A. Selected Financial Data The selected balance sheet data as of December 31, 2025 and 2024 and the income statement data for the years ended December 31, 2025, 2024 and 2023 of Arcos Dorados Holdings Inc. are derived from the consolidated financial statements included elsewhere in this annual report, which have been audited by Pistrelli, Henry Martin y Asociados S.A., member firm of Ernst & Young Global Limited. We were incorporated on December 9, 2010 as a direct, wholly-owned subsidiary of Arcos Dorados Limited, the prior holding company for the Arcos Dorados business. On December 13, 2010, Arcos Dorados Limited effected a downstream merger into and with us, with us as the surviving entity. The merger was accounted for as a reorganization of entities under common control in a manner similar to a pooling of interest and the consolidated financial statements reflect the historical consolidated operations of Arcos Dorados Limited as if the reorganization structure had existed since Arcos Dorados Limited was incorporated in July 2006. We did not commence operations until the Acquisition on August 3, 2007. We prepare our consolidated financial statements in accordance with accounting principles and standards generally accepted in the United States, or U.S. GAAP, and elect to report in U.S. dollars. This financial information should be read in conjunction with “Presentation of Financial and Other Information,” “Item 5. Operating and Financial Review and Prospects” and our consolidated financial statements, including the notes thereto, included elsewhere in this annual report. 2 Table of Contents For the Years Ended December 31, 2025 2024 2023 (in thousands of U.S. dollars, except percentages) Other Data: Total Revenues Brazil $ 1,770,301 $ 1,768,311 $ 1,701,547 NOLAD 1,266,129 1,225,751 1,132,912 SLAD 1,641,829 1,476,100 1,497,419 Total $ 4,678,259 $ 4,470,162 $ 4,331,878 Operating Income (Loss) Brazil $ 278,043 $ 269,019 $ 230,024 NOLAD 71,144 67,412 73,237 SLAD 119,959 87,406 121,683 Corporate and others and purchase price allocation (104,753) (99,322) (110,905) Total $ 364,393 $ 324,515 $ 314,039 Operating Margin(1) Brazil 15.7 % 15.2 % 13.5 % NOLAD 5.6 5.5 6.5 SLAD 7.3 5.9 8.1 Corporate and others and purchase price allocation (2.2) (2.2) (2.6) Total 7.8 % 7.3 % 7.2 % Adjusted EBITDA(2) Brazil $ 358,774 $ 340,002 $ 300,177 NOLAD 130,860 116,256 115,364 SLAD 180,097 133,692 160,380 Corporate and others (94,522) (89,850) (103,617) Total $ 575,209 $ 500,100 $ 472,304 Net Income attributable to Arcos Dorados Holdings Inc. $ 212,116 $ 148,759 $ 181,274 Adjusted EBITDA Margin(3) Brazil 20.3 % 19.2 % 17.6 % NOLAD 10.3 9.5 10.2 SLAD 11.0 9.1 10.7 Corporate and others (2.0) (2.0) (2.4) Total 12.3 % 11.2 % 10.9 % Other Financial Data: Net Income attributable to Arcos Dorados Holdings Inc. Margin (4) 4.5 % 3.3 % 4.2 % Working capital(5) 23,223 (297,521) (236,392) Capital expenditures and purchase of restaurant businesses paid at acquisition date 288,407 333,719 362,178 Cash Dividends declared per common share $ 0.24 $ 0.24 $ 0.19 3 Table of Contents As of December 31, 2025 2024 2023 Number of systemwide restaurants(6) 2,520 2,428 2,361 Brazil 1,230 1,173 1,130 NOLAD 669 654 647 SLAD 621 601 584 Number of Company-operated restaurants 1,800 1,725 1,678 Brazil 762 723 689 NOLAD 522 497 494 SLAD 516 505 495 Number of franchised restaurants 720 703 683 Brazil 468 450 441 NOLAD 147 157 153 SLAD 105 96 89 (1)Operating margin is operating income divided by revenues for each division, except for Corporate and others and purchase price allocation which is calculated as Operating loss divided by Total Revenues, since there are no revenues assigned to this segment, expressed as a percentage. Total Operating margin is calculated as Total Operating Income divided by Total Revenues, expressed as a percentage. (2)Adjusted EBITDA is a measure of our performance that is reviewed by our management. Adjusted EBITDA does not have a standardized meaning and, accordingly, our definition of Adjusted EBITDA may not be comparable to Adjusted EBITDA as used by other companies. Total Adjusted EBITDA is a non-GAAP measure. For our definition of Adjusted EBITDA, see “Item 5. Operating and Financial Review and Prospects—A. Operating Results—Key Business Measures.” (3)Adjusted EBITDA margin is Adjusted EBITDA divided by revenues for each division, except for Corporate and others which is calculated as Adjusted EBITDA divided by Total Revenues, since there are no revenues assigned to this segment, expressed as a percentage. Total Adjusted EBITDA margin is calculated as Total Adjusted EBITDA divided by Total Revenues, expressed as a percentage. (4)Net Income attributable to Arcos Dorados Holdings Inc. margin is Net Income attributable to Arcos Dorados Holdings Inc. divided by Total Revenues, expressed as a percentage. (5)Working capital equals current assets minus current liabilities. (6)Includes both traditional restaurants and satellite non-traditional restaurants. We define non-traditional satellite restaurants as those points of distribution that have one or more of the following characteristics: (i) depend on another of our restaurants, (ii) offer a limited menu of products, (iii) have approximately 30% of the size of our average restaurants (other than McCafé or other satellites), (iv) generate approximately 50% of the gross sales of our average restaurants (other than McCafé or other satellites), or (v) are located inside a Wal-Mart. 4 Table of Contents Presented below is the reconciliation between net income and Adjusted EBITDA on a consolidated basis: Consolidated Adjusted EBITDA Reconciliation For the Years Ended December 31, 2025 2024 2023 (in thousands of U.S. dollars) Net income attributable to Arcos Dorados Holdings Inc. $ 212,116 $ 148,759 $ 181,274 Plus (Less): Net interest expense and other financing results 13,660 47,238 32,275 Loss (Gain) from derivative instruments 3,078 (941) 13,183 Foreign currency exchange results 4,859 15,063 (10,774) Other non-operating expenses, net 1,484 3,873 1,238 Income tax expense, net 128,728 109,903 95,702 Net income attributable to non-controlling interests 468 620 1,141 Operating income 364,393 324,515 314,039 Plus (Less): Items excluded from computation that affect operating income: Depreciation and amortization 197,257 177,354 149,268 Gains from sale and insurance recovery of property and equipment (2,641) (5,486) (2,030) Write-offs of long-lived assets 6,557 2,650 8,401 Impairment of long-lived assets 922 1,067 2,626 Reorganization and optimization plan 8,721 — — Adjusted EBITDA 575,209 500,100 472,304 Exchange Rates and Exchange Controls In 2025, 63.0% of our total revenues were derived from our restaurants in Brazil, Argentina and Mexico. While we report figures in U.S. dollars, our revenues are generated in the local currencies of the territories in which we operate and may therefore be affected by exchange rate fluctuations. The exchange rates discussed in this section have been obtained from each country’s central bank. For consolidation purposes, we use foreign currency to U.S. dollar exchange rates obtained from Bloomberg. Any differences between these sources are not material. Brazil Exchange Rates The Brazilian real appreciated 8.2% against the U.S. dollar in 2023, depreciated 27.2% in 2024, appreciated 11.0% in 2025 and appreciated 5.7% in the first quarter of 2026. As of April 27, 2026, the exchange rate for the purchase of U.S. dollars was R$4.98 per U.S. dollar. The Brazilian real has historically experienced periods of significant volatility against the U.S. dollar, influenced by various economic, political, and external factors, including macroeconomic conditions, inflationary pressures, interest rate differentials, fiscal and monetary policies, global commodity prices, and investor sentiment towards emerging markets. There is an ongoing market concern regarding Brazil’s fiscal outlook, including fiscal targets and government spending constraints, which have contributed to investor uncertainty. Additionally, global monetary policy dynamics, particularly the stance of the U.S. Federal Reserve, as well as geopolitical developments, continue to impact the U.S. dollar and drive exchange rate volatility. 5 Table of Contents Exchange Controls The Central Bank of Brazil may issue further regulations in relation to foreign exchange transactions, as well as on payments and transfers of Brazilian currency between Brazilian residents and non-residents (such transfers being commonly known as the international transfer of reais), including those made through so-called non-resident accounts. Brazilian law also imposes a tax on foreign exchange transactions on the conversion of reais into foreign currency and on the conversion of foreign currency into reais. As of June 11, 2025, the general IOF/Exchange rate applicable to almost all foreign currency exchange transactions was increased from 0.38% to 3.5%, although other rates may apply in particular operations, such as the below transactions which are currently not taxed: •inflow related to transactions carried out in the Brazilian financial and capital markets, including investments in our common shares by investors which register their investment under Joint CVM-Central Bank of Brazil Resolution No. 13/2024; •outflow related to the return of the investment mentioned under the first bulleted item above; and •outflow related to the payment of dividends and interest on shareholders’ equity in connection with the investment mentioned under the first bulleted item above. •Inflow related to loans: International loans in USD/EUR with a tenor of less than 364 days: 3.5% IOF on the principal amount. Loans in local currency: 0.38% plus 0.0082% per day over the principal for the duration of the operation. Notwithstanding these rates of the IOF/Exchange, in force as of the date hereof, the Minister of Finance is legally entitled to increase the rate of the IOF/Exchange to a maximum of 25% of the amount of the currency exchange transaction, but only on a prospective basis. Although the Central Bank of Brazil has intervened occasionally to control movements in the foreign exchange rates, the exchange market may continue to be volatile as a result of capital movements or other factors, and, therefore, the Brazilian real may substantially decline or appreciate in value in relation to the U.S. dollar in the future. Brazilian law further provides that whenever there is a significant imbalance in Brazil’s balance of payments or reasons to foresee such a significant imbalance, the Brazilian government may, and has done so in the past, impose temporary restrictions on the remittance of funds to foreign investors of the proceeds of their investments in Brazil. The likelihood that the Brazilian government would impose such restricting measures may be affected by the extent of Brazil’s foreign currency reserves, the availability of foreign currency in the foreign exchange markets on the date a payment is due, the size of Brazil’s debt service burden relative to the economy as a whole and other factors. We cannot assure you that the Central Bank of Brazil will not modify its policies or that the Brazilian government will not institute restrictions or delays on cross-border remittances in respect of securities issued in the international capital markets. Argentina Exchange Rates The Argentine peso depreciated 357.4% against the U.S. dollar in 2023, depreciated 27.5% in 2024, depreciated 40.8% in 2025 and appreciated 4.8% in the first quarter of 2026. As of April 27, 2026, the exchange rate for the purchase of U.S. dollars was ARS$1,417.02 per U.S. dollar. Exchange Controls Since 2019, Argentina has had currency controls in place that tightened restrictions on capital flows, exchange controls, the official U.S. dollar exchange rate and transfers that substantially limit the ability of companies to retain foreign currency or make payments abroad. By means of Decree No. 609/2019, as amended, the Argentine government reinstated foreign exchange controls and authorized the Central Bank of Argentina to (a) regulate access to the foreign exchange market (Mercado Libre de Cambios or “MLC”) for the purchase of foreign currency and outward remittances; and (b) set forth regulations to avoid practices and transactions aimed to circumvent the measures adopted through the decree. As a consequence of these exchange controls, the spread between the official exchange rate and other exchange rates implicitly resulting from certain capital market operations usually effected to obtain U.S. dollars broadened significantly during 2023. 6 Table of Contents The current administration implemented a currency adjustment, leading to a 120.6% depreciation of the Peso in December 2023, followed by the establishment of a guideline by the Central Bank of Argentina of a 2% monthly devaluation of the exchange rate, which was reduced to 1% in February 2025. In April 2025, the Argentine government established floating bands, between Ps. 1,000 and Ps. 1,400, at a rate of 1% per month, within which the dollar exchange rate was allowed to float. As of January 1, 2026, the Central Bank of Argentina transitioned to a new floating band system. Under this framework, the exchange rate fluctuates between a floor and a ceiling that are adjusted monthly based on the Argentine consumer price index with a two-month lag ($T-2$). The Central Bank only intervenes if the exchange rate reaches the limits of these bands. The abovementioned exchange rate as of April 27, 2026, was within the applicable floating band. In addition, the current administration has implemented reforms to reduce the burden for access to the MLC by importers and other market participants. At present, foreign exchange regulations have been consolidated in a single regulation, Communication “A” 8307, as subsequently amended and supplemented from time to time by the Central Bank’s communications (the “Argentine FX Regulations”). Specific provisions for inward remittances Obligation to repatriate and settle in Argentine pesos the proceeds from exports of services Section 2.2 of the Argentine FX Regulations imposes the obligation on exporters to repatriate, and exchange into Argentine pesos through the MLC, the proceeds from services rendered to non-residents within 20 business days following either the perception of funds in the country or abroad, or their accreditation in foreign accounts. Sale of non-financial non-produced assets Pursuant to Section 2.3 of the Argentine FX Regulations, the proceeds in foreign currency of the sale to non-residents of non-financial non-produced assets must be repatriated and settled in Argentine pesos in the MLC within 20 business days following either the perception of funds in the country or abroad, or their accreditation in foreign accounts. External financial indebtedness Pursuant to Section 2.4 of the Argentine FX Regulations, the proceeds of new financial indebtedness disbursed as of September 1, 2019, must be repatriated, and exchanged into Argentine pesos through the MLC, as a condition for accessing the MLC to make debt principal and service payments thereunder. The reporting of debt under the reporting regime established by Communication “A” 6401 (as amended and restated from time to time, the “External Assets and Liabilities Reporting Regime”) is also a condition to access the MLC to repay external financial indebtedness. Access to the MLC to make such payments more than three days in advance of the due date is, as a general rule, subject to the Central Bank of Argentina’s prior authorization. Prepayments made with funds from new foreign loans duly settled or in connection with debt refinancing or liability management processes may be exempt from such prior authorization from Argentina’s Central Bank to the extent they comply with several requirements as set forth in Section 3.5 of the Argentine FX Regulations. Specific Provisions Regarding Access to the MLC Payment of principal under intercompany foreign financial indebtedness and payment of dividends Access to the MLC for payments of principal or interest under intercompany foreign financial indebtedness is subject to the Central Bank of Argentina’s prior approval. Certain specific exceptions apply and are included in Section 3.5.6. of the Argentine FX Regulations. Likewise, in April 2025, the Central Bank authorized the distribution of profits to foreign shareholders of Argentine companies, applicable to financial years commencing in 2025. 