sales and direct costs are recorded by each segment. Certain inventory procurement functions, such as production and design, as well as corporate overhead, including executive management, finance, real estate, human resources, legal, and information technology services, are managed by The Children’s Place U.S. segment. Expenses related to these functions, including depreciation and amortization, are allocated to The Children’s Place International segment based primarily on net sales. The assets related to these functions are not allocated. The Company periodically reviews these allocations and adjusts them based upon changes in business circumstances. Major Customers Net sales to external customers are derived from merchandise sales, and the Company has one U.S. wholesale customer that individually accounted for more than 10% of its net sales, amounting to $ 170.7 million during Fiscal 2024, and accounts for a majority of the Company’s accounts receivable, amounting to $ 31.6 million as of February 1, 2025. Store Count by Segment As of February 1, 2025, The Children’s Place U.S. had 437 stores and The Children’s Place International had 58 stores. As of February 3, 2024, The Children’s Place U.S. had 460 stores and The Children’s Place International had 63 stores. 86 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The tables below present certain segment information for our reportable segments for the periods indicated: Fiscal Year Ended February 1, 2025 The Children’s Place U.S. The Children’s Place International (1) Total (in thousands) Net sales $ 1,266,500 $ 119,769 $ 1,386,269 Cost of sales (2) 836,351 90,457 926,808 Selling, general, and administrative expenses (3) 405,895 39,267 445,162 Other segment expenses (4) 28,000 — 28,000 Segment operating loss $ ( 3,746 ) $ ( 9,955 ) $ ( 13,701 ) Segment operating loss as a percentage of net sales ( 0.3 )% ( 8.3 )% ( 1.0 )% Fiscal Year Ended February 3, 2024 The Children’s Place U.S. The Children’s Place International (1) Total (in thousands) Net sales $ 1,457,352 $ 145,156 $ 1,602,508 Cost of sales (2) 1,058,423 98,811 1,157,234 Selling, general, and administrative expenses (3) 450,868 43,661 494,529 Other segment expenses (4) 34,543 — 34,543 Segment operating income (loss) $ ( 86,482 ) $ 2,684 $ ( 83,798 ) Segment operating income (loss) as a percentage of net sales ( 5.9 )% 1.8 % ( 5.2 )% Fiscal Year Ended January 28, 2023 The Children’s Place U.S. The Children’s Place International (1) Total (in thousands) Net sales $ 1,533,934 $ 174,548 $ 1,708,482 Cost of sales (2) 1,079,241 115,079 1,194,320 Selling, general, and administrative expenses (3) 460,218 52,218 512,436 Other segment expenses (4) 3,256 — 3,256 Segment operating income (loss) $ ( 8,781 ) $ 7,251 $ ( 1,530 ) Segment operating income (loss) as a percentage of net sales ( 0.6 )% 4.2 % ( 0.1 )% ___________________________________________ (1) The Company’s foreign subsidiaries, primarily in Canada, have operating results based in foreign currencies and are thus subject to the fluctuations of the corresponding translation rates into U.S dollars. (2) Refer to Note 1. Basis of Presentation for additional information on the components of Cost of sales. (3) Selling, general, and administrative expenses include store expenses, marketing, corporate payroll, including long-term incentive compensation, information technology, other administrative expenses, and depreciation and amortization. (4) Other segment expenses include asset impairment charges. 87 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The table below presents a reconciliation of reportable segment operating loss to Loss before provision (benefit) for income taxes: Fiscal Years Ended February 1, 2025 February 3, 2024 January 28, 2023 (in thousands) Total segment operating loss $ ( 13,701 ) $ ( 83,798 ) $ ( 1,530 ) Related party interest expense ( 6,493 ) — — Other interest expense ( 29,301 ) ( 30,087 ) ( 13,324 ) Interest income 47 87 92 Loss before provision (benefit) for income taxes $ ( 49,448 ) $ ( 113,798 ) $ ( 14,762 ) Additional Segment Data Fiscal Years Ended February 1, 2025 February 3, 2024 January 28, 2023 (in thousands) Depreciation and amortization: The Children’s Place U.S. $ 35,644 $ 43,428 $ 47,612 The Children’s Place International 3,968 3,758 3,852 Total depreciation and amortization $ 39,612 $ 47,186 $ 51,464 Capital expenditures: The Children’s Place U.S. $ 15,245 $ 27,462 $ 44,970 The Children’s Place International 585 97 607 Total capital expenditures $ 15,830 $ 27,559 $ 45,577 February 1, 2025 February 3, 2024 (in thousands) Total assets: The Children’s Place U.S. $ 711,564 $ 758,003 The Children’s Place International 35,988 42,305 Total assets $ 747,552 $ 800,308 Geographic Information The Company’s long-lived assets were located in the following countries: February 1, 2025 February 3, 2024 (in thousands) Long-lived assets (1) : United States $ 267,751 $ 334,425 Canada 9,801 13,382 Asia 1,996 375 Total long-lived assets $ 279,548 $ 348,182 ___________________________________________ (1) The Company long-lived assets are comprised of net Property and equipment, ROU assets, Tradenames, and Other assets. 