What changed in this filing

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Item 1. Business

2024-02-21 compared with 2023-02-27 · 98 added, 105 removed, 125 unchanged (62% of the section changed)

The Company and the Operating Partnership

Tanger Factory Outlet Centers, Inc.

and subsidiaries, which we refer to as the Company, is one of the largest owners and operators of outlet centers in the United States and Canada.

We are a fully-integrated, self-administered and self-managed REIT, which focuses on developing, acquiring, owning, operating and managing outlet shopping centers.

As of December 31, 2022, our consolidated portfolio consisted of 29 outlet centers, with a total gross leasable area of approximately 11.4 million square feet, which were 97% occupied and contained over 2,200 stores representing approximately 600 store brands, as well as one center under construction.

We also had partial ownership interests in 6 unconsolidated outlet centers totaling approximately 2.1 million square feet, including 2 outlet centers in Canada.

Our portfolio also includes one managed center totaling approximately 500,000 square feet.

Each of our outlet centers, except one joint venture property, features the Tanger brand name.

Our outlet centers and other assets are held by, and all of our operations are conducted by, Tanger Properties Limited Partnership and subsidiaries, which we refer to as the Operating Partnership.

and its subsidiaries, which we refer to as the Company, is one of the leading owners and operators of outlet and open-air centers in the United States and Canada.

We are a fully-integrated, self-administered and self-managed REIT, which focuses on developing, acquiring, owning, operating and managing outlet and open-air shopping centers.

As of December 31, 2023, our consolidated portfolio consisted of 31 outlet centers and one open-air lifestyle center, with a total gross leasable area of approximately 12.7 million square feet, which were 97% occupied and contained over 2,400 stores representing approximately 660 store brands.

We also had partial ownership interests in 6 unconsolidated centers totaling approximately 2.1 million square feet, including 2 centers in Canada.

Our portfolio also includes two managed centers totaling approximately 760,000 square feet.

Each of our centers, except one joint venture center, features the Tanger brand name.

Our shopping centers and other assets are held by, and all of our operations are conducted by, Tanger Properties Limited Partnership and its subsidiaries, which we refer to collectively as the Operating Partnership.

The Company, including its wholly-owned subsidiary, Tanger LP Trust, owns the majority of the units of partnership interest issued by the Operating Partnership.

The Company controls the Operating Partnership as its sole general partner.

Tanger LP Trust holds a limited partnership interest.

Tanger LP Trust holds a limited partnership interest in the Operating Partnership.

As of December 31, 2023, the Company and its wholly-owned subsidiaries owned 108,793,251 units of the Operating Partnership and the Non-Company LPs collectively owned 4,707,958 Class A common limited partnership units.

Each Class A common limited partnership unit held by the Non-Company LPs is exchangeable for one of the Company's common shares, subject to certain limitations to preserve the Company's status as a REIT.

federal income tax purposes.

Class B common limited partnership units, which are held by Tanger LP Trust, are not exchangeable for common shares of the Company.

Ownership of the Company's common shares is restricted to preserve the Company's status as a REIT for federal income tax purposes.

Ownership of the Company's common shares is restricted to preserve the Company's status as a REIT for U.S.

federal income tax purposes.

Subject to certain exceptions, a person may not actually or constructively own more than 9.8% of our common shares.

We also operate in a manner intended to enable us to preserve our status as a REIT, including, among other things, making distributions with respect to our then outstanding common shares and preferred shares, if applicable, equal to at least 90% of our taxable income each year.

The Company is a North Carolina corporation that was incorporated in March 1993 and the Operating Partnership is a North Carolina partnership that was formed in May 1993.

The Company is a North Carolina corporation that was incorporated in March 1993 and the Operating Partnership is a North Carolina limited partnership that was formed in May 1993.

Our executive offices are currently located at 3200 Northline Avenue, Suite 360, Greensboro, North Carolina, 27408 and our telephone number is (336) 292-3010.

Our website can be accessed at www.tangeroutlet.com.

Copies of our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments thereto can be obtained, free of charge, on our website as soon as reasonably practicable after we file such material with, or furnish it to, the Securities and Exchange Commission (the "SEC").