7 Table of Contents Payment of imports of goods Pursuant to Argentine FX Regulations, accessing the MLC to make deferred payments for new imports of goods with customs entry registration as from December 13, 2023, does not require Central Bank of Argentina’s prior approval, when in addition to the other applicable regulatory requirements, it is verified that the payment complies with the requirements established in Section 10.10.1 of the Argentine FX Regulations. In addition, Section 3.1 of the Argentine FX Regulations allows access to the MLC for the payment of imports of goods, establishing different conditions depending on whether they are payments of imports of goods with customs entry registration, or payments of imports of goods with pending customs entry registration. It also provides for the reestablishment of the “SEPAIMPO”, the import payment tracking system, for the purpose of monitoring import payments, import financing and the demonstration of the entry of goods into the country. A licensing regime is also in place, which requires importers of non-automatic import licenses to provide information about the product they intend to import (e.g., FOB value, type and quantity, commercial brand, model, country of origin and of shipping). Though there are additional exceptions to the access to the MLC for the payment of imports of goods, they do not apply to the operations of our Company. Payment of services provided by non-residents Pursuant to Section 13.1 of the Argentine FX Regulations, residents may access the MLC for payment of services rendered by non-residents, as long as, among other requirements, it is verified that the operation has been declared, if applicable, in the last overdue presentation of the External Assets and Liabilities Reporting Regime. As a general rule, if the non-resident service provider is not an affiliated company, access to the MLC for payment of services is granted once the services have been rendered. In the case of intercompany services, access is generally granted within 90 days from the date the services are provided. Access to the MLC for the prepayment of debts for services requires prior authorization by the Central Bank of Argentina. Other Specific Provisions Additional requirements on outflows through the MLC As a general rule, and in addition to any rules regarding the specific purpose for access, certain general requirements must be met by a local company or individual to access the MLC for the purchase of foreign currency or its transfer abroad (i.e., payments of imports and other purchases of goods abroad; payment of services rendered by non-residents; remittances of profits and dividends; payment of principal and interest on external indebtedness; payments of interest on debts for the import of goods and services, among others). These include the following: (i) during the 90 calendar days preceding the date of such access, the local company must not have directly or indirectly or on behalf of a third party: (a) sold securities in Argentina, with settlement in foreign currency; (b) transferred securities to a foreign depositary; (c) exchanged securities issued by resident issuers for foreign assets; (d) purchased in Argentina securities issued by non-resident issuers with settlement in Argentine pesos; (e) acquired Argentine depositary certificates representing shares issued by non-resident companies, (f) acquired corporate debt securities representing private debt issued in foreign jurisdiction; and (g) delivered Argentine pesos or any other local assets (other than foreign currency funds deposited in Argentine banks) to any person, receiving in exchange thereof, whether prior to or after such delivery, and whether directly or indirectly through a related, controlled or controlling entity, foreign assets, crypto assets or securities deposited abroad. 8 Table of Contents (ii) on the date of such access, the local company must: (a) not have any available foreign liquid assets or Argentine depositary certificates representing shares issued by non‑resident companies for an aggregate amount exceeding U.S.$100,000. The Argentine FX Regulations contains a non-exhaustive list of assets that qualify as “foreign liquid assets” for purposes thereof, which include foreign currency bills and coins, gold bars, sight deposits with foreign banks and, generally, any investment that allows for immediate availability of foreign currency (e.g., foreign bonds and securities, investment accounts with foreign investment managers, crypto-assets, cash held with payment service providers, etc.); (b) deposit all its local holdings of foreign currency in accounts held with local financial institutions. (c) undertake to settle through the MLC within 5 business days from the date of receipt of any funds originating from abroad as a result of the repayment of loans, the release of term-deposits or the sale of any type of asset, to the extent the asset was originally acquired, the deposit made or the loan granted, as applicable, after May 28, 2020; and (d) during the 90 calendar days following such access to the MLC, undertake to not sell securities issued by residents in Argentina for foreign currency, transfer such securities to foreign depositaries, exchange such securities for other foreign assets, or purchase foreign securities with pesos in Argentina. Furthermore, in order to access the MLC without obtaining prior approval from the Central Bank of Argentina, the local company has to file several affidavits. In connection with this matter, the affidavit shall meet certain requirements established in Section 3.16.3 of the Argentine FX Regulations. Foreign Exchange Criminal Regime Foreign exchange regulations are characterized as “public policy” rules in Argentina. Failure to comply with such provisions could result in penalties pursuant to the Foreign Exchange Criminal Law No. 19,359. Although the current administration has implemented measures aimed at gradually easing certain foreign exchange restrictions, including the authorization, as of 2026, to distribute and remit dividends abroad subject to applicable regulatory requirements, foreign exchange regulations remain subject to change. The Central Bank of Argentina and the federal government may impose additional exchange controls or modify existing regulations in the future, which could further impact our ability to transfer funds abroad and may prevent or delay payments that our Argentine subsidiaries are required to make outside Argentina. Mexico Exchange Rates The Mexican peso appreciated 13% against the U.S. dollar in 2023, depreciated 22.5% in 2024, appreciated 13.5% in 2025 and appreciated 0.4% in the first quarter of 2026. As of April 27, 2026, the free-market exchange rate for the purchase of U.S. dollars was Ps.17.38 per U.S. dollar. Exchange Controls In recent years, the Mexican government has maintained a policy of non-intervention in the foreign exchange markets, other than conducting periodic auctions for the purchase of U.S. dollars, and has not had in effect any exchange controls (although these controls have existed and have been in effect in the past). We cannot assure you that the Mexican government will maintain its current policies with regard to the Mexican peso or that the Mexican peso will not further depreciate or appreciate significantly in the future. B. Capitalization and Indebtedness Not applicable. C. Reasons for the Offer and Use of Proceeds Not applicable. 9 Table of Contents D. Risk Factors Our business, financial condition and results of operations could be materially and adversely affected if any of the risks described below occur. As a result, the market price of our class A shares could decline, and you could lose all or part of your investment. This annual report also contains forward-looking statements that involve risks and uncertainties. See “Forward-Looking Statements.” Our actual results could differ materially and adversely from those anticipated in these forward-looking statements as a result of certain factors, including the risks facing our company or investments in Latin America and the Caribbean described below and elsewhere in this annual report. Summary of Risk Factors An investment in our Company is subject to a number of risks, including risks related to our business, results of operations, financial condition, liquidity and indebtedness, industry, and reputation. The following summarizes some, but not all, of these risks. Please carefully consider all of the information discussed in “Item 3. Key Information—D. Risk Factors” in this annual report for a more thorough description of these and other risks. Risks Related to Our Business and Operations •Our rights to operate and franchise McDonald’s-branded restaurants are dependent on the MFAs, the termination or expiration of which would materially adversely affect our business, results of operations, financial condition and prospects. •Our business depends on our relationship with McDonald’s and changes in this relationship may adversely affect our business, results of operations and financial condition. •McDonald’s has the right to acquire control of all or portions of our business upon the occurrence of certain events and, in the case of a material breach of the MFAs, may terminate such MFA and acquire our non-public shares or our interests in one or more Territories at 80% of their fair market value. •Our business activity and results of operations may be negatively affected by unforeseen events, such as disruptions, natural disasters, adverse weather conditions, national and international armed conflicts and wars, pandemics, or other catastrophic events, such as hurricanes, earthquakes and floods. •The failure to successfully manage our future growth may adversely affect our results of operations. •From time to time, we rely on informal agreements with third-party suppliers and distributors for the provision of products and services that are necessary for our operations. •Supply chain interruptions may increase our costs and reduce revenues. •Information technology system failures or interruptions or breaches of our network security may interrupt our operations, exposing us to lost sales, increased operating costs, fraud, data protection incidents and litigation. •Our financial condition and results of operations depend, to a certain extent, on the financial condition of our sub‑franchisees and their ability to fulfill their obligations under their franchise agreements. •We do not have full operational control over the businesses of our sub‑franchisees. •Ownership and leasing of a broad portfolio of real estate exposes us to potential losses and liabilities. •The success of our business is dependent on the effectiveness of our marketing strategy. •The inability to attract and retain qualified management may affect our growth and results of operations. •The resignation, termination, permanent incapacity or death of our Executive Chairman could adversely affect our business, results of operations, financial condition and prospects. •Labor shortages or increased labor costs could harm our results of operations. •A failure by McDonald’s to protect its intellectual property rights, including its brand image, could harm our results of operations. Risks Related to Our Results of Operations and Financial Condition •We may use non-committed lines of credit to partially finance our working capital needs. •Covenants and events of default in the agreements governing our outstanding indebtedness could limit our ability to undertake certain types of transactions and adversely affect our liquidity. •Fluctuation in market interest rates could affect our ability to refinance our indebtedness or results of operations. •Inflation and government measures to curb inflation may adversely affect the economies in the countries where we operate, our business and results of operations. 10 Table of Contents •Exchange rate fluctuations against the U.S. dollar in the countries in which we operate have negatively affected, and could continue to negatively affect, our results of operations. •Price controls and other similar regulations in certain countries have affected, and may in the future affect, our results of operations. •We are subject to significant foreign currency exchange controls, currency devaluation and cross-border money transfer controls and restrictions in certain countries in which we operate, which could affect our ability to move our cash flow and pay dividends out from those countries. Risks Related to Government Regulation •If we fail to comply with, or if we become subject to, more onerous government regulations, our business could be adversely affected. •We could be subject to expropriation or nationalization of our assets and government interference with our business in certain countries in which we operate. •Non-compliance with anti-terrorism and anti-corruption regulations could harm our reputation and have an adverse effect on our business, results of operations and financial condition. •Tax increases or changes in tax legislation may adversely affect our results of operations. •Tax, customs or other inspections and investigations in any of the jurisdictions in which we operate may negatively affect our business and results of operations. •We are subject to increasingly stringent data protection laws, which could increase our costs, damage our reputation and adversely affect our business. •Litigation and other pressure tactics could expose our business to financial and reputational risk. •Our insurance may not be sufficient to cover certain losses. •Our cash balance may not be covered by government-backed deposit insurance programs in the event of a default or failure of any bank with which we maintain a commercial relationship, which may have a material adverse effect on our business, financial condition results of operations and cash flows. Risks Related to Our Industry •The food services industry is intensely competitive and we may not be able to continue to compete successfully. •Increases in commodity prices, logistics or other operating costs could harm our operating results. •Demand for our offerings may decrease due to changes in consumer preferences, habits or other factors. •Our investments to enhance customer experience, including through technology, may not generate the expected returns. •Food safety and food- or beverage- borne illnesses may have an adverse effect on our business and results of operations. •Restrictions on promotions and advertisements directed at families with children and regulations regarding the nutritional content of children’s meals may harm McDonald’s brand image and our results of operations. •Environmental laws and regulations may affect our business. •Our business is subject to an increasing focus on ESG matters. •We may be adversely affected by legal actions with respect to our business. •Unfavorable publicity or a failure to respond effectively to adverse publicity, particularly on social media platforms, could harm our reputation and adversely impact our business and financial performance. Risks Related to Our Business and Operations in Latin America and the Caribbean •Our business is subject to the risks generally associated with international business operations. •Developments and the perception of risk in other countries, especially emerging market countries, as well as the increasingly complex political and social environment in Latin America and the Caribbean have in the past and could in the future lead to social unrest, which may adversely affect our business, operations, sales, results, financial conditions and prospects. •Changes in governmental policies in the Territories could adversely affect our business, results of operations, financial conditions and prospects. •Latin America has experienced, and may continue to experience, adverse economic conditions that have impacted, and may continue to impact, our business, financial condition and results of operations. 