88 Table of Contents THE CHILDREN’S PLACE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 18. SUBSEQUENT EVENTS On February 6, 2025, the Company completed a rights offering pursuant to which the Company distributed to the holders of record of the Company’s Common stock as of the close of business on December 13, 2024, the record date for the Rights Offering, non-transferable subscription rights to purchase, in the aggregate, up to 9.2 million shares of Common stock. Each subscription right entitled its holder to purchase 0.7220 shares of Common stock at a subscription price of $ 9.75 per whole share of Common stock. Additionally, rights holders who fully exercised their basic subscription rights were entitled to subscribe for additional shares of Common stock that remained unsubscribed as a result of any unexercised basic subscription rights. The subscription price was payable by rights holders (i) in cash, (ii) by delivery in lieu of cash of an equivalent amount of any indebtedness for borrowed money (principal and/or accrued and unpaid interest) owed by the Company to such rights holder, or (iii) by delivery of a combination of cash and such indebtedness. Upon the completion of the Rights Offering, the Company issued 9.2 million shares of Common stock for a total purchase price of $ 90 million. Mithaq purchased 6.7 million shares of Common stock pursuant to the Rights Offering and as of February 6, 2025, it owns and controls the voting power of 62.2 % of our outstanding shares of Common stock. It paid (i) $ 5.1 million of the subscription price for such shares in cash and (ii) the remaining $ 60.2 million of the subscription price for such shares by delivery of indebtedness for borrowed money owed by the Company to Mithaq pursuant to the Initial Mithaq Term Loan. Accordingly, the aggregate outstanding indebtedness owed by the Company to Mithaq pursuant to the Mithaq Term Loans has been reduced to $ 108.4 million as of February 6, 2025, the date of issuance of shares. The Company received approximately $ 29.8 million in gross cash proceeds from the Rights Offering on February 6, 2025. Substantially all of the gross cash proceeds from the Rights Offering were used towards prepaying the Company’s ABL Credit Facility. The following table reflects a pro forma condensed consolidated balance sheet of the Company to reflect the impact of the Rights Offering had the shares of Common stock been issued as of February 1, 2025: February 1, 2025 Pre-Rights Offering Adjustments Post Rights Offering (in thousands) Cash and cash equivalents $ 5,347 $ 29,813 $ 35,160 Total assets 747,552 29,813 777,365 Related party long-term debt 165,974 ( 59,148 ) 106,826 Total liabilities 806,963 ( 59,148 ) 747,815 Stockholder's equity (deficit) ( 59,411 ) 88,961 29,550 Total liabilities and stockholder’s equity (deficit) $ 747,552 $ 29,813 $ 777,365 Number of shares of Common stock outstanding 12,782 9,231 22,013 89 Table of Contents (a)(3) Exhibits. Exhibit Description 3.1 Amended and Restated Certificate of Incorporation of the Company dated May 31, 2016 filed as Exhibit 3.1 to the registrant’s Current Report on Form 8-K filed on June 7, 2016 is incorporated by reference herein. 3.2 Eight h Amended and Restated Bylaws of The Children’s Place, Inc. filed as Exhibit 3. 2 to the registrant’s Current Report on Form 8-K filed on December 12 , 202 4 , is incorporated by reference herein. 4.1 (1) Form of Certificate for Common Stock of the Company filed as an exhibit to the registrant’s Registration Statement No. 333‑31535 on Form S-1, is incorporated by reference herein. 4.2 (1) Amended Form of Certificate for Common Stock of the Company filed as Exhibit 4.2 to the registrant’s Annual Report on Form 10-K for the period ended January 28, 2017, is incorporated by reference herein. 4.3 Description of capital stock of the Company filed as Exhibit 4.3 to the registrant’s Annual Report on Form 10-K for the period ended February 1, 2020, is incorporated by reference herein. 