STOCKHOLDERS' EQUITY

12 Months Ended

Dec. 31, 2021

STOCKHOLDERS' EQUITY

13. STOCKHOLDERS' EQUITY

Dividends on Common Stock

The tax characterization of dividends per share on common shares as reported to stockholders was as follows for the years ended December 31, 2020 and 2019 (unaudited):

			Ordinary			Return of		Total
Declaration Date	Record Date	Payable Date	Income			Capital		Per Share
February 21, 2019	April 1, 2019	April 15, 2019		0.383646	(1)		0.056354	$	0.44
May 16, 2019	July 1, 2019	July 16, 2019		0.383646	(1)		0.056354	$	0.44
August 15, 2019	October 1, 2019	October 15, 2019		0.383646	(1)		0.056354	$	0.44
December 12, 2019	January 6, 2020	January 15, 2020		0.440000	(2)		—	$	0.44
February 20, 2020	April 1, 2020	April 15, 2020		0.440000	(2)		—	$	0.44

⁽¹⁾ $0.042774 of this amount constitutes a "Qualified Dividend", as defined by the IRS.

⁽²⁾ $0.040745 of this amount constitutes a "Qualified Dividend", as defined by the IRS.

As further discussed in Note 1, on August 5, 2020, the BOD voted unanimously to approve a plan to revoke the Company’s REIT election and become a taxable C Corporation, effective January 1, 2021; the BOD also voted unanimously to discontinue the quarterly dividend and prioritize allocating the Company's free cash flow to reduce debt levels.

Common Stock

Restricted shares.  During 2021, CoreCivic issued approximately 2.7 million RSUs to certain of its employees and non-employee directors, with an aggregate value of $21.8 million, including 2.5 million RSUs to employees and non-employee directors whose compensation is charged to general and administrative expense and 0.2 million RSUs to employees whose compensation is charged to operating expense.  During 2020, CoreCivic issued approximately 1.2 million RSUs to certain of its employees and non-employee directors, with an aggregate value of $20.9 million, including 1.1 million RSUs to employees and non-employee directors whose compensation is charged to general and administrative expense and 0.1 million RSUs to employees whose compensation is charged to operating expense.

Since 2015, CoreCivic has established performance-based vesting conditions on the RSUs awarded to its officers and executive officers that, unless earlier vested under the terms of the agreements, are subject to vesting over a three-year period based upon the satisfaction of certain annual performance criteria, and no more than one-third of the RSUs could vest in any one performance period.  The RSUs awarded to officers and executive officers in 2019, 2020 and 2021 consist of a combination of awards with performance-based conditions and time-based conditions.  Unless earlier vested under the terms of the RSU agreements, the RSUs with time-based vesting conditions vest evenly generally on the first, second, and third anniversary of the award. The RSUs with performance-based vesting conditions are divided into one-third increments, each of which is subject to vesting based upon satisfaction of certain annual performance criteria established at the beginning of the fiscal years ending December 31, 2019, 2020, and 2021 for the 2019 awards, December 31, 2020, 2021, and 2022 for the 2020 awards, and December 31, 2021, 2022, and 2023 for the 2021 awards, and which can be increased up to 150% or decreased to 0% based on performance relative to the annual performance criteria, and further increased or decreased using a modifier of 80% to 120% based on CoreCivic's total shareholder return relative to a peer group.  Based on performance achieved for 2021, the RSUs subject to performance-based vesting criteria were increased by 150%, and were further increased by a 114.2% modifier based on CoreCivic's total shareholder return relative to the peer group. Because the performance criteria for the fiscal years ending December 31, 2022 and 2023 have not yet been established, the values of the third RSU increment of the 2020 awards and of the second and third increments of the 2021 awards for financial reporting purposes will not be determined until such criteria are established.  Time-based RSUs issued to other employees, unless earlier vested under the terms of the agreements, generally vest equally on the first, second, and third anniversary of the award.  RSUs issued to non-employee directors generally vest one year from the date of award.  