11 Table of Contents Risks Related to Our Class A Shares •Mr. Woods Staton, our Executive Chairman, controls all matters submitted to a shareholder vote, which will limit your ability to influence corporate activities and may adversely affect the market price of our class A shares. •Sales of substantial amounts of our class A shares in the public market, or the perception that these sales may occur, could cause the market price of our class A shares to decline. •As a foreign private issuer, we are permitted to, and we will, rely on exemptions from certain NYSE corporate governance standards applicable to U.S. issuers, including the requirement that a majority of an issuer’s directors consist of independent directors. This may afford less protection to holders of our class A shares. Risks Related to Investing in a British Virgin Islands Company •We are a British Virgin Islands company and it may be difficult for you to obtain or enforce judgments against us or our executive officers and directors in the United States. •You may have more difficulty protecting your interests than you would as a shareholder of a U.S. corporation. •You may not be able to participate in future equity offerings, and you may not receive any value for rights that we may grant. Risks Related to Our Business and Operations Our rights to operate and franchise McDonald’s-branded restaurants are dependent on the MFAs, the termination or expiration of which would materially adversely affect our business, results of operations, financial condition and prospects. Our rights to operate and franchise McDonald’s-branded restaurants in the Territories, and therefore our ability to conduct our business, derive exclusively from the rights granted to us by McDonald’s in the MFAs through December 31, 2044 (for most Territories). As a result, our ability to continue operating in our current capacity is dependent on the continued existence of our contractual relationship with McDonald’s. After the expiration of the term, McDonald’s may grant us an option to enter into a new agreement to continue the franchise for an additional term of (a) 20 years with respect to all Territories other than French Guiana, Guadeloupe, Martinique and Saint Martin (French part) and (b) 10 years with respect to French Guiana, Guadeloupe, Martinique and Saint Martin (French part), with an option to extend the term with respect to such territories for an additional term of 10 years. Pursuant to the MFAs, McDonald’s will determine whether to grant us the option to renew between January 2040 and January 2042. If McDonald’s grants us the option to renew and we elect to exercise the option, then we and McDonald’s will amend the MFAs to reflect the terms of such renewal option, as appropriate. We cannot assure you that McDonald’s will grant us an option to extend the term of the MFAs or that the terms of any renewal option will be acceptable to us, will be similar to those contained in the MFAs or will not be less favorable to us than those contained in the MFAs. If McDonald’s elects not to grant us the renewal option or we elect not to exercise the renewal option, we will have a two and a half-year period in which to solicit offers for our business, which offers would be subject to McDonald’s approval. Upon the termination or expiration of the MFAs, McDonald’s has the option to acquire all of our non-public shares at their fair market value. In the event McDonald’s does not exercise its option to acquire our non-public shares, the MFAs would expire and we would be required to cease operating McDonald’s-branded restaurants, identifying our business with McDonald’s and using any of McDonald’s intellectual property. Although we would retain our real estate and our rights therein, the MFAs prohibit us from engaging in certain competitive businesses, including any other local or international quick-service restaurant or informal eating out business, or duplicating the McDonald’s system at another restaurant or business during the two-year period following the expiration of the MFAs. Moreover, McDonald’s would have the option to purchase the furniture, fixtures, signs, equipment, leasehold improvements and other similar fixed property or any portion thereof held by the franchised restaurant(s) designated by McDonald’s, for a sum equal to the fair market value of such property. As the McDonald’s brand and our relationship with McDonald’s are among our primary competitive strengths, the termination or expiration of the MFAs for any reason would materially and adversely affect our business, results of operations, financial condition, reputation and prospects. 12 Table of Contents Our business depends on our relationship with McDonald’s and changes in this relationship may adversely affect our business, results of operations and financial condition. Our rights to operate and franchise McDonald’s-branded restaurants in the Territories, and therefore our ability to conduct our business, derive exclusively from the rights granted to us by McDonald’s in the MFAs. As a result, our revenues are dependent on the continued existence of our contractual relationship with McDonald’s. Pursuant to the MFAs, McDonald’s has the ability to exercise substantial influence over the conduct of our business. For example, among other restrictions and obligations, under the MFAs, we are not permitted to operate any other competitive businesses, including any other local or international quick-service restaurant or informal eating out business, we must comply with McDonald’s high quality standards, we must own and operate at least 50% of all McDonald’s-branded restaurants in each Territory, we must maintain certain guarantees in favor of McDonald’s, including standby letters of credit (or other similar financial guarantee acceptable to McDonald’s) in an amount of $80.0 million, to secure our payment obligations under the MFAs, we cannot incur debt above certain financial ratios, we cannot transfer the equity interests of our subsidiaries, any significant portion of their assets or certain of the real estate properties that we own without McDonald’s consent, and McDonald’s has the right to approve the appointment of our chief executive officer and chief operating officer (such approval not to be unreasonably withheld) as well as to approve certain related party transactions. In addition, the MFAs require us to reinvest a significant amount of money, including through reimaging our existing restaurants, opening new restaurants and advertising, which McDonald’s has the right to approve. However, McDonald’s does not have an obligation to fund our operations. Furthermore, McDonald’s does not guarantee any of our financial obligations, including trade payables or outstanding indebtedness, and has no obligation to do so. In addition to using our cash flow from operations, we may need to incur additional indebtedness in order to finance future commitments, which could adversely affect our financial condition. Moreover, we may not be able to obtain this additional indebtedness on favorable terms, or at all. Failure to comply with our commitments could constitute a material breach of the MFAs and may lead to a termination by McDonald’s of the MFAs. If the terms of the MFAs excessively restrict our ability to operate our business or if we are unable to satisfy our restaurant opening and reinvestment commitments under the MFAs, our business, results of operations and financial condition would be materially and adversely affected. McDonald’s has the right to acquire control of all or portions of our business upon the occurrence of certain events and, in the case of a material breach of the MFAs, may terminate such MFA and acquire our non-public shares or our interests in one or more Territories at 80% of their fair market value. McDonald’s has the right to acquire all of our non-public shares or our interests in one or more Territories upon the occurrence of certain events, including the death or permanent incapacity of our controlling shareholder, an election by McDonald’s or us not to renew the MFA, a material breach of the MFAs or the termination of the MFAs for any reason other than a material breach. In the event McDonald’s were to exercise its right to acquire all of our non-public shares, McDonald’s would become our controlling shareholder. McDonald’s has the option to acquire all, but not less than all, of our non-public shares at 100% of their fair market value: •upon expiration of the two and a half-year period beginning on either (i) the date when McDonald’s notifies us of its election to not renew the MFAs or (ii) if McDonald’s notifies us of an offer to renew the MFAs and we do not accept such offer, the date of such offer notice from McDonald’s, in each case, to and including the expiration or termination of the MFA; •within 30 days after the termination of the MFAs for any reason other than for a material breach; or •during the twelve-month period following the earlier of: (i) the eighteen-month anniversary of the death or permanent incapacity of Mr. Woods Staton, our Executive Chairman and controlling shareholder, during which period no successor to Mr. Staton has been nominated or appointed, and (ii) the receipt by McDonald’s of notice from the beneficiaries of Mr. Woods Staton’s estate that such beneficiaries have elected to have such twelve-month period commence as of a date specified in such notice, which date shall be after the receipt of such notice. 13 Table of Contents If there is a material breach of the MFA, other than our failure to achieve certain targeted openings, McDonald’s has the option to acquire all, but not less than all, of our non-public shares at 80% of their fair market value. If we fail to achieve such targeted openings, McDonald’s has the right to terminate our exclusive right to exploit the rights granted under the MFAs with respect to each Territory to which such failure may be attributable. In addition, if there is a material breach that relates to one or more Territories in which, at the time of the material breach determination, there are at least 100 franchised restaurants in operation, McDonald’s also has the right, in McDonald’s sole discretion, to acquire (i) all of our interests in our subsidiaries in all Territories or (ii) all of our interests in our subsidiaries in the Territory or Territories identified by McDonald’s as being affected by such material breach or to which such material breach may be attributable, in each case at 80% of their fair market value. By contrast, if the material breach of the MFAs affects or is attributable to any of the Territories in which, at the time of the material breach determination, there are less than 100 franchised restaurants in operation, McDonald’s only has the right to acquire the equity interests of any of our subsidiaries in the Territory or Territories being affected by such material breach or to which such material breach may be attributable. For example, since, as of the date hereof, we have more than 100 franchised restaurants in Mexico, if there is a material breach with respect to our business in Mexico identified by McDonald’s as being affected by such material breach or to which such material breach may be attributable, McDonald’s would have the right to acquire our entire business throughout Latin America and the Caribbean or just our Mexican operations, whereas upon a similar breach relating to our Ecuadorian business, which, as of the date hereof, has less than 100 franchised restaurants in operation, McDonald’s would only have the right to acquire our business in Ecuador. Additionally, if there is a material breach under an MFA, other than our failure to achieve certain targeted openings, McDonald’s has the right to terminate the MFAs, in whole or, in McDonald’s sole discretion, with respect to any one or more Territories identified by McDonald’s as being affected by such material breach or to which such material breach may be, directly or indirectly attributable. Any such termination would have a material adverse effect on our business, results of operations and financial condition. McDonald’s was granted a perfected security interest in the equity interests of the Master Franchisee, the Brazilian Master Franchisee and our subsidiaries other than our subsidiaries organized in Costa Rica, Mexico, French Guiana, Guadeloupe and Martinique. The equity interests of our subsidiaries organized in Costa Rica and Mexico were transferred to trusts for the benefit of McDonald’s. If McDonald’s exercises its right to acquire our interests in one or more Territories as a result of a material breach, our business, results of operations and financial condition would be materially and adversely affected. See “Item 10. Additional Information—C. Material Contracts—The MFAs—Termination” for more details about fair market value calculation. Our business activity and results of operations may be negatively affected by unforeseen events, such as disruptions, natural disasters, adverse weather conditions, national and international armed conflicts and wars, pandemics, or other catastrophic events, such as hurricanes, earthquakes and floods. Unforeseen events beyond our control, including war, terrorist activities, political and social unrest, boycotts, natural disasters (or expectations about them), adverse weather conditions and pandemics, could disrupt our operations and results of operations and those of our sub‑franchisees, suppliers or customers, have a negative effect on consumer spending or result in political or economic instability. These events could reduce demand for our offerings or make it difficult to ensure the regular supply of ingredients and products through our distribution chain. For instance, ongoing conflicts in several areas of the world and their related impact and the sanctions imposed as a consequence, have adversely affected the macroeconomic environment, contributing to volatile economic conditions and heightened inflationary pressures. For example, ongoing hostilities between the United States and Iran, including disruptions to key energy transit routes, have contributed to significant volatility and upward pressure on global crude oil prices, which could adversely affect global economic conditions. These factors have led to increased food inflation, rising commodity and energy costs, and worsened supply chain disruptions. We anticipate that these challenges may continue to influence consumer behavior and demand, escalate geopolitical tensions, and negatively impact our business and financial results. Additionally, adverse weather conditions, including climate change, which has become more pronounced in recent years, may also increase the frequency and severity of weather-related events and natural disasters or affect customer behavior or preferences. Furthermore, incidents of pandemics, if not controlled, could affect visitors and reduce sales in our restaurants. The duration and scope of a health crisis, pandemic, epidemic, natural disaster, adverse weather conditions, war or other catastrophic events can be difficult to predict and depend on many factors, including emergence of new variants, outbreaks of diseases, extreme weather shifts, shorter harvest seasons, availability, acceptance and effectiveness of preventative measures, increased geopolitical tensions and economic sanctions, among other. A health crisis, pandemic, epidemic, natural disaster, adverse weather conditions, war or other catastrophic events may also heighten other risks disclosed in these Risk Factors, including, but not limited to, those related to the availability and costs of labor and commodities, supply chain interruptions, consumer behavior, and consumer perceptions of our brand and industry. 14 Table of Contents The failure to successfully manage our future growth may adversely affect our results of operations. Our business has grown significantly since the Acquisition, largely due to the opening of new restaurants in existing and new markets within the Territories, from an increase in comparable store sales and, more recently, from the growth of sales through digital channels, which comprised 61%, or $3.7 billion, of our systemwide sales in 2025. Our total number of restaurant locations has increased from 1,569 at the date of the Acquisition to 2,520 restaurants as of December 31, 2025. Our growth is, to a certain extent, dependent on new restaurant openings and therefore may not be constant from period to period; it may accelerate or decelerate in response to certain factors. There are many obstacles to opening new restaurants, including determining the availability of desirable locations, securing reliable suppliers, permit approval by governments, hiring and training new personnel and negotiating acceptable lease terms, and, in times of adverse economic conditions, sub‑franchisees may be more reluctant to provide the investment required to open new restaurants. In addition, our growth in comparable store sales is dependent on continued economic growth in the countries in which we operate as well as our ability to continue to predict and satisfy changing consumer preferences and to navigate other external pressures. See “—Our business activity and results of operations may be negatively affected by unforeseen events, such as disruptions, natural disasters, adverse weather conditions, national and international armed conflicts and wars, pandemics or other catastrophic events, such as hurricanes, earthquakes and floods.” In addition, the continued growth of our sales through digital channels is dependent on the continued adoption of technology and digital and delivery channels by our customers, which is in turn dependent on wider consumer trends. We plan our capital expenditures on a long-term basis and conduct annual reviews, taking into account historical information, regional economic trends, restaurant opening and reimaging plans, site availability and the investment requirements of the MFAs in order to maximize our returns on invested capital. The success of our investment plan may, however, be harmed by factors outside our control, such as changes in macroeconomic conditions, changes in demand and construction difficulties that could jeopardize our investment returns and our future results and financial condition. From time to time, we rely on informal agreements with third-party suppliers and distributors for the provision of products and services that are necessary for our operations. Effective supply chain management is a key driver of our success and a critical factor in optimizing profitability. We use McDonald’s centralized supply chain management model, which depends on approved third-party suppliers and distributors for goods, and we typically engage multiple suppliers to meet our product needs. This model includes the selection and development of suppliers of both core products (such as beef, chicken, buns, potatoes, produce, sauces, cheese, dairy mixes and beverages) and non-core products (including dressings, pork, condiments, confectionery and toppings among others). These suppliers must meet McDonald’s high standards for quality, food safety, sustainability policies and commitments, which requires fostering long-term and sustainable relationships. McDonald’s standards include the highest expectations with respect to our suppliers’ food safety and quality management systems, product consistency and timeliness, as well as commitments to follow internationally recognized manufacturing and management schemes and practices to meet or exceed all local food regulations and to comply with our policies, procedures and guidelines. Our continued success depends heavily on the ability of McDonald’s suppliers to consistently deliver safe, high quality products that meet our specifications and requirements and comply with all applicable laws and regulations. McDonald’s is widely recognized as a leader in food safety by both suppliers and the public health community. Our 32 largest suppliers represent approximately 76% of our total purchases. Only a limited number of these suppliers have formal written contracts with us; instead, we only maintain pricing protocols or informal agreements with most of them. Our supplier approval process is comprehensive and time‑intensive, ensuring full compliance with McDonald’s strict standards. As a result, we tend to build strong relationships with approved suppliers and, given our relevance to their business, pricing protocols have generally proven sufficient to secure a reliable supply of quality products. While we source goods from numerous approved suppliers across Latin America and the Caribbean, reducing our dependence on any single supplier, the informal nature of many of our supplier relationships means we cannot always ensure long-term or reliable product availability. 