The information found on, or otherwise accessible through, our website is not incorporated into, and does not form a part of, this Annual Report on Form 10-K or any other report or document we file with or furnish to the SEC.

Our website can be accessed at www.tanger.com.

Copies of our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and any amendments thereto can be obtained, free of charge, on our website as soon as reasonably practicable after we file such material with, or furnish it to, the SEC.

The information found on, or otherwise accessible through, our website is not incorporated into, and does not form a part of, this Annual Report or any other report or document we file with or furnish to the SEC.

Recent Developments

New Development

In May 2022, we broke ground on our 37th center in Nashville, Tennessee.

The center, which will be approximately 290,000 square feet, is expected to open in the third quarter of 2023 at an estimated total cost of $142.0 million to $150.0 million with a projected stabilized yield of 7.0% to 7.5%.

Through December 31, 2022, we had incurred costs of $36.0 million associated with this development.

Property Management

In August 2022, we announced a strategic partnership with Clarion Partners at Palm Beach Outlets in West Palm Beach, Florida.

We assumed marketing, leasing and property management responsibilities at the 457,000 square foot property, which has been rebranded as Tanger Outlets Palm Beach.

In October 2023, we opened a 291,000 square foot outlet center in Nashville, Tennessee.

The open-air center offers shopping and dining across seven retail buildings and a unique, placemaking community space.

Tanger Nashville reflects our commitment to diversify and enhance the shopping experience for our customers with nearly one quarter of the center’s dynamic assortment of retailers being new to our portfolio or first to the outlet channel.

In November 2023, we acquired a 382,000-square-foot, open-air outlet center in Asheville, North Carolina for $70 million.

The established center is occupied by a diverse mix of brands that includes leading home furnishings providers as well as iconic apparel, footwear and accessories brands.

In addition, in November 2023, we acquired Bridge Street Town Centre, an 825,000-square-foot, open-air lifestyle center in Huntsville, Alabama for $193.5 million.

The center serves as the dominant shopping destination in its market and comprises over 80 retail stores, restaurants, and entertainment venues, including approximately 174,000 square feet ground leased to tenants.

Financing Transactions

Unsecured Term Loan

In October 2022, we amended and restated our unsecured term loan.

The outstanding balance was increased from $300.0 million to $325.0 million and the maturity was extended from April 2024 to January 2027 plus a one-year extension option.

The interest rate changed from LIBOR + 1.25% to Adjusted Secured Overnight Financing Rate (SOFR) + 1.20% based on our current credit rating at closing.

The amendment also incorporates a sustainability metric, reducing the applicable grid-based interest rate spread by one basis point annually, subject to meeting certain thresholds.

Unsecured Lines of Credit

In October 2022, we amended our unsecured lines of credit to change the interest rate index from LIBOR to Adjusted SOFR.

All other terms remained unchanged.

Southaven, MS mortgage

In October 2022, the Southaven, Mississippi joint venture amended and restated its secured term loan, increasing the outstanding balance to $51.7 million from $40.1 million, extending the maturity from April 2023 to October 2026 plus a one-year extension option, with an interest rate of Adjusted SOFR plus 2.00%.

ATM Equity Offerings

During 2023, we sold 3.5 million common shares under our at-the-market stock offering (“ATM Offering”) program at a weighted average price of $25.75 per share, generating gross proceeds of $90.0 million.

As of December 31, 2023, we have a remaining authorization of $220.1 million under the ATM Offering.

Throughout 2023, we entered into $325.0 million of forward starting daily Secured Overnight Financing Rate (“Daily SOFR”) interest rate swaps at an average fixed pay rate of 3.9%.

The swaps were effective February 1, 2024 and end at various dates from February 1, 2026 to January 1, 2027.

These swaps replaced $300.0 million of existing swaps that expired on February 1, 2024 as part of our interest rate risk management strategy.

Unconsolidated Real Estate Joint Ventures Financing Transactions

Columbus, Ohio

In September 2022, the joint venture completed the refinance of its existing $71.0 million LIBOR + 1.85% which had a maturity date of November 2022.

The refinanced mortgage remained $71.0 million but became a non-recourse loan with a maturity date in October 2032 and a fixed interest rate of 6.25%.

