CoreCivic (CXW) risk factors, FY2024 10-K

Risks Related to Our Business and Industry

1. 01Resistance to privatization of correctional, detention, and residential reentry facilities, and negative publicity regarding inmate disturbances or perceived poor operational performance, could result in our inability to obtain new contracts, the loss of existing contracts, or other unforeseen consequences
2. 02We are subject to fluctuations in occupancy levels, and a decrease in occupancy levels could cause a decrease in revenues and profitability
3. 03We are dependent on government appropriations, and our results of operations may be negatively affected by governmental budgetary challenges or government shutdowns
4. 04Efforts to reduce the U.S. federal deficit could adversely affect our liquidity, results of operations and financial condition
5. 05Competition may adversely affect the profitability of our business
6. 06We are subject to terminations, non-renewals, or competitive re-bids of our government contracts
7. 07earned during the year ended December 31, 2024 for the 33 contracts with scheduled maturity dates, notwithstanding contractual renewal options, on or before December 31, 2025 was $657.9 million, or 34% of total revenue
8. 08Our ability to secure new contracts to develop and manage correctional, detention, and residential reentry facilities depends on many factors outside our control
9. 09Expectations about growth in the utilization of detention beds by the federal government may not be realized, which could negatively impact our stock price
10. 10We may face community opposition to facility location, which may adversely affect our ability to obtain new contracts
11. 11We may incur significant start-up and operating costs on new contracts before receiving related revenues, which may impact our cash flows and not be recouped
12. 12Failure to comply with facility contracts or with unique and increased governmental regulation could result in material penalties or non-renewal or termination of noncompliant contracts or our other contracts to provide or manage correctional, detention, and residential reentry facilities
13. 13The failure to comply with data privacy, security and exchange legal requirements could have a material adverse impact on our business, financial position, results of operations, cash flows and reputation
14. 14We depend on a limited number of governmental customers for a significant portion of our revenues
15. 15The success of our business depends in large part on the ability and experience of our senior management. The unexpected loss of any of these persons could materially adversely affect our business and operations
16. 16We are subject to various types of litigation
17. 17We are subject to necessary insurance costs
18. 18We may be adversely affected by inflation
19. 19We depend in part on the performance and capabilities of third parties with whom we have commercial relationships
20. 20We may be subject to costly product liability claims from the use of our electronic monitoring products, which could damage our reputation, impair the marketability of our products and services and force us to pay costs and damages that may not be covered by adequate insurance
21. 21We are subject to risks associated with ownership of real estate
22. 22We may be adversely affected by an increase in costs or difficulty of obtaining adequate levels of surety credit on favorable terms
23. 23Interruption, delay or failure of the provision of our technology services or information systems, or the compromise of the security thereof, could adversely affect our business, financial condition or results of operations
24. 24Technology infrastructure failures: Our reliance on complex technology infrastructure creates risks associated with potential failure of hardware, software, or network components. Such failures could lead to loss of customer trust and incur significant recovery costs
25. 25Force majeure: Unforeseeable circumstances or circumstances beyond our controls such as geopolitical conflicts, natural disasters, etc. may cause significant operational disruptions, which could result in material recovery costs or loss of customer confidence
26. 26We are subject to risks related to corporate social responsibility
27. 27As an owner and operator of correctional, detention, and residential reentry facilities, we are subject to risks relating to acts of God, outbreaks of epidemic or pandemic disease, global climate change, terrorist activity and war

Risks Related to Our Indebtedness

1. 28Our indebtedness could adversely affect our financial health and prevent us from fulfilling our obligations under our debt securities
2. 29limit our ability to borrow additional funds or refinance existing indebtedness on favorable terms, or at all
3. 30Our Bank Credit Facility, indentures related to our senior notes, and other debt instruments have restrictive covenants that could limit our financial flexibility
4. 31Our indebtedness is secured by a substantial portion of our assets
5. 32Servicing our indebtedness will require a significant amount of cash or may require us to refinance our indebtedness before it matures. Our ability to generate cash depends on many factors beyond our control and there is no assurance that we will be able to refinance our debt on acceptable terms, or at all
6. 33We are required to repurchase all or a portion of our senior notes upon a change of control, and the debt under our Bank Credit Facility is subject to acceleration upon a change of control
7. 34Despite current indebtedness levels, we may still incur more debt
8. 35Our access to capital may be affected by general macroeconomic conditions
9. 36Rising interest rates increase the cost of our variable rate debt
10. 37The market price of our equity securities may vary substantially, which may limit our stockholders' ability to liquidate their investment
11. 38The number of shares of our common stock available for future sale could adversely affect the market price of our common stock
12. 39Future offerings of debt or equity securities ranking senior to our common stock or incurrence of debt (including under our Bank Credit Facility) may adversely affect the market price of our common stock
13. 40Our issuance of preferred stock could adversely affect holders of our common stock and discourage a takeover
14. 41Our charter and bylaws and Maryland law could make it difficult for a third party to acquire our company
15. 42establish advance notice requirements for submitting nominations for election to the Board of Directors and for proposing matters that can be acted upon by stockholders at a meeting