15 Table of Contents Additionally, certain goods, such as beef, dairy products, confectionery and produce, are often sourced locally due to import restrictions. Due to these restrictions, as well as McDonald’s requirements to purchase certain core items from approved suppliers, if any supplier terminates our relationship or if a supplier’s products or services no longer meet required standards and we must end the relationship, we may be unable to rapidly secure alternative or additional sources of supply. Supply chain interruptions may increase our costs and reduce revenues. Our business relies on an effective supply chain that ensures a reliable and adequate supply of quality products, supplies, equipment, and equipment parts. If our suppliers fail to deliver these items in a timely manner due to unexpected demand, production or distribution issues, financial distress or shortages, or if they decide to end their relationship with us, or we terminate our relationship with such suppliers because they no longer comply with McDonald’s standards, we may face challenges securing replacement suppliers in a timely manner or at all. As a result, we could experience inventory shortages and increased costs that may negatively affect our operations and results of operations. Supply chain interruptions, delivery delays, and related price increases have adversely affected us and our suppliers in the past and may do so again in the future. These disruptions may arise from shortages, inflationary pressures, unexpected surges in demand, transportation or logistics difficulties, labor, or technology issues, adverse weather conditions, natural disasters, pandemics, acts of war, terrorism, social unrest and protests or other circumstances beyond our or our suppliers’ control. Such interruptions, delays, or failures in contingency planning may increase our costs, reduce revenues and limit the availability of our products, supplies, or equipment that are critical to our operations. Information technology system failures or interruptions or breaches of our network security may interrupt our operations, exposing us to lost sales, increased operating costs, fraud, data protection incidents and litigation. We rely heavily on our computer systems and network infrastructure across our operations including, but not limited to, point-of-sale processing at our restaurants. We implement security measures and controls that we believe provide reasonable assurance regarding our security posture. See “Part II—Item 16K. Cybersecurity” for further detail. However, there remains the risk that our technology systems are vulnerable to damage, disability or failures due to physical theft, fire, power loss, telecommunications failure or other catastrophic events. If those systems were to fail or otherwise be unavailable, and we were unable to recover in a timely way, we could experience an interruption in our operations. Moreover, security breaches, data breaches and cyberattacks involving our systems have occurred, and may continue to occur, from time to time. Although we have procedures and controls in place to protect our systems and safeguard confidential information, including personal information, and financial data, we have been and continue to be subject to a range of internal and external security breaches, denial of service attacks, malware, phishing attacks, viruses, worms and other disruptive problems caused by hackers. Data breaches, security incidents and cyberattacks can result from, among other things, inadequate personnel, inadequate or failed internal control processes and systems, fraud or external events, or actors that interrupt normal business operations. Our information technology systems contain personal, financial and other information that is entrusted to us by our customers, our employees and other third parties, as well as financial, proprietary and other confidential information related to our business. The proper and secure functioning of our technology, financial and processing systems is critical to our business and to our ability to compete effectively. Furthermore, we have experienced a rise in transactions through our online digital channels for which we rely more heavily on third-party operators or trusted certified payment gateways to handle an increasing volume of sensitive financial transactions and other sensitive customer information, which increases our cybersecurity risks. Our increasing reliance on third-party systems also presents the risks faced by the third party’s business, including the operational, security and credit risks of those parties. Moreover, due to our digital strategy and increased use of our digital channels, there has also been an increase in the number of registered customers, now over 100 million, for whom we store and process personal information to strengthen our relationship with customers. Although we work with our customers, third-party service providers and other third parties to develop secure data and information processing, collection, authentication, management, usage, storage and transmission capabilities and to ensure the eventual destruction of confidential information, including personal information, to prevent against information security risk, we, our third-party service providers or other third parties with whom we do business have been and continue to be the target of cyberattacks or subject to other information security incidents, breaches or disruption in our operations. An actual or alleged security breach of our or their systems has resulted and could result in additional disruptions, shutdowns, theft, fraud or unauthorized disclosure of personal, financial, proprietary or other confidential information. For example, on April 4, 2025, we were notified by one of our third-party service providers of an unauthorized access to a database hosted by them, which included certain non-sensitive personal identifiable employee information. This third-party vendor has advised us that the vulnerability in their systems has been remedied. The occurrence of any of these incidents could result in reputational damage, adverse publicity, loss of consumer confidence, reduced sales and profits, fines, increased costs of regulatory compliance or enhanced measures against such security or data breaches, complications in executing our growth initiatives and regulatory and legal risk. 16 Table of Contents Our financial condition and results of operations depend, to a certain extent, on the financial condition of our sub‑franchisees and their ability to fulfill their obligations under their franchise agreements. As of December 31, 2025, 28.6% of our restaurants were franchised. Under our franchise agreements, we receive monthly payments which are, in most cases, the greater of a fixed rent or a certain percentage of the sub-franchisee’s gross sales. Sub‑franchisees are independent operators with whom we have franchise agreements. We typically own or lease the real estate upon which sub‑franchisees’ restaurants are located and sub‑franchisees are required to follow our operating manual that specifies items such as menu choices, permitted advertising, equipment, food handling procedures, product quality and approved suppliers. Our operating results depend to a certain extent on the restaurant profitability and financial viability of our sub‑franchisees. The concurrent failure by a significant number of sub‑franchisees to meet their financial obligations to us could jeopardize our ability to meet our obligations. We are liable for our sub‑franchisees’ monthly payment of royalties to McDonald’s, which represents a percentage of those franchised restaurants’ gross sales. To the extent that our sub‑franchisees fail to pay this fee in full, we are responsible for any shortfall under the MFAs. As such, the concurrent failure by a significant number of sub‑franchisees to pay their royalties could have a material adverse effect on our results of operations and financial condition. We do not have full operational control over the businesses of our sub‑franchisees. We are dependent on sub‑franchisees to maintain McDonald’s quality, service and cleanliness standards, and their failure to do so could materially affect the McDonald’s brand and harm our business. Although we exercise significant influence over sub‑franchisees through the franchise agreements, sub‑franchisees have some flexibility in their operations, including the ability to set prices for our products in their restaurants, hire employees and select certain service providers. In addition, it is possible that some sub‑franchisees may not operate their restaurants in accordance with our quality, service, cleanliness, health, food safety or product standards. Although we take corrective measures if sub‑franchisees fail to maintain McDonald’s quality, service and cleanliness standards, we may not be able to identify and rectify problems with sufficient speed and, as a result, our image and operating results may be negatively affected. Ownership and leasing of a broad portfolio of real estate exposes us to potential losses and liabilities. As of December 31, 2025, we owned the land for 474 of our 2,520 restaurants. The value of these assets could decrease or rental costs could increase due to changes in local demographics, the investment climate and local economic conditions, including taxes. The majority of our restaurant locations, or those operated by our sub‑franchisees, are subject to long-term leases. We may not be able to renew leases on acceptable terms or at all, in which case we would have to find new locations to lease or be forced to close the restaurants. If we are able to negotiate a new lease at an existing location, we may be subject to a rent increase. In addition, current restaurant locations may become unattractive due to changes in neighborhood demographics or economic conditions, which may result in reduced sales at these locations. The success of our business is dependent on the effectiveness of our marketing strategy. Market awareness and engagement are essential to our continued growth and financial success. Pursuant to the MFAs, we create, develop and coordinate marketing plans and promotional activities throughout the Territories, and sub‑franchisees contribute a percentage of their gross sales to our marketing plan. Unless otherwise provided in or required by existing franchise agreements, pursuant to the MFAs we are required to make aggregate expenditures in an amount not less than 5% of the gross sales of all franchised restaurants in the Territories in connection with advertising, communications and promotional activities, in accordance with guidelines established by McDonald’s. Pursuant to the MFAs, McDonald’s has the right to review and approve our marketing plans in advance and may request that we cease using the materials or promotional activities at any time. We also participate in global and regional marketing activities undertaken by McDonald’s and pay McDonald’s up to 0.2% of our gross sales of all franchised restaurants in the Territories in order to fund such activities. If our advertising programs are not effective, or if our competitors begin spending significantly more on advertising than we do, or if our competitors develop attractive new products or innovative advertising techniques, we may be unable to attract new customers or existing customers may not return to our restaurants and our operating results may be negatively affected. 17 Table of Contents The inability to attract and retain qualified management may affect our growth and results of operations. We have a strong, diverse and multidisciplinary management team with broad experience in the various areas of the modern management, such as human resources, product development, supply chain management, operations, finance, ESG, marketing, real estate development, communications, government relations, investor relations, security, information technology, legal, and training. Our growth plans place substantial demands on our management team, and future growth could increase those demands. Our ability to manage future growth will depend on the adequacy of our resources and our ability to continue to identify, attract, retain and train management. Failure to do so could have a material adverse effect on our business, financial condition and results of operations. In addition, pursuant to the MFAs, McDonald’s is entitled to approve the appointment of our chief executive officer and chief operating officer. If we and McDonald’s have not agreed upon a successor CEO after six months, McDonald’s may designate a temporary CEO in its sole discretion pending our submission of information relating to a further candidate and McDonald’s approval of that candidate. A delay in finding a suitable successor CEO could adversely affect our business, results of operations, financial condition and prospects. The resignation, termination, permanent incapacity or death of our Executive Chairman could adversely affect our business, results of operations, financial condition and prospects. Due to Mr. Woods Staton’s unique experience and leadership capabilities, it would be difficult to find a suitable successor for him if he were to cease serving as Executive Chairman for any reason. In the event of Mr. Woods Staton’s death or permanent incapacity where no successor to Mr. Staton has been appointed by us and approved by McDonald’s, McDonald’s has the right to acquire all of our non-public shares during the twelve-month period following the earlier of (1) the eighteen-month anniversary of his death or incapacity, and (2) the receipt by McDonald’s of notice from the beneficiaries of Mr. Staton’s estate that such beneficiaries have elected to have such twelve-month period commence as of a date specified in such notice, which date shall be after the receipt of such notice. Labor shortages or increased labor costs could harm our results of operations. Our operations depend in part on our ability to attract and retain restaurant managers and crew. While the turnover rate varies significantly among categories of employees, due to the nature of our business, we traditionally experience a high rate of turnover among our crew. As of December 31, 2025, we had approximately 96,782 employees, including our Company-operated restaurants and staff. Controlling labor costs is critical to our results of operations, and we closely monitor those costs. Some of our employees are paid minimum wages and any increases in minimum wages or changes to labor regulations in the Territories could increase our labor costs. In recent years, the legal minimum wage has increased in several of the countries in which we operate, having an adverse impact on our results of operations. In addition, legislative proposals currently under discussion in Brazil contemplate a reduction in statutory working hours, which are currently up to 44 hours per week under Brazilian labor legislation, without a corresponding reduction in pay. If enacted, and depending on the final wording, such measures could increase our labor costs and require adjustments to our workforce planning and operations in Brazil. Additionally, competition for employees could also result in additional incurred costs to pay for higher wages. We are also impacted by the costs and other effects of compliance with regulations affecting our workforce. These regulations are increasingly focused on employment issues, including wages and working hours, healthcare, employee safety and other employee benefits and workplace practices. Claims of non-compliance with these regulations could result in liability and expense to us. Despite our anti-discriminatory policies and related employee training, we are exposed to potential reputational and other harm regarding our workplace practices or conditions or those of our sub‑franchisees or suppliers, including those giving rise to claims of sexual harassment or discrimination (or perceptions thereof), which could have a negative impact on consumer perceptions of us and a reputation of our business. In 2019, two of our restaurant employees in Peru died in a workplace accident at one of our restaurants. This accident is still under investigation by Peruvian authorities, and while we have not been materially impacted by this event, any future workplace accidents could have a material adverse effect on our business, financial condition and results of operations. Some of our employees are represented by unions and are working under agreements that are subject to annual salary negotiations. We cannot guarantee the results of any such collective bargaining negotiations or whether any such negotiations will result in a work stoppage. In addition, employees may strike for reasons unrelated to our union arrangements. Any future work stoppage could, depending on the affected operations and the length of the work stoppage, have a material adverse effect on our financial position, results of operations or cash flows. 