Company: CAVA
Filing Date: 2025-02-26
Form Type: 10-K
Source: 0001628280-25-007882
Chunk: 130

Company: CAVA GROUP, INC.
Filing Date: 2025-02-26
Form: 10-K
Item: Item 1
Chunk 130
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 business strategies.”

Borrowings under the 2022 Credit Facility bear interest at variable rates based on prevailing conditions in the financial markets, and changes to such variable market rates may affect both the amount of cash we must pay for interest as well as our reported interest expense. Assuming our 2022 Credit Facility were to be fully drawn, a 100-basis point increase to the applicable variable rate of interest would increase the amount of interest expense by $0.7 million per annum. If we are unable to generate sufficient cash flows to pay the interest expense on our debt, future working capital, borrowings, or equity financing may not be available from which to pay or refinance such debt. See Part II, Item 7A. “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Indebtedness.”

In addition, if any of the financial institutions that provide loan commitments to us were to fail, our liquidity could be adversely impacted and we may not be able to obtain financing for working capital, capital expenditures, acquisitions, and other purposes. In such event, our ability to operate and compete effectively, and our ability to execute on our growth strategies, could be adversely affected, which in turn would have an adverse impact on our business, results of operations and financial condition.

Our 2022 Credit Facility contains restrictions on our ability to operate our business and to pursue our business strategies.

Our 2022 Credit Facility restricts, subject to certain exceptions, among other things, our ability and the ability of our subsidiaries to:

•incur additional indebtedness and guarantee indebtedness;

•prepay, redeem, or repurchase certain debt;

•create or incur liens;

•make investments and loans;

•pay dividends or make other distributions, in respect of, or repurchase or redeem, capital stock;

•engage in mergers, consolidations, or sales of all or substantially all of our assets;

•sell or otherwise dispose of assets;

•amend, modify, waive, or supplement certain subordinated indebtedness to the extent such amendments would be materially adverse to the interests of the lenders; and

•engage in certain transactions with affiliates.

In addition, we are required to maintain specified financial covenant ratios and satisfy other financial condition tests. Any future financing arrangements entered into by us or any of our subsidiaries may contain similar restrictions or maintenance covenants. As a result of these covenants and restrictions, we and our subsidiaries are, and will be, limited in 

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