10.1 Lease Agreement as of August 12, 2003 between Orlando Corporation and The Children’s Place (Canada), LP, together with Indemnity Agreement as of August 12, 2003 between the Company and Orlando Corporation, together with Surrender of Lease as of August 12, 2003 between the Company and Orlando Corporation and Orion Properties Ltd. (Canadian Distribution Center) filed as Exhibit 10.2 to the registrant’s Quarterly Report on Form 10‑Q for the period ended November 1, 2003, is incorporated by reference herein. 10.2 Form of Indemnity Agreement between the Company and certain members of management and the Board of Directors filed as Exhibit 10.7 to registrant’s Quarterly Report on Form 10-Q for the period ended August 2, 2008, is incorporated by reference herein. 10.3 Lease Agreement between The Children’s Place Services Company, LLC and 500 Plaza Drive Corp. effective as of March 12, 2009 (500 Plaza Drive), Secaucus, New Jersey filed as Exhibit 10.67 to the registrant’s Annual Report on Form 10-K for the period ended January 31, 2009, is incorporated by reference herein. 10.4 Guaranty between the Company and 500 Plaza Drive Corp. effective as of March 12, 2009 filed as Exhibit 10.68 to the registrant’s Annual Report on Form 10-K for the period ended January 31, 2009, is incorporated by reference herein. 10.5 The First Lease Modification Agreement, dated as of August 27, 2009, between The Children’s Place Services Company, LLC and 500 Plaza Drive Corp. filed as Exhibit 10.3 to the registrant’s Quarterly Report on Form 10-Q for the period ended August 1, 2009, is incorporated by reference herein. 10.6 Sixth Modification Agreement, dated as of January 23, 2024, by and between Hancock S-REIT SECA LLC and The Children’s Place Services Company, LLC filed as Exhibit 10.6 to the registrant’s Annual Report on Form 10-K for the period ended February 3, 2024, is incorporated by reference herein. 10.7 The Company Nonqualified Deferred Compensation Plan effective January 1, 2010 filed as Exhibit 10.82 to the registrant’s Annual Report on Form 10-K for the period ended January 30, 2010, is incorporated by reference herein. 10.8 Form of Amended and Restated Change in Control Agreement filed as Exhibit 10.41 to the registrant’s Annual Report on Form 10-K for the period ended January 29, 2011, is incorporated by reference herein. 10.9 Agreement dated May 22, 2015, by and among The Children’s Place, Inc., Macellum SPV II, LP, Barington Companies Equity Partners, L.P., Jonathan Duskin, James A. Mitarotonda, certain of their affiliates listed on Schedule A to the Agreement, and Robert L. Mettler filed as Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed on May 29, 2015, is incorporated by reference herein. 10.10(*) The Company Profit Sharing/401(k) Plan Adoption Agreement No.#001 for use with Fidelity Basic Plan Document No. 17 entered into by the Company and Fidelity Management Trust Company on September 11, 2015 as filed as Exhibit 10.28 to the registrant’s Annual Report on Form 10-K for the period ended January 30, 2016, is incorporated by reference herein. 10.11 The Children’s Place, Inc. Fourth Amended and Restated 2011 Equity Incentive Plan filed as Annex B to the registrant’s Definitive Proxy Statement on Schedule 14A filed on April 2, 2021, is incorporated by reference herein. 10.12 Amended and Restated Credit Agreement, dated as of May 9, 2019, by and among the Company and The Children’s Place Services Company, LLC, as borrowers, The Children’s Place (International), LLC, The Children’s Place Canada Holdings, Inc., the childrensplace.com, inc., TCP IH II, LLC, TCP International IP Holdings, LLC and TCP International Product Holdings, LLC, as guarantors, Wells Fargo Bank, National Association (successor by merger to Wells Fargo Retail Finance, LLC), as Administrative Agent and Collateral Agent, L/C Issuer, Swing Line Lender and as a lender and Bank of America, N.A., HSBC Bank USA, N.A. and JPMorgan Chase Bank, N.A., as lenders, filed as Exhibit 10.5 to the registrant’s Quarterly Report on Form 10-Q for the period ended May 4, 2019, is incorporated by reference herein. 