18 Table of Contents A failure by McDonald’s to protect its intellectual property rights, including its brand image, could harm our results of operations. Our business depends in part on consumers’ perception of the McDonald’s brand. Under the terms of the MFAs, we are required to assist McDonald’s with protecting its intellectual property rights in the Territories. However, McDonald’s is generally responsible for decisions about whether and how to enforce its rights. Any failure by McDonald’s to protect its proprietary rights in the Territories or elsewhere could harm its brand image, which could affect our competitive position and our results of operations. Under the MFAs, we may use, and grant rights to sub‑franchisees to use, McDonald’s intellectual property in connection with the development, operation, promotion, marketing, communications and management of our restaurants. McDonald’s has reserved the right to use, or grant licenses to use, its intellectual property in Latin America and the Caribbean for all other purposes, including to sell, promote or license the sale of products using its intellectual property. If we or McDonald’s fail to identify unauthorized filings of McDonald’s trademarks and imitations thereof, and we or McDonald’s do not adequately protect McDonald’s trademarks and copyrights, the infringement of McDonald’s intellectual property rights by others may cause harm to McDonald’s brand image and decrease our sales. Risks Related to Our Results of Operations and Financial Condition We may use non-committed lines of credit to partially finance our working capital needs. We may use non-committed lines of credit to partially finance our working capital needs. Given the nature of these lines of credit, some of these lines could be withdrawn and no longer be available to us, or their terms, including the interest rate, could change to make the terms no longer acceptable to us. The availability of these lines of credit depends on the level of liquidity in financial markets, which can vary based on events outside of our control, including financial or credit crises. Any inability to draw upon our non-committed lines of credit could have an adverse effect on our working capital, financial condition and results of operations. Covenants and events of default in the agreements governing our outstanding indebtedness could limit our ability to undertake certain types of transactions and adversely affect our liquidity. As of December 31, 2025, we had $1,101.7 million in total outstanding indebtedness (including interest payable), consisting of $1,156.5 million in long-term debt (including interest payable) net of $54.8 million related to the fair market value of our outstanding derivative instruments. The agreements governing our outstanding indebtedness contain covenants and events of default that may limit our financial flexibility and ability to undertake certain types of transactions. For instance, we are subject to negative covenants that restrict some of our activities, including restrictions on: •creating liens; •paying dividends; •maintaining certain leverage ratios; •entering into sale and lease-back transactions; and •consolidating, merging or transferring assets. Although certain of the negative covenants under our 2029 Notes are currently suspended as a result of our investment grade credit rating, we cannot guarantee that we will be able to maintain this rating. If we were to lose our investment grade rating, these negative covenants would become effective again, potentially limiting our financial flexibility and our ability to undertake certain transactions. If we fail to satisfy the covenants set forth in these agreements or another event of default occurs under the agreements, our outstanding indebtedness under the agreements could become immediately due and payable. In addition, we are required to meet certain financial ratios under our line of credit, our revolving credit facility and the credit facilities entered into by Arcos Dourados Comercio de Alimentos S.A., our Brazilian subsidiary. If we are unable to comply with such ratios or obtain waivers for non-compliance in the future, we will be in default under such facilities. In the case of our revolving credit facility and our Brazilian subsidiary’s credit facilities, any amounts drawn under such facilities may be declared to be immediately due and payable by the relevant lender, who may also terminate its obligation to provide loans under such agreement if we are not in compliance with our ratios under the agreement. In the case of our non-committed lines of credit, 19 Table of Contents if we have previously drawn any amount, then such amounts may be immediately due and payable to the relevant lender, subject to the terms of each non-committed line of credit. If our outstanding indebtedness becomes immediately due and payable and we do not have sufficient cash on hand to pay all amounts due, we could be required to sell assets, to refinance all or a portion of our indebtedness or to obtain additional financing. Refinancing may not be possible and additional financing may not be available on commercially acceptable terms, or at all. Fluctuation in market interest rates could affect our ability to refinance our indebtedness or results of operations. We are exposed to market risk related to changes in interest rates that could affect our results of operations or ability to refinance our existing indebtedness. Volatility or increases in interest rates could affect our ability to refinance our existing indebtedness or to obtain incremental debt financing. Volatility or increases in interest rates could increase our interest expense or borrowing costs and may adversely affect our results of operations. Our future ability to refinance our existing indebtedness will depend on certain financial, business and market trends, many of which are beyond our control. Inflation and government measures to curb inflation may adversely affect the economies in the countries where we operate, our business and results of operations. Certain of the countries in which we operate, have experienced, or are currently experiencing, high rates of inflation. For example, both Venezuela and Argentina have been considered highly inflationary under U.S. GAAP since 2010 and 2018, respectively, which has significantly reduced competitiveness, real wages and consumption. Although in most of our markets inflationary pressures decreased in 2025 as compared to 2024 (as is the case in Argentina, where inflation in 2025, although still high, was 31.5% compared to 117.8% in 2024), inflation has proven more resilient than expected and decreased at a lower rate than anticipated. In an effort to contain inflation, central banks shifted to more restrictive monetary policy, including increased interest rates, which has contributed to a slowdown in the global economy, thereby restricting the availability of credit and impairing economic growth. The measures taken by the governments of these countries to control inflation have historically been indicative of a potential economic recession. Inflation, measures to combat inflation and public speculation about possible additional actions have also contributed materially to economic uncertainty in many of these countries and to heightened volatility in their securities markets. Periods of higher inflation may also slow the growth rate of local economies that could lead to reduced demand for our core products and decreased sales. Inflation is also likely to increase some of our costs and expenses, which we may not be able to fully pass on to our customers or offset with other efficiencies, which could adversely affect our operating margins and operating income. Although the risk of high inflation has generally been mitigated in most of the Territories in which we operate, we cannot guarantee that inflation will not rise again, which could lead to measures as those described above being implemented again which would have an adverse effect on our operating margins and operating income. Exchange rate fluctuations against the U.S. dollar in the countries in which we operate have negatively affected, and could continue to negatively affect, our results of operations. We are exposed to exchange rate risk in relation to the U.S. dollar. While substantially all of our income is denominated in the local currencies of the countries in which we operate, our supply chain management involves the importation of various products, and some of our imports, as well as some of our capital expenditures and a significant portion of our long-term debt, are denominated in U.S. dollars. As a result, the decrease in the value of the local currencies of the countries in which we operate as compared to the U.S. dollar has increased our costs, and any further decrease in the value of such currencies will further increase our costs. Although we maintain a hedging strategy to attempt to mitigate some of our exchange rate risk, our hedging strategy may not be successful or may not fully offset our losses relating to exchange rate fluctuations. For example, the Brazilian real and the Mexican peso have historically experienced periods of significant volatility against the U.S. dollar. Similar fluctuations in other currencies in the region have in the past and may in the future adversely affect our costs, margins and results of operations. As a result, fluctuations in the value of the U.S. dollar with respect to the various currencies of the countries in which we operate or in U.S. dollar interest rates could adversely impact our net income, results of operations and financial condition. Price controls and other similar regulations in certain countries have affected, and may in the future affect, our results of operations. Certain countries in which we conduct operations have imposed, and may continue to impose, price controls that restrict our ability, and the ability of our sub‑franchisees, to adjust the prices of our products. 20 Table of Contents For example, certain markets in which we operate, such as Venezuela, have historically been subject to government intervention in pricing, including price controls and other limitations that may restrict our ability to adjust prices. While the enforcement of such measures has varied over time, the existence of these regulatory frameworks, as well as the potential for future government action or changes in policy, could adversely affect our business and results of operations. We continue to closely monitor developments in these markets. See “Item 4. Information on the Company—B. Business Overview—Regulation.” The imposition and enforcement of these and similar restrictions in the future may place downward pressure on the prices at which our products are sold and may limit the growth of our revenue. We cannot assure you that existing price controls will not be enforced or become more stringent, or that new price controls will not be imposed in the future, or that any such controls may not have an adverse effect on our business. Our inability to control the prices of our products could have an adverse effect on our results of operations. We are subject to significant foreign currency exchange controls, currency devaluation and cross-border money transfer controls and restrictions in certain countries in which we operate, which could affect our ability to move our cash flow and pay dividends out from those countries. Certain Latin American economies have experienced shortages in foreign currency reserves and their respective governments have adopted restrictions on the ability to transfer funds out of the country and convert local currencies into U.S. dollars. This may increase our costs and limit our ability to convert local currency into U.S. dollars and transfer funds out of certain countries, including for the purchase of dollar-denominated inputs, the payment of dividends or the payment of interest or principal on our outstanding debt. In the event that any of our subsidiaries are unable to transfer funds to us due to currency restrictions, we are responsible for any resulting shortfall. For example, certain countries in which we operate have historically imposed foreign exchange controls and restrictions on the transfer of funds abroad, such as Argentina. While some of these measures have been recently relaxed, there can be no assurance that such conditions will continue or that additional restrictions will not be introduced in the future. Any such restrictions could limit our ability to access foreign currency, transfer funds outside of these countries or service our foreign currency-denominated obligations, which could adversely affect our business, financial condition and results of operations. In addition, to the extent that we incur indebtedness in local markets that is denominated in, or requires payment in, foreign currency, restrictions on access to foreign exchange markets or limitations on the purchase of foreign currency or compliance with applicable regulatory requirements in the jurisdictions in which we operate could affect our ability to obtain the necessary foreign currency to service such indebtedness. As a result, we may be required to seek alternative sources of foreign currency, incur additional costs or delays, or otherwise be unable to repay such indebtedness when due which could have a material adverse effect on our results of operations and financial condition. Further currency devaluations in any of the countries in which we operate could have a material adverse effect on our results of operations and financial condition. See “—A. Selected Financial Data—Exchange Rates and Exchange Controls.” Risks Related to Government Regulation If we fail to comply with, or if we become subject to, more onerous government regulations, our business could be adversely affected. We are subject to various federal, state, provincial and municipal laws and regulations in the countries in which we operate, including those related to the food services industry, health and safety standards, imports of goods and services, marketing and promotional activities, cross-border money transfers, nutritional labeling, packaging and zoning and land use, environmental standards and consumer protection. We strive to abide by and maintain compliance with these laws and regulations. The imposition of new laws or regulations, including potential trade barriers, may increase our operating costs or impose restrictions on our operations, which could have an adverse impact on our financial condition. Regulations governing the food services industry have become more restrictive. We cannot assure you that new and stricter standards will not be adopted or become applicable to us, or that stricter interpretations of existing laws and regulations will not occur. Any of these events may require us to spend additional funds to gain compliance with the new rules, if possible, and therefore increase our cost of operation. 