Nonvested RSU transactions as of December 31, 2021 and for the year then ended are summarized below (in thousands, except per share amounts).

	Shares of RSUs	Weighted average grant date fair value
Nonvested at December 31, 2020	2,021	$18.40
Granted	2,707	$8.07
Cancelled	(284)	$10.66
Vested	(979)	$18.74
Nonvested at December 31, 2021	3,465	$10.35

During 2021, 2020, and 2019, CoreCivic expensed $18.7 million ($1.6 million of which was recorded in operating expenses and $17.1 million of which was recorded in general and administrative expenses), $17.3 million ($1.7 million of which was recorded in operating expenses and $15.6 million of which was recorded in general and administrative expenses), and $17.3 million ($1.8 million of which was recorded in operating expenses and $15.5 million of which was recorded in general and administrative expenses), net of forfeitures, relating to RSUs, respectively. As of December 31, 2021, CoreCivic had $16.3 million of total unrecognized compensation cost related to RSUs that is expected to be recognized over a remaining weighted-average period of 1.6 years.  The total fair value of RSUs that vested during 2021, 2020, and 2019 was $18.3 million, $17.4 million, and $13.4 million, respectively.

Termination of ATM Agreement

On August 25, 2021, CoreCivic terminated its Amended and Restated ATM Equity Offering Sales Agreement (“ATM Agreement”), with multiple sales agents, which permitted CoreCivic to offer and sell to or through the agents, from time to time, shares of its common stock, par value $0.01 per share, having an aggregate gross sales price of up to $200.0 million. No sales of the CoreCivic’s common stock were made under the ATM Agreement. During the third quarter of 2021, CoreCivic decided to terminate the Sales Agreement in connection with the expiration of the registration statement on Form S-3 (File No. 333-227078) that CoreCivic filed with the SEC on August 28, 2018, and because CoreCivic had no plans to issue shares of its common stock.

Preferred Stock

CoreCivic has the authority to issue 50.0 million shares of $0.01 par value per share preferred stock (the "Preferred Stock").  The Preferred Stock may be issued from time to time upon authorization by the BOD, in such series and with such preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends, qualifications or other provisions as may be fixed by CoreCivic's BOD.

Stock Option Plans

CoreCivic has equity incentive plans under which, among other things, incentive and non-qualified stock options are granted to certain employees and non-employee directors of CoreCivic by the compensation committee of CoreCivic's BOD.  The options are granted with exercise prices equal to the fair market value on the date of grant.  Vesting periods for options granted to employees generally range from three to four years.  Options granted to non-employee directors vest on a date approximately following the first anniversary of the grant date. The term of such options is ten years from the date of grant.

Since 2012, CoreCivic has elected not to issue stock options to its non-employee directors, officers, and executive officers as it had in prior years, and instead elected to issue all of its equity compensation in the form of RSUs as previously described herein. All outstanding stock options were fully vested as of December 31, 2016.

Stock option transactions relating to CoreCivic's non-qualified stock option plans are summarized below (in thousands, except exercise prices):

	No. of options			Weighted- Average Exercise Price of options		Weighted- Average Remaining Contractual Term	Aggregate Intrinsic Value
Outstanding at December 31, 2020		472		$	22.13
Granted		—			—
Exercised		—			—
Cancelled		(171	)		21.00
Outstanding at December 31, 2021		301		$	22.77	0.2	$	—
Exercisable at December 31, 2021		301		$	22.77	0.2	$	—

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between CoreCivic's stock price as of December 31, 2021 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on December 31, 2021. This amount changes based on the fair market value of CoreCivic's stock. The total intrinsic value of options exercised during the year ended December 31, 2019 was $0.5 million.  There were no options exercised during 2020 and 2021.

At CoreCivic's 2020 annual meeting of stockholders held in May 2020, CoreCivic's stockholders approved the CoreCivic, Inc. 2020 Stock incentive Plan that authorized the issuance of new awards to an aggregate of up to 4.7 million shares. As of December 31, 2021, CoreCivic had 2.8 million shares available for issuance under the 2020 Stock Incentive Plan.