Property Sales

In December 2022, we sold our Blowing Rock, North Carolina center for $13.0 million, which resulted in a gain on sale of assets of $3.2 million.

Houston/Galveston, Texas

In June 2023, the Galveston/Houston joint venture completed the refinance of its mortgage.

The new $58.0 million loan has a maturity date of June 2026 and an interest rate of Daily SOFR + 3.00%.

In conjunction with this refinance, the joint venture entered into a $29.0 million interest rate swap that fixes Daily SOFR at 4.44% until December 2025.

Organizational Changes

In November 2022, Michael Bilerman became the Company’s Executive Vice President, Chief Financial Officer and Chief Investment Officer.

In July 2023, Bridget Ryan-Berman, who had been a member of the Company's board of directors ("Board") since January 1, 2009, was appointed lead independent director, a position previously held by Board member David B.

In September 2023, Jessica K.

Norman joined the Company as the Executive Vice President, General Counsel and Secretary.

Effective January 1, 2024, Steven B.

Tanger transitioned from his role as Executive Chair of the Board to Non-Executive Chair of the Board in connection with his retirement from the Company under the terms of his employment agreement.

Business Strategy

Our Company was built on a firm foundation of strong and enduring business relationships coupled with disciplined business practices.

We partner with many of the world's best known and most respected brands and retailers.

By fostering and maintaining strong relationships with these successful, high volume companies, we believe we have been able to solidify our position as a leader in the outlet and open-air retail industry for over thirty years.

The confidence and trust that we have developed with our retail partners from the very beginning has allowed us to forge the impressive retail alliances that we enjoy today with our brands and retailers.

Our seasoned team of professionals with diverse sets of expertise utilize the knowledge and experience that we have gained to give us a competitive advantage in the outlet and open-air retail business.

The Outlet Concept

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Outlet centers also enable brands and retailers to establish a direct relationship with their customers and maintain brand integrity through control of product placement and pricing.

Our Outlet Centers

Each of our outlet centers, except one joint venture property, features the Tanger brand name.

Additionally, we leverage the Tanger brand and platform to manage a center in Palm Beach, Florida owned by an institutional investor.

We believe that our tenants and consumers recognize the Tanger brand as one that provides outlet shopping centers where consumers can trust the brand, value and experience.

As one of the original participants in this industry and through key additions to our executive, leasing, operating and center teams, we have established long-standing relationships with many of our tenants that we believe are critical in operating, managing, developing, and acquiring successful outlet and retail centers.

Our consolidated outlet centers are typically located in a variety of geographical areas, including high frequency tourist destinations and suburbs of vibrant and fast-growing markets.

Each of our centers, except one joint venture center, features the Tanger brand name.

Additionally, we leverage the Tanger brand and platform to manage centers in Palm Beach, Florida.

We believe that our tenants and consumers recognize the Tanger brand as one that provides retail centers where consumers can trust the brand, value and experience.

In addition to our Tanger branded outlet portfolio, we recently acquired our first open-air lifestyle center in Huntsville, Alabama which was a natural extension of our capabilities and consistent with our long-term strategy of investing in dominant open-air retail centers in markets that benefit from outsized residential and tourism growth.

As one of the original participants in the outlet industry and through key additions to our executive, leasing, operating and center teams, we have long-standing relationships with many of our tenants that we believe are critical in operating, managing, developing, and acquiring successful centers.

Our consolidated centers are typically located in a variety of geographical areas, including high frequency tourist destinations and suburbs of vibrant and fast-growing markets.

Additionally, our centers are often situated in close proximity to interstate highways that provide accessibility and visibility to potential customers.

We have a diverse tenant base throughout our consolidated portfolio, comprised of approximately 600 designers, brands, specialty retailers and select multi-brand retailers such as Nike, Coach, Gap Outlet, Ralph Lauren, Michael Kors, Kate Spade, American Eagle, Under Armour, Banana Republic, Ann Taylor, Columbia, The North Face, Adidas, Levis, H&M, Old Navy, Bath and Body Works, Vineyard Vines, J Crew, Tory Burch, Hollister, Lululemon, Allbirds, Summersalt, Ulta, Hey Dude, Huk, Crocs, Restoration Hardware, Pottery Barn, West Elm, Williams-Sonoma, and many more.