21 Table of Contents We could be subject to expropriation or nationalization of our assets and government interference with our business in certain countries in which we operate. We face a risk of expropriation or nationalization of our assets and government interference with our business in some of the countries in which we do business. The current Venezuelan government has promoted a model of increased state participation in the economy through welfare programs, exchange and price controls and the promotion of state-owned companies. Although the Venezuelan government has not carried out expropriations in some years, in recent years the risk of expropriation by municipalities of land considered to be excess property (which consists of land owned by the Company on which no restaurants are currently in operation) has increased. In spite of the recent operation in Venezuela by the U.S. government, which led to the arrest of Nicolas Maduro, we cannot provide assurance that Company-operated or franchised restaurants will not be threatened with expropriation, either at a national or a municipal level, and that our operations will not be transformed into state-owned enterprises. In addition, the Venezuelan government may pass laws, rules or regulations which may directly or indirectly interfere with our ability to operate our business in Venezuela which could result in a material breach of the MFAs, in particular if we are unable to comply with McDonald’s operations system and standards. A material breach of the MFAs would trigger McDonald’s option to acquire our non-public shares or our interests in Venezuela. See “—Risks Related to Our Business and Operations—McDonald’s has the right to acquire control of all or portions of our business upon the occurrence of certain events and, in the case of a material breach of the MFAs, may terminate such MFA or acquire our non-public shares or our interests in one or more Territories at 80% of their fair market value.” Non-compliance with anti-terrorism and anti-corruption regulations could harm our reputation and have an adverse effect on our business, results of operations and financial condition. A material breach under the MFAs would occur if we, or our subsidiaries, materially breached any of the representations or warranties or obligations under the MFAs and, to the extent the MFAs provide for a cure period, such material breach is not cured within such specified time, including by failing to comply with anti-terrorism or anti-corruption policies and procedures required by applicable law. We maintain policies and procedures that require our employees to comply with anti-corruption laws, including the Foreign Corrupt Practices Act of 1977 (the “FCPA”), and our corporate standards of ethical conduct. Our employees, including part-time employees, participate in training on ethical and anti-corruption standards, and we utilize our online campus to provide such training. However, we cannot ensure that these policies and procedures will always protect us from intentional, reckless or negligent acts committed by our employees or agents. If we are not in compliance with the FCPA and other applicable anti-corruption laws, we may be subject to criminal and civil penalties and other remedial measures, which could have an adverse impact on our business, financial condition, and results of operations. Any investigation of any potential violations of the FCPA or other anti-corruption laws by U.S. or other governmental authorities could adversely impact our reputation, cause us to lose or become disqualified from bids, and lead to other adverse impacts on our business, financial condition and results of operations. Tax increases or changes in tax legislation may adversely affect our results of operations. Since we conduct our business in many countries in Latin America and the Caribbean, we are subject to multiple taxation regimes and multinational tax conventions. Our effective tax rate therefore depends on these tax laws and multinational tax conventions, as well as on the effectiveness of our tax planning abilities. Our income tax position and effective tax rate are subject to uncertainty, as our income tax position for each year depends on the profitability of Company‑operated restaurants and franchised restaurants operated by our sub‑franchisees in tax jurisdictions that levy income tax at a broad range of rates. It is also dependent on changes in the valuation of deferred tax assets and liabilities, the impact of various accounting rules, changes to these rules and tax laws, and examinations by various tax authorities. If our actual tax rate differs significantly from our estimated tax rate, this could have a material impact on our financial condition. In addition, any increase in the rates of taxes, such as income taxes, excise taxes, value added taxes, import and export duties, withholding taxes or other transaction-based taxes, or the adoption of new taxes or enhanced economic protectionist measures, could negatively affect our business. Fiscal measures that target quick service restaurants or specific consumer products could also be adopted in the jurisdictions in which we operate. In recent years, several jurisdictions in which we operate have enacted significant tax reforms or adopted new tax measures. For example, Brazil approved a comprehensive constitutional tax reform creating a dual value-added tax system to replace existing consumption taxes and introducing a new selective tax, with a multi-year transition period beginning in 2026. In addition, certain countries have introduced measures that led to an increase in withholding taxes, advance tax payments or 22 Table of Contents indirect taxes. For instance, Brazil recently introduced a withholding tax on dividends and increased the withholding income tax rate applicable to interest on net equity distributions. In Ecuador, tax reforms enacted in recent years have included increases in value added tax rates, changes to foreign exchange outflow taxes, temporary advance income tax mechanisms and certain import-related measures, some of which have adversely affected consumption levels and operating costs in that market. Although some of these measures may be temporary or subject to change, these tax reforms and fiscal measures may affect consumption patterns as well as our operating margins and cash flow, which could have a material adverse effect on our results of operations and financial condition. In December 2021, the Organization for Economic Co-operation and Development published Tax Challenges Arising from the Digitalization of the Economy - Global Anti-Base Erosion Model Rules (Pillar Two). These rules are designed to ensure that large multinational enterprises pay a minimum effective tax rate of 15% on income arising in each jurisdiction where they operate. We are within the scope of these rules, and they have been enacted or substantively enacted in certain jurisdictions in which we operate and became effective as of January 1, 2024. Although we did not record any tax charge in connection with these rules for the year ended December 31, 2025, we continue to monitor legislative developments, as further countries enact Pillar Two legislation, to evaluate the potential future impact on our consolidated results of operations, financial position and cash flows. We cannot assure you that governmental authorities in any country in which we operate will not increase existing taxes, impose new taxes, or adopt more stringent interpretations or enforcement measures in connection with existing taxes, which could materially and adversely affect our business, financial condition, results of operations, cash flows or the amounts available for distribution to shareholders. Tax, customs or other inspections and investigations in any of the jurisdictions in which we operate may negatively affect our business and results of operations. From time to time, we are subject to inspections or other investigations by federal, municipal and state tax and customs authorities in Latin America. These inspections and investigations may generate tax or other assessments, including fines, and could lead to other civil or criminal investigations which, depending on their results, may have a material adverse effect on our reputation, business, operations and financial results. See “Item 8. Financial Information—A. Consolidated Statements and Other Financial Information—Legal Proceedings.” We are subject to increasingly stringent data protection laws, which could increase our costs, damage our reputation and adversely affect our business. We operate in jurisdictions with increasingly stringent and evolving data protection laws, which impose substantial compliance requirements and restrictions on how we collect, process, store, and transfer personal data. Many of these laws, including those in Brazil, Argentina, Uruguay, Peru, Ecuador, Colombia, Mexico, and Chile, are inspired by or similar to the European Union’s General Data Protection Regulation (GDPR). Our efforts to enhance guest engagement through loyalty programs and personalized marketing strategies further expose us to increasing customer requests to comply with their data protection rights, heightened regulatory scrutiny, and compliance and reputational risks related to the collection and use of their data. In line with our governance practices, in 2020, Arcos Dourados Comercio de Alimentos S.A., our Brazilian subsidiary, appointed a Data Protection Officer (“DPO”) in Brazil, as required by local legislation, and in 2023, we established a Corporate Data Protection Area and appointed a Corporate DPO to strengthen our data protection strategy in all our markets. Since then, we have been working on the design and implementation of our Privacy Program to enhance our compliance framework and mitigate data protection risks. As the regulatory landscape continues to evolve, our ability to effectively comply with these requirements will be critical. Failure to comply with these data protection laws and regulations may result in severe legal, financial, and operational consequences, including substantial fines, regulatory investigations, and reputational harm, which could materially affect our business, results of operations and financial condition. Additionally, the implementation of new regulations or the tightening of existing requirements could lead to increased compliance costs and operational burdens. 23 Table of Contents Litigation and other pressure tactics could expose our business to financial and reputational risk. Given that we conduct our business in many countries, we may be subject to multi-jurisdictional private and governmental lawsuits, including but not limited to lawsuits relating to labor and employment practices, taxes, trade and business practices, franchising, intellectual property, consumer, real property, landlord/tenant, environmental, advertising, nutrition and antitrust matters. In the past, QSR chains have been subject to class-action lawsuits claiming that their food products and promotional strategies have contributed to the obesity of some customers. We cannot guarantee that we will not be subject to these or similar types of lawsuits in the future. We may also be the target of pressure tactics such as strikes, boycotts and negative publicity from government officials, suppliers, distributors, employees, unions, special interest groups and customers that may negatively affect our reputation. Additionally, in recent years there has been an increase in litigation against public companies in relation to ESG matters, including in relation to claims made by public companies related to climate justice, net-zero targets and ambitions, greenwashing, climate-washing, supply chain commercial relationships, and diversity and sustainability disclosure practices. Given our commitment to social and environmental sustainability matters, we may and McDonald’s also may provide expanded disclosure, establish, modify, adjust or expand goals, commitments or targets, and take actions to meet such goals, commitments and targets, which may expose us to class actions or other litigation, including administrative proceedings, with respect to our ESG practices, particularly in light of the heightened focus on ESG matters from investors and other stakeholders. Any potential fines, damages or reputational damages to us or our brands as a result from such litigation could have a material adverse effect on our reputation, business, financial condition, or results of operations. Our insurance may not be sufficient to cover certain losses. We face the risk of loss or damage to our properties, machinery, cash and inventories due to fire, theft, climate change and natural disasters such as earthquakes and floods. While our insurance policies cover some losses with respect to damage or loss of our properties, machinery, cash and inventories, our insurance may not be sufficient to cover all such potential losses. Losses of sales resulting from the preventive closure of our restaurants due to social or political protests, civil unrest, or workforce unavailability, in the absence of material physical damage, are not covered under our insurance policies, except where such closures are mandated by an express governmental order. Furthermore, we generate significant cash from our operations and have been and continue to be the target of theft of that cash, misappropriation and fraud from employees, suppliers, such as cash-in-transit service companies, and third-party service providers that has resulted and could result in future losses that may not be fully covered by our insurance. The increased use of technology and digital operations expose us to larger cyber security, data protection and delivery operation risks. The delivery channel could expose us to subsidiary liability for accidents and injuries that riders could suffer or cause to third parties with their vehicles. These risks are not fully covered by insurance, especially when they are related to attacks in our technology and delivery suppliers’ systems. Although we have negotiated indemnity provisions with some of our suppliers against cyber security, data protection and delivery operation risks arising from their systems or activities in support of our business, enforcement action and any reimbursement for our losses may be difficult to obtain should these risks materialize. In addition, even if any such losses are fully covered by our insurance policies, such fire, theft, climate change or natural disasters may cause disruptions or cessations in our operations that would adversely affect our financial condition and results of operations. Our cash balance may not be covered by government-backed deposit insurance programs in the event of a default or failure of any bank with which we maintain a commercial relationship, which may have a material adverse effect on our business, financial condition results of operations and cash flows. We expect that a limited number of financial institutions will hold all or most of our cash. Depending on our cash balance in any of our accounts at any given point in time, our balances may not be covered by government-backed deposit insurance programs in the event of default or failure of any bank with which we maintain a commercial relationship. For example, while the U.S. Federal Deposit Insurance Corporation provides deposit insurance of $250,000 per depositor, per insured bank, the amounts we have in deposits in U.S. banks far exceed the insured amount. Therefore, if the U.S. government does not impose measures to protect depositors in the event a bank in which our funds are held fails, we may lose all or a substantial portion of our deposits with such bank. The occurrence of any default or failure of any of the banks in which we have deposits could have a material adverse effect on our business, financial condition, results of operations and cash flows. 