OTC: NROM

As discussed below under “Impact of COVID-19 Pandemic” the COVID-19 pandemic materially affected the Company’s operations.

Noble Roman’s Pizza For Non-Traditional Locations

In 1997, the Company started franchising non-traditional locations (a Noble Roman’s pizza operation within some other host business or activity with existing traffic) such as hospitals, convenience stores and other types of facilities. These locations utilize the two pizza styles the Company started with in 1972, along with its great tasting, high quality ingredients and menu extensions.

Coming out of the COVID-19 years, the Company refocused its development plans to more narrowly focus on selling Noble Roman’s Food Service Program (“Program”) to convenience store operators. The Company documents the sale of its Program to a convenience store owner using a franchise agreement, which describes the owner’s responsibilities under the agreement and provides for a long-term, 10-year renewable relationship, providing the Company an annuity-like royalty income stream from each location. Research indicates that convenience store owners increasingly desire to retail quality food in their business, and as a result of the COVID-19 pandemic coming to an end, the owners of such locations became more willing to look at expansion options and to invest in their growth and profitability. The focus on selling more non-traditional franchise locations, including several locations with higher-than-average potential volumes, is continuing, and the Company has a significant backlog of prospects to expand the number of franchise locations, including a backlog of sold Programs which have not yet opened.

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For example, in October 2023, the Company entered into a development agreement with Majors Management LLC (“Majors Management”) for 100 franchise locations to be developed prior to September 30, 2026. Majors Management is a large convenience store owner with stores predominantly located in the southern part of the United States. It owns many more locations in addition to the initial locations covered by this development agreement and has indicated interest in expanding participation in the Company’s Program to several other locations. The Company is also expanding with various mid-size convenience store chains, as well as smaller operators.

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.

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A fully-prepared pizza crust that captures the made-from-scratch pizzeria flavor which gets delivered to non-traditional locations in a shelf-stable condition so that dough handling is no longer an impediment to a consistent product, which otherwise is a challenge in non-traditional locations.

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Fresh packed, uncondensed and never cooked sauce made with secret spices and vine-ripened tomatoes in all venues.

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100% real cheese blended from mozzarella, Muenster, and oregano, with no additives or extenders.

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100% real meat toppings, with no soy additives or extenders, a distinction compared to many pizza concepts.

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Vegetables (like onions and green peppers) and mushrooms for pizzas are sliced and delivered fresh, never canned.

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An extended product line that includes breadsticks and cheesy stix with dip, pasta, baked sandwiches, salads, wings and a line of breakfast products.

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The fully-prepared crust also forms the basis for the Company’s Take-N-Bake pizza for use as an add-on component for its non-traditional franchise base.

Noble Roman’s Craft Pizza & Pub

The Noble Roman’s Craft Pizza & Pub format incorporates many of the basic elements first introduced in 1972 but in a modern atmosphere with up-to-date baking technology and equipment to maximize speed, enhance quality and continue the taste customers love and expect from a Noble Roman’s.

The Noble Roman’s Craft Pizza & Pub provides for a selection of approximately 40 different toppings, cheeses and sauces from which to choose. Beer and wine also are featured, with 16 different beers on tap including both national and local craft selections. Wines include 16 affordably priced options by the bottle or glass in a range of varietals. Beer and wine service is provided at the bar and throughout the dining room.

The Company designed the system to enable fast cook times, with oven speeds set at approximately 3 minutes for traditional pizzas and 5.75 minutes for Sicilian pizzas. Popular pizza favorites such as pepperoni are options on the menu and these locations also offer a selection of Craft Pizza & Pub original pizza creations. The menu also features a selection of contemporary and fresh, made-to-order salads and fresh-cooked pasta. The menu also incorporates baked sub sandwiches, hand-sauced boneless wings, salad bars and a selection of desserts, as well as Noble Roman’s famous Breadsticks with delicious Cheese Sauce, most of which has been offered in its locations since 1972. In 2022, new salad bars were rolled out over time across all Company-operated restaurants.

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Additional enhancements include a glass enclosed “Dough Room” where Noble Roman’s Dough Masters hand make all pizza and breadstick dough from scratch in customer view. Kids and adults enjoy Noble Roman’s self-serve root beer tap, which is also part of a special menu for customers 12 and younger. Throughout the dining room and the bar area there are many giant screen television monitors for sports and the nostalgic black and white shorts featured in Noble Roman’s since 1972.

The Company designed its curbside service for carry-out customers, called “Pizza Valet Service,” to create added value and convenience. With Pizza Valet Service, customers place orders ahead, drive into the restaurant’s reserved valet parking spaces and have their pizza run to their vehicle by specially uniformed pizza valets. Customers who pay when they place their orders are able to drive up and leave with their order very quickly without stepping out of their vehicle. With the fast baking times, the entire experience, from order to pick-up can take as little as 12 minutes.

