Six Flags Entertainment (FUN) risk factors, FY2024 10-K

Risks Related to the Integration of the Combined Company

1. 01The Combined Company may be unable to integrate the businesses of Former Six Flags and Former Cedar Fair successfully or realize the anticipated benefits of the Mergers
2. 02Due to the Mergers, the Combined Company’s future ability to use net operating losses ("NOLs") to offset future taxable income may be restricted and these net operating losses could expire or otherwise be unavailable

Risks Related to the Business

1. 03Instability in economic conditions could impact the business, including its results of operations and financial condition
2. 04The high fixed cost structure of amusement park operations can result in significantly lower margins, profitability and cash flows if attendance levels do not meet expectations
3. 05Bad or extreme weather conditions can adversely impact attendance at the parks, which in turn would reduce revenues
4. 06Insurance coverage may not be adequate to cover all possible losses that the Combined Company could suffer, and insurance costs may increase
5. 07Unanticipated construction delays in completing capital improvement projects at the parks and resort facilities, significant ride downtime, or other unplanned park closures could adversely affect revenues
6. 08There is a risk of accidents or other incidents occurring at amusement and water parks, which may reduce attendance and negatively impact revenues
7. 09Public health concerns or a future pandemic could adversely impact the business, as well as intensify certain risks
8. 10Extended disruptions to technology platforms may adversely impact sales and revenues
9. 11Failure to keep pace with developments in technology could adversely affect operations or competitive position

Risks Related to Strategy

1. 12The Combined Company's growth strategy may not achieve the anticipated results
2. 13The Combined Company competes for discretionary spending and discretionary free time with many other entertainment alternatives and is subject to factors that generally affect the recreation and leisure industry, including general economic conditions
3. 14The operating season at most of the parks is of limited duration, which can magnify the impact of adverse conditions or events occurring within that operating season
4. 15The Combined Company may be unable to purchase or contract with third parties to manufacture amusement park or water park rides and attractions
5. 16Various external factors, including difficult economic and political conditions throughout the world, could negatively affect the progress of initiatives to develop new parks outside of North America. These initiatives could be delayed, and the ultimate success of such parks may be uncertain
6. 17The Combined Company may not be able to renew its leases on acceptable terms or at all and the Combined Company's leases contain default provisions that, if enforced or exercised by the landlord, could significantly impact the operations at those parks
7. 18Intellectual property rights are valuable, and any inability or material increase in the cost to protect them could adversely affect the business
8. 19The Combined Company may be subject to claims for infringing the intellectual property rights of others, which could be costly and result in the loss of intellectual property rights

Risks Related to Indebtedness and Common Stock

1. 20The Combined Company's amount of indebtedness could adversely affect its ability to raise additional capital to fund its operations, limit its ability to react to changes in the economy or its industry and prevent the Combined Company from fulfilling its obligations under its debt agreements
2. 21The Combined Company's debt agreements contain restrictions that could limit its flexibility in investing in the business
3. 22Changes in the Combined Company's credit ratings could adversely affect the price of its common stock
4. 23The Combined Company is a holding company and is dependent on cash flows, including dividends and other distributions, from its subsidiaries
5. 24Variable rate indebtedness could subject the Combined Company to the risk of higher interest rates, which could cause future debt service obligations to increase
6. 25Declaration, payment and amounts of dividends, if any, distributed to shareholders of the Combined Company will be uncertain
7. 26A portion of the Combined Company's cash flows is required to be used to fund its Partnership Park arrangements
8. 27Anti-takeover provisions in the Combined Company's organizational documents, debt agreements and Delaware law could delay or prevent change of control

Risks Related to Human Capital

1. 28Increased costs of labor and employee health and welfare benefits may impact the Combined Company's results of operations
2. 29The Combined Company depends on a seasonal workforce to meet its operational needs
3. 30If the Combined Company loses key personnel, the business may be adversely affected
4. 31Unionization activities or labor disputes may disrupt operations and affect profitability

Risks Related to Legal, Regulatory and Compliance Matters

1. 32Cyber-security risks and the failure to maintain the integrity of internal or customer data could result in damages to the Combined Company's reputation and/or subject it to costs, fines or lawsuits
2. 33Data privacy regulation and the Combined Company's ability to comply could harm the business
3. 34The Combined Company's operations, its workforce and its ownership of property subject it to various laws and regulatory compliance, which may create uncertainty regarding future expenditures and liabilities
4. 35Adverse litigation judgments or settlements resulting from legal proceedings in which the Combined Company may be involved in the normal course of business could adversely affect its business, financial condition or results of operations
5. 36Other factors, including local events, natural disasters, other effects of climate change, pandemics, and terrorist activities, or threats of these events, could adversely impact park attendance and revenues