No single tenant, including all of its store concepts, accounted for 10% or more of our combined base and percentage rental revenues during 2022, 2021 or 2020.

We have a diverse tenant base throughout our consolidated portfolio comprising over 2,400 stores operated by more than 660 different brand name companies.

Our centers offer shoppers a curated mix of retailers specializing in apparel, footwear, accessories, athletic wear, athleisure, home furnishings, health and beauty, and digitally-native brands.

Additionally, we are adding food, beverage, and entertainment options, along with other services, at our centers to attract new shoppers, extend visitor dwell time and increase frequency of visits.

No single tenant, including all of its store concepts, accounted for 10% or more of our combined base and percentage rental revenues during the years ended 2023, 2022 or 2021.

As of December 31, 2023, no single tenant accounted for more than 8% of our leasable square feet or 6% of our combined base and percentage rental revenues.

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Rental revenues $ 438,889

(1) Primarily includes rents based on a percentage of tenant sales volume and reimbursable expenses such as common area expenses, utilities, insurance and real estate taxes, which are paid on a pro rata basis.

(1) Primarily includes rents based on a percentage of tenant gross sales volume and reimbursable expenses such as common area expenses, utilities, insurance and real estate taxes, which are paid on a pro rata basis.

Business History

Tanger, the Company's founder, entered the outlet center business in 1981.

Prior to founding our Company, Stanley K.

Prior to founding the Company, Stanley K.

Tanger and his son, Steven B.

Tanger, our Executive Chair, built and managed a successful family owned apparel manufacturing business, Tanger/Creighton, Inc., which included the operation of five outlet stores.

Based on their knowledge of the apparel and retail industries, as well as their experience operating Tanger/Creighton, Inc.'s outlet stores, they recognized that there would be a demand for outlet centers where a number of manufacturers could operate in a single location and attract a large number of shoppers.

Tanger joined the predecessor company in 1986, and by June 1993, the Tangers had developed 17 outlet centers totaling approximately 1.5 million square feet.

In June 1993, we completed our initial public offering, making Tanger Factory Outlet Centers, Inc.

the first publicly traded outlet center company.

Since our initial public offering, we have grown our portfolio through the strategic development, expansion and acquisition of outlet centers and are now one of the largest owner operators of outlet centers in the United States and Canada.

In April 2020, Stephen Yalof, a successful and proven retail real estate executive, joined the Company as President and Chief Operating Officer, as part of an executive succession plan for the role of CEO.

Effective January 1, 2021, Steven B.

Tanger, the Company's CEO, transitioned to the position of Executive Chair of the Company's Board of Directors, effective through January 1, 2024, and Mr.

Yalof assumed the role of CEO of the Company.

Business Strategy

Our Company has been built on a firm foundation of strong and enduring business relationships coupled with disciplined business practices.

We partner with many of the world's best known and most respected brands and retailers.

By fostering and maintaining strong relationships with these successful, high volume companies, we have been able to solidify our position as a leader in the outlet industry for over thirty years.

Our seasoned team of professionals with diverse sets of expertise utilize the knowledge and experience that we have gained to give us a competitive advantage in the outlet business.

Tanger, our Non-Executive Chair, built and managed a successful family-owned apparel manufacturing business, Tanger/Creighton, Inc.

In June 1993, we completed our initial public offering and subsequently grew our portfolio through the strategic development, expansion and acquisition of outlet and open-air retail centers.

In April 2020, Stephen Yalof, a successful and proven retail and real estate executive, joined the Company as President and Chief Operating Officer, as part of an executive succession plan for the role of Chief Executive Officer.

Yalof became the Chief Executive Officer of the Company effective January 1, 2021.

Growth Strategy

Our goal is to build shareholder value through a comprehensive, disciplined plan for sustained, long-term growth.

We focus our efforts on increasing net operating income at our existing outlet centers, renovating and optimizing selected outlet centers and pursuing disciplined external growth in our current markets and potential new markets through selective ground-up development or the acquisition of retail real estate.

We focus our efforts on increasing net operating income at our existing centers, renovating and optimizing selected centers and pursuing disciplined external growth in our current markets and potential new markets through selective ground-up development or the acquisition of retail real estate.

