Securities registered pursuant to Section 12(b) of the Act:

Quarter Ended March 31, 2020:

Note 1 - The accompanying unaudited interim condensed consolidated financial statements, included herein, have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. These condensed consolidated statements have been prepared in accordance with the Company’s accounting policies described in the Company’s Annual Report on Form 10-K for the year ended December 31, 20192020 and should be read in conjunction with the audited consolidated financial statements and the notes thereto included in that report. Unless the context indicates otherwise, references to the “Company” mean Noble Roman’s, Inc. and its subsidiaries.

Significant Accounting Policies

There have been no other significant changes in the Company's accounting policies from those disclosed in its Annual Report on Form 10-K.

In the opinion of the management of the Company, the information contained herein reflects all adjustments necessary for a fair presentation of the results of operations and cash flows for the interim periods presented and the financial condition as of the dates indicated, which adjustments are of a normal recurring nature. The results for the three-month period ended March 31, 20202021 are not necessarily indicative of the results to be expected for the full year ending December 31, 2020,2021, especially in light of recent volatility and uncertainty resulting from the coronavirus (“COVID-19) pandemic, the governmental response and the governmental response.PPP funding.

Noble Roman’s, Inc., an Indiana corporation incorporated in 1972, sells and services pizza-focused foodservice franchises and licenses and operates Company-owned foodservice locations for stand-alone restaurants and non-traditional foodservice operations under the trade namenames “Noble Roman’s Craft Pizza & Pub,” “Noble Roman’s Pizza,” “Noble Roman’s Take-N-Bake,” and “Tuscano’s Italian Style Subs”. It also currently operates one Company-owned non-traditional Noble Roman's Pizza location in a hospital and five Company-owned Craft Pizza & Pub restaurants. The Company's concepts’ feature high quality fresh pizza, pasta and salads along with other related menu items, simple operating systems, fast service times, attractive food costs and overall affordability.

Noble Roman's franchised and licensedIn 1997, the Company started franchising non-traditional locations are designed to bring high-quality, pizza-focused foodservice into underlying establishments(a Noble Roman’s pizza operation within some other business or activity that have a captive audience or high customer counts associated with their business. Examples of these venues includehad existing traffic) such as entertainment facilities, hospitals, convenience stores hospitals, entertainment facilities, military bases, bowling centers and other similartypes of facilities. Noble Roman's, for non-traditionalThese locations rangeutilize the two pizza styles the Company started with in scope from relatively small operations focused on quick meals1972, along with its great tasting, high quality ingredients and impulse food purchases to elaborate, full-scale restaurant operations depending on the facility and the goals of the individual franchisee or licensee.menu extensions.

The hallmark of Noble Roman’s Pizza for non-traditional locations is “Superior quality that our customers can taste.” Every ingredient and process has been designed with a view to produce superior results.

The Company’s proprietary ingredients are manufactured pursuant to the Company’s recipes and specifications by third-party manufacturers under contracts between the Company and its various manufacturers. These contracts require the manufacturers to produce ingredients meeting the Company’s specifications and to sell them to Company-approved third-party distributors at prices negotiated between the Company and the manufacturer.

The Company has third-party distributors strategically located throughout the United States. The agreements require the distributors to maintain adequate inventories of all ingredients necessary to meet the needs of the Company’s franchisees and licensees in their distribution areas for weekly deliveries to the franchisee/licensee locations and to its grocery store distributors in their respective territories. Each of the primary distributors purchases the ingredients from the manufacturers at prices negotiated between the Company and the manufacturers, but under payment terms agreed upon by the manufacturers and the distributors, and distributes the ingredients to the franchisee/licensee at a price determined by the distributor agreement. Payment terms to the distributor are agreed upon between each franchisee/licensee and the respective distributor. In addition, the Company has agreements with various grocery store distributors located in parts of the country which agree to buy the Company’s ingredients from one of the Company’s primary distributors and to distribute those ingredients only to their grocery store customers who have signed license agreements with the Company.

The preparation of the consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results may differ from those estimates. The Company periodically evaluates the carrying value of its assets, including property, equipment and related costs, accounts receivable and deferred tax assets, to assess whether any impairment indications are present due to (among other factors) recurring operating losses, significant adverse legal developments, competition, changes in demand for the Company’s products or changes in the business climate which affect the recovery of recorded value. If any impairment of an individual asset is evident, a charge will be provided to reduce the carrying value to its estimated fair value.

The following table sets forth the revenue, expense and margin contribution of the Company's non-traditional franchising venue and the percent relationship to its revenue:

The following table sets forth the revenue, expense and margin contribution of the Company-owned non-traditional venue and the percent relationship to its revenue:

The revenue from this venue remained approximatelywas $2.1 million compared to $1.1 million for the same at $1.1 million.corresponding period in 2020. Revenue was increased by the opening anof three additional Craft Pizza & Pub restaurant onrestaurants in March, 25,October and November 2020, respectively, but that increase was offsetpartially constrained by the Governor of the State of Indiana issuing an order on March 16, 2020 in response to the COVID-19 pandemic closing all dining rooms for inside dining for an indefinite period of time but allowedallowing carry-out and delivery.

