Global Partners (GLP) risk factors, FY2024 10-K

Risks Related to Our Business

1. 01We may not have sufficient cash from operations to enable us to pay distributions on our preferred units or maintain distributions on our common units at current levels following establishment of cash reserves and payment of fees and expenses, including payments to our general partner
2. 02The amount of cash we have available for distribution to unitholders depends on our cash flow and does not depend solely on profitability
3. 03We commit substantial resources to pursuing acquisitions and expending capital for growth projects, although there is no certainty that we will successfully complete any acquisitions or growth projects or receive the economic results we anticipate from completed acquisitions or growth projects
4. 04We may not be able to realize expected returns or other anticipated benefits associated with our joint ventures
5. 05Our gasoline financial results in our GDSO segment can be lower in the first and fourth quarters of the calendar year due to seasonal fluctuations in demand
6. 06Our heating oil and residual oil financial results can be lower in the second and third quarters of the calendar year
7. 07Warmer weather conditions could adversely affect our results of operations and financial condition
8. 08A significant decrease in price or demand for the products we sell or a significant increase in the cost of our logistics activities could have an adverse effect on our financial condition, results of operations and cash available for distribution to our unitholders
9. 09Tariffs could significantly impact our operations and costs, adversely affecting our business
10. 10Historical prices for certain products we sell have been volatile and significant changes in such prices in the future may adversely affect our financial condition, results of operations and cash available for distribution to our unitholders
11. 11We have contractual obligations for certain transportation assets such as barges and railcars
12. 12The condition of credit markets may adversely affect our liquidity
13. 13Our debt levels may limit our flexibility in obtaining additional financing and in pursuing other business opportunities
14. 14A significant increase in interest rates could adversely affect our ability to service our indebtedness
15. 15We may not be able to obtain funding on acceptable terms or at all, which could have a material adverse effect on our financial condition, results of operations and cash available for distribution to our unitholders
16. 16Operating and financial restrictions and covenants in our credit agreement and the indentures governing our senior notes and borrowing base requirements in our credit agreement may restrict our business and financing activities
17. 17In addition, our credit agreement requires us to comply with specified financial ratios and covenants and borrowing base limitations
18. 18Restrictions in our credit agreement and indentures limit our ability to pay distributions upon the occurrence of certain events
19. 19We can borrow money under our credit agreement to pay distributions, which would reduce the amount of credit available to operate our businesses
20. 20The enactment of derivatives legislation could have an adverse effect on our ability to use derivative instruments to reduce the effect of commodity price, interest rate and other risks associated with our businesses
21. 21We are exposed to trade credit risk and risk associated with our trade credit support in the ordinary course of our business activities
22. 22We are exposed to performance risk in our supply chain
23. 23Energy efficiency, higher prices, new technology and alternative fuels could reduce demand for our heating oil and residual oil
24. 24Erosion of the value of major gasoline brands could adversely affect our gasoline sales and customer traffic
25. 25value of major gasoline brands could have a negative impact on our gasoline sales, which in turn may cause our operations to be less profitable
26. 26Changes in government usage mandates and tax credits could adversely affect the availability and pricing of ethanol and renewable fuels, which could negatively impact our sales
27. 27We may not be able to obtain state fund or insurance reimbursement of our environmental remediation costs
28. 28Potential exposure to products we handle at our facilities could subject us to product liability claims and complaints which could increase our litigation, operating and compliance costs and adversely affect our financial condition and results of operations
29. 29Future consumer or other litigation could adversely affect our financial condition and results of operations
30. 30We may incur costs or liabilities as a result of litigation or adverse publicity resulting from concerns over food quality, health or other issues that could cause customers to avoid our convenience stores
31. 31We depend upon a small number of suppliers for a substantial portion of our convenience store merchandise inventory. A disruption in supply or an unexpected change in our relationships with our principal merchandise suppliers could have an adverse effect on our convenience store results of operations
32. 32Governmental action and campaigns to discourage smoking and use of other products may have a material adverse effect on our financial condition, results of operations, and cash available for distribution to our unitholders
33. 33Our financial condition, results of operations, and cash available for distribution to our unitholders may be adversely affected by global and national health concerns
34. 34New entrants or increased competition in the convenience store industry could result in reduced gross profits
35. 35We may not be able to renew or replace our leases or agreements for dedicated storage when they expire
36. 36We may not be able to lease sites we own and/or sub-lease sites we lease with respect to the sale of gasoline and/or related activities on favorable terms and any such failure could adversely affect our financial condition, results of operations and cash available for distribution to our unitholders
37. 37Some of our sales are generated pursuant to contracts that must be renegotiated or replaced periodically. If we are unable to successfully renegotiate or replace these contracts, our financial condition, results of operations and cash available for distribution to our unitholders could be adversely affected
38. 38Due to our limited asset and geographic diversification, adverse developments in the terminals we use or in our operating areas could reduce our ability to make distributions to our unitholders
39. 39Our operations are subject to operational hazards and unforeseen interruptions for which we may not be adequately insured
40. 40Environmental laws and other industry-related regulations or environmental litigation could significantly impact our operations and/or increase our costs, which could adversely affect our results of operations and financial condition
41. 41Our terminalling operations are subject to federal, state and municipal laws and regulations relating to environmental protection and operational safety that could require us to incur substantial costs
42. 42Our assets and operations are subject to a series of risks arising from climate change
43. 431Increasing attention to environmental, social and governance (“ESG”) matters may impact our business
44. 44based on climate change related concerns, which could affect our access to capital for potential growth projects. Moreover, to the extent ESG matters negatively impact our reputation, we may not be able to compete as effectively or recruit or retain employees, which may adversely affect our operations
45. 45We are subject to federal, state and municipal laws and regulations that govern the product quality specifications of the refined petroleum products, gasoline blendstocks, renewable fuels, crude oil and propane we purchase, store, transport and sell
46. 46We are subject to federal, state and municipal environmental regulations which could have a material adverse effect on our retail operations business and results of operations
47. 47We are subject to federal, state and municipal non-environmental regulations which could have an adverse effect on our convenience store business and results of operations
48. 48Any terrorist attacks aimed at our facilities and any global and domestic economic repercussions from terrorist activities and the government’s response could adversely affect our financial condition, results of operations and cash available for distribution to our unitholders
49. 49We rely on our operational and information technology systems, including cybersecurity, to manage numerous aspects of our businesses, and a disruption of these systems could adversely affect our businesses
50. 50Cybersecurity breaches and other disruptions could compromise our information and operations, and expose us to liability, which would cause our business and reputation to suffer
51. 51We have providers that may incorporate generative artificial intelligence and other similar artificial intelligence tools into their offerings, and these providers may not meet regulatory or industry standards
52. 52We are subject to various federal and state laws and regulations related to cybersecurity, privacy and data protection which can impact our operations and increase our costs
53. 53We depend on key personnel for the success of our businesses
54. 54We depend on unionized labor for the operation of certain of our terminals. Any work stoppages or labor disturbances at these terminals could disrupt our businesses