Future retail real estate assets may be wholly-owned by us, owned through joint ventures or partnership arrangements, or through management agreements.

Increasing net operating income at existing outlet centers

Increasing net operating income at existing centers

Our leasing team focuses on optimizing the use of our real estate to attract and engage best in class brands and retailers with a focus on maximizing consumer demand and rent.

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Given the current retail environment, we may choose to execute leases with new tenants or renew certain tenants to enhance our tenant mix or maintain a high portfolio occupancy rate.

In addition, we are focused on generating non-store revenues (other revenues), through marketing partnerships, media and ROI driven sustainability initiatives and actively managing property operating expenses and marketing expenses as a means of growing net operating income.

Developing new outlet centers

In addition, we are focused on generating non-store revenues (other revenues), through marketing partnerships, media and return on investment ("ROI") driven sustainability initiatives, and actively managing property operating expenses and marketing expenses as a means of growing net operating income.

Developing new centers

We believe that there continue to be opportunities to introduce the Tanger brand in untapped or under-served markets across the United States and Canada in the long-term.

We believe our expertise in the outlet industry, extensive development expertise and strong retail relationships give us a distinct competitive advantage.

In order to help ensure the viability of proceeding with a project, we gauge the interest of our retail partners first.

We typically prefer to have signed leases or leases out for negotiation with tenants for at least 60% of the space in each outlet center prior to acquiring the site and beginning construction;

We believe our expertise in the outlet and open-air retail industry, extensive development expertise and strong retail relationships give us a distinct competitive advantage.

In order to help ensure the viability of proceeding with a project, we first gauge the interest of our retail partners.

We typically prefer to have signed leases or leases out for negotiation with tenants for at least 60% of the space in each center prior to acquiring the site and beginning construction;

however, we may choose to proceed with construction with less than 60% of the space pre-leased under certain circumstances.

Construction of a new outlet center has typically taken us twelve to eighteen from groundbreaking to grand opening of the outlet center.

Expanding and renovating existing outlet centers

Construction of a new center typically takes us 12 to 18 months from groundbreaking to the grand opening of the center.

Expanding and renovating existing centers

Keeping our centers vibrant and growing is a key part of our formula for success.

In order to maintain our reputation as the premiere shopping destination in the markets that we serve, we have an ongoing program of renovations and expansions taking place at our outlet centers.

In order to maintain our reputation as the premier shopping destination in the markets that we serve, we have an ongoing program of renovations and expansions taking place at our centers.

Construction for expansion and renovation to existing properties typically takes less time, usually between six to nine months depending on the scope of the project.

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Increasing cash flow to enhance the value of our properties and operations remains a primary business objective.

Through targeted marketing and operational efficiencies, we strive to improve sales and profitability of our tenants and our outlet centers as a whole.

Through targeted marketing and operational efficiencies, we strive to improve sales and profitability of our tenants and our centers as a whole.

Achieving higher base and percentage rents and generating additional income from temporary leasing, media and other non-store sources also remains an important focus and goal.

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In addition, we are focused on adding non-traditional uses to our tenant mix, including experiential and food and beverage tenants.

In order for our outlet centers to perform at a high level, our leasing professionals continually monitor and evaluate tenant mix, store size, store location and sales performance.

They also work to assist our tenants through re-sizing and re-location of retail space within each of our outlet centers for maximum sales of each retail unit across our portfolio.

In order for our centers to perform at a high level, our leasing professionals continually monitor and evaluate tenant mix, store size, store location and sales performance.

They also work to assist our tenants through re-sizing and re-location of retail space within each of our centers for maximum sales of each retail unit across our portfolio.

Our comprehensive marketing plans are designed to drive sales and traffic in partnership with our retail partners.

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We believe our current balance sheet position is financially sound;

however, due to the uncertainty and unpredictability of the capital and credit markets, we can give no assurance that affordable access to capital will exist between now and when our next significant debt maturity, which is our unsecured senior note due September 2026.

As a result, our current primary focus is to continually strengthen our capital and liquidity position by controlling and reducing construction and overhead costs, generating positive cash flows from operations to cover our distributions and maintaining appropriate leverage levels.