90 Table of Contents Exhibit Description 10.13 First Amendment to Amended and Restated Credit Agreement, dated April 24, 2020, by and among the Company and The Children's Place Services Company, LLC, as borrowers, The Children's Place (International), LLC, The Children's Place Canada Holdings, Inc., the childrensplace.com, inc., TCP IH II, LLC, TCP International IP Holdings, LLC and TCP International Product Holdings, LLC, as guarantors, Wells Fargo Bank, National Association (successor by merger to Wells Fargo Retail Finance, LLC), as Administrative Agent and Collateral Agent, L/C Issuer, Swing Line Lender and as a lender and HSBC Bank USA, N.A. and JPMorgan Chase Bank, N.A., as lenders, filed as Exhibit 10.1 to the registrant’s Quarterly Report on Form 10-Q for the period ended May 2, 2020, is incorporated by reference herein. 10.14 Joinder and Second Amendment to Amended and Restated Credit Agreement and Other Loan Documents, dated as of October 5, 2020, among the Company, the Borrowers identified on Schedule I thereto, TCP Brands, LLC, TCP Investment Canada I Corp., collectively, the New Guarantors, the Guarantors identified on Schedule II thereto, the Credit Agreement Lenders and Wells Fargo Bank, National Association (successor by merger to Wells Fargo Retail Finance, LLC), as Administrative Agent and Collateral Agent, L/C Issuer, Swing Line Lender and as a lender, filed as Exhibit 4.2 to the registrant’s Current Report on Form 8-K filed on October 6, 2020, is incorporated by reference herein. 10.15 Third Amendment to Amended and Restated Credit Agreement, dated as of April 23, 2021, by and among the Company, the Borrowers identified on Schedule I thereto, the Guarantors identified on Schedule II thereto, the Credit Agreement Lenders and Wells Fargo Bank, National Association (successor by merger to Wells Fargo Retail Finance, LLC), as Administrative Agent, Collateral Agent, L/C Issuer, and Swing Line Lender filed as Exhibit 10.23 to the registrant’s Annual Report on Form 10-K for the period ended January 29, 2022, is incorporated by reference herein. 10.16 Joinder and Fourth Amendment to Amended and Restated Credit Agreement and Other Loan Documents, dated as of November 15, 2021, among the Company, the Borrowers identified on Schedule I thereto, TCP Brands, LLC, The Children’s Place International, LLC, collectively the New Borrowers, the Guarantors identified on Schedule II thereto, the Credit Agreement Lenders and Wells Fargo Bank, National Association, as Administrative Agent, Collateral Agent, L/C Issuer, Swing Line Lender and Term Agent, filed as Exhibit 10.4 to the registrant’s Quarterly Report on Form 10-Q for the period ended October 30, 2021, is incorporated by reference herein. 10.17 Joinder and Fifth Amendment to the Amended and Restated Credit Agreement and Other Loan Documents, dated as of June 5, 2023, among the Company, the Borrowers identified on Schedule I thereto, the Guarantors identified on Schedule II thereto, the Credit Agreement Lenders and Wells Fargo Bank, National Association, as Administrative Agent, Collateral Agent, L/C Issuer, Swing Line Lender and Term Agent filed as Exhibit 10.1 to the registrant’s Quarterly Report on Form 10-Q for the quarterly period ended April 29, 2023, is incorporated by reference herein. 10.18 Waiver and Amendment Agreement to the Credit Agreement, dated as of October 24, 2023, among the Company, the Borrowers identified on Schedule I thereto, the Guarantors identified on Schedule II thereto, the Credit Agreement Lenders and Wells Fargo Bank, National Association, as Administrative Agent, Collateral Agent, L/C Issuer, Swing Line Lender and Term Agent, filed as Exhibit 10.4 to the registrant’s Quarterly Report on Form 10-Q for the period ended October 28, 2023, is incorporated by reference herein. 10.19 Seventh Amendment to Amended and Restated Credit Agreement, dated April 16, 2024, among the Company, certain subsidiaries of the Company, the Credit Agreement Lenders and Wells Fargo Bank, National Association, as Administrative Agent, Collateral Agent, L/C Issuer and Swing Line Lender filed as Exhibit 10.24 to the registrant’s Annual Report on Form 10-K for the period ended February 3, 2024, is incorporated by reference herein. 10.20 Unsecured P romissory Note, dated February 29, 2024, among the Company, certain subsidiaries of the Company, and Mithaq Capital SPC filed as Exhibit 4.1 to the registrant’s Current Report on Form 8-K filed on March 4, 2024, is incorporated by reference herein. 10.21 Unsecured Promissory Note, dated April 16, 2024, among the Company, certain subsidiaries of the Company, and Mithaq Capital SPC filed as Exhibit 10.26 to the registrant’s Annual Report on Form 10-K for the period ended February 3, 2024, is incorporated by reference herein. 