Cost of sales increasedimproved to 21.6%20.8% from 20.8%21.6% in the comparablecorresponding period last year.

Salaries and wages improved to 29.1%10.9% compared to 32.0%29.1% for the comparable period in 2019.2020. This improvement was primarily the result of this cost being partially reimbursed from the proceeds of the PPP grant, in the amount of $371,000, and the efficiencies gained as the restaurants had been operating longer. It was also partially the result of all of the dining rooms being closed by order of the Governor on March 16, 2020, however the restaurants continued to use Pizza Valet service for carry-out which decreased the labor requirements to a greater extent in percentage terms than the sales were reduced by the lack of dining room service.

Gross margin contribution decreasedimproved to 41.7% from 11.5% to 11.1% for the quarter compared to the comparable period last year. Overall expenses for this venue increaseddecreased to 58.3% from 88.5% to 88.9% with the cost of sales increasingdecreasing by 0.8%, facility cost increasingdecreasing by 1.0%13.2%, delivery fees and bank charges increase by 2.4%1.3%, all being partially offset byand labor efficiency improving with the cost decreasing by 18.2%. As discussed above, certain costs were reimbursed with proceeds from 32.0% to 29.1%. The non-cash expense for adopting to ASU 2016-02 accounting for operating leases, which became effective after January 1, 2019 for publicly reporting companies, decreased the margin from 12.0% to 11.1%.PPP grant.

Salaries and wages tradeimproved from $196,000 to $88,000 primarily the result of those expenses being partially offset by $140,000 of the PPP grant allocated to that purpose.

Trade show expense, insurance and other operating costs decreased from $495,000$294,000 to $490,000$251,000 for the three-month period ended March 31, 20202021 compared to the comparablecorresponding period in 2019.2020. In January 2019, the Company reviewed this venue in depth to find ways to minimize costs and accomplish its objectives with fewer people and lower costs in general. These efforts are reflected in the 66.6% margin during the three-month period ended March 31, 2020 and are expected to benefit results in future quarters.

Gross margin contribution from this venue decreasedimproved from 66.6% to 66.6% from 69.0%67.8% in the three-month period ended March 31, 20202021 compared to the comparablecorresponding period in 2019.2020. The reason for the margin decreaseincrease was apartially the result of using a portion of the PPP grant to offset salaries and wages cost offset in part by the decrease in total revenue, resulting from a declineas explained in grocery store take-n-bake sales while maintaining the same reduced expense level.paragraph above.

Gross revenue from this venue decreased from $171,000$155,000 to $155,000$116,000 in the three-month period ended March 31, 20202021 compared to the comparablecorresponding period in 2019.2020. The primary reason for this decrease was the restriction placed on hospital locations as a result of the COVID-19 pandemic whereby hospitals were restricted from having outside visitors and staff inside the hospital was restricted from going from one area of the hospital to another. The Company does not intend to operate any more Company-owned non-traditional locations except the one location that it is currently operating.

Total expenses wereimproved from $152,000 to $89,000 for the three-month period ended March 31, 20202021 compared to $154,000 for the comparablecorresponding period in 2019.2020. The primary reason for this decrease was caused by lower volume due to restrictions on hospitals resulting from the COVID-19 pandemic.pandemic and, in addition, $29,000 in salaries being partially offset by use of a portion of the PPP grant for that purpose.

Gross margin contribution from this venue decreasedimproved from 1.6% to 1.6% from 9.9%23.2% in the three-month period ended March 31, 20202021 compared to the comparablecorresponding period in 2019.2020. As previously discussed, the margin was decreasedimproved as a result of decreased revenue duea partial use of the PPP grant to restrictions on hospitals resulting from the COVID-19 pandemic, as described above.offset $29,000 in salaries.

Net income (loss) before income taxes decreasedimproved from $(337,000) to ($337,000) from $627,000$827,000 for the three-month period ended March 31, 20202021 compared to the corresponding period in 2019.2020. This was primarily the result of the one-timepartial reimbursement of certain expenses as a result of the PPP grant and by the non-cash interest in 2020, as explained in the previous paragraph.discussed above.

Net income (loss) decreasedimproved from $(255,000) to ($255,000) from $476,000$827,000 for the three-month period ended March 31, 20202021 compared to the corresponding period in 2019.2020. Net income decreasedimproved because of the one-time non-cash expense in 2020 associated with financingrefinancing the Company’s debt and to a lesser extent the decreasepartial reimbursement of certain expenses in total revenue, butaccordance with approximately the same expenses, primarily caused byPPP grant. No income tax expense was recorded since the COVID-19 pandemic.