We carefully consider the degree of existing and planned competition in a proposed area before deciding to develop, acquire or expand a new outlet center.

Our outlet centers compete for customers primarily with outlet centers built and operated by different developers, traditional shopping malls, full- and off-price retailers and e-commerce retailers.

We believe that the majority of our customers visit outlet centers because they are intent on shopping brands at discounted prices.

Traditional full-and off-price retailers and e-commerce retailers are often unable to provide such a variety and depth of selection and sizes at attractive prices.

however, due to the uncertainty and unpredictability of the capital and credit markets, we can give no assurance that affordable access to capital will exist between now and our next significant debt maturity, which is our $350.0 million unsecured senior notes due September 2026.

As a result, our current primary focus is to continually strengthen our capital and liquidity position by controlling our capital expenditure levels, generating positive cash flows from operations to cover our distributions and maintaining appropriate leverage levels.

We carefully consider the degree of existing and planned competition in a proposed area before deciding to develop, acquire or expand a new retail center.

Our centers compete for customers primarily with retail centers built and operated by different developers, traditional shopping malls, full- and off-price retailers and e-commerce retailers.

Because our revenues are ultimately linked to our tenants' success, we are affected by the same competitive factors, such as consumer spending habits, as our tenants.

We compete with institutional pension funds, private equity investors, other REITs, individual owners of outlet centers, specialty stores and others who are engaged in the acquisition, development or ownership of outlet centers and stores.

In addition, the number of entities competing to acquire or develop outlet centers has increased and may continue to increase in the future, which could increase demand for these outlet centers and the prices we must pay to acquire or develop them.

Nevertheless, we believe the high barriers to entry in the outlet industry, including the need for extensive marketing programs to drive traffic to the centers and relationships with premier brands and retailers, will continue to limit the number of new outlet centers developed each year.

We compete with institutional pension funds, private equity investors, other REITs, individual owners of retail centers, specialty stores and others who are engaged in the acquisition, development or ownership of retail centers and stores.

In addition, the number of entities competing to acquire or develop retail centers has increased and may continue to increase in the future, which could increase demand for these retail centers and the prices we must pay to acquire or develop them.

Financial Information

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We rent space in an office building in Greensboro, North Carolina where our corporate headquarters is located, as well as a regional office in New York, New York.

As of December 31, 2022, we maintain offices and employ on-site management at 32 consolidated and unconsolidated outlet centers.

The managers closely monitor the operation, marketing and local relationships at each of their outlet centers.

As of December 31, 2023, we maintain offices and employ on-site management at 34 consolidated and unconsolidated centers and one managed center.

The managers closely monitor the operation, marketing and local relationships at each of their centers.

We believe that as a whole our properties are covered by adequate comprehensive liability, fire, flood, earthquake and extended loss insurance provided by reputable companies with commercially reasonable and customary deductibles and limits.

Northline Indemnity, LLC, ("Northline"), a wholly-owned captive insurance subsidiary of the Operating Partnership, is responsible for losses up to certain levels for property damage (including wind damage from hurricanes) prior to third-party insurance coverage.

Northline Indemnity, LLC, a wholly-owned captive insurance subsidiary of the Operating Partnership, is responsible for losses up to certain levels for property damage (including wind damage from hurricanes) prior to third-party insurance coverage.

Specified types and amounts of insurance are required to be carried by each tenant under their lease.

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Our decision-making must reflect the varied perspectives that contribute to making our Company a welcoming environment for all.

We work to embrace these differences which strengthen Our Tanger.

Our philanthropic and sustainable commitments exist to better all the communities we serve.

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We are empowered to take smart risks, innovate and to use our voices to advocate for our ideas and for others within our communities.

Human Capital Resources

Human Capital

As of December 31, 2023, we had 364 full-time employees, located at our corporate headquarters in North Carolina and 35 business offices.

At that date, we also employed 43 part-time employees at various locations.

In 2022, 57% of our full-time workforce has been with us for five years or longer.

Our company has a Diversity, Equity, and Inclusion Council with representation from across the Company.