24 Table of Contents Risks Related to Our Industry The food services industry is intensely competitive and we may not be able to continue to compete successfully. Although competitive conditions in the QSR industry vary in each of the countries in which we conduct our operations, in general, we compete with many well-established restaurant companies on price, brand image, quality, sales promotions, new product development and restaurant locations. Since the restaurant industry has few barriers to entry, our competitors are diverse and range from national and international restaurant chains to individual, local restaurant operators. Our largest sources of competition include Restaurant Brands International (which franchises Burger King, Popeyes, Firehouse Subs and Tim Hortons), Yum! Brands (which franchises KFC restaurants, Taco Bell, Pizza Hut and Pizza Hut Express, and the Habit Burger Grill restaurants), Carl’s Junior and Subway. In Brazil, we also compete with ZAMP (which franchises Burger King, Popeyes, Starbucks and Subway), Habib’s, a Brazilian QSR chain that focuses on low-price Middle Eastern street food, and Bob’s, a primarily-Brazilian QSR chain that focuses on hamburger product offerings. Alsea is one of the largest restaurant operators in Latin America (Mexico, Argentina, Colombia, Chile, and Uruguay); it has a diversified portfolio, with brands such as Domino’s Pizza, Starbucks, Burger King, Chili’s and other casual dining brands. In Argentina, we also compete with Mostaza, an Argentine QSR chain that focuses on hamburger product offerings. Another competitor in Latin America is Grupo Serrano, a KFC operator that originated in Ecuador and has since expanded regionally. The company operates in Ecuador, Colombia, Chile, Argentina and Venezuela, and entered the Brazilian market in 2025. We also face strong competition from new businesses targeting the same clients we serve, including, for example, the strong online betting behavior in Brazil, which consumes an increasing portion of the discretionary spending of potential customers as well as from street vendors of limited offerings, including hamburgers, hot dogs, pizzas and other local food items. We expect competition to increase as our competitors continue to expand their operations, introduce new options and market their brands. If any of our competitors offers items that are better priced or more appealing to consumers, increases its number of restaurants, obtains more desirable restaurant locations, provides more attractive financial incentives to management personnel, franchisees or hourly employees or has more effective marketing initiatives than we do in any of the markets in which we operate, this could have a material adverse effect on our results of operations. Increases in commodity prices, logistics or other operating costs could harm our operating results. Food and paper costs represented 36.0% of our total sales by Company-operated restaurants in 2025, and 23.3% of our food and paper raw materials cost is exposed to fluctuations in foreign exchange rates. We source, among other commodities, beef, chicken, pork, potatoes, produce, sauces, dairy mixes, dairy cheeses, grains, sugar, fiber and coffee. The cost of food and supplies depends on several factors, including global supply and demand, new offerings, global macroeconomic conditions, acts of war and other hostilities, weather conditions, fluctuations in energy costs, tax incentives and our suppliers’ ability to comply with sustainability and animal welfare commitments, all of which makes us susceptible to substantial price and currency fluctuations and other increased operating costs. For instance, commodity prices have been adversely affected by recent climate-related phenomena, which has had an impact on our costs. Our hedging strategies on the imported portion of our food and paper raw materials may not be successful in fully offsetting cost increases due to currency nor commodities fluctuations. Furthermore, due to the competitive nature of the restaurant industry, we may be unable to pass increased operating costs on to our customers, which could have an adverse effect on our results of operations. In addition, the U.S. government has introduced significant changes in trade policies, including the imposition of new tariffs and other trade restrictions that could affect cross-border commerce. The U.S. government has imposed tariffs on substantially all countries (and has threatened increased tariffs on goods originating from countries that do not cooperate with the U.S.), the rates of which could increase or fluctuate in the future. In response, some countries have announced the imposition of retaliatory tariffs on certain U.S. imports. While the U.S. Supreme Court issued a ruling against the validity of such tariffs in February 2026, subsequent to that ruling, the executive branch of the U.S. government announced the imposition of a new 15% baseline tariff under another legal authority and there is ongoing uncertainty in connection with tariff policies. The imposition of tariffs by the U.S. government, along with retaliatory actions by other countries, have had a significant impact on global trade flows and led to increased operational costs for companies reliant on international supply chains, which could potentially result in lower global growth and an increase cost of certain goods. Increased protectionism and trade tensions, such as the tensions between the United States and China during Donald Trump’s first term as President of the United States, could recur or intensify, which could have a negative impact on the economies in which we operate, which could have a material adverse effect on our business, results of operations and financial condition. For example, based on the shift in U.S. trade policies and in an effort to align with such policies, Mexico has imposed tariffs of up to 50% on various goods (including beef and toys) imported from countries with which it has no free trade agreements. If we are not able to successfully mitigate the impact of such tariffs, their implementation could materially impact our costs of operations in Mexico, which would in turn have an adverse effect on our business, results of operations and financial condition. 25 Table of Contents Demand for our offerings may decrease due to changes in consumer preferences or other factors. Our competitive position depends on our continued ability to offer items that have a strong appeal to consumers. If consumer dining preferences change due to shifts in consumer demographics, dietary inclinations, for example those who are looking for vegan and vegetarian options, consumer behavior and preferences, such as widespread and long-term usage of GLP-1 and similar weight loss drugs, and focus on environmental, social and governance matters, trends in food sourcing or food preparation and our consumers begin to seek out alternative restaurant options, our financial results might be adversely affected. In addition, negative publicity surrounding our products or our food safety could also materially affect our business and results of operations. Our success in responding to consumer demands depends in part on our ability to anticipate consumer preferences in the countries in which we operate, allocate sufficient resources to effectively reach and appeal to our consumers, market and advertise our products and platforms, and introduce new items in a timely manner to address evolving preferences. Our investments to enhance customer experience, including through technology, may not generate the expected returns. We are engaged in various efforts to improve our customers’ experience in our restaurants. In particular, we have invested in reimaging our restaurant portfolio to the latest McDonald’s restaurant design, which focuses on restaurant modernization and technology and digital engagement in order to transform the restaurant experience. As we modernize restaurants, we are placing renewed emphasis on improving our service model and strengthening relationships with customers, in part through digital channels and loyalty initiatives and payment systems. We are evolving our digital transformation with the goal of increasing our engagement with our customers, including the release of our own mobile application, delivery, loyalty program and order taking, and using data in order to improve our decision-making. In order to accomplish this goal, we made structural changes in our IT and data systems, to facilitate collaboration across groups within Arcos Dorados and adopting agile methodologies and principles to aid different groups in transforming products and services and the customer experience, or in otherwise achieving a specific business objective. We may not fully realize the intended benefits of these significant investments, or we might not find or retain the right talent to operate the new digital tools, or these initiatives may not be well executed, and therefore our business results may suffer. Food safety and food- or beverage- borne illnesses may have an adverse effect on our business and results of operations. Food- or beverage- borne illnesses, such as those caused by E. coli, listeria, salmonella, cyclospora or trichinosis, as well as food safety incidents involving contamination or tampering, are risks that could affect our industry and may impact our restaurants. Widespread illnesses including avian influenza, the H1N1 influenza virus, pathogenic E. coli, bovine spongiform encephalopathy, hepatitis A or salmonella could also reduce consumer demand of meat or other animal products. Furthermore, our reliance on third-party food suppliers and distributors increases the risk of food-borne illness incidents being caused by third-party food suppliers and distributors who operate outside of our control and/or multiple locations being affected rather than a single restaurant. Food safety events involving McDonald’s outside of Latin America or other well-known QSR chains could negatively impact our reputation and the entire business industry. Furthermore, our industry has long been subject to the threat of food tampering by suppliers, employees or customers, such as the addition of foreign objects to the food. The increase in sales through our delivery channel also represents an increased risk of food tampering because we do not have control of the food once it leaves our restaurants. Reports, whether true or not, of injuries caused by food tampering have in the past negatively affected the reputations of QSR chains and could affect us in the future. While we require that suppliers maintain procedures and practices to ensure food safety and quality requirements, we cannot guarantee that suppliers will not breach their requirement to uphold our safety measures and standards. Instances of food tampering, even those occurring solely at competitor restaurants, could, by causing negative publicity about the restaurant industry, adversely affect our sales on a local, regional, national or systemwide basis. A decrease in customer traffic as a result of public health concerns or negative publicity could materially affect our business, results of operations and financial condition. 26 Table of Contents Restrictions on promotions and advertisements directed at families with children and regulations regarding the nutritional content of children’s meals may harm McDonald’s brand image and our results of operations. A significant portion of our business depends on our ability to make our product offerings appealing to families with children, and restrictions on promotions and advertising targeting families with children, along with regulations on the nutritional content of children’s meals, could negatively impact McDonald’s brand image and operating results. Some countries in which we operate, such as Brazil, Mexico, Chile, and Peru, have implemented restrictions on marketing and advertising directed at children and adolescents. Although we have been able to continue advertising children’s meals and Happy Meals, including offering toys with them by modifying the content of certain of our offerings to comply with regulatory requirements such that these restrictions have not had a significant impact on our sales, we cannot guarantee that we will be able to continue advertising our children’s meals and Happy Meals if more stringent regulations were passed in any of the Territories, which could materially affect our business, results of operations and financial condition. For instance, in 2010, the Brazilian National Health Surveillance Agency (“ANVISA”) published “RDC 24,” a regulation that sets rules for the marketing and advertising of foods considered to have high amounts of sugar, saturated fat, trans fat, sodium, and beverages with low nutritional value. This regulation has significant impacts on advertisements (including television media), as it requires the display of warnings about the dangers of excessive consumption and informs consumers about health risks such as diabetes and heart disease. Since its publication, the regulation has been legally challenged by the Brazilian Food Industry Association (“ABIA”), with which our Brazilian subsidiary is associated, arguing that ANVISA lacked the authority to regulate food and beverage advertising. Until 2024, courts had ruled in ABIA’s favor, suspending the regulation. However, in June 2024, the Supreme Federal Court (STF) reversed this decision, confirming ANVISA’s authority to regulate such advertising. The regulation is now in effect, though ABIA has filed an appeal, which is pending a decision. In 2025, the Brazilian Association of Radio and Television Broadcasters (“ABERT”) filed an action claiming the unconstitutionality of RDC 24 before the Brazilian Supreme Court. The case has been suspended by the court to allow the parties to negotiate a potential settlement. ABIA is working on a self-regulatory proposal to be submitted to ABERT to support the settlement negotiations. The next conciliation hearing is scheduled for May 11, 2026. If a settlement is not reached, the case will be determined by the Brazilian Supreme Court and may impact the Brazilian food industry’s ability to advertise its products. As of the date of this annual report, the outcome of the case remains uncertain. In April 2013, a consumer protection agency in Brazil fined us $1.6 million for a 2010 advertising campaign relating to our offering of meals with toys from the motion picture Avatar. We filed a lawsuit seeking to annul the fine. The lower court ruled there was no basis for the penalty, which was upheld by the appellate court. The consumer protection agency filed a special appeal against this decision, which is pending a final decision. Although the fine under discussion relates to a specific campaign, industry and consumer associations on both sides have joined the case as amici curiae (non-parties who have submitted briefs to assist the court in its analysis), demonstrating an intention to broaden the discussion. An adverse decision could increase the risk of future claims or regulatory actions seeking to impose similar restrictions or prohibitions on advertising directed at children. Although we have introduced changes in our Happy Meals in order to offer more balanced and nutritious options to our customers and in many cases been able to mitigate the impact of these types of laws and regulations on our sales, we may not be able to do so in the future and the imposition of similar or stricter laws and regulations in the future in the Territories may have a negative impact on our results of operations. In general, regulatory developments that adversely impact our ability to promote and advertise our business and communicate effectively with our target customers, including restrictions on the use of licensed characters, may have a negative impact on our results of operations. Environmental laws and regulations may affect our business. We are subject to various environmental laws and regulations in the countries in which we operate. These laws and regulations govern, among other things, discharges of pollutants into the air and water and the presence, handling, release and disposal of, and exposure to, hazardous substances and waste, such as common or non-hazardous waste and used vegetable oils, among others, in addition to requiring us to obtain permits and authorizations for various activities. These laws and regulations provide for significant fines and penalties for noncompliance. Third parties may also assert personal injury, property damage or other claims against owners or operators of properties associated with release of, or actual or alleged exposure to, hazardous substances at, on or from our properties. Liability from environmental conditions relating to prior, existing or future restaurants or restaurant sites, including franchised restaurant sites, may have a material adverse effect on us. Moreover, the adoption of new or more stringent environmental laws or regulations could result in a material environmental liability to us. 27 Table of Contents Since 2018, Latin America has experienced a wave of regulatory initiatives aimed at eliminating plastic bags and single‑use plastic products. This trend has resulted in the enactment or discussion of new laws and regulations in most of the countries where we operate, primarily targeting plastic bags, straws, and other plastic items, often with severe penalties for violations. For example, Chile, French Guiana, Martinique, Peru, and Puerto Rico all impose significant restrictions and/or bans on single-use plastics and other non-recyclable containers. Similarly, Mexico City and São Paulo have imposed such restrictions at the municipal level. In Uruguay, the government has imposed requirements in packaging waste recovery and recycling that led the private sector to develop a new packaging waste management plan. In Argentina, a bill addressing minimal standards for the production, commercialization and sustainable use of single-use plastics is currently under discussion in Congress. We have addressed this issue by eliminating plastic straws, removing plastic lids, and replacing salad containers with cardboard alternatives, among other initiatives, in most of the countries where we operate. This approach has led to a significant reduction in single-use plastic within our operations over the last three years. However, the enactment of additional laws and regulations on this matter could lead to increased costs and certain capital investments, which could materially impact our business and results of operations. Our business is subject to an increasing focus on ESG matters. In recent years, there has been an increasing focus on ESG matters by stakeholders, including employees, sub‑franchisees, customers, suppliers, governmental and non-governmental organizations and investors. A failure, whether real or perceived, to address ESG matters or to achieve progress on our ESG initiatives could adversely affect our business, including by heightening other risks disclosed in this annual report, such as those related to consumer behavior, consumer perceptions of our brand, labor costs and shortages, supply chain interruptions, commodity costs, legal and regulatory complexity, and the timing and cost of restaurant development. We may be adversely affected by legal actions with respect to our business. We could be adversely affected by legal actions and claims brought by consumers or regulatory authorities in relation to the quality of our products, food safety and eventual health problems or other consequences caused by our offerings or by any of their ingredients. We could also be affected by legal actions and