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The outbreak of, and local, state and federal governmental responses to, the COVID-19 pandemic, as well as our responses to the outbreak, have significantly disrupted and will continue to disrupt our business.
−Removed: In the United States and other regions, social distancing restrictions have been enacted and in many areas individuals are restricted from non-essential movements outside of their homes.
−Removed: In response to the COVID-19 pandemic and these changing conditions, we have temporarily closed a number of restaurants across our portfolio with the remaining locations shifted to an off-premise only operating model on an interim basis.
−Removed: In late April 2020, certain jurisdictions began allowing the reopening of restaurant dining rooms, however we will be operating under capacity restrictions for some time as social distancing protocols remain in place.
+Added: In the United States and other regions, social distancing restrictions have been enacted.
+Added: In response to the COVID-19 pandemic and these changing conditions, we temporarily closed a number of restaurants across our portfolio while the remaining locations shifted to an off-premise only operating model on an interim basis.
+Added: In late April 2020, certain jurisdictions began allowing the reopening of restaurant dining rooms.
+Added: However, we will be operating under capacity restrictions for some time as social distancing protocols remain in place , and dining rooms that are currently open are subject to closure based on the changing rules of various jurisdictions.
Additionally, an outbreak or perceived outbreak of the COVID-19 pandemic connected to one or more of our restaurants could cause negative publicity directed at any of our brands and cause customers to avoid our restaurants.
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Our suppliers could be similarly adversely impacted by the COVID-19 pandemic, and we could face shortages of food items or other supplies at our restaurants and our operations and sales could be adversely impacted by such supply interruptions.
−Removed: In addition, we furloughed approximately 41,000 staff members, and although some have returned to work, we may need to implement additional furloughs depending on future events.
+Added: In addition, we furloughed approximately 41,000 staff members, and although a significant number have returned to work, we may need to implement additional furloughs depending on future events.
Staff members who are furloughed might seek and find other employment, which could materially adversely affect our ability to properly staff and reopen our restaurants with experienced staff members when the business interruptions caused by the COVID-19 pandemic abate or end.
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Following the end of the covenant relief period, a material increase in our level of debt could cause our net adjusted leverage ratio and EBITDAR to interest and rent expense coverage ratios to exceed the maximum levels permitted under the covenants in the Amended Facility.
−Removed: To increase our liquidity given the impact of COVID-19 on our operations, we also sold 200,000 shares of Series A Convertible Preferred Stock on April 20, 2020 for an aggregate purchase price of $200 million.
−Removed: See Note 15 of Notes to Condensed Consolidated Financial Statements in Part 1, Item 1 of this report for further discussion of these events.
+Added: To further increase our liquidity given the impact of COVID-19 on our operations, we issued 200,000 shares of Series A Convertible Preferred Stock on April 20, 2020 for an aggregate purchase price of $200 million.
+Added: See Notes 7 and 11 of Notes to Condensed Consolidated Financial Statements in Part 1, Item 1 of this report for further discussion of these events.
The impact of COVID-19 on our business has resulted in the impairment of certain of our long-lived assets, goodwill and other intangible assets and a revaluation of contingent consideration associated with the acquisition of Fox Restaurant Concepts LLC.
Future changes in estimates could further impact the carrying value of these items.
−Removed: Our efforts to address our rent obligations during the COVID-19 pandemic are ongoing and our ability to obtain rent concessions will vary by landlord.
−Removed: While we continue to engage in discussions with our landlords, certain of our landlords have alleged that we are in default of our leases with them.
−Removed: If we are unable to reach an agreement with these landlords, we may face eviction proceedings, which could be expensive to litigate and may jeopardize our ability to continue operations at the impacted restaurant.
−Removed: The COVID-19 pandemic has also adversely affected our ability to open new restaurants, and we have paused nearly all construction of new restaurants and certain remodeling projects at existing restaurants.
−Removed: These changes may materially adversely affect our ability to grow our business, particularly if these construction pauses are in place for a significant amount of time.
+Added: Our efforts to address our rent obligations during the COVID-19 pandemic are ongoing and our ability to obtain rent concessions has varied by landlord.
+Added: While we have paid a substantial majority of our rent payment through July after giving effect to various abatement and deferral structures in place for certain lease agreement, certain of our landlords have alleged that we are in default of our leases with them.
+Added: If we are unable to reach an agreement with these landlords, we may face eviction proceedings and/or incur costs related to litigation which could be expensive, and may jeopardize our ability to continue operations at the impacted restaurant.
+Added: We also may choose to cease operations at certain restaurants where profitability is especially impacted by challenges related to the COVID-19 pandemic.
+Added: Should we do so, we will incur significant costs associated with lease terminations and our winding down of operations at the affected restaurant(s).
+Added: The COVID-19 pandemic has also adversely affected our ability to open new restaurants.
+Added: We have delayed some new unit openings and will continue to evaluate the pace and quantity of new unit development until more clarity on the restaurant industry operating environment emerges.
+Added: Delays in new unit development may materially adversely affect our ability to grow our business, particularly if these delays extend for a significant amount of time.
The impact global and domestic economic conditions have on consumer discretionary spending could materially adversely affect our financial performance.
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Consumer discretionary spending has weakened.
−Removed: Reduced discretionary spending could influence off-premise dining, customer traffic in our restaurants when it resumes and average check amount, which in turn could have a material impact on our financial performance.
+Added: Reduced discretionary spending could influence off-premise dining, customer traffic in our restaurants as capacity restrictions are lifted and average check amount, which in turn could have a material impact on our financial performance.
Global and domestic conditions, including as a result of COVID-19, that have an effect on consumer discretionary spending include, but may not be limited to:
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.