Risks Related to our Structure

1. 55Our general partner and its affiliates have conflicts of interest and limited fiduciary duties, which could permit them to favor their own interests to the detriment of our unitholders
2. 56Our partnership agreement limits our general partner’s fiduciary duties to unitholders and restricts the remedies available to unitholders for actions taken by our general partner that might otherwise constitute breaches of fiduciary duty
3. 57By purchasing a unit, a unitholder will become bound by the provisions of the partnership agreement, including the provisions described above
4. 58We may issue additional units without unitholder approval, which would dilute unitholders’ ownership interests
5. 59We are prohibited from paying distributions on our common units if distributions on our preferred units are in arrears
6. 60Our preferred units are subordinated to our existing and future debt obligations and could be diluted by the issuance of additional units, including additional preferred units, and by other transactions
7. 61We cannot assure that we will be able to pay distributions on our preferred units regularly, and the agreements governing our indebtedness and redemptions of some or all of our preferred units may limit the cash available to make distributions on our preferred units
8. 62Change of control conversion rights may make it more difficult for a party to acquire us or discourage a party from acquiring us
9. 63The market price of our common units could be adversely affected by sales of substantial amounts of our common units, including sales by our existing unitholders
10. 64An increase in interest rates may cause the market price of our units to decline
11. 65Our general partner has a limited call right that may require unitholders to sell their common units at an undesirable time or price
12. 66Our partnership agreement restricts the voting rights of unitholders owning 20% or more of any class of our units
13. 67Cost reimbursements due to our general partner and its affiliates will reduce cash available for distribution to our unitholders
14. 68Unitholders may not have limited liability if a court finds that unitholder action constitutes control of our businesses
15. 69Unitholders may have liability to repay distributions
16. 70The control of our general partner may be transferred to a third party without unitholder consent
17. 71Certain members of the Slifka family and their affiliates may engage in activities that compete directly with us

Tax Risks

1. 72The anticipated after-tax economic benefit of an investment in our common units depends largely on our being treated as a partnership for U.S. federal income tax purposes
2. 73The tax treatment of publicly traded partnerships or an investment in our units could be subject to potential legislative, judicial or administrative changes or differing interpretations thereof, possibly applied on a retroactive basis
3. 74income tax laws or the Treasury Department’s interpretation of the qualifying income rules in a manner that could impact our ability to qualify as a partnership in the future
4. 75We have subsidiaries that are treated as corporations for U.S. federal income tax purposes and subject to corporate-level income taxes
5. 76If the IRS were to contest the U.S. federal income tax positions we take, it may adversely impact the market for our units, and the costs of any such contest would reduce our cash available for distribution to our unitholders
6. 77Our common unitholders are required to pay taxes on their share of our income even if they do not receive any cash distributions from us
7. 78Tax gain or loss on the disposition of our common units could be more or less than expected
8. 79Common unitholders may be subject to limitation on their ability to deduct interest expense incurred by us
9. 80Tax-exempt entities face unique tax issues from owning our common units that may result in adverse tax consequences to them
10. 81We treat each purchaser of our common units as having the same tax benefits without regard to the common units actually purchased. The IRS may challenge this treatment, which could adversely affect the value of our common units
11. 82We have adopted certain valuation methodologies in determining a unitholder’s allocations of income, gain, loss and deduction. The IRS may challenge these methodologies or the resulting allocations, which could adversely affect the value of our common units
12. 83Unitholders may be subject to state and local taxes and return filing requirements in jurisdictions where they do not live as a result of investing in our units
13. 84The treatment of income attributable to distributions on our preferred units as guaranteed payments for the use of capital creates a different tax treatment for the holders of our preferred units than the holders of our common units and such income is not eligible for the 20% deduction for qualified business income