10.22 Commitment Letter for $40 Million Senior Unsecured Credit Facility (Third), dated as of May 2, 2024, among the Company, certain subsidiaries of the Company, and Mithaq Capital SPC filed as Exhibit 10.27 to the registrant’s Annual Report on Form 10-K for the period ended February 3, 2024, is incorporated by reference herein. 10.23 Asset Purchase Agreement, dated March 1, 2019, by and among TCP Brands, LLC, as buyer, and Gymboree Group, Inc. and its subsidiaries, as sellers, filed as Exhibit 10.6 to the registrant’s Quarterly Report on Form 10-Q for the period ended May 4, 2019, is incorporated by reference herein. 10.24 The Fifth Lease Modification Agreement, dated as of January 29, 2021, by and between The Children’s Place Services Company, LLC and Hancock S-REIT SECA LLC filed as Exhibit 10.24 to the registrant’s Annual Report on Form 10-K for the period ended January 30, 2021, is incorporated by reference herein. 91 Table of Contents Exhibit Description 10.25 ( * ) Letter Agreement dated July 21, 2021 between The Children’s Place Services Company, LLC and Jared Shure filed as Exhibit 10.2 to the registrant’s Quarterly Report on Form 10-Q for the period ended July 31, 2021, is incorporated by reference herein. 10.26(*) Letter Agreement dated May 2 9, 2024 between The Children’s Place, Inc. and Muhammad Umair filed as Exhibit 10. 2 to the registrant’s Quarterly Report on Form 10-Q for the period ended May 4 , 2024, is incorporated by reference herein. 10.27(*) Letter Agreement dated August 9, 2024 between The Children’s Place , Inc. and Claudia Lima-Guinehut filed as Exhibit 10.4 to the registrant’s Quarterly Report on Form 10-Q for the period ended Au gust 3 , 2024, is incorporated by reference herein. 10.28(+)(*) Letter Agreement dated February 25, 2025 between The Children’s Place , Inc. and John Szczepanksi. 10.29(+)(*) Form of Deferred Cash Award Agreement under the 2011 Equity Incentive Plan (Group Vice President & below). 10.30(+)(*) Form of Restricted Stock Unit Award Agreement under the 2011 Equity Incentive Plan (Senior Vice President & above). 19.1(+) The Children’s Place Inc. Insider Trading Policy 21.1(+) Subsidiaries of the Company. 23.1(+) Consent of Independent Registered Public Accounting Firm BDO USA, P.C. 23.2(+) Consent of Independent Registered Public Accounting Firm Ernst & Young, LLP. 31.1(+) Certificate of Principal Executive Officer pursuant to Section 302 of the Sarbanes Oxley Act of 2002. 31.2(+) Certificate of Principal Financial Officer and Principal Accoun ting Officer pursuant to Section 302 of the Sarbanes Oxley Act of 2002. 32(+) Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 101.SCH* XBRL Taxonomy Extension Schema. 101.CAL* XBRL Taxonomy Extension Calculation Linkbase. 101.DEF* XBRL Taxonomy Extension Definition Linkbase. 101.LAB* XBRL Taxonomy Extension Label Linkbase. 101.PRE* XBRL Taxonomy Extension Presentation Linkbase. ________________________________________ (1) Exhibit numbers are identical to the exhibit numbers incorporated by reference to such registration statement. (*) Compensation Arrangement. (+) Filed herewith. * Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability. (b) Exhibits . The exhibits required by Item 601 of Regulation S-K are filed herewith or incorporated by reference. (c) Financial Statement Schedules and Other Financial Statements . All other financial statement schedules are omitted from this Annual Report on Form 10-K, as they are not required or applicable or the required information is included in the financial statements or notes thereto. ITEM 16. FORM 10-K SUMMARY. Omitted at registrant’s option. 92 Table of Contents 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 CHILDREN’S PLACE, INC. By: /S/ Muhammad Umair Muhammad Umair President and Interim Chief Executive Officer (Principal Executive Officer) April 17, 2025 93 Table of Contents 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. Signature Title Date /S/ Turki Saleh A. AlRajhi Chairman of the Board April 17, 2025 Turki Saleh A. AlRajhi /S/ Muhammad Umair Director, President and Interim Chief Executive Officer (Principal Executive Officer) April 17, 2025 Muhammad Umair /S/ John Szczepanski Chief Financial Officer (Principal Financial Officer) April 17, 2025 John Szczepanski /S/ Laura Lentini Chief Accounting Officer (Principal Accounting Officer) April 17, 2025 Laura Lentini /S/ Douglas Edwards Director April 17, 2025 Douglas Edwards /S/ Hussan Arshad Director April 17, 2025 Hussan Arshad /S/ Muhammad Asif Seemab Director April 17, 2025 Muhammad Asif Seemab /S/ Rhys Summerton Director April 17, 2025 Rhys Summerton 94