claims brought against us for products made in a jurisdiction outside the jurisdictions where we are operating. An array of legal actions, claims or damaging publicity may affect our reputation as well as have a material adverse effect on our revenues and businesses. Unfavorable publicity or a failure to respond effectively to adverse publicity, particularly on social media platforms, could harm our reputation and adversely impact our business and financial performance. The good reputation of our brand is a key factor in the success of our business. Actual or alleged incidents at any of our restaurants could result in harmful publicity. Moreover, we have seen a significant increase in the use of our delivery options, as this has been part of our growth strategy to strengthen guest relationships and integrate our mobile ordering channels. Any actual or perceived issue with the delivery of orders could also result in harmful publicity. Even incidents occurring at restaurants operated by our competitors or in the supply chain generally could result in negative publicity that could harm the restaurant industry and thus, indirectly, our brand. In particular, in recent years, there has been a marked increase in the use of social media platforms and similar devices which give individuals access to a broad audience of consumers and other interested persons. Many social media platforms immediately publish the content their participants’ posts, often without filters or checks on accuracy of the content posted. A variety of risks are associated with the dissemination of this information online, including the improper disclosure of proprietary information, negative comments about our company, exposure of personally identifiable information, fake news and disinformation, fraud or outdated information. The inappropriate use of social media platforms by our customers, employees or other individuals could increase our costs, lead to litigation or result in negative publicity that could damage our reputation. In addition, we are often affected by negative news about McDonald’s Corporation published in the media and picked up by Latin America outlets, as it can lead to the incorrect assumption by the public that it relates to Arcos Dorados or McDonald’s brand in our region. If we are unable to quickly and effectively respond to negative reports, comments or posts in the media and social media platforms, we may suffer damage to our reputation or loss of consumer confidence in our offerings, which could adversely affect our business, results of operations, cash flows and financial condition, as well as require resources to rebuild our reputation. 28 Table of Contents Risks Related to Our Business and Operations in Latin America and the Caribbean Our business is subject to the risks generally associated with international business operations. We engage in business activities throughout Latin America and the Caribbean. In 2025, 63.0% of our revenues were derived from Brazil, Argentina and Mexico. As a result, our business is and will continue to be subject to the risks generally associated with international business operations, including: •governmental regulations applicable to food services operations; •changes in social, political and economic conditions, including financial system instability; •internal armed conflicts; •transportation delays and other supply chain disruptions; •power, water and other utility shutdowns or shortages; •climate disasters such as earthquakes, hurricanes, floods and fires; •limitations on foreign investment; •restrictions on currency convertibility and volatility of foreign exchange markets; •inflation; •import-export quotas and restrictions on importation; •changes in local labor conditions; •changes in tax and other laws and regulations; •expropriation and nationalization of our assets in a particular jurisdiction; and •restrictions on repatriation of dividends or profits. Some of the Territories have been subject to social and political instability in the past, and interruptions in operations could occur in the future. See also “—Developments and the perception of risk in other countries, especially emerging market countries, as well as the increasingly complex political and social environment in Latin America and the Caribbean have in the past and could in the future lead to social unrest, which may adversely affect our business, operations, sales, results, financial conditions and prospects.” Developments and the perception of risk in other countries, especially emerging market countries, as well as the increasingly complex political and social environment in Latin America and the Caribbean have in the past and could in the future lead to social unrest, which may adversely affect our business, operations, sales, results, financial conditions and prospects. Arcos Dorados’ growth and profitability depend on political stability and economic activity, whether real or perceived, in Latin America and the Caribbean, especially in emerging market countries. Political unrest and social strife could affect developments and perception of risk in this region. For example, in recent periods, Ecuador has experienced internal disturbances associated with organized crime, leading to the implementation of states of emergency and curfews during certain periods, which have affected, and may continue to affect, commercial activity, including nighttime sales. In addition, in February 2026, Mexico experienced a wave of cartel-related violence following the death of the leader of the Jalisco New Generation Cartel, which led to the temporary closure of a significant number of our restaurants. Any continuation of or increase in social unrest or violence related to organized crime in the future could lead to additional operational costs, a decline in sales or otherwise negatively impact our results. Changes in governmental policies in the Territories could adversely affect our business, results of operations, financial conditions and prospects. Governments throughout Latin America and the Caribbean have exercised, and continue to exercise, significant influence over the economies of their respective countries. Accordingly, the governmental actions, political developments, 29 Table of Contents regulatory and legal changes or administrative practices in the Territories concerning the economy in general and the food services industry in particular could have a significant impact on us. We cannot assure you that changes in the governmental policies of the Territories will not adversely affect our business, results of operations, financial condition and prospects. Latin America has experienced, and may continue to experience, adverse economic conditions that have impacted, and may continue to impact, our business, financial condition and results of operations. The success of our business is dependent on discretionary consumer spending, which is influenced by general economic conditions, consumer confidence and the availability of discretionary income in the countries in which we operate. Latin American countries have historically experienced uneven periods of economic growth, recessions, periods of high inflation and economic instability. Any prolonged economic downturn in the future could result in a decline in discretionary consumer spending. This may reduce the number of consumers who are willing and able to dine in our restaurants, or consumers may make more value-driven and price-sensitive purchasing choices, eschewing our core menu items for our entry-level food options. We may also be unable to sufficiently increase prices of our menu items to offset cost pressures, which may negatively affect our financial condition. In addition, a prolonged economic downturn may lead to higher interest rates, significant changes in the rate of inflation or an inability to access capital on acceptable terms. Our suppliers and service providers could experience cash flow problems, credit defaults or other financial hardships. If our sub‑franchisees cannot adequately access the financial resources required to open new restaurants, this could have a material effect on our growth strategy. Risks Related to Our Class A Shares Mr. Woods Staton, our Executive Chairman, controls all matters submitted to a shareholder vote, which will limit your ability to influence corporate activities and may adversely affect the market price of our class A shares. Mr. Woods Staton, our Executive Chairman, owns or controls common stock representing 38.0% and 75.4%, respectively, of our economic and voting interests. As a result, Mr. Woods Staton is and will be able to strongly influence or effectively control the election of our directors, determine the outcome of substantially all actions requiring shareholder approval and shape our corporate and management policies. The MFAs’ requirement that Mr. Woods Staton at all times hold at least 51% of our voting interests and 30% of our economic interest likely will have the effect of preventing a change in control of us and discouraging others from making tender offers for our shares, which could prevent shareholders from receiving a premium for their shares. Moreover, this concentration of share ownership may make it difficult for shareholders to replace management and may adversely affect the trading price for our class A shares because investors often perceive disadvantages in owning shares in companies with controlling shareholders. This concentration of control could be disadvantageous to other shareholders with interests different from those of Mr. Woods Staton and the trading price of our class A shares could be adversely affected. See “Item 7. Major Shareholders and Related Party Transactions―A. Major Shareholders” for a more detailed description of our share ownership. Furthermore, the MFAs contemplate instances where McDonald’s could be entitled to purchase the shares of Arcos Dorados Holdings Inc. held by Mr. Woods Staton. However, our publicly held class A shares will not be similarly subject to acquisition by McDonald’s. Sales of substantial amounts of our class A shares in the public market, or the perception that these sales may occur, could cause the market price of our class A shares to decline. Sales of substantial amounts of our class A shares in the public market, or the perception that these sales may occur, could cause the market price of our class A shares to decline. This could also impair our ability to raise additional capital through the sale of our equity securities. Under our articles of association, we are authorized to issue up to 420,000,000 class A shares, of which 130,663,057 class A shares were outstanding as of December 31, 2025 and 2,309,062 class A shares were held in treasury. We cannot predict the size of future issuances of our shares or the effect, if any, that future sales and issuances of shares would have on the market price of our class A shares. 30 Table of Contents As a foreign private issuer, we are permitted to, and we will, rely on exemptions from certain NYSE corporate governance standards applicable to U.S. issuers, including the requirement that a majority of an issuer’s directors consist of independent directors. This may afford less protection to holders of our class A shares. Section 303A of the New York Stock Exchange, or “NYSE,” Listed Company Manual requires listed companies to have, among other things, a majority of their board members be independent, and to have independent director oversight of executive compensation, nomination of directors and corporate governance matters. As a foreign private issuer, however, we are permitted to, and we generally will, follow home country practice in lieu of the above requirements. British Virgin Islands law, the law of our country of incorporation, does not require a majority of our board to consist of independent directors or the implementation of a nominating and corporate governance committee, and our board thus may not include, or may include fewer, independent directors than would be required if we were subject to these NYSE requirements. Since a majority of our board of directors may not consist of independent directors as long as we rely on the foreign private issuer exemption to these NYSE requirements, our board’s approach may, therefore, be different from that of a board with a majority of independent directors, and as a result, the management oversight of our Company may be more limited than if we were subject to these NYSE requirements. Risks Related to Investing in a British Virgin Islands Company We are a British Virgin Islands company and it may be difficult for you to obtain or enforce judgments against us or our executive officers and directors in the United States. We are incorporated under the laws of the British Virgin Islands. Most of our assets are located outside the United States. Furthermore, most of our directors and officers reside outside the United States, and most of their assets are located outside the United States. As a result, you may find it difficult to effect service of process within the United States upon these persons or to enforce outside the United States judgments obtained against us or these persons in U.S. courts, including judgments in actions predicated upon the civil liability provisions of the U.S. federal securities laws. Likewise, it may also be difficult for you to enforce in U.S. courts judgments obtained against us or these persons in courts located in jurisdictions outside the United States, including actions predicated upon the civil liability provisions of the U.S. federal securities laws. It may also be difficult for an investor to bring an action against us or these persons in a British Virgin Islands court predicated upon the civil liability provisions of the U.S. federal securities laws. As there is no treaty in force on the reciprocal recognition and enforcement of judgments in civil and commercial matters between the United States and the British Virgin Islands, courts in the British Virgin Islands will not automatically recognize and enforce a final judgment rendered by a U.S. court. Any final and conclusive monetary judgment obtained against us in U.S. courts, for a definite sum, may be treated by the courts of the British Virgin Islands as a cause of action in itself so that no retrial of the issue would be necessary, provided that in respect of the U.S. judgment: •the U.S. court issuing the judgment had jurisdiction in the matter and we either submitted to such jurisdiction or were resident or carrying on business within such jurisdiction and were duly served with process; •the judgment given by the U.S. court was not in respect of penalties, taxes, fines or similar fiscal or revenue obligations of ours; •in obtaining judgment there was no fraud on the part of the person in whose favor judgment was given or on the part of the court; •recognition or enforcement of the judgment in the British Virgin Islands would not be contrary to public policy; and •the proceedings pursuant to which judgment was obtained were not contrary to public policy. Under our articles of association, we indemnify and hold our directors harmless against all claims and suits brought against them, subject to limited exceptions. 31 Table of Contents You may have more difficulty protecting your interests than you would as a shareholder of a U.S. corporation. Our affairs are governed by the provisions of our memorandum of association and articles of association, as amended and restated from time to time, and by the provisions of applicable British Virgin Islands law. The rights of our shareholders and the responsibilities of our directors and officers under the British Virgin Islands law are different from those applicable to a corporation incorporated in the United States. There may be less publicly available information about us than is regularly published by or about U.S. issuers. Also, the British Virgin Islands regulations governing the securities of British Virgin Islands companies may not be as extensive as those in effect in the United States, and the British Virgin Islands law and regulations in respect of corporate governance matters may not be as protective of minority shareholders as state corporation laws in the United States. Therefore, you may have more difficulty protecting your interests in connection with actions taken by our directors and officers or our principal shareholders than you would as a shareholder of a corporation incorporated in the United States. You may not be able to participate in future equity offerings, and you may not receive any value for rights that we may grant. Under our memorandum and articles of association, existing shareholders are entitled to preemptive subscription rights in the event of capital increases. However, our articles of association also provide that such preemptive subscription rights do not apply to certain issuances of securities by us, including (i) pursuant to any employee compensation plans; (ii) as consideration for (a) any merger, consolidation or purchase of assets or (b) recapitalization or reorganization; (iii) in connection with a pro rata division of shares or dividend in specie or distribution; or (iv) in a bona fide public offering that has been registered with the SEC.