Business Strategy

The Company refocused its development plans toward selling more Programs after identifying growth opportunities at the end of COVID-19 and the owners of potential non-traditional locations becoming more willing to look at expansion options and to invest in their growth. In doing so the Company is maintaining its focus on expansion of revenue while carefully managing corporate-level overhead expenses.

The initial fees for a Noble Roman’s Pizza non-traditional location or a Craft Pizza & Pub location are as follows:

Non-Traditional Except Hospitals

Non-Traditional

Hospitals

Traditional

Stand-Alone

Either a Noble Roman’s Pizza or Craft Pizza & Pub

$7,500

$10,000

$30,000(1)

(1) With the sale of multiple traditional stand-alone franchises to a single franchisee, the franchise fee for the first unit is $30,000, the franchise fee for the second unit is $25,000 and the franchise fee for the third unit and any additional unit is $20,000 each.

The fees are paid upon signing the franchise agreement and, when paid, are non-refundable in consideration of the administration and other expenses incurred by the Company in granting the franchises.

The Company’s proprietary ingredients used by both Craft Pizza & Pub locations and non-traditional locations are manufactured pursuant to the Company’s recipes and formulas 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 distributors at prices negotiated between the Company and the manufacturer.

The Company utilizes distributors it has strategically identified in areas across the United States where Company-owned and franchise operations are located. The distributor agreements require the distributors to maintain adequate inventories of all ingredients necessary to meet the needs of the Company’s franchisees in their distribution areas for weekly deliveries and are only allowed to sell the Company’s proprietary ingredients to Company-approved franchisees and licensees.

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Competition

The restaurant industry and the retail food industry in general are very competitive with respect to convenience, price, product quality and service. In addition, the Company competes for franchise sales on the basis of product engineering and quality, investment cost, cost of sales, distribution, simplicity of operation and labor requirements. Actions by one or more of the Company’s competitors could have an adverse effect on the Company’s ability to sell additional franchises, maintain and renew existing franchises, or sell its products. Many of the Company’s competitors are very large, internationally established companies.

Within the environment in which the Company competes, management has identified what it believes to be certain competitive advantages for the Company. Many of the Company’s competitors in the non-traditional venue were established with little or no organizational history operating traditional foodservice locations. This lack of operating experience may limit their ability to attract and maintain non-traditional franchisees who, by the nature of the venue, often have little exposure to foodservice operations themselves. The Company’s background in traditional restaurant operations has provided it experience in structuring, planning, marketing, and controlling costs of franchise unit operations which may be of material benefit to franchisees.

The Company’s Noble Roman’s Craft Pizza & Pub format competes with similar restaurants in its service area. Some of the competitors are company-owned, some are franchised locations of large chains and others are independently owned. Many of the competitors are larger and have greater financial resources than the Company.

Seasonality of Sales

Inclement or unusually cold winter weather conditions tend to adversely affect sales, especially those of the Craft Pizza & Pubs which are primarily designed for in-store dining and carry-out, which in turn affects Company revenue. Spring weather may also adversely affect sales in Craft Pizza & Pub locations as people first start to spend time outside. Sales of non-traditional franchises may be affected by weather and holiday periods. Non-traditional venue sales may be slower around major holidays such as Thanksgiving and Christmas, and during the first quarter of the year. Product sales by the non-traditional franchises are generally slower during the first quarter of the year.

Human Capital

As of May 8, 2026, the Company employed approximately 38 persons full-time and 114 persons on a part-time, hourly basis, of which 15 of the full-time employees are employed in sales and service of the franchise units and 23 in restaurant locations. No employees are covered under a collective bargaining agreement. The Company believes that relations with its employees are good.

Trademarks and Service Marks

The Company owns and protects several trademarks and service marks. Many of these, including NOBLE ROMAN’S®, Noble Roman’s Pizza®, THE BETTER PIZZA PEOPLE®, “Noble Roman’s Take-N-Bake Pizza,” “Noble Roman’s Craft Pizza & Pub®,” “Pizza Valet” and “Tuscano’s Italian Style Subs®,” are registered with the U.S. Patent and Trademark Office as well as with the corresponding agencies of certain other foreign governments. The Company believes that its trademarks and service marks have significant value and are important to its sales and marketing efforts.

