V2X (VVX) risk factors, FY2025 10-K

RISKS RELATED TO OUR BUSINESS

1. 01We may not be successful in winning new contracts or recompeting our existing contracts, which could have an adverse impact on our business and prospects72% rewritten
2. 02Our profitability or performance could suffer if we are unable to recruit, retain and develop qualified personnel or maintain adequate staffing levels to meet our contract requirements59% rewritten
3. 03Termination, expiration or non-renewal of our existing U.S. government contracts may adversely affect our business32% rewritten
4. 04We derive a significant portion of our revenue from a concentrated number of large contracts, and the loss or material reduction of any of these contracts could have a material adverse effect on our results of operations and cash flows38% rewritten
5. 05We rely on internal and external information technology systems to conduct our business, and disruption or failure of these systems could adversely affect our business and results of operations26% rewritten
6. 06Competition within our markets may reduce our revenue and market share
7. 07Our earnings and margins may vary based on our performance, the mix of our contracts, and our ability to control costs
8. 08We use estimates in accounting for many of our programs, and changes in our estimates could adversely affect our future financial results
9. 09While firm-fixed-price contracts allow us to benefit from cost savings, these contracts also increase our exposure to the risk of cost overruns27% rewritten
10. 10Uncertainties in the U.S. government defense budget, changes in spending or budgetary priorities or delays in contract awards or collection of our receivables may significantly and adversely affect our financial performance and limit our growth prospects26% rewritten
11. 11Business disruptions caused by natural disasters, global hostilities, pandemics, and other crises could adversely affect our profitability and our overall financial position
12. 12We rely on our information and communications systems in our operations. Security breaches, cybersecurity attacks, and other disruptions could adversely affect our business and results of operations51% rewritten
13. 13Any of the foregoing cybersecurity risks could materially and adversely affect our business, financial condition or operations, and our insurance and other risk mitigation mechanisms may not be sufficient to recover the costsNew
14. 14We work in international locations where there are high security risks, which could result in harm to our employees and contractors and the incurrence of substantial costs
15. 15A significant portion of our workforce is represented by labor unions and conducting business internationally, and our business could be harmed in the event of a prolonged work stoppage29% rewritten
16. 16We conduct a portion of our operations through joint ventures and other partnerships, exposing us to certain risks and uncertainties, many of which are outside of our control
17. 17Our earnings and margins depend, in part, on supplier performanceNew
18. 18Our business could be adversely affected by bid protests
19. 19Misconduct of our employees, suppliers, agents, prime contractors or business partners could cause us to sustain financial or criminal penalties, lose customers and could have a material adverse impact on our business and reputation, adversely affecting our ability to obtain new contracts
20. 20Our success depends, in part, on our ability to work with and manage complex and rapidly changing technologies to meet the needs of our customers63% rewritten
21. 21We may pursue acquisitions and other investments that involve numerous risks and uncertainties
22. 22We depend on our teaming relationships with other contractors. If we are not able to maintain these relationships, or if these parties fail to satisfy their obligations to us or the customer, our revenue, profitability and growth prospects could be adversely affected
23. 23We may be required to contribute additional funds to meet any present or future underfunded benefit obligations associated with multiemployer pension plans in which we participate
24. 24Legal disputes could require us to pay potentially large damage awards and could be costly to defend, which would adversely affect our cash balances and profitability, and could damage our reputation
25. 25Our insurance may be insufficient to protect us from claims or losses
26. 26Increasing scrutiny and changing expectations from governmental organizations, customers, and our employees with respect to our sustainability practices may impose additional costs or expose us to new or additional risks

RISKS RELATED TO GOVERNMENTAL REGULATIONS AND LAWS

1. 27EHS issues could have a material adverse effect on our business, financial position or results of operations
2. 28As a U.S. government contractor, we are subject to a number of procurement laws and regulations and could be adversely affected by changes in regulations or our failure to comply with these regulations
3. 29Our business is subject to audits, reviews, cost adjustments, and investigations by the U.S. government, which, if resolved unfavorably to us, could adversely affect our profitability, cash position or growth prospects
4. 30The DoW continues to modify its business practices, which could have a material effect on its overall procurement processes and adversely impact our current programs and potential new awards
5. 31Our business depends upon obtaining and maintaining required facility security clearance and individual security clearances
6. 32We are subject to legal and regulatory compliance risks associated with operating internationally21% rewritten
7. 33As a U.S. defense contractor, we are subject to security restrictions, which may limit investor insight into portions of our business
8. 34Our business may be negatively impacted if we are unable to adequately protect our intellectual property rights
9. 35Government withholding regulations could adversely affect our operating performance25% rewritten
10. 36We are subject to certain data privacy regulations, which expose us to certain risks if we do not comply with these requirements

RISKS RELATED TO OUR INDEBTEDNESS, FINANCIAL CONDITION AND MARKETS

1. 37Our level of indebtedness and our ability to make payments on or service our indebtedness could adversely affect our business, financial condition, results of operations, cash flow and liquidity
2. 38As of December 31, 2025, we had approximately $1.1 billion of aggregate debt outstanding, which consists of the First Lien Term Facility and the 2023 Revolver and Term Loan. See Note 9, Debt, in the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K for further information43% rewritten
3. 39Our variable rate indebtedness may expose us to interest rate risks, which could cause our debt costs to increase significantly33% rewritten
4. 40Our debt agreements contain covenants with which we must comply or risk default, or that impose restrictions on us and certain of our subsidiaries that may affect our ability to operate our businesses
5. 41Goodwill represents a significant portion of our assets, and any impairment of these assets could negatively impact our results of operations
6. 42The effects of changes in worldwide economic and capital markets conditions may significantly affect our ability to maintain liquidity or procure capital
7. 43We may not realize as revenue the full amounts reflected in our backlog, which could adversely affect our future revenue and growth
8. 44Unanticipated changes in our tax provisions or exposure to additional U.S. and foreign tax liabilities could affect our profitability

RISKS RELATED TO OUR SECURITIES

1. 45Our stock price may be volatile24% rewritten
2. 46Any future offerings of securities, including debt or preferred stock, which would be senior to our common stock, or other equity securities may materially and adversely affect us or our shareholders, including the per share trading price of our common stock
3. 47If our significant shareholders who received shares of our common stock in the Merger sell their shares, the price of our common stock could be materially affectedNew
4. 48All of the shares of our common stock issued in connection with the completion of the Merger are available for resale in the public market, including pursuant to an effective registration statement that the Company filed for these shareholdersNew
5. 49We do not currently plan to pay dividends on our common stock, and our indebtedness could limit our ability to pay dividends on our common stock in the future45% rewritten
6. 50Anti-takeover provisions in our organizational documents and Indiana law could delay or prevent a change in control