The financial results for the first quarter ended March 31, 2020 are preliminary, estimated and
unaudited, and are based on information available to management as of the date of this supplement and are subject to completion by management of the Companys financial statements as of and for the quarter ended March 31, 2020. Such
financial data is based upon a number of assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control or relate to future business decisions, some of
which may change. The Company has provided ranges for certain of its estimated financial results described above primarily because the financial closing procedures for the quarter ended March 31, 2020 are not yet complete as of the date of this
supplement. While certain of the above information is presented as a range of results, the actual results could fall outside of the suggested range. In addition, there is a possibility that the Companys first quarter financial results
could vary materially from these preliminary estimates due to, among other things, further information learned during that completion and finalization may alter the final results. In addition to the completion of the financial closing procedures,
factors that could cause actual results to differ from those described above are set forth under Risk Factors herein and in the accompanying base prospectus. Accordingly, you should not place undue reliance upon this preliminary
information. Furthermore, the preliminary estimates should not be viewed as a substitute for quarterly financial statements prepared in accordance with generally accepted accounting principles in the United States of America (GAAP).
Complete quarterly results will be included in our Quarterly Report on Form 10-Q for the three months ended March 31, 2020.
Business Update
In the first three months of
2020, the Company implemented several strategic initiatives with a focus on improving revenue per order, cost per order, cash flow and profitability. For instance, one of the major initiatives was switching to an independent contractor driver model,
which is close to completion. The Company expects these actions to enable it to stabilize and position itself for long-term growth and in February 2020, the Company realized its first ever profitable month.
As the COVID-19 pandemic became more widespread in the U.S., the Company experienced a decrease in orders in mid-March, but orders began to rebound towards the end of March and continued to grow in April 2020. As of the date of this prospectus supplement, driver supply was at
an all-time high and new restaurants have continued to sign up for our services. In response to the concerns posed by COVID-19, the Company has begun
to offer no-contact delivery on all restaurant orders and has started to offer no-contact grocery delivery in certain markets. In addition, the
Company is working with its restaurant partners to waive delivery fees and is deploying free marketing programs for restaurants. The Company has also begun to provide gloves, hand sanitizer and masks to its drivers. Lastly, the Company has committed
to paying any employee who gets quarantined or contracts COVID-19 while on the job.
The Company has
thus far been able to operate effectively as it relates to the COVID-19 pandemic. However, the potential impact and duration of the COVID-19 pandemic
on the global economy and on the Companys business in particular may be difficult to assess or predict. The pandemic has resulted in, and may continue to result in, significant disruption of global financial markets, which may reduce the
Companys ability to access capital and continue to operate effectively. The COVID-19 pandemic could also reduce the demand for the Companys services. In addition, a recession or further
financial market correction resulting from the spread of COVID-19 could adversely affect demand for the Companys services. To the extent that
the COVID-19 pandemic adversely impacts the Companys business, results of operations, liquidity or financial condition, it may also have the effect of heightening many of the other risks
described in the risk factors in the Companys Annual Report on Form 10-K for the fiscal year ended December 31, 2019.
Non-GAAP Financial Measure
Adjusted EBITDA is a financial measure that is not calculated in accordance with GAAP. We define Adjusted EBITDA as net loss adjusted to exclude interest
expense, income taxes, depreciation and amortization, acquisition and restructuring costs, stock-based compensation expense, impairments of intangible assets and goodwill and gains and losses associated with derivatives and debt extinguishments and
when applicable, other expenses that do not reflect our core operations. We use this non-GAAP financial measure as a key performance measure because we believe it facilitates operating performance
comparisons from period to period by excluding potential differences primarily caused by variations in capital structures, tax positions, the impact of acquisitions and restructuring, the impact of depreciation and amortization expense on our fixed
assets and the impact of stock-based compensation expense. Adjusted EBITDA is not a measurement of our financial performance under GAAP and should not be considered as an alternative to performance measures derived in accordance with GAAP.
See below for a reconciliation of preliminary, estimated net loss to Adjusted EBITDA for the first quarter ended March 31, 2020.