The Diversity, Equity and Inclusion Council is deeply committed to creating and sustaining an organizational culture reflective of the collective mixture of unique experiences, perspectives, and viewpoints of our people, partners, and communities that contribute to making Tanger an environment where everyone is welcomed, respected, heard, supported, and able to thrive.

Embracing a diverse, equitable, and inclusive workplace is part of our Core Values, strengthening Our Tanger, supporting our efforts to better the communities we serve, and allowing us to be transformative in delivering compelling customer experiences.

One of our DEI Strategic Priorities is to Nurture a Diverse Tanger Community, including but not limited to driving equal access, opportunity, and advancement for customers, partners, stakeholders, board of directors, and all current and future team members, growing the diverse representation of our shoppers and communities within our workforce.

In 2023, 41% of our full-time workforce have been employed by us for five years or longer.

We believe our relations with our employees to be relatively good.

None of our employees are represented by a union or parties to a collective bargaining agreement.

As of December 31, 2023, team members who identify as females made up 70% of field employees, 33% of our executive leadership team, and 71% of our total 407-person workforce.

Racial minorities made up 16% of our total workforce in 2023.

The Company's Board gender composition consisted of 22% members who identify as female and 22% of members with racial diversity.

We focus on developing strategies that enhance an environment where high performance, training and expression of our core competencies are rewarded and publicly recognized.

We provide numerous training programs which include topics related to, among other things, operational training, leadership development, customer service and technology training.

The Board's gender composition consisted of 22% members who identify as female and 22% of members with racial diversity.

We believe attracting, developing and retaining talent is critical to our long-term success.

We focus on creating strategies that enhance an environment of high-performance engagement, and individual development, where employees are rewarded and recognized.

We provide numerous training programs, which include topics such as operational training, leadership development, customer service and technology training.

We recognize that motivation and rewards are different for individuals at various times in their careers, and a balanced blend of monetary and non-monetary rewards can generate valuable business results.

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We have utilized the standards of the Global Reporting Initiative ("GRI") since 2016 and began integrating certain disclosures from the Sustainability Accounting Standards Board ("SASB," now the "Value Reporting Foundation") in 2019.

In 2021 and 2022, we disclosed to Global Real Estate Sustainability Benchmark (GRESB) and CDP (formerly, the Carbon Disclosure Project).

We are also currently assessing our climate-related governance and strategy to report in line with the Task Force on Climate-related Financial Disclosures (TCFD) and we became a signatory to the United Nations Global Compact (UNGC) in 2022.

Since 2021, we have disclosed our data to the Global Real Estate Sustainability Benchmark ("GRESB") and CDP (formerly, the "Carbon Disclosure Project").

In 2022, we became a signatory to the United Nations Global Compact, and aligned our reporting with the Task Force on Climate-related Financial Disclosures ("TCFD") framework.

We continue to assess and improve our climate-related governance and strategy to remain apace with current regulatory landscape and framework reporting requirements.

ESG governance

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The Executive Committee monitors progress toward achievement of goals and communicates priority ESG issues to senior leadership.

Our full Board of Directors provides oversight for the ESG function, and, as appropriate, certain matters are considered by a specific committee of the Board of Directors.

Our full Board provides oversight for the ESG function, and, as appropriate, certain matters are considered by a specific committee of the Board.

Priority ESG issues

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We begin by identifying opportunities and risks, and leverage external frameworks and engage stakeholders, executives and our Board members to help identify key ESG issues.

These key issues are translated into operational priorities and processes across our Company.

As a result of a robust materiality assessment conducted by a third party in 2021, we have identified the following priority material issues that are of greatest relevance to the Company and our stakeholders:

These key issues are translated into operational priorities and processes across the Company.

As a result of a robust materiality assessment conducted by a third party in 2021, we identified the following priority material issues that we believe are of greatest relevance to the Company and our stakeholders:

Diversity, Equity and Inclusion;

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federal securities laws and regulations.

The contents of our ESG Report, ESG Policies and other ESG-related disclosures are not incorporated by reference into this Form 10-K, and do not form a part of this Form 10-K.

The contents of our ESG Report, ESG Policies and other ESG-related disclosures are not incorporated by reference into this Annual Report and do not form a part of this Annual Report.

Government Regulations

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business