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Covid-19 Update

3 Months Ended

Mar. 31, 2020

(2)

COVID-19 UPDATE

The negative impact of the COVID-19 pandemic on the restaurant and bar industry was abrupt and substantial, and the Company’s business, cash flows from operations and liquidity suffered, and continues to suffer, materially as a result. In many jurisdictions, including those in which the Company has many customers and prospective customers, restaurants and bars have been ordered by the government to shut down or close all on-site dining since the latter half of March 2020. At its peak, approximately 70% of the Company’s customers requested that their subscriptions to the Company’s services be temporarily suspended. As governmental orders and restrictions impacting restaurants and bars are eased or lifted, the Company expects the temporary subscription suspensions to end, however, even in jurisdictions in which such orders and restrictions are eased or lifted, the Company’s customers could request to continue their subscription suspensions if, for example, such customers choose not to re-open despite being permitted to do so. The Company has experienced material decreases in subscription revenue, advertising revenue and cash flows from operations, which it expects to continue for at least as long as the restaurant and bar industry continues to be negatively impacted by the COVID-19 pandemic, and which may continue thereafter if restaurants and bars seek to reduce their operating costs or are unable to re-open even if restrictions within their states are eased or lifted. The Company cannot predict with certainty whether, when or the manner in which the impact of the pandemic will improve, including when restaurants will be permitted to offer on-site dining or when bars will be permitted to re-open or to what degree, when the Company’s customers will re-open, or if they will subscribe to the Company’s service if and when they do, or if and when there will be a resurgence in COVID-19 transmission or infection after the easing or lifting of stay-at-home orders, and if three is, the impact of such resurgence on the Company’s business. Similarly, the Company cannot predict with certainty the duration of the negative effects of the pandemic on its business and liquidity, however, unless in the very near term the Company’s subscription revenue, advertising revenue and cash flows from operations return to pre-pandemic levels and/or the Company raises substantial capital, the amount of time and the amount of cash the Company has to maintain operations and sustain the negative effects of the pandemic is very limited. See Item 2 “—Liquidity and Capital Resources,” and “Item 1A. Risk Factors” in Part II of this report for additional information regarding the impact of the pandemic on our business and outlook.

While the Company expects the effects of COVID-19 to negatively impact its future results of operations, cash flows and financial position, the current level of uncertainty over the economic and operational impacts of COVID-19 means the related financial impact cannot be reasonably estimated at this time. The Company’s consolidated financial statements reflect estimates and assumptions made by management that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities, if any, at the date of the consolidated financial statements and reported amounts of revenue and expenses during the reporting periods presented. Such estimates and assumptions affect, among other things, the allowance for doubtful accounts, site equipment to be installed, fixed assets, capitalized software development, goodwill and right-of-use assets. Events and changes in circumstances arising after the issuance of the financial statements as of and for the three months ended March 31, 2020, including those resulting from the impacts of COVID-19, will be reflected in management’s estimates for future periods