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Government Regulation

The Company and its franchisees are subject to various federal, state and local laws affecting the operation of the respective businesses. Each location, including the Company’s Craft Pizza & Pub locations, are subject to licensing and regulation by a number of governmental authorities, which include health, safety, sanitation, building, employment, alcohol and other agencies and ordinances in the state or municipality in which the facility is located. The process of obtaining and maintaining required licenses or approvals can delay or prevent the opening of a location. Vendors, such as third parties that produce and distribute products the Company and its franchisees sell, are also licensed and subject to regulation by state and local health and fire codes and the U. S. Department of Transportation. The Company, its franchisees and vendors are also subject to federal and state environmental regulations, as well as laws and regulations relating to minimum wage and other employment-related matters. The Company is subject to various local, state and/or federal laws requiring disclosure of nutritional and/or ingredient information concerning the Company’s products, its packaging, menu boards and/or other literature. Changes in the laws and rules applicable to the Company or its franchisees, or their interpretation, could have a material adverse effect on the Company’s business.

The Company is subject to regulation by the Federal Trade Commission (“FTC”) and various state agencies pursuant to federal and state laws regulating the offer and sale of franchises. Several states also regulate aspects of the franchisor-franchisee relationship. The FTC requires the Company to furnish to prospective franchisees a disclosure document containing specified information. Several states also regulate the sale of franchises and require registration of a franchise disclosure document with state authorities. Substantive state laws that regulate the franchisor-franchisee relationship presently exist in a substantial number of states. State laws often limit, among other things, the duration and scope of non-competition provisions and the ability of a franchisor to terminate or refuse to renew a franchise. Some foreign countries also have disclosure requirements and other laws regulating franchising and the franchisor-franchisee relationship, and the Company is subject to applicable laws in each jurisdiction where it seeks to market additional franchised units.

Impact of COVID-19 Pandemic and the Government Response

In the first quarter of 2020, a novel strain of coronavirus (COVID-19) emerged and spread throughout the United States. The World Health Organization recognized COVID-19 as a pandemic in March 2020. In response to the pandemic, the U.S. federal government and various state and local governments did, among other things, impose travel and business restrictions, including stay-at-home orders and other guidelines that required restaurants and bars to close or restrict inside dining. The pandemic resulted in significant economic volatility, uncertainty and disruption, reduced commercial activity and weakened economic conditions in the regions in which the Company and its franchisees operate.

Host facilities for the Company’s non-traditional franchises were affected by labor shortages which adversely impacted those developments and in turn slowed the sales of franchises. The largest impact on the Company’s non-traditional franchising segment was that essentially all facilities located inside entertainment venues, including bowling centers, were ordered to close as they were deemed to be high risk of spread of the disease. Though varied by state, generally speaking those locations were required to be closed for up to two years by government order. Often being small businesses and not highly capitalized, many could not withstand that period of being closed and were not able to reopen. However, with the current strategy of focusing the Company’s efforts on well capitalized non-traditional locations, especially in convenience stores, it has successfully replaced those locations with other non-traditional franchise locations and continues to add more.

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The employee retention credit (“ERC”) was a refundable tax credit that businesses may claim on qualified wages paid to employees. The credit was introduced in March 2020 in the CARES Act to incentivize employers to keep their employees on their payroll during the pandemic and economic shutdown. The credit applies to all qualified wages, including certain health plan expenses, paid during the period in which the operations were fully or partially suspended due to a government shutdown order or where there was significant cost increases or decline in gross receipts.

When first established under the CARES Act, the tax credit was equal to 50% of the qualified wages an eligible employer paid to employees after March 12, 2020 and before January 1, 2021. The credit was also limited to a maximum annual per employee credit of $5,000. The credit was then extended through June 30, 2021 by the Tax Payer Certainty and Disaster Relief Act (“Relief Act”). The Relief Act modified the credit to be 70% of up to $10,000 of qualified wages per quarter in 2021 through June 30, 2021. The Program was further extended through December 31, 2021 by the American Rescue Plan Act of 2021 (“ARPA”) but was retroactively reduced by the Infrastructure Investment and Jobs Act, ending effective September 30, 2021.

During the first quarter of 2023, the Company determined that it was entitled to an ERC of $1.718 million and submitted amended federal Form 941 returns claiming that refund. The ERC refund is treated as a government grant and reduced appropriate expenses for the $1.718 million less expenses of $258,000 for applying for the refund, or a net of $1.460 million. This refund applied both to Noble Roman’s, Inc. and its subsidiary, RH Roanoke, Inc. To date, the Company has received all five quarterly refunds for RH Roanoke, Inc. and three refunds for 2020 and one of the two quarterly refunds for 2021 for Noble Roman’s, Inc. In recent communications with the Internal Revenue Service (“IRS”), that was initiated by the Company, the IRS indicated the final refund claim had been received and was still in process but that all ERC refund payments had been delayed due to administrative backlog in processing refunds generally.

Available Information

The Company makes available, free of charge through its Investor Relations website (http://www.nrom.info), access to the latest Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K and amendments to these reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after electronically filing these reports with, or furnishing them to, the Securities and Exchange Commission. The information on the Company’s investor website is not incorporated into this Annual Report on Form 10-K.