The Company’s strategy is to grow its business by concentrating on franchising/licensing non-traditional locations, franchising its updated stand-alone concept, Craft Pizza & Pub, and operating a limited number of Company-owned Craft Pizza & Pub restaurants. The Company added new Company-operated Craft Pizza & Pub locations in January and November of 2017, January and June of 2018 and March, October and November of 2020. The Company intends to open three more Company-owned Craft Pizza & Pub locations in 2021.

During 2018, the Company invested resources (approximately $300,000) to commence franchising of the Craft Pizza & Pub franchise. As of DecemberMarch 31, 2019,2021, the Company had twothree Craft Pizza & Pub locations under franchise agreements which were open and one of those franchisees is exploring other locations for an additional franchise location under development and expected to open in the summer of 2020.location.

The Company is operating one non-traditional location in a hospital and has no plans for operating any additional non-traditional locations.

The Company’s current ratio was 4.1-to-13.8-to-1 as of March 31, 20202021 compared to 1.5-to-12.6-to-1 as of December 31, 2019.2020. The current ratio was improved significantly with the new financingPPP funding in February 2020.2021.

In January 2017, the Company completed the offeringprivate placement of $2.4 million principal amount of the Notes convertible subordinated and unsecured promissory notes (the “Notes”) to common stock at $0.50 per share and warrants (the “Warrants”)Warrants to purchase up to 2.4 million shares of the Company’s common stock at an exercise price of $1.00 per share, subject to adjustment. In 2018, $400,000 principal amount of Notes was converted into 800,000 shares of the Company’s common stock, in January 2019 another Note in the principal amount of $50,000 was converted into 100,000 shares of the Company’s common stock, and in August 2019 another Note in the principal amount of $50,000 was converted into 100,000 shares of the Company’s common stock, leaving principal amounts of Notes of $1.9 million outstanding as of December 31, 2019. Holders of Notes in the principal amount of $775,000 extended their maturity date to January 31, 2023. In February 2020, $1,275,000 principal amount of the Notes were repaid in conjunction with a new financing leaving a principal balance of $625,000 of subordinated convertible notes outstanding due January 31, 2023. These Notes bear interest at 10% per annum paid quarterly and are convertible to common stock any time prior to maturity at the option of the holder at $0.50 per share. The remaining Warrants to purchase 1,775,000775,000 shares of common stock at $1.00were re-priced to $0.57 per share expired late in 2019.

On April 25, 2020, the Company received a loan of $715,000 under the Payroll Protection Program. It is anticipated this note will be forgiven. The funds, according toPPP. In accordance with the provisionapplicable accounting policy adopted, the Company accounted for the loan as a government grant and presented it in the Condensed Consolidated Statement of Operations as a reduction of certain qualifying expenses incurred during the three-month period ended June 30, 2020. On February 19, 2021, the Company received formal notice from the SBA that the entire $715,000 loan was forgiven in accordance with the provisions of the CARES Act, mayACT which the Company had already treated as a grant.

As a result of the financial arrangements described above and the Company’s cash flow projections, the Company believes it will have sufficient cash flow to meet its obligations and to carry out its current business plan. The Company’s cash flow projections for the next two years are primarily based on the Company’s strategy of growing the non-traditional franchising/licensing venues, operating Craft Pizza & Pub locations and pursuing an aggressive franchising program for Craft Pizza & Pub restaurants. The Company intends to open additional Company-owned Craft Pizza & Pub restaurants in the future.

The Company does not anticipate that any of the recently issued pronouncements relating to the Statement of Financial Accounting Standards will have a material impact on its Consolidated Statement of Operations or its Consolidated Balance Sheet.

The statements contained above in Management’s Discussion and Analysis concerning the Company’s future revenues, profitability, financial resources, market demand and product development are forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) relating to the Company that are based on the beliefs of the management of the Company, as well as assumptions and estimates made by and information currently available to the Company’s management. The Company’s actual results in the future may differ materially from those indicated by the forward-looking statements due to risks and uncertainties that exist in the Company’s operations and business environment, including, but not limited to the effects of the COVID-19 pandemic, the availability of hourly and management labor to adequately staff company-operated and franchise operations, competitive factors and pricing pressures, accelerating inflation and the cost of labor, food items and supplies, non-renewal of franchise agreements, shifts in market demand, the success of new franchise programs, including the Noble Roman’s Craft Pizza & Pub format, the Company’s ability to successfully operate an increased number of Company-owned restaurants, general economic conditions, changes in demand for the Company’s products or franchises, the Company’s ability to service its loans, the impact of franchise regulation, the success or failure of individual franchisees and changes in prices or supplies of food ingredients and labor as well as the factors discussed under “Risk Factors " contained in the annual report on Form 10-K. Should one or more of these risks or uncertainties materialize, or should underlying assumptions or estimates prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated, expected or intended.

Based on their evaluation as of the end of the period covered by this report, A. Scott Mobley, the Company’s President and Chief Executive Officer, and Paul W. Mobley, the Company’s Executive Chairman and Chief Financial Officer, have concluded that the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) are effective. There have been no changes in internal controls over financial reporting during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